# Petition — National Labor Relations Board v. Electro Vector, Inc.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition
- **Published:** January 1, 1977
- **Citation:** 434 U.S. 821

## Text

Sep:eme Court, U. &

FILED
76-1561 | way 9 un
No. MICHAEL RODAK, N.,

Yn the Supreme Court of the Wnited States

Ocroser TERM, 1976

Nationat LABOR RELATIONS BoarD, PETITIONER
v.

Exectro Vector, INC.

PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES
COURT OF APPEALS FOR THE NINTH CIRCUIT

WADE H. McCREE, IR.

Solicitor General,
Department of Juatice,
Washington, D.C. 20580.
JOHN s. IRVING,
General Counsel,
JOHN E. HIGCINS, IR.
Deputy General Counsel,
CARL L. TAYLOR,
Associate General Counael,
NORTON JZ. COME,
Deputy Associate General Counact,
LINDA SHER,
Assistant General Counsel,
National Labor Relations Board,
Washington, D.C. 20570.

Page
ee 1
GD — — 1
. 2
. — —ò1¹ 2
1 —— — — 4
Reasons for granting the writ 8
GD —— 18
55 la
Fe Oe 7A
88 ———ñ—ñ— 84
1881 —— 264

CITATIONS

Cases :

American Fire Apparatus Co. v. National
Labor Relations Board, 380 F. 2d 1005 — 14
Geauga Plastics Co. v. National Labor Re-
lations Board, 404 2d 1382 ~~~ a ©
R Manufacturing Co., 169 NLRB 57— 17
Marshall Field d Co. v. National Labor

Relations Board, 318 U.S. 253— 9, 12, 14
National Labor Relations Board v. Cast-a-
Stone Products Co., 479 F. 2d 396 14

National Labor Relations Board v. Cheney
California Lumber Co., 327 U.S 385. 8, 9, 10, 12
National Labor Relations Board v. District
50, United Mine Workers, 355 U.S. 453. 9
National Labor Relations Board v. Duncan
Foundry and Machine Works, Inc., 435

2 ͤ³—Uü—Ui!1—— 17
National Labor Relations Board v. Erie
Resistor Corp., 373 U.S. 221 15
(1)

234-3876 —77—_-11

United States v. L. A. Tucker Truck Lines,
Inc., 344 U.S. 33.

1
Cases Continued
National Labor Relations Board v. Frick page
OU GS Ee 17
National Labor Relations Board v. Great
Dane Trailers, Inc., 388 U.S. 26-.------ 6, 14
National Labor Relations Board v Inter-
national Union of Operating Engineers
Local 66, A B & C, 357 F. 2d 841_----. 14
National Labor Relations Board v. Maine
Sugar Industries, Inc., 425 F. 2d 942... 14
National Labor Relations Board v. Mid-
western Manufacturing Co., 388 F. 2d
1 citi etiiitiemepiitatiadtiis 14
National Labor Relations Board v. Nello
Pistoresi d Son, Inc., 500 F. 2d 399. 8,16
National Labor Relations Board v. Ochoa
Fertilizer Corp., 368 U.S. 318_----- 8, 9, 10, 13
National Labor Relations Board v. Seven-
Up Bottling Co., 344 U.S. 344 9, 12
Nello Pistoresi & Son, Inc., 203 NLRB
1K———— a A a 16
Niz v. National Labor Relations Board, 418
i, § eee 14
Puerto Rico Drydock & Marine Terminals,
Ine. v. National Labor Relations Board,
284 P. 2d 212............ 2 14
Red Cross Drug Co. v. National Labor
Relations Board, 419 F. 2d 1245. 14
Sullivan Dry Dock d Repair Corp., 67
NLRB 627— 8 17
Tex Tan Welhausen Co. v. National Labor
Relations Board, 419 F. 2d 1265, re-
manded on other grounds, 397 U.S. 819 — 17

Statutes :

National Labor Relations Act, as amended
(61 Stat. 136, 73 Stat. 519, 29 U.S.C. 151,

et seq.) :
Section 7..-------- |
Section 8(a)(1)---------------- 2, 6, 16, 18
Section 8(a)(3)-------------- 2, 3, 6, 15, 17
Section 8(a) (5 2
Section 10e) 3, 9, 10, 11, 13, 14, 18

Gn the Supreme Court of the United States

Ocroser Term, 1976

No.
National Laon RELATIONS Board, PETITIONER

v.
Exezecrro Vector, Inc.

PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES
COURT OF APPEALS FOR THE NINTH CIRCUIT

The Solicitor General, on behalf of the National
Labor Relations Board, petitions for a writ of cer-
tiorari to review the judgment of the United States
Court of Appeals for the Ninth Circuit in this case.

OPINIONS BELOW

The opinion of the court of appeals (App. A, infra)

is reported at 539 F. 2d 35. The decision and order

of the National Labor Relations Board (App. C,
infra) are reported at 220 NLRB 445.

The opinion of the court of appeals was entered on
August 5, 1976, and the Board’s timely petition for
rehearing and suggestion for rehearing en banc (App.
B, infra) was denied on January 17, 1977. On April 6,

(1)

1977, Mr. Justice Rehnquist extended the time for
filing a petition for a writ of certiorari to and in-
cluding May 9, 1977. The jurisdiction of this Court
is invoked under 28 U.S.C. 1254(1).

1. Whether, in view of the employer's tailure to
raise the issue before the Board, Section 10(e) of the
National Labor Relations Act foreclosed the court of
appeals from considering whether a cash bonus for
work previously performed, and paid by the employer
to employees who were working on certain dates but
withheld from employees who were striking on those
dates, was a term or condition of employment within
the meaning of Section 8(a)(3) of the Act.

2. Whether, if the court of appeals was not fore-
closed, it erred in concluding that the bonus was not a
term or condition of employment within the mean-
ing of Section 8(a)(3) of the Act merely because it
was discretionary in amount and of recent origin,
and in failing to consider the Board’s alternative find-
ing that the employer’s conduct also violated Section
8(a)(1) of the Act.

The relevant provisions of the National Labor
Relations Act, as amended (61 Stat. 136, 73 Stat. 519,
29 U.S.C. 151, et seq.), are as follows:

Section 7. Employees shall have the right to
self-organization, to form, join, or assist labor
organizations, to bargain collectively through
representatives of their own choosing, and to

membership in any labor organization * * *.
Section 10(e). The Board shall have power

petition any court of appeals of the United
within any cireuit * * * i

(“the Union”) (App. C, infra, 16a; Tr. 30.)* On
May 2, 1974, during negotiations for a new contract,
the Union, in support of its bargaining demands,
called a strike which was still continuing at the time
of the Board hearing in March 1975 (App. C, infra,
16a; Tr. 7, 11-12, 14-15). Initially, all of the unit em-
ployees participated in the strike, but approximately
one-third returned to work two or three weeks after
the strike started and more employees returned there-
after (App. C, infra, 17a; Tr. 20-21, 39-40).

The Company's fiscal year is October 1 through
September 30. On November 27, 1974, the Company

Tr.“ references are to the stenographic transcript of the hear-
ing before the Administrative Law Judge. “GCX” references are

to the exhibits introduced at the hearing by the Board’s General
Counsel. — of

5

paid a bonus, in varying amounts, to 101 of its em-
ployees who had worked for some period during the
Company’s fiseal year and who also worked on both
September 30 and November 27, 1974 (App. C, infra,
17a; Tr. 17, 23-24, 29, GCX 5).* A majority of the em-
ployees received less than $150 (the base figure) because
of absences from the payroll during the fiscal year. In-
cluded in this group were employees who had
abandoned the strike prior to September 30 and
striker replacements (App. C, infra, 17a; Tr. 21, 24,
30-31, 34-35). A few employees, whose performance
Vice-President-General Manager Del Valle con-
sidered exceptional, received more than $150 (App. C,
infra, 174-184; Tr. 26-27, 29).

