Petition — Local 450, United Furniture Workers v. Donn Products, Inc.

Supreme Court brief1980

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Text

APR 16 ta89

MICHAEL RODA K. IR. CLERR

IN THE

Supreme Court of the United States

October Term, 1979

No.

LOCAL 450, UNITED FURNITURE WORKERS

OF AMERICA, AFL-CIO,

Petitioner,

Vv.

DONN PRODUCTS, INC., and

AMERICAN METALS CORP.,

and

NATIONAL LABOR RELATIONS BOARD,

Respondents.

PETITION (WITH APPENDIX) FOR

A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

—

James F. Gill

230 Park Avenue

New York, New York 10017

Attorney for Petitioner

Robinson, Silverman, Pearce,

Aronsohn & Berman

Michael F. O'Toole

Andrew Irving

Of Counsel

(9676)

ce ia

INDE X

Page

Opinions Below... ..cececcseeee 2

JULISGIctioON.ccccccesticovccee 2

Questions Presented........+. 3

Questions Presented.......... 3

Statutes Involved.....eeeeeee 4

Statement of the Case.... ... 6

Reasons for Granting the

EO Ce 19

Cee El « hs 6 G6 6s 6 8 clbe¥ad 47

Appendix

Decision of the Court of

AppealS.cwccccccccccccce Al

Decision and Order of

the National Labor

Relations Board.......--- AlO

Judgment of the Court of

AppealS.ccrccocccccccccccs A82

a Se ee ee: ee

Amalgamated Cloth. Workers

of America v. N.L.R.B.,

174 U.S. App. D.C. 20,

527 F.2d 803 (1975), cert.

denied sub nom. Jimmy-Richard

Co. v. N.L.R.B. 426

Wels Be Ree cccctnccsss SH

site

American Federation of

Labor v. N.L.R.B.,

SUS UsGe SOA Cae ee) cccccse

Axton Candy & Tobacco

Co., 241 NLRB

NO. 163 (IGT9) a cweccccvrdvecs

Bandag, Inc. v. N.L.R.B.,

583 F.2d 765

CS Cis, LOTS) vcccageveceas

Curlee Clothing Co. v.

N.L.R.B., 607 F.2d

1213 (8 Cir. 1979) -ccccees

E.S. Merriman & Sons, 219

NLRB 972 (1975),

mod. sub nom. N.L.R.B.

v. E.S. Merriman & Sons,

No. 75-3731, 99 LRRM

2634; (9) Cif. 2978) ou 0% 9.0.00

F.T.C. v. Sperry and

Hutchinson Co., 405

Debs. 225. LAPIS) 060s Cone 5-08

Gibson Products of Washington

Parish, La., 185 NLRB

\ yl. | eres Pr

Hedstrom Co. v. N.L.R.B.,

558 F.2d 1137 (3 Cir.

1977) « éctmensewecwes » 2: en 2 se

International Manufacturing

Co., 238 NLRB No. 190

CEOTOS «60 ede cde tes e*eeee#s?

Leedom v. Kyne, 358 U.S.

LUG CAPPER ec oeeaekeeceenes

23, 24

-iii-

Local Union No. 2338, Int.

Bro. of Electrical Workers

Ve ~L.R. Oe eWe

D.C. 406, 499 F.2d 542

(LSTA i 66nd 0.00 h46 b66 ose

N.L.R.B. v. American Cable

Systems, Inc., 427 F.2d

TG (5 Chee Pe cert.

denied 400 U.S. 957

CED TO Si ct Jvc S44 Cee huis

N.L.R.B. v. Central Machine

& Tool Co., 424 F.2d 542

r. 1970), cert.

denied 407 U.S. 910

{ 3972) cucnncss dows cad ctwe

23,24

N.L.R.B. v. Coca-Cola Bottling

Co. of San Mateo, 472 F.

2g 140 (9 Cit. S9723% scx

N.L.R.B. v. Copps Corp.,

458 F.2d 1227 (7 are’

iA gy ) Sa Sree een

N.L.R.B. v. East Side

Shopper, Inc., 498

F.2d 1334 (6 Cir. 1974).

N.L.R.B. v. General Stencils,

Inc., 438 F.2d 894

(2 Cir. LOU) cv be céeeee ec

N.L.R.B. v. Gissel Packin

Co., 395 U.S. 575

CEPTS ca Ohk eh ok6 bee OR es

19,20,21,

25,26,27,

29,30,31,

35,36,44,

passim

N.L.R.B. v. Henry Colder Co.,

447 F.2d 629 (7 Cir. 1971)

N.L.R.B. v. Matouk Industries,

Inc., 582 F.2d 125

(1 Cir. LOTS) cnccevecoses

N.L.R.B. v. Pacific

Grinding Wheel Co.,

InCe >» S33 F.2d 1343

(9 Cals APTS ccvecsceccece

N.L.R.B. v. Walton

Manufacturing Co., 369

Uses SOS Tae 664 Cannkox

Russell-Newman Mfg. Co.,

407 F.2da 247 (5 Cir. 1969)

Securities and Exchange Com.

v. Chenery Corp., 318

U.S. 80 (1943)... eeee

Universal Camera Corp. v.

N.L.R.B., 340 U.S.

474 CASSE Doe sede 6s eedsese

Vermont Yankee Nuclear Power

v. Natural Resources Def.

Council, 435 U.S. 519

(ZTE s 4d uetégadaaee nuns

44,45

45, 46

40, 44

IN THE

SUPREME COURT OF THE UNITED STATES

October Term, 1979

LOCAL 450, UNITED FURNITURE WORKERS

OF AMERICA, AFL-CIO,

Petitioner,

DONN PRODUCTS, INC., and AMERICAN

METALS CORP.,

and

NATIONAL LABOR RELATIONS

BOARD,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF

APPEALS FOR THE SIXTH CIRCUIT

The petitioner, Local 450,

United Furniture Workers of America,

AFL-CIO ("the Union"), prays that a writ

of certiorari be issued to review the

judgment of the United States Court of

Appeals for the Sixth Circuit entered

an this case on January 17, 1980.

OPINIONS BELOW

The opinion of the Court of

Appeals is reported at 613 F. 2d 162.

The decision and order of the National

Labor Relations Board ("the Board") are

reported at 229 NLRB No. 9.

JURISDICTION

The decision and judgment of

the Court of Appeals were entered January

17, 1980 and are reproduced in the Appendix

to this Petition at pp. Al-A9, A82-A83.*

The jurisdiction of this Court is invoked

pursuant to 28 U.S.C. §1254(1).

* References to the Appendix are set

forth hereafter as "(A )."

= 3=

QUESTIONS PRESENTED

1. Whether a Court of Appeals

may refuse to enforce an order of the

Board directing an employer to bargain

with a union whose majority status was

destroyed by pervasive unfair labor prac-

tices simply because the employer discon-

tinued its unlawful activity during the

several years between the representation

election tainted by the unfair labor prac-

tices and the judgment of the Court of

Appeals? |

2. Whether a Court of Appeals

may ignore both the Board's expertise in

the field of labor relations and the “sub-

stantial evidence” test by brushing aside

the identifiable and specific portions of

an employer's speech to employees relied

upon by the Board in the Board's finding

that the speech was a coercive and

threatening unfair labor practice?

-4-

3. Whether, when a remedial

bargaining order by the Board is based on

numerous unfair labor practices, a Court

of Appeals which disagrees with the Board

as to only one of those unfair labor

practices may usurp the Board's role and

impose a different remedy without remand-

ing the matter to the Board for consider-

ation of the proper remedy?

STATUTES INVOLVED

The relevant provisions of the

National Labor Relations Act, 49 Stat.

449 (1935), as amended, 29 U.S.C. §151 et

seq., are as follows:

Sec. 7. Employees shall have

the right to self-organization, to form,

join or assist labor organizations, to

bargain collectively through representa-

tives of their own choosing, and to

engage in other concerted activities for

the purpose of collective bargaining or

=5<

other mutual aid or protection, and shall

also have the right to refrain from any

or all of such activities except to the

extent that such right may be affected by

an agreement requiring membership in a

labor organization as a condition of

employment as authorized in section

8(a) (3).

Sec. 8. (a) It shall be an

unfair labor practice for an employer--

(1) to interfere with, re-

Strain, or coerce employees in the

exercise of the rights guaranteed in

section 7;

* * *

(5) to refuse to bargain

collectively with the representa-

tives of his employees, subject to

the provisions of section 9(a).

=-6-

STATEMENT OF THE CASE

This case was before the Court

of Appeals upon petition of Donn Products,

Inc., and its wholly-owned subsidiary,

American Metals Corporation (hereinafter

referred to jontly as "the Company") for

review of the order of the Board, and

upon the Board's cross-application for

enforcement. The Court of Appeals has

jurisdiction of the proceedings under

Section 10(e) and (f£) of the Act.