None of the approximately 33 employees who had
worked for some period during the 1974 fiscal year
but who were still striking on September 30 or No-
vember 27 was paid the bonus (App. C, infra, 94, 174;
Tr. 7-8, 10-11, 18; GCX 3). Approximately nine
employees who were working at the end of the fiscal
year, September 30, but were not working on the
day the bonus was actually paid, November 27, also
did not receive the bonus (App. A, infra, 2a; Tr. 23).

* Year-end cash bonuses were instituted by the Company in 1973,
in lieu of its former practice of distributing hams and turkeys
(App. C. infra, 18a; Tr. 18, 29-30). The Company's reasons for
instituting the bonus were to mitigate the economic “tough time”
the employees were suffering in 1973 “due to the inflation,” and
“to motivate [the employees] to better attendance” (App. C, infra,
18a; Tr. 28-29, 36-37). The Company utilized the same eligibility

requirement for payment of the 1974 bonus as it did for payment
of the 1973 bonus (App. C, infra, 18a; Tr. 17, 23-24, 29-30).

234- 376—77— 2

After charges had been filed by the Union, and a
hearing held, the Administrative Law Judge ruled
that the Company had discriminated against striking
employees in violation of Section 8(a)(3) and (1)
of the Act by paying a year-end bonus, based on time
previously worked, to nonstriking employees, strik-
ers who had returned to work, and replacements for
strikers, while denying the bonus to employees still on
strike (App. C, infra, 184-214). The Company filed
two general exceptions to the Judge’s decision, broadly
challenging the statement and conclusion of law that
its exclusion of strikers from bonus distributions
violated Section 8(a) (3) and (1) of the Act (App.
D, infra, 264-274). The Company also filed a support-
ing brief, contending that it had not discriminated
against strikers and that any deni was
supported by substantial busin The
Company at no time contested that the bonuses were
“a term or condition of employment.”

The Board, applying the principles set forth in
National Labor Relations Board v. Great Dane Trail-
ers, Inc., 388 U.S. 26, affirmed the decision of the Ad-
ministrative Law Judge (App. C. infra, 8a—14a). The
Board reasoned that, since “[dJepriving striking em-
ployees of the benefits which they have previously
qualified for because they are on strike will have the
natural tendency of coercing employees to give up the
strike” (App. C, infra, ga), Great Dane required the
employer to come forward with a legitimate business

7

justification for disqualification of the strikers. The
Board coneluded that, while it is “legitimate to reduce
the bonus by the length of any employee’s absence,
even if that absence is due to a strike,“ the Company
“offers no justification, nor do we preceive any, for its
requirement that the strikers be actually on duty on
the two eligibility dates” (App. C, infra, 9a—10a). The
Board ordered the Company, inter alia, to restore the
strikers to eligibility for the 1974 bonus and to pay
them their share “reduced pro rata for their absences
from the job during the pertinent fiscal year whether
because on strike or for any other reason” (App. C,
infra, 10a—lla, 224, 234).

The court of appeals denied enforcement of the
Board’s order, finding it to be “not supported by sub-
stantial evidence” (App. A, infra, 14). In the court’s
view, the Board’s ultimate finding of discrimination
implicitly rested on a threshold finding that the Com-
pany’s “bonus practice involved a term or condition
of employment” (App. A, infra, 3a). Although admit-
ting that the parties had not raised the issue (App. A,
infra, 3a), the court held that it was not bound to ac-
cept this finding unless it was “supported by substantial
evidence in the record taken as a whole” (App. A, infra,
4a). Making its own independent examination of the
record, the court concluded that the short history of the

»The Board noted (App. C, infra, 10a) that the Administra-
tive Law Judge’s proposed remedy, which it adopted, called for
such a reduction.

bonus program, combined with its informal nature and
the discretionary variance in the amounts of the individ-
ual bonuses, indicated that it “was a gift rather than
a wage” and therefore not a “term or condition of em-
ployment” (App. A, infra, 44-64).

The Board filed a petition for rehearing and sug-
gestion for rehearing en banc, contending that the
court’s consideration of an issue not previously raised
by the Company before the Board was contrary to
Section 10(e) of the Act and this Court’s decisions in
National Labor Relations Board v. Cheney California
Lumber Co., 327 U.S. 385, and National Labor Rela-
tions Board v. Ochoa Fertilizer Corp., 368 U.S. 318.
The court denied the Board’s petition for rehearing
and rejected the suggestion for rehearing en banc
(App. B, infra, 74).

REASONS FOR GRANTING THE WRIT
1, The decision of the court of appeals, overturning
the Board’s finding of an unfair labor practice on a
ground not raised before the Board, is inconsistent

»The court applied the test enunciated in an earlier decision,
National Labor Relations Board v. Nello Pistoresi d Son, Inc.,
500 F. 2d 399, 400 (C.A. 9), ., “Bonuses * * * are considered
wages if they are of such a fixed nature and have been paid over
a sufficient length of time to have become a reasonable expectation
of the employees and, therefore, a part of their anticipated
remuneration” (App. A, infra, 4a).

The court stated: “The full Court was advised of the Sugges-
tion for Rehearing en banc, An active judge of the Court sug-
gested that the opinion may be in conflict with Supreme Court
cases cited by the Government, but later, after considering the
re 1 3 Board's Petition, withdrew his objection“ (App. B,
infra, Ta).

with the plain language of Section 10(e) of the Na-
tional Labor Relations Act and with numerous deci-

sions of this Court. National Labor Relations Board
v. Cheney California Lumber Co., 327 U.S. 385; Va-
tional Labor Relations Board v. Ochoa Fertilizer
Corp., 368 U.S. 318. See also Marshall Field & Co. v.
National Labor Relations Board, 318 U.S. 253; Na-
tional Labor Relations Board v. Seven-Up Bottling
Co., 344 U.S. 344; National Labor Relations Board v.
District 50, United Mine Workers, 355 U.S. 453. Proper
interpretation of Section 10(e) is of great importance
to the administration of the Act, since that Section
enables the Board to act expeditiously on uncontested
issues and give full and proper consideration to the
issues that are in dispute.
Section 10(e) of the Act provides that in reviewing
an order of the Board:
No objection that has not been urged before
the Board, its member, agent, or agency, shall
be considered by the court, unless the failure
or neglect to urge such objection shall be ex-
cused because of extraordinary circumstances.
The findings of the Board with respect to ques-
tions of fact if supported by substantial evi-
dence on the record considered as a whole shall
be conclusive. * * *
The purpose of this provision is to give the review-
ing court the benefit of the Board’s views on dis-
puted questions of fact and law.
In National Labor Relations Board v. Cheney
California Lumber Co., supra, this Court held that the
court of appeals had improperly limited an order is-

10

sued by the Board in a litigated proceeding because
no objection to the breadth of the order had been
urged bx “ore the Board. The Court held that the duty
of a court of appeals in such circumstances is “to
render judgment on consent as to all issues that
were contestable before the Board but were in fact
not contested' (327 U.S. at 389). The Court then
noted :

Justification of such an order, which neces-
sarily involves consideration of the facts which
are the foundation of the order, is not
open for review by a court if no prior objec-
tion has been urged before the case gets into
court and there is a total want of extraordinary
circumstances to excuse “the failure or neglect
to urge such objection * * *” Congress desired
that all controversies of fact, and the allow-
able inferences from the facts, be threshed out,
certainly in the first instance, before the
Board. libid.]