Factual Background

The Union began its organiza-

tional drive among the Company's employ-

ees in March 1936. The Company is

engaged in the processing and production

of ceiling and partition systems in the

l. All dates are 1975, unless otherwise

indicated.

Cleveland, Ohio area. When the organiza-

tional campaign began, the Company oper-

ated out of three production facilities.

By July 9, the Union had

obtained valid authorization cards from

156 of the 288 employees in the we on

that day. The Union demanded that the

Company recognize and bargain with it as

representative of the employees, but the

Company refused to do so. In August, the

Union petitioned the Board for an elec-

tion pursuant to Section 9 of the Act.

2. The unit included

"All production and maintenance employees,

including shipping and receiving employees,

plant janitor, the paint technician, the

chief inspector, assistant foremen, leadmen

and probationary or production trainee

employees of the [Company] at its two

facilities . . . excluding office clerical

employees, technical employees, engineers

and draftsmen, production clerk, foremen,

and all professional employees, guards, and

supervisors as defined in the Act."

=§-

The election was held on September 10,

and the Union failed to obtain a majority

of the votes -- 115 ballots were cast for

the Union, against 148 for the Company.

The Union timely filed objec-

tions to the election and, at approxi-

mately the same time, unfair labor

practice charges against the Company.

Following a consolidated hearing on

the objections and unfair labor prac-

tice charges, the Administrative Law

Judge ("ALJ") issued his Decision and

Recommended Order on October 18, 1976.

The ALJ Decision

The ALJ found that the Company

had committed the following unfair labor

practices in violation of Section 8(a)(1)

of the Act:

-9-

Granting and promising benefits to

encourage abandonment of the Union

The Company instituted an

unprecedented arbitration procedure for

the resolution of employee grievances.

Announced in June, the new procedure

went into effect in August, a month

before the election, and after the Union

demanded recognition. (A45-A46).

Also in August, the Company

began a new program of assisting employ-

ees in obtaining bank loans. (A46-A47).

Late in August, the Company

distributed a 14-page pamphlet which

included a promise to establish a new,

more advantageous bonus system. (A48-A50).

On September 8, only two

days before the election, the Company's

president promised to explore the possi-

bility of instituting a dental insurance

program. (A50).

ain

Threat to close the Berea

production facility

In a speech to employees at

the Berea location on September 5, only

five days before the election, the

Company president, in a generally anti-

union speech, threatened to exercise his

managerial perogative to close the plant.

The ALJ credited an employee's testi-

mony quoting the president as saying,

"he could take the company and move

it anywhere he pleases at any time,"

"he could just take off and move the

company anywhere he chooses at any time.”

(A50-A52).

Threats and Interrogation

On several occasions, Company

supervisors threatened employees with

discharge and criminal prosecution, and

interrogated them about their union

ati-

activity and the activities of others.

(A52-A58).

On the basis of these findings,

the ALJ recommended entry of a cease and

desist order directed at these unfair

labor practices. In addition, he recom-

mended that the results of the election

be set aside, and a new election held.

The Board's Decision

The Company, the Union, and the

Board's General Counsel filed exceptions

and cross-exceptions to the ALJ's deci-

sion. In its April 20, 1977 Decision and

order (Al0-A34), the Board affirmed

all of the findings of Section 8(a)(1)

violations described above. The Board

particularly noted that the Company

president's “talk about [the Company's]

ability to move the plant wherever it

wanted constituted a threat of economic

-12-

reprisal in the event the Union won the

election." (Al12).

The Board went on to reverse

the ALJ and find that, in a speech to

employees on September 8, two days before

the election, the Company's president had

threatened to engage in sham bargaining

in the event the Union won the election.

(Al7). While the ALJ had considered and

rejected this allegation (A58-A60), his

decision made absolutely no reference

to the existence of a transcript of the

speech which was admitted into evidence.

The Board rejected the ALJ's characteri-

zation of the evidence of the speech as

"nebulous, vague, [and] indirect" (Al13)

and quoted extensively from the tran-

script apparently ignored by the ALJ.

It is worthwhile to reproduce here the

portions of the speech quoted by the

Board (Al14-Al7):

=] 3=

"As I mentioned to you before,

I am not inclined to be forced to do

anything. It is a free country, I

am a free man, and I believe that I

ought to be able to do what I be-

lieve I have to do and, that is,

I'll bargain; but it's like leading

a horse to water. When he's got his

head under water, you don't know for

sure he is drinking, but then you've

got to practically drown the horse

before he drinks enough water,

before you bring him out.

"So this is how the battle

starcts: i Ge

* * *

"The length of negotiations has

to do with how long do you hold the

horse's head under the water.

Finally, he wants a drink of water

and he comes up, so he talks for a

little bit, a little while, and goes

back and forth. And, as I pointed

out, a lot of it is for show.

* * *

". . « ({I]£ I decide I'm not

going to do something and it doesn't

matter what it is, there's no law

in this country that says I have

to.

"So then we start down the

line: ‘How far are we going to

carry this out?" Well, this is

-14-

what happens--it's very simple--we

react the point of impasse. That's

really easy to reach, a point of

impasse,

"You say, ‘Well, you got to

keep talking,’ and you've got to

keep talking and negotiating with

the union or you've got to be

continuing to negotiate in what

they call good faith. I am an

expert. That is negotiating in good

faith, because all you've got to do,

I_am sure, is keep talking and keep

talking and keep saying no until

finally you all decide to go on and

step outside and stand outside the

same stake that this union is trying

to get in, but now my employees ste

Out and join them and they stand out

there, outside of that stake.

[Emphasis supplied. }

"Don't forget. You can't step

on our front lawn, and we'll put up

a few more stakes to be sure that

Our own employees don't come back in

again, because then you are on

Strike it's no longer your company,

it's not your company any more. You

have decided that you are going to

go somewhere else and you won't come

back to work unless you get whatever

your demand is.

* * *

"Well, how do you cause the

company to hurt? You try and get

=) Sa

even with us for not negotiating as

much as you think you would like to

have and, therefore, you go out on

strike, and you step out, pick up

your signs, and there you are.

"Now, it's very simple. When

are you going to come in We'll

come in when our demands are met.

[Emphasis supplied.]

"'when are your demands met?'

You know I am going to have to be

the one to meet them. So, now time

goes by and the talk behind the

scenes naturally is, ‘I wonder

when they are going to be tired of

losing money by sitting out there

and wanting to come in, and how much

do they think they are going to

get?' And all these favoritisms and

all these other little things that

you are talking about, and some of

them are pretty small, how long are

you going to stay out there? Well,

it's your guess; it's my guess.”

Based upon its analysis of the speech,

the Board ruled that only two days before

the election, the Company “conveyed to

employees the futility of choosing union

representation and presented them with

3. All emphases supplied by the Board.

ol$<

only a choice between striking and no

union". (Al7) The speech therefore

constituted unlawful restraint and

coercion, violative of §8(a)(1l).

The Board also reversed the

ALJ's choice of remedy, finding that

"there is little or no likelihood that

a second and fair election could be con-

ducted in the face of the Company's far-

reaching unfair labor practices ...."

The Board catalogued the various un-

fair labor practices committed by the

Company and found, without emphasizing

any particular one over the others, that

they "were intended to, and did in fact,

undermine the Union's majority strength."

On this basis, the Board directed entry

of a bargaining order, and found that the

Company violated §8(a)(5) of the Act by

refusing to recognize and bargain with

the Union as of July 9. In connection

with the bargaining order, the Board

directed the Company to rescind the

arbitration procedure and loan assistance

programs instituted after that date.

Finally, the Board directed the Company

to bargain with the Union over both its

decision to close the Berea Plant in

December and the effects thereof.

The Court's Decision

The Court of Appeals affirmed

all of the Board's §8(a)(1) findings

except for the threat to refuse to bar-

gain in good faith. Citing a few pas-

sages from the speech different from

those relied upon by the Board, the Court

held that the speech could not “be con-

sidered an advance threat not to bargain

in good faith... ."™ (A5). The

=2§-

Court also declined to enforce the

Board's bargaining order, giving three

separate reasons. First, the Court held

that none of the violations "are of a

continuing nature." (A7). Second,

the Court ruled that the effect of the

violations "would quickly dissipate."

(A8). Third, the Court deemed it "clear

that the [bargaining order] was deter-

mined to a large extent by the finding

that there had been a threat of sham

bargaining." (A8-A9). Since this

finding had been overruled, the basis for

the bargaining order had been eliminated,

according to the Court.