This construction of Section 10(e) was reaffirmed
in National Labor Relations Board v. Ochoa Fertilizer
Corp., supra. Unlike Cheney, there was no formal
proceeding at all before the Board in Ochoa but rather
the order was entered pursuant to a settlement agree-
ment. This Court disagreed with the court of appeals
that it was nonetheless entitled to satisfy itself that
there was record support for the Board’s order,
stating (368 U.S. at 323):

We understand the opinion of the Court of
Appeals to hold that the limitation of § 10(e)

11

is inapplicable when the record contains no
findings or facts supporting the order—that
“affirmative reasons must appear to warrant
broad injunctions.” * * * The court reasoned
that the limitation of § 10(e) was therefore no
barrier to its sua sponte revision of the order
and stated that “We do not think that consent
makes the difference.” * * * Contrary to the
Court of Appeals, we think that consent makes
a significant difference; it relieves the Board
of the very necessity of making a supporting
record. * * *
See also United States v. L. A. Tucker Truck Lines,
Inc., 344 U.S. 33, 37 (“Simple fairness to those who
are engaged in the tasks of administration, and to
litigants, requires as a genera! rule that courts should
not topple over administrative decisions unless the
administrative body not only has erred but has erred
against objection made at the time appropriate under
its practice).

In the present case, the court of appeals disregarded
Section 10(e), and thus exceeded its reviewing au-
thority, by considering and deciding the question
whether the bonus paid by the Company was a term
or condition of employment. As the court acknowl-
edged (App. A, infra, 34): “No such finding was ex-
pressly made [by the Board] nor was this implicit
finding discussed in the parties’ briefs before this
Court. Rather, the proceedings below focused on
whether Electro’s activities discouraged union mem-
bership and whether these activities had an anti-union

12

motive.“ Moreover, the court suggested no extraor-
dinary circumstances that would excuse the fail-
ure to present the issue to the Board.

The court of appeals apparently believed that it was
required to satisfy itself that the Board’s findings of
fact were supported by substantial evidence on the
record considered as a whole in order to insure that
it was not entering a decree where “the Board has
patently traveled outside the orbit of its authority.“
Cheney, supra, 327 U.S. at 388. However, while this

Before the Board, the Company made the following exceptions
(App. D, infra, 264-27).

“To the statement of the Administrative Law Judge that the
Employer’s exclusion of strikers from participation in the bonus
distribution, because not on the active payroll at the prescribed
times, violated Section 8(a) (3) and (1).

“To the Administrative Law Judge’s conclusion of law that by
disqualifying strikers from bonuses as found in this case, the
Respondent ELECTRO VECTOR, INC., engaged in unfair labor
practices within Section 8(a) (1) and (3) of the Act.”

Contrary to the Company’s contention (Reply to Pet. for Re-
hearing, p. 6), these general exceptions were not sufficient to place
“the burden upon the Board to support its order as to questions
of fact by substantial evidence on the record, which requires a
showing that the employer has discriminated against employees
with respect to a term or condition of employment.” See Marshall
Field & Co. v. National Labor Relations Board, 318 U.S. 253, 255
(objection that the Trial Examiner had erred “in making each
and every recommendation” did not sufficiently apprise the Board
that the employer intended to press the question whether unem-
ployment compensation benefits should be deducted from backpay
award); National Labor Relations Board v. Seven-Up Bottling
Co., 344 U.S. 344, 350 (objection that the Examiner’s “recommen-
dations as to the remedy were contrary to, and unsupported by, the
evidence and contrary to law” did not give adequate notice to the
Board that the employer intended to contest the propriety of com-
puting backpay on a quarterly basis for a seasonal business).

13

Court in Cheney did acknowledge that a court of ap-
peals need not render a decree “if the Board has pat-
ently traveled outside the orbit of its authority so that
there is, legally speaking, no order to enforce” (ibid.),
that narrow exception to the policy of Section 10(e)
applies only to an order that would be beyond the
Board’s power on any conceivable set of facts. Thus,
the Court in Ochoa found that the standard of Cheney
had been satisfied, despite the absence of any record,
because “[t]he order here consented to would be
within the Board’s authority under appropriate cir-
cumstances.’’ 068 U.S. at 322, n. 6. It is unquestion-
ably within the Board’s authority to find that a cash
bonus is a term and condition of employment (see
infra, pp. 14-18) and to prohibit discrimination in the
award thereof.’

The requirements of Section 10(e) are of consider-
able importance to the Board. In the sensitive area of
labor-management relations, it is plainly inappro-
priate to permit a party to leave important issues,
whether factual or legal, unaddressed and unbriefed
before the Board and then challenge their resolution
before the reviewing court on the ground of an in-
adequate supporting record. Under such circumstances
the Board is not only deprived of the opportunity to
apply its own experienced judgment in the first in-
stance—a judgment that well may assist the court of

Indeed, the court below acknowledged that “If Electro had
adopted a formal program of paying a cash bonus or had paid a
bonus for a number of years, we might reach a different result”
(App. A, infra, 5a).

234-376—17-—_3

14

appeals on review—but also of the opportunity to in-
sist upon a fuller record appropriate for resolution of
those issues. Such deprivation is directly contrary to

„the salutary policy adopted by 5 10(e) of afford-
ing the Board opportunity to consider on the merits
questions to be urged upon review of its order”
(Marshall Field & Co. v. National Labor Relations
Board, supra, 318 U.S. at 256).

2. The need for proper observance of Section 10(e)
is emphasized by the decision in this case, which is
not only inconsistent with the rationale of this Court’s
“decision in National Labor Relations Board v. Great
Dane Trailers, Inc., 388 U.S. 26, but also violative of
a fundamental purpose of the Act to safeguard em-

* Other courts of appeals have properly recognized the policy
of Section 10(e). Thus, in American Fire Apparatus Co. v. Va-
tional Labor Relations Board, 380 F. 2d 1005, 1006, the Eighth
Circuit held that an employer was “precluded by Section 10(e)
of the Act from obtaining judicial review” of his contention “that
he did not commit an unfair labor practice by failing to pay
the employees a Christmas bonus,” when no exceptions on that
issue were taken to the Trial Examiner’s decision.

See also National Labor Relations Board v. Maine Sugar In-
dustries, Inc., 425 F. 2d 942, 944 (C.A. 1); National Labor Rela-
tions Board v. International Union of Operating Engineers, Local
66, A, B & C, 357 F. 2d 841 (C.A. 8); National Labor Relations
Board v. Cast-a-Stone Products Co., 479 F. 2d 396 (C. A. 4); Nia
v. National Labor Relations Board, 418 F. 2d 1001, 1009 (C. A. 5) ;
Geauga Plastics Co. v. National Labor Relations Board, 404 F. 2d
1382, 1383 (C. A. 6) ; Red Cross Drug Co. v. National Labor Rela-
tions Board, 419 F. 2d 1245, 1249 (C. A. 7) ; National Labor Rela-
tions Board v. Midwestern Manufacturing Co., 388 F. 2d 251, 253
(C. A. 10); Puerto Rico Drydock d Marine Terminals, Ino. v. Na-
tional Labor Relations Board, 284 F. 2d 212, 215-216 (C. A. D.C.).

15

ployees against discrimination for engaging in pro-
tected concerted activities.

While Section 8(a)(3), in relevant part, merely
proscribes discrimination in regard to a “term or con-
dition of employment,’’ Congress entrusted the Board
with the task of giving content to those terms in light
of “the complexities of industrial life.” National
Labor Relations Board v. Erie Resistor Corp., 373
U.S. 221, 236. Thus, in Great Dane Trailers, supra,
this Court accepted the conclusion of the Board and
court of appeals (388 U.S. at 30) that a refusal to pay
accrued vacation benefits to striking employees con-
cerned “a term or condition of employment. Indeed,
the Court recognized that the “result of the company's
refusal to pay vacation benefits to strikers was dis-
crimination in its simplest form” (id. at 32). The
Court therefore struck down the denial of benefits to
a group of employees identified ‘‘only by their par-
ticipation in protected concerted activity” (ibid.).