Petitioner asks that this

Court grant certiorari to review three

aspects of the lower court's decision:

its refusal to enforce the Board's

bargaining order, its rejection of the

-19-

Board's finding that the employer engaged

in sham bargaining, and its failure to

remand the case to the Board for recon-

sideration of the proper remedy.

REASONS FOR GRANTING THE PETITION

THE COURT BELOW HAS

SEVERELY RESTRICTED THE

AVAILABILITY OF BARGAINING

ORDERS IN A MANNER CONTRARY

TO THE TEACHINGS OF THIS

COURT, OTHER COURTS OF APPEAL,

AND THE BOARD.

The present case requires this

Court's intervention in order to repair

serious damage done to this Court's

mandate in NLRB v. Gissel Packing Co.,

395 U.S. 575 (1969) and eliminate a

serious dispute which has developed

between several of the courts of appeal

and the Board. In Gissel, the Court gave

-20-

its unequivocal approval to the use of a

bargaining order to remedy unfair labor

"practices [which] have the tendency to

undermine [a union's] majority strength

and impede the election processes." 395

U.S. at 614. Imposition upon an employer

of the obligation to bargain with a union

whose provable majority was lost by the

time of a representation election through

the employer's unlawful acts "is de-

signed as much to remedy past election

damage as it is to deter future mis-

conduct.” Id. at 612 (footnote omitted).

The bargaining order thus serves two dis-

tinct purposes.

"({E)ffectuating ascertainable

employee free choice becomes as

important a goal as deterring em-

ployer misbehavior." Id. at 614.

This Court thus sanctioned the

bargaining order as an alternative to the

traditional remedies of a cease and

=Zlea

desist order and the posting of an

appropriate notice. The Court also

identified the body which would choose

the correct remedy:

"It is for the Board and

not the courts, however, to make

that determination, based on its

expert estimate as to the effects on

the election process of unfair labor

practices of varying intensity."

395 U.S. at 612 n.32.

The decision by the lower court

in the present case is perhaps the latest

salvo in an ongoing battle between

several of the courts of appeal and the

Board concerning the proper timeframe

for evaluating the need for a bargain-

ing order. The Court of Appeals criti-

cized the Board for having “made no

findings or detailed analysis as to

the residual impact or continuing effect

. - - of the unfair labor practices."

(A8) (emphasis supplied). The Court

concluded,

a$te

"It has now been four years since

the election was held. We believe

the purposes of the Act will be best

served by an early rerun election."

(A9).

The basis of the Court's challenge to

the Board's choice of remedy lies in its

conclusion that the contemporary effects

of the unfair labor practices as of the

time of the court's decision are dispo-

sitive of the issue of remediation. The

Sixth Circuit here held that although the

threat of a plant closure is a severe

unfair labor practice which ordinarily

would require a bargaining order, no

bargaining order is necessary because of

events which took place after the election.

Specifically, the Court asserted that the

effects of the threat were dissipated

because the plant was actually closed and

the employees were given new jobs in the

unit. The Sixth Circuit has thus taken

an extreme position on the issue of

=«23=

timeframe, a position it shares with at

least one panel of the Fifth Circuit.

See NLRB v. American Cable Systems, Inc.,

427 F.2d 446 (5 Cir.), cert. denied 400

U.S. 957 (1970). The Third Circuit

also concurs in this view. See Hedstrom

Co. v. NLRB, 558 F.2d 1137 (3 Cir. 1977).

These courts would require the Board to,

in effect, conduct an ongoing inquiry

into the current residual impact of the

unlawful activities which form the basis

of the bargaining order. By contrast,

the Seventh, Eighth, and Ninth Circuits

view the date of the Board's order as the

relevant cut-off period. NLRB v. Henry

Colder Co., 447 F.2d 629 (7 Cir. 1971);

Curlee Clothing Co. v. NLRB, 607 F.2d

4. Compare Bandag, Inc. v. NLRB, 583 F.2d

765 (5 Cir. 1378).

«Sie

1213 (8 Cir. 1979); NLRB v. Coca-Cola

Bottling Co. of San Mateo, 472 F.2d 140

(9 Cir. 1972).

The Board has resisted all

of these views, and takes the position

that its choice of remedy rests upon an

evaluation of the seriousness of the

unfair labor practices as of the time

they were committed. International

Manufacturing Co., 238 NLRB No. 190

(1978), citing Gibson Products Co. of

Washington Parish, La., 185 NLRB 362

(1970). In Gibson Products, the Board

specifically considered and rejected the

Fifth Circuit's view expressed in NLRB v.

American Cable Systems, Inc., supra. The

5. The Board has carved out an exception

for cases in which it is hearing a case for

a second time upon remand by a reviewing

court. In such cases, it will evaluate the

impact of the unlawful activity as of the

time of its prior decision.

o-25—

Board first noted that, in Gissel, the

Court ruled that a union's loss of major-

ity status by the time of the Board's

decision does not affect the validity of

the Bord's bargaining order. The Board

went on to announce its rule:

", . . Gissel, in our view, made

it plain that the Supreme Court

fashioned no different rule for

authorization card cases from that

which it applies in other cases

where the union has lost majority

Status as a result of the employer's

unfair labor practices and the time

required for the Board to ‘catch-up'

with that unlawful action. In the

former, no less than the latter, the

Court held that the Board could

properly impose a bargaining order

even though the union may not in

fact represent a majority of the

current employee complement. It

follows, therefore, that in deter-

mining whether the employer's unfair

labor practices are of such a nature

as to preclude a fair election and

thus necessitate a bargaining order

based on a past card showing of

majority status, the situation must

be appraised as of the time of the

commission of the unfair labor

practices, and not currently. For,

in virtually every case, by the time

a Board decision is reached, there

is likely to be sufficient employee

my oe

turnover and other changes to make

it arguable, where the employer has

meanwhile refrained from committing

new unfair labor practices, that an

election held now would be free of

the taint of the old unfair labor

practices. But, the union and the

employees then supporting it were

entitled to an election at an

earlier time, and, if the employer's

original unfair labor practices were

of such a nature as to deprive them

of an election at that time, to

permit one now, when the union's

support had been unlawfully dissi-

pated ‘would in effect be rewarding

the employer and allowing him to

profit from [his] own wrongful

refusal to bargain.’ Gissel, supra,

395 U.S. at 610."

The position of the Board is

supported by this Court's recognition in

Gissel that changes in circumstances

could only be considered after the

bargaining relationship had been given a

chance to succeed. This Court stated:

"For, aS we pointed out long ago,

in finding that a bargaining order

involved no ‘injustice to employees

who may wish to substitute for the

particular union some other * * *

arrangement,' a bargaining relation-

ship ‘once rightfully established

must be permitted to exist and

my Pe

‘function for a reasonable period in

which it can be given a fair chance

to succeed,' after which the 'Board

may, * * * upon a proper showing,

take steps in recognition of changed

situations which might make appro-

priate changed bargaining relation-

ships.' Franks Bros., supra, at

705-706, 64 S.Ct. at 819."

395 U.S. at 613

The lower court in this case,

like the other courts of appeal in

the cited cases, has refused to defer to

this rule and consequently denied en-

forcement of the Board's order largely

on that basis. This disagreement is of

far more than technical importance, and

requires resolution by this Court for

several reasons.

In the first place, the Board's

rule most effectively serves the purposes

announced by this Court in Gissel, while

the Sixth Circuit's contrary position

creates the greatest possibility of both

frustrating workers' rights of self-

—2Ge

determination and rewarding employer

misconduct. The Board has the discretion

to enter a bargaining order both to give

effect to the employees' previously

expressed (through authorization cards)

choice of representative and to punish

and deter employer misconduct. The

passage of time, which the Sixth Circuit

found dispositive in this case, cannot

alter the fact that employees' pro-union

sentiments were frustrated by illegal

activity. A bargaining order based upon

a card majority does not impose a new

condition but simply restores the status

quo which existed prior to the illegal

activity. Substitution of a rerun

election for a bargaining order because

of the passage of time diminishes the

possibility that such status quo will be

restored, since a union's chances of

reversing the results of a tainted

-29-

election in a rerun diminish with time.

Gissel, at 611 nn. 30, 31. Moreover, the

circumstance that an employer's unlawful

activities cease after the union loses an

election has no predictive value regard-

ing "the likelihood of their recurrence"

(Id. at 614) after a new election is

scheduled. Once the union loses the

election, the "need" for unlawful

activity greatly diminishes. The rulings

of the vagious courts of appeals reward

an employer only for avoiding beating the

dead horse of the union while consuming

time in the litigation process.