The facts in this case present a very similar issue.
The Company's bonus program, although only in its
second year of operation, was tied to work perform-
ance. Employees earned less than the base amount if
because of late hire or absenteeism they had missed
work during the preceding year; superior work was
compensated by bonuses larger than the base amount.
The Board found that the bonus “was earned as a
result of work attendance over the fiscal year’’ and
that the striking employees had “previously qualified”
for the bonus and would have received it had they not

been on strike (App. C, infra, 9a). In these cireum-
stances, the Board could reasonably have concluded
that the bonus accrued from the employment relation
and thus was a “term or condition of employment.”
The court of appeals did not disturb the Board’s
findings. Rather, relying on its decision in National
Labor Relations Board v. Nello Pistoresi d Son, Inc,,
500 F. 2d 399, 401,“ the court held that the discretion-
ary amount of the bonus and the short duration of the
program precluded characterization of the bonus as a
term or condition of employment (App. A, infra, 54
6a). However, while these factors may be relevant in
determining whether a bonus withdrawn from all em-

ployees was a term or condition of employment (see n.
9, supra, and cases cited at App. A, infra, 34-44),
they are immaterial where the employer has decided to
pay a bonus. In those circumstances, an employer is not
free to pay the bonus to some employees, and withhold
it from others who are engaged in a strike or other

»In Nello Pistoresi, the court reversed the Board’s conclusion
that the company had violated Section 8(a)(5) and (1) of the
Act, 29 U.S.C. 158(a) (5) and (1), by terminating, in 1971, a bonus
program that had been in effect for only two years. However,
in Pistoresi, the Administrative Law Judge, whose findings were
adopted by the court, had noted that, since the size of the bonus
had been within the company’s discretion and since the work
force did not remain constant each year, there was no way to know
whether or to what extent the failure to pay a bonus in 1971 was
a substantial departure from past practice. See Nello Pistoresi d
Son, Ine, 203 NLRB 905, 910. Since a bonus was paid here on the
same basis as it was paid in 1973, there is no doubt that it ac-

corded with past practice.

SO — eee

17

activity protected by Section 7, without being subject
to the ban on discrimination imposed by Section 8(a)
(3). See National Labor Relations Board v. Duncan
Foundry and Machine Works, Inc., 435 F. 2d 612, 617,
n. 8 (C.A. 7) (“Certainly, the Company was under no
duty to apply the terms of the expired contract,
but * * if the terms were applied, they could not
be applied discriminatorily”). See also Tex Tan Wel-
hausen Co. v. National Labor Relations Board, 419
F. 2d 1265, 1271 (C. A. 5), remandea on other grounds,
397 U.S. 819; National Labor Relations Board v.
Frick Co., 397 F. 2d 956, 961-962 (C. A. 3) ; Sullivan Dry
Dock & Repair Corp., 67 NLRB 627, 634; K-D Man-
ufacturing Co., 169 NLRB 57, 60, 64.

The contrary view of the court below that a bonus is
removed from the ambit of Section 8(a)(3) where it
is discretionary in nature and of recent origin opens
up a wide gap in the protection against discrimination
afforded by that Section. Many employment benefits—
é.g., promotions, overtime work, favorable work
shifts—are within the employer’s discretion, at least
absent their coverage in a collective bargaining agree-
ment. Under the reasoning of the court below, the
employer would be free to withhold such discretionary
benefits from employees engaged in Section 7 activity
without violating Section 8(a)(3). It is hardly likely
that Congress would have intended to permit such a
ready means of eluding the reach of the latter See-

tion’s basic guarantee against discrimination for en-

gaging in protected activity.”

For the foregoing reasons, the petition for a writ

of certiorari should be granted."
Respectfully submitted.

Wane H. McCnez, Jr.,
Solicitor General.
Jonx S. Irvine,
General Counsel,

Joun E. Hicars, Jr.,

Deputy General Counsel,
Cari L. Tayior,

Associate General Counsel.
Norton J. Come,

Deputy Associate General Counsel,
Laiypa SHeEr,

Assistant General Counsel,

National Labor Relations Board.

May 1977.

Apart from its unduly restrictive interpretation of “term or
condition of employment” as used in Section 8(a) (3), the court
below also failed to consider the Board's alternative finding that
the Company's withholding of the bonus from employees who
were striking on the specified dates also violated Section 8(a) (1)
of the Act. Section 8 (4) (1) proscribes any employer action which
would “interfere with, restrain, or coerce employees in the exer-
cise of the rights guaranteed in section 7,” without regard to
whether a “term or condition of employment” is affected. To with-
hold from strikers a bonus which they had earned for work pre-
— —EUũ4ͤ— on 2
tend

J
2 unequivocal language of Section 10 (e) and its
prior decisions under that Section, the Court consider

mary reversal to be appropriate in this case. as

— — —

APPENDIX A
No. 75-3638
United States Court of Appeals, Ninth Cireuit

Natrona, Lasor Reiations Board, PETITIONER

v.
Ex.ectrro Vector, INC., RESPONDENT

Aug. 5, 1976
O pinion

Before Barnes, Senior Circuit Judge, and WricHt,
and Kr-Kenny, Circuit Judges

Barnes, Senior Circuit Judge:

The National Labor Relations Board seeks enforce-
ment of its order against Electro Vector, Inc. Affirm-
ing the administrative law judge, the Board held that
the Company violated 29 U.S.C. § 158(a) (3) and (1)
by granting a bonus for work previously performed,
to employees who were actually working on Septem-
ber 30, and November 27, 1974, while denying such
bonus for work previously performed to other em-
ployees who were striking on either of those two dates.
We hold that because the Board’s finding that the
bonuses were wages, hours, or other term[s] or condi-
tionſs]̃ of employment is not supported by substantial
evidence, enforcement of its order is denied.

The relevant facts follow. Electro manufactures
cleetronie equipment in a plant located near Santa

(la)

24

Rosa, California. The Company's production and
maintenance employees have been represented for col-
lective bargaining purposes by the Union for a num-
ber of years. On May 2, 1974, after the expiration of
the prior contract and the breakdown of negotiations,
the Union struck Electro over economic issues.

Electro followed a discretionary policy of paying
“year-end”’ bonuses based on a fiscal year ending Sep-
tember 30, 1974. The previous 1972-73 fiscal year was
the first year for paying cash bonuses. In prior years,
turkeys and hams were distributed. Attendance and
exceptional merit determined the amount paid above
and below the base figure of $150.00. Eligibility for
the bonus depended upon an employee maintaining
“active pay roll status“ on two crucial dates—the final
day of the fiscal year and the actual date of bonus
payment, here, November 27, 1974.

The group which received the bonus included non-
striking workers, strikers who had returned to work,
and replacements for strikers. All of these employees
had active payroll status on the two relevant dates—
September 30 and November 27. Excluded were thirty-
three strikers who had not worked either date and
cate e who had worked only one of those

Subsequently, the Union filed charges against Elec-
tro alleging discrimination against the striking em-
ployees through the Company’s refusal to pay them
bonuses. The N.L.R.B. issued a complaint based on
the charges and ordered a hearing. After such a hear-
ing was conducted, the administrative law judge
concluded that “[b]y disqualifying strikers from bo-
nuses * * * [Electro] engaged in unfair labor prac-
tices within Section 8(a) (1) and (3) of the[ National
Labor Relations] Act.” The judge recommended the

3a

issuance of a cease and desist order and the payment
of 1974 bonuses to the striking employees. Elec-
tro excepted. The Board, however, adopted the
administrative law judge’s recommendations and is-
sued an order requiring bonus payments to the em-
ployees. Electro appeals from this order. ;

Implicit in the administrative proceedings below is
a finding that Electro’s bonus practice involved a
term or condition of employment. No such finding
was expressly made nor was this implicit finding dis-
cussed in the parties’ briefs before this Court. Rather,
the proceedings below focused on whether Electro’s
activities discouraged union membership and whether
these activities had an anti-union motive. See National
Labor Relations Board v. Great Dane Trailers, Inc.,
388 U.S. 26, 32-34, 87 S. Ct. 1792, 18 L. Ed. 2d 1027
(1967); Portland Willamette Company v. National
Labor Relations Board, 534 F. 2d 1331, 1332 (9th Cir.
1976). But in order to determine whether Electro’s
activities violated the Act here, a preliminary require-
ment must be satisfied. It must be shown that there
had been employer discrimination with respect to
“fany] term or condition of employment.” See
N.L.R.B. v. Great Dane Trailers, supra, 388 U.S. at
30, 87 S. Ot. at 1976; E. I. Du Pont de Nemours and
Company v. V. L. R. B., 480 F. 2d 1245, 1248 (5th Cir.
1973).

The importance of this findin- is that a bonus which
is considered a „gift“ can be withheld by the em-
ployer at will, but a bonus which is in reality a
„wage“ becomes a term or condition of employment.
See Century Electric Motor Company v. N. L. R. B.,
447 F. 2d 10, 14 (8th Cir. 1971); N. L. R. B. v. Harrah’s
Club, 403 F. 2d 865, 874 (9th Cir. 1968); N. L. R. B. v.
Electric Steam Radiator Corporation, 321 F. 2d 733,

234-376-774

4a

736-37 (6th Cir. 1963). In elaborating upon this con-
cept in V. L. R. B. v. Nello Pistoresi d Son, Inc, 500
F. 2d. 399 (9th Cir. 1974), this Court observed: Bo-
nuses * * * are considered wages if they are of such a
fixed nature and have been paid over a sufficient
length of time to have become a reasonable expectation
of the employees and, therefore, part of their antici-
pated remuneration.“ Id. at 400."

Applying these principles to the case before us, the
Board was required to find that Electro’s bonus policy
involved a term or condition of employment. This
Court is bound to accept this finding unless it is not
supported by substantial evidence in the record taken
as a whole. Universal Camera Corp. v. V. L. R. B., 340
U.S. 474, 477-91, 71 S. Ct. 456, 95 L.Ed. 456 (1951).
Upon examining the record, we find no such finding
or any discussion thereof. Hence, we must conclude
that the Board’s finding is not supported by substan-
tial evidence.

Our conclusion is based on the following evidence
which appears in the record. Ms. Ann L. Waterman,
an accountant for Electro, testified that prior to 1973,
the company did not have a bonus program. In 1973,
the company determined that it was financially able
to pay a bonus. Even then, however, there was no
official program established. Ms. Waterman further
testified that even after the company began giving
cash bonus to its employees, this bonus was not auto-
matically given. Mr. Philip B. Del Valle, the vice
president and general manager of Electro, testified
that the giving of a bonus was not mandatory but was
rather at the discretion of Electro’s owner. He fur-

' Neither petitioner nor respondent has seen fit to mention this
two-year-old case in their briefs.

—

5a

ther testified that the bonus issue was not part of the
Union contract that was in existence at the time of
the controversy. Additionally, Mr. Del Valle stated:

“[P]rior to 1973 there wasn’t any bonuses.
We gave turkeys or hams, but the inflation got
so bad we realized the predicament of of
the people, and so I went to the owner. I don't
have the authority to disburse profits. I went to
20 CURE? SE 5 95 eae \ Goeee SS 0 coe
sum of money and this was given, in essence in

lieu of a turkey or in lieu of a ham, as being a
little bit more substantial; but it wasn’t a

formal a ». in any way. It was

R.T. at 29-30. None of the above testimony has been
refuted by any other witness.

We thus must determine whether the payment of
a cash bonus by Electro was of a fixed nature and
had been paid over a sufficient period of time to have
become a part of the employees’ anticipated remuner-
ation. From the above evidence, we conclude that the
1973-74 fiseal year was only the second year in which
such a cash bonus was given. The amounts of these
bonuses were determined primarily by Mr. Del Valle
and ranged greatly from a base of $150.00. In
V. L. R. B. v. Nello Pistoresi d Son, Inc., supra, we
held that because of the short two-year history of the
company giving cash bonuses to its employees and
the indefinite nature of the bonuses, the bonuses did
not constitute wages but were rather gifts. 500 F. 2d
at 400-01. We find the case at bar indistinguishable.
If Electro had adopted a formal program of paying
a cash bonus or had paid a bonus for a number of
years, we might reach a different result. But here,
the cash bonus had only been given for two years, and
was agreed upon by the owner only informally. We

6a
therefore conclude that the bonus given by Electro
was a gift rather than a wage. Hence, the Union has
failed to prove that there has been employer discrimi-
nation with respect to any term or condition of

employment.
Accordingly, enforcement of the Board’s order is

denied. Respondent’s counsel to prepare order.

APPENDIX B

In the United States Court of Appeals for the
Ninth Circuit
No. 75-3638

NaTIONAL Laspor RELATIONS BoARD, PETITIONER
v.
ELectro Vector, INC., RESPONDENT

[Filed January 17, 1977]
ORDER

Before: Barnes, Wricut, and Ki.Kkenny, Circuit
Judges.

After considering Petitioner’s Petition for Rehear-
ing with Suggestion for Rehearing en bane (filed Sep-
tember 9, 1976), and Respondent's reply to said Petition
filed October 14, 1976, Judge Wright voted to deny the
Petition for Rehearing and to reject the Suggestion for
Rehearing en banc. Judges Barnes and Kilkenny voted
to deny the Petition for Rehearing and recommended
the denial of the Suggestion for Rehearing en bane.

The full Court was advised of the Suggestion for
Rehearing en bane. An active judge of the Court sug-
gested that the opinion may be in conflict with Supreme
Court cases cited by the Government, but later, after
considering the reply to the Board’s Petition, withdrew
his objection.

The Petition for Rehearing is denied, and the
Suggestion for an en bane Rehearing is rejected.

(TA)

APPENDIX CO

United States of America Before the National Labor
Relations Board

Case 20-CA-9771

ELxorno Vector, Inc. anp GENERAL Truck DRIvERs,
WaRreHOUSEMEN & Hetpers Union, LocaL 980, Ix-
TERNATIONAL BrRoTHERHOOD OF TEAMSTERS, CHAUF-
FEURS, WAREHOUSEMEN AND HELPERS OF AMERICA

Decision and Order

On April 8, 1975, Administrative Law Judge Rich-
ard J. Boyce issued the attached Decision in this pro-
ceeding. Thereafter, Respondent filed exceptions and
a supporting brief, and the General Counsel filed a
brief in support of the Decision.

Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its author-
ity in this proceeding to a three-member panel.

The Board has considered the record and the
attached Decision in light of the exceptions and briefs
and has decided to affirm the rulings, findings, and
conclusions of the Administrative Law Judge and to
adopt his recommended Order.*

In the absence of exceptions, we adopt pro forma the Admin-
istrative Law Judge’s conclusion that the strike was not converted
into an unfair labor practice strike.

In support of our finding of a violation, we also rely on V.L.2.B.
v. Great Dane Trailers, Inc. 388 U.S. 26 (1967).

(Sa)

9A

The Administrative Law Judge finds that Respond-
ent unlawfully denied bonus payments to striking
employees. We agree.

The faets here are not in controversy. Respondent
in 1974 had in effect a bonus program. Under the
program such employees received a basic amount of
$150, less diminutions due to absences or due to not
being on the payroll for the entire fiscal year. The
diminutions were based on a formula uniformally
applied. However, no bonus was paid to any employee
who was not on the active payroll, i.e., actually work-
ing, both on the last day of the fiscal year, Septem-
her 30, and the date the bonus was paid, November 27,
1974. On May 2, 1974, the employees had gone on
strike. The strike was continuing as of November 27,
1974. As a result of their participation in the strike,
a number of employees were not on the payroll on
the two qualifying dates and were, therefore, denied
anv bonus.

The benefit here was earned as a result of work
attendan over the fiscal year. As of the May 2, 1974,
strike date the employees had, under Respondent’s
formula, earned a part of the benefit subject only to
their being on the active payroll on the two qualifying
dates. Depriving striking employees of the benefits
which they have previously qualified for because they
are on strike will have the natural tendency of co-
ereing employees to give up the strike.

Nevertheless, disqualification of the strikers is not
unlawful if it serves Respondent’s legitimate business
interests in some significant fashion. N. L. N. B. v. Great
Dane Trailers, Inc., 388 U.S. 26. It is, of course, legiti-
mate to reduce the bonus by the length of any em-
ployee’s absence, even if that absence is due to a

104

strike.“ The Administrative Law Judge’s proposed
remedy, correctly, calls for such a reduction. However,
Respondent offers no justification, nor do we perceive
any, for its requirement that the strikers be actually
on duty on the two eligibility dates. Thus, Respond-
ent does not contend that the failure of employees to
work on those dates, as opposed to any other dates of
the year, has any significant impact on its business.
Nor does it contend there is anything else special
about those particular dates.

Depriving employees of any entitlement to the
bonus which they had otherwise qualified for because
they are on strike on two dates without special busi-
ness significance is inherently destructive of the em-
ployees’ right to strike.“ Therefore, we adopt the Ad-
ministrative Law Judge’s finding that Respondent
violated Section 8(a) (3) and (1) by depriving strik-
ers of bonus payments,

Order

Pursuant to Section 10(e) of the National Labor
Relations Act, as amended, the National Labor Rela-
tions Board adopts as its Order the recommended Or-

Of. Tex-Tan Welhausen Company and Tex-Tan Western
Leather Company, Division of Tandy Corporation, 172 NLRB
851, 889-890 (1968), enfd. 419 F. 2d 1265 (C. A. 5, 1969), rehearing
denied and rehearing denied en bane Jan. 12, 1970.

* Quality Castings Company, 1389 NLRB 928 (1962). The in-
stant case is factually much stronger for the result reached than
Quality Castings. In that case the employer sought to apply a 50-
percent attendance requirement for eligibility to participate in a
profit-sharing plan. Such a requirement bears at least some rela-
tionship to productivity. Whether there is a sufficient relationship
to productivity to warrant denial of benefits to strikers must be
determined on the facts of each case. We perceive no business jus-
tification herein which would even arguably warrant denial of
benefits to strikers for failure to work on the two eligibility dates.

lla

der of the Administrative Law Judge and hereby
orders that Respondent, Electro Vector, Inc., Forest-
ville, California, its officers, agents, successors, and
assigns, shall take the action set forth in the said
recommended Order.

Dated, Washington, D.C., September 18, 1975.

NATIONAL. Lasor RELATIONS Boarp
Berry SournHarp Murpny,
Chairman.
Howarp JENKINS, Jr.,
Member.
Member FannING, concurring

I concur in my colleagues’ adoption of the Admin-
istrative Law Judge’s Decision.

Pursuant to a practice instituted in 1973, Respond-
ent paid a bonus to employees who worked for it
during fiscal year 1974. Respondent's tiscal year runs
from October 1 to September 30 of the following

+
;
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:
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;
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according to a set formula for absences during
fiscal year. According to Respondent's officials.
reason for instituting the practice of paying a
was “a humanistic one due to the economic

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111515
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The issue in this case is whether Respondent's treat-
ment of the strikers’ absence on September 30 and
November 27 as absence from the “active payroll”
constituted discrimination against the strikers be-

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134

in protected activities surely may have a discouraging
effect on either present or future concerted activity.”
Ibid. There seems to me no reasonable doubt that the
determination between the two groups was “so ‘inher-
ently destructive of employee interests’ that it may be
deemed proscribed without the need of proof of an
underlying improper motive.” Id. at 33. I can per-
ceive no business justification that would excuse this
discriminatory conduct.

Nor has Respondent come forward with a justifica-
tion for discriminating between those employees who
received the earned portion of their bonus and the
strikers who did not. At most, Respondent argues
that it did not have a discriminatory motive because
it treated strikers the same way it treated other em-
ployees who were absent from work on September 30
or November 27. But the argument at once proves too

two groups of employees who did not receive the
to
those employees who did not receive the bonus

on the two critical dates in all instances. As noted in Respondent's
brief, she testified “that a person on lay-off for maternity leave
might recei¥g the bonus even though she was not actively working
on the date of payment, if she had in fact been working at the close
of the fiscal year.”

|
f
|
4

—
son of strike with other absences and its
consequent discrimination between strikers and em-
their strike

lawful

Company, 139

I would therefore find that Respondent’s denial of
a bonus to strikers because they were not at work on
September 30 and November 27 violated Section 8(a)

(3) and (1) of the Act.

Dated, Washington, D.C., September 18, 1975.
Nationa Laon Recations Boarp,
Jonx H. Farm,

Member.

JD-(SF)-68-75, Forestville, CA

United States of America before the National Labor
Relations Board, Division of Judges, Branch Office,
San Francisco, California

Case No. 20-CA-9771

Exectro Vector, Inc. A&D GeneraL Truck Drivers,
WanrenousemMen & Huren Union, Locar 980, Ix-
TERNATIONAL BrotHernoop or TEamMsTers, CHAUF-
FeuRS, WAREHOUSEMEN AND HELPERS oF AMERICA

Lucile L. Rosen, Atty., of San Francisco, Calif.,
for the General Counsel.

Michael P. Merrill, Esq., of Santa Rosa, Calif., for
the Respondent.

Decision
I. STATEMENT OF THE CASE

Ricuarp J. Boyce, Administrative Law Judge: This
case was tried before me in San Francisco, California,
on March 4, 1975. The charge was filed December 3,
1974, and amended January 29, 1975, by General
Truck Drivers, Warehousemen & Helpers Union, Lo-
cal 980 (herein called the Union). The complaint is-
sued January 29, 1975, was amended February 6, and
alleges that Electro Vector, Inc. (herein called Re-
spondent) violated Section 8(a) (1) and (3) of the
National Labor Relations Act.

(15a)

164

The parties were permitted at the trial to introduce
relevant evidence, examine and cross-examine wit-
nesses, and argue orally. Briefs were filed for the
General Counsel and Respondent.

II. ISSUES

The issues are whether Respondent, by not paying
year-end bonuses to economic strikers in the circum-
stances detailed below, violated Section 8(a) (1) and
(3) of the Act; and, if so, whether the strike thereby
was converted into an unfair labor practice strike.

III. JURISDICTION

Respondent is a California corporation engaged in
Forestville, California, in the manufacture of elec-
tronie products. It annually sells and causes to be de-
livered to customers outside California products of a
value exceeding $50,000.

Respondent is an employer engaged in and affect-
ing commerce within Section 2 (2), (6) and (7) of
the Act.

IV. LABOR ORGANIZATION

The Union is a labor organization within Section
2(5) of the Act.

V. THE ALLEGED UNFAIR LABOR PRACTICE

A. Facts

Respondent’s production and maintenance employ-
ees are represented in collective bargaining by the
Union. On May 2, 1974, during contract negotiations
with Respondent, the Union called a strike in support
of its demands. The strike is still on.

174

Respondent’s fiscal year is October 1 through Sep-
tember 30. On November 27, 1974, it paid end-of-
fiscal- year bonuses to those of its employees who were
on the “active” payroll—i.e. actually working—on both
that date and on the final day of the fiscal year, Sep-
tember 30. There were about 100 recipients, among
them strikers who had quit the strike in time to meet
September 30/November 27 qualifying standard, as
well as striker replacements meeting that test. Re-
spondent’ general manager, Philip Del Valle, testified
eredibly and without refutation that the qualifying
test was not compromised for anyone. Strikers and
anyone else not satisfying it were ineligible. There
were about 33 strikers in this category.

Among those qualifying, the bonus amounts varied.
The basic amount was $150, but the great majority
got less because of absenteeism or absence from the
active payroll during the fiscal year.“ A formula was
eh a tae
allow for these factors, an exception being that ab-
sences sometimes were overlooked, as in the case of
serious illness or maternity leave, if Del Valle felt
the specific circumstances so warranted. The record
does not set forth the particulars of the formula, and
is devoid of citation to any given situation in which
special dispensation was granted. Those who quit
strike and striker replacements received the same
partial-year treatment as others who worked like
periods of time. A select few, who in Del Valle’s judg-
ment had made exceptional contributions during the
year, received above the basic $150. Four thus re-

For example, Floyd Maes, hired September 26, 1974, received
only $10.

F

18a

ceived $225 in 1974. The record does not reveal the
nature of their contributions.

Year-end bonuses were instituted by Respondent
in 1973, in lieu of hams and turkeys. Although not a
product of collective bargaining, they apparently had
the Union’s blessing. They were administered in ex-
actly the same way in 1974 as 1973. To quote Del
Valle: [Wie took great pains to follow the exact
formula so there would be no question of an unfair
labor practice.” A prime purpose of the bonuses is to
stimulate better attendance, other purposes being to
give the employees a stake in the success of the busi-
ness after the fashion of profit-sharing plans and to
ease the economic impact on employees of inflation
and Christmastime.

No evidence was proffered that the denial of bon-
uses to strikers prolonged the strike. Two strikers
testified of learning, at about the time the bonuses
were granted, that they had been excluded from
participation. °

B. Diseussion

It is concluded, in agreement with the General
Counsel, that Respondent’s exclusion of strikers from
participation in the bonus distribution, because not
on the active payroll at the prescribed times, violated
Section 8(a) (3) and (1). This conclusion is grounded
on Quality Castings Company, 139 NLRB 928—
a case similar to the present.

Quality Castings involved distributions under a
profit-sharing plan. Each employee, to qualify, had
to have worked 50 percent of the time between Janu-
ary and September preceding distribution. As in the
present case, the amounts paid to those qualifying
were a function of absenteeism, exceptions being

19a

allowed for excused absences. Some 64 employees, who
had struck in April and May of that year and were
not thereafter recalled for valid economic reasons,
were deemed not to have satisfied the qualifying
The Board held that the disqualified strikers had
been discriminated against in violation of Section 8(a)
(3) and (1), determining that the respondent’s inter-
pretation of the qualifying criterion rested * * *

* * * on the faulty premise that time on strike
may lawfully be considered the equivalent of
normal absence for purposes of determining
profit-share forfeiture. [139 NLRB at 930]

The Board continued (139 NLRB 930-31) :

T]he Respondent cannot be required to make
istributions to individuals for the period they
were absent on strike. Neither, however, can the
Respondent state that strike time is merely an-
other form of absence, equating it to other
forms of absence discouraged by it, and then
roceed to impose a total and non-proportionate
orfeiture on employees because they engaged
in such absences—in effect because they en-
gaged in Section 7 activities.

[N Jotwithstanding the obvious fact that strike
absences intensify an employer’s production
problems, strikers are given protection under
the Act not available to workers whose absences
are caused by other reasons. While the Act
2 no protection to workers who are absent

ause of illness, athletic events, or family
celebrations, it does protect employees who are
absent because of a strike, and “excuse” such
absences, in the sense contemplated by Respond-
ent. Respondent’s contrary treatment subverts
the protection afforded = statute, and its
total denial of all profit-sharing benefits to the
strikers because of their absence“ discrimi-

20a

nates against them as directly as if they were
discharged for such activities. Surely Re-
spondent could not lawfully enforce a general
discharge rule for absenteeism against the 64
strikers, merely because their participation in
the strike for its duration constituted “exces-
sive absenteeism” under the Respondent’s for-
mula. We therefore find that the 100-percent
profit-sharing forfeiture * * * imposed by Re-
spondent on the 64 strikers * * * was violative
of Section 8(a) (3) and (1), regardless of
Respondent’s motivation in imposing such a
penalty.’
This reasoning, which the Board has never disavowed,
is equally @pposite to the present situation.“
In addition to urging the illegality of Respondent’s
denial of bonuses to strikers, the General Counsel
contends that the denials converted the strike into an

* Citing Erie Resistor Corp., 132 NLRB 621, later to be affirmed
by the Supreme Court at 373 U.S. 221 (1963).

* This reasoning, however, has experienced some difficulty at
judicial levels. Quality Castings Corpany was reversed at 325 F. 2d
36 (Sixth Cir. 1963). Similarly, Pittsburgh-Des Moines Steel Co.,
124 NLRB 855, and National Seal, 141 NLRB 661, in which the
Board used kindred reasoning to support violations, were reversed,
respectively, at 284 F. 2d 74, (Ninth Cir. 1960) and 336 F. 2d. 781
(Ninth Cir. 1964). Board law, not that of the circuits, is control-
ling, however, at this juncture of this proceeding. E.g., Brick-
layers Local No. 1,209 NLRB No. 123, fn. 1. Academic criticism
of the Board’s Quality Castings reasoniug appears in Getman,
Section 8(a) (3) of the NLRB and the Effort to Insulate Free Em-
ployee Choice, 32 U. of Chi. L. Rev. 735, 741-42 (1965), wherein
it is observed among other things:

Where the employer applies uniform criteria which ate
the — 1 2 pp
siderable leeway * * *, [T]he fact that the employer applies
these standards in situations which do not involve union
ay a 6 ee a
in

21a

unfair labor practice strike, entitling any strikers not
theretofore permanently replaced to unqualified re-
instatement upon their application. This contention is
rejected. There is no evidence that the bonus mis-
conduct influenced any striker to prolong the strike,
and it is not manifest from the facts that the mis-
conduct would have had that effect. The strike was
called in aid of the Union’s overall position in contract
negotiations and already had been underway some
7 months. It cannot be assumed that the larger strike
strategy was affected by the bonus matter. See Romo
Paper Products Co., 208 NLRB No. 96; Anchor Rome
Mills, 86 NLRB 1120, 1122.*

VI. CONCLUSIONS OF LAW

1. By disqualifying strikers from bonuses as found
herein, Respondent engaged in unfair labor practices
within Section 8(a) (1) and (3) of the Act.

2. These unfair labor practices affect commerce
within Section 2 (6) and (7) of the Act.

3. Respondent’s misconduct, as found herein, did
not convert the economic strike that began May 2,
1974, into an unfair labor practice strike.

VII. THE REMEDY

It is recommended that Respondent be ordered to
cease and desist from the unfair labor practices found.

The General Counsel’s argument to the contrary cites M. L. N. B.
v. Erie Resistor Corp., 373 U.S. 221 (1963). As I read that de-
cision, however, the Supreme Court did not address itself to the
issue of the strike’s status. Beyond that, a reading of the under-
lying NLRE decision—Zrie Resistor Corp., 132 NLRB 621—
reveals that in that case, unlike the present, the striking employees
expressiy voted to continue the strike in protest of the company’s
unlawful conduct.

224

Affirmatively, it is recommended that Respondent be
ordered to cure its unlawful discrimination by restor-
ing to eligibility for the 1974 bonuses those disquali-
fied because of strike- related absence, and by caleulat-
ing their bonus shares in such a way that they do not
suffer a disproportionate reduction because of their
strike activities. Their shares may, however, be re-
duced pro rata for their absences from the job during
the pertinent fiscal year whether because on strike or
for any other reason. Quality Castings Company,
supra, at page 932. Interest at the rate of six percent
per annum from November 27, 1974, shall be included
in the shares.

Those entitled to relief include: °

J. E. Anderson M. Gramlich

J. L. Aviles D. G. Herrington
S. A. Aviles S. F. Hester
R. L. Beck I. J. Jorgensen
A. Bribiescas D. Karson

D. Burris B. L. Kelly

S. E. Butters S. L. Palmer
P. V. Cox J. L. Say

D. G. Cresta V. M. Signett
M. Cribbins A. E. Skinner
S. L. Davis E. Stockman
E. B. Edwards J. B. Tryon

J. Frost B. S. Vierra
H. P. Galusha B. A. Wesley
P. A. Garrison L. K. Whitley
G. A. Gibson F. G. Wilson
R. N. Graham

» And such others as are determined, in the compliance phase
of this proceeding, to be entitled. F.C.F. Papers, Inc., 211 NLRB
No. 67, slip op. 7; Boilermakers Local No. 101, 206 NLRB No. 5,
slip. op. 2, fn. 3.

23

Upon the foregoing findings of fact, conclusions of
law, and the entire record, and pursuant to Section
10(e) of the Act, I hereby issue the following recom-
mended : °

Order

Respondent, Electro Vector, Inc., its officers, agents,
successors, and assigns, shall:

I. Cease and desist from discouraging membership
in General Truck Drivers, Warehousemen & Helpers
Union, Local 980, International Brotherhood of Team-
sters, Chauffeurs, Warehousemen and Helpers of
America, or any other labor organization, by discrim-
inatorily denying a bonus distribution to employees
because of their participation in a strike.

II. Take the following affirmative action:

A. Make whole the employees referred to in the
Remedy section of this Decision, in the manner set
forth in that section, for the losses suffered by reason
of Respondent’s discrimination against them.

B. Preserve and, upon request, make available to
the Board or its agents, for examination and copying,
all payroll records, social security payment records,
timecards, personnel records and reports, and all
other records necessary for determination of the
amount of payment due under this Order.

C. Post at its place of business in Forestville, Cali-
fornia, copies of the attached notice marked “Ap-

* All outstanding motions inconsistent with this recommended
Order hereby are denied. In the event no exceptions are filed as
provided by Section 102.46 of the Rules and Regulations of the
National Labor Relations Board, the findings, conclusions, and
recommended Order herein shall, as provided in Section 102.48
of the Rules and Regulations, be adopted by the Board and be-
come its findings, conclusions, and Order, and all objections thereto
shall be deemed waived for all purposes.

244

pendix.” Copies of said notice, on forms provided by
the Regional Director of Region 20, after being signed
by an authorized representative of Respondent, shall
be posted by Respondent immediately upon receipt
thereof, and be maintained by it for 60 consecutive
days thereafter, in conspicuous places, including all
places where notices to employees customarily are
posted. Reasonable steps shall be taken to ensure that
said notices are not altered, defaced, or covered by
other material

D. Notify the Regional Director of Region 20, in
writing, within 20 days from the date of this Order,
what steps Respondent has taken to comply herewith.

Dated: April 8, 1975.

RicHarD J. Boyce,
Administrative Law Judge.

Norice To EMPLovers

Posted by Order of the National Labor Relations
Board—an Agency of the United States Govern-

The trial held in San Francisco, California, on
March 4, 1975, in which we participated and had a
chance to give evidence, resulted in a decision that
we had committed certain unfair labor practices in
violation of Section 8(a)(1) and (3) of the National

In the event that the Board's Order is enforced by a Judgment
of a United States Court of Appeals, the words in the notice read-
ing “POSTED BY ORDER OF THE NATIONAL LABOR
RELATIONS BOARD” shall be changed to read “POSTED
PURSUANT TO A JUDGMENT OF THE UNITED STATES
COURT OF APPEALS ENFORCING AN ORDER OF THE
NATIONAL LABOR RELATIONS BOARD.”

25a

Labor Relations Act, as amended, and this notice is
posted pursuant to that Decision.

Section 7 of the National Labor Relations Act, as
amended, gives all employees the following rights:

To organize themselves

To form, join, or support unions

To bargain as a group through a representative
they choose

To act together for collective bargaining or
other mutual aid or protection

To refrain from any or all such activities.

In recognition of these rights, we hereby notify our
employees that:

WE WILL NOT discourage membership in Gen-
eral Truck Drivers, Warehousemen & Helpers Union,
Local 980, International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of America,
or any other labor organization, by discriminatorily
denying a bonus distribution to employees because of
their participation in a strike.

WE WILL make whole the approximately 33 strik-
ing employees for losses suffered by reason of their
being discriminatorily excluded from the November
1974 bonus distributions.

(Representative) (Title)

THIS IS AN OFFICIAL NOTICE AND MUST NOT BE
DEFACED BY ANYONE

This notice must remain posted for 60 consecutive days from the
date of posting and must not be altered, defaced, or covered by
any other material. Any questions concerning this notice or com-
pliance with its provisions may be directed to the Board’s Office,
450 Golden Gate Ave., Federal Building, Rm. 13018, Box 36047,
San Francisco, California, 94102—Telephone No. (415) 556-6721.

APPENDIX D

United States of America before the National Labor
Relations Board

Case No. 20-CA-9771

Ex.ecrro Vector, Inc., anp GENERAL TRucK DRIVERS,
WaAREHOUSEMEN & HAS, Loca, 980, LNTERNA-
TIONAL BroTHERHOOD oF TEAMSTERS, CHAUFFEURS,
WaAREHOUSEMEN AND HELPERS OF AMERICA

Employer’s Exceptions to the Administrative Law
Judge’s Decision

Pursuant to the Board’s Rules and Regulations, Se-
ries 8, as amended, Section 102.46. Counsel for the
Employer, ELECTRO VECTOR, INC., hereby files
the following exceptions to the Administrative Law
Judge’s Decision in the above case, which Decision
was issued on April 8, 1975, by Administrative Law
Judge Richard J. Boyce.

Exceptions

1. Page 3, lines 19-24: To the statement of the Ad-
ministrative Law Judge that the Employer’s exclusion
of strikers from participation in the bonus distribu-
tion, because not on the active payroll at the pre-
scribed times, violated Section 8(a)(3) and (1).

(26a)

27a

2. Page 5, lines 10-13: To the Administrative Law
Judge’s conclusion of law that by disqualifying strik-
ers from bonuses as found in this case, the Respondent
ELECTRO VECTOR, INC., engaged in unfair labor
practices within Section 8(a)(1) and (3) of the Act.

Respectfully submitted

Dated: April 25, 1975.

Merritt & THOMPSON,

Attorneys for Respondent,
Electro Vector, Inc.

By: MichAEL P. MERRILL.

U.S. COVERNEENT PRINTING OFFICE, 1977

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385004_1814%3A1. Public record. Not legal advice.