The Board's rule, on the

other hand, focuses on the immediate

effects of the unfair labor practices as

they happen. By thus foreshortening the

timeframe, the Board vindicates the

national labor policy favoring the prompt

resolution of questions of employee

-30-

representation. See Leedom v. Kyne, 358

U.S. 184, 191-93 (1958) (Brennan and

Frankfurter, J.J., dissenting); cf.

American Federation of Labor v. NLRB, 308

U.S. 401 (1940). Workers are entitled to

reasonably prompt resolution of questions

of representation. A rerun election is a

part of that process and is meaningful

only if it can take place in a relatively

short period of time. After all, a union

may, on a 30% showing of interest, obtain

a new election within 12 months of a

prior defeat even if it never objected to

the first election. Act §9(c)(3).

In Gissel, the Court expressed

the balancing test which the Board must

use as follows:

"If the Board finds that the possi-

bility of erasing the effects of

past practices and ensuring a fair

election (or a fair rerun) by

the use of traditional remedies,

though present, is slight and that

employee sentiment once expressed

«i=

through cards would, on balance, be

better protected by a bargaining

order, then such an order should

issue e ° e — 395 U.S. at 614-15.

The Board, consistent with the national

labor policy, has treated the proposed

rerun election as a prompt one by focus-

ing on the impact of the unfair labor

practices in the time period which im-

mediately follows them. If those illegal

acts rendered a fair and prompt rerun

impossible, a rerun several years later can

hardly be said to be any remedy at all.

The dispute between the Board

and the courts has implications broader

than the labor relations issues which

occasion the dispute. The courts of

appeal, including the Sixth Circuit in

the present case, have attacked and

refused to enforce bargaining orders

because they disagree with the Board's

method of decisionmaking. The Board has

*“32=

determined that it can faithfully carry

out its responsibilities under Gissel and

the Act by using a narrow timeframe to

consider the impact of an employer's

unfair labor practices. The courts

disagree. and have substituted their

judgment for the Board's. This Court

has recently, in a related context,

vigorously defended the power of admini-

Strative agencies to fulfill their

Statutory obligations free from judicial

interference:

"Absent constitutional constraints

‘the administrative agencies "“shouid

be free to fashion their own rules

of procedure and to pursue methods

of inquiry capable of permitting

them to discharge their multitudin-

ous duties."'" Vermont Yankee

Nuclear Power v. Natural Resources

Def. Council, 435 U.S. 519, 544

(1978).

A second reason, then, for this Court

to assert itself in clarifying the issue

raised by this petition is the need to

on Bes

protect agencies such as the Board from

inexpert interference from a judiciary

bent on imposing its own view on the

entity recognized by Congress and the

Court as the proper forum for resolving

these issues.

The Sixth Circuit's decision

in this case presents a particularly

appropriate opportunity for this Court to

resolve what we have referred to as the

"timeframe" issue. The decision below is

an extreme example of a court using the

passage of time to reverse a bargaining

order granted by the Board. The Sixth

Circuit has not merely concluded that the

Board erred by failing to look a few

months past the election to, say, the

time of the ALJ's or Board's decision to

weigh the possible impact of the unfair

labor practices and consider the possi-

bility of a fair election within that

-34-

time period. Instead, the Court ruled

that the impact issue had to be con-

sidered in view of the more than four

years of litigation since the election.

The court gave no consideration to the

employees' long-delayed right to repre-

sentation or the benefit the court's view

bestowed on the Company as a reward for

years of litigation.

The lower court's decision

is also particularly deserving of this

Court's attention for its two startling

new concepts which will further encourge

employers to undermine illegally their

workers' chosen representatives. The

court pointed out, as a mitigating factor

in analyzing the Company's illegal

activities, that none was a "continuing

violation." This new standard, peculiar

to the Sixth Circuit, effectively

6. See also NLRB v. East Side Shopper, Inc.,

498 ¥.2d 1334 (6 Cir. 1974).

-35-

nullifies the bargaining order as a

remedy for §8(a)(1) violations such as

coercive speeches, threats, or interro-

gations. Such incidents are, by defini-

tion, not "continuing"; they may begin

and end in a matter of minutes. Yet it

is beyond dispute that such unlawful

acts may form the basis for a bargain-

ing order. In Gissel itself, a series

of §8(a)(1) violations supported the bar-

gaining order in The Sinclair Company

case. The Sixth Circuit's “continuing

violation" test simply billion no sense in

the context of evaluating the severity

of coercive activity.

A second significant departure

from accepted bargaining order juris-

prudence lies in the Court's finding that

the Company's threat to close and move

its plants was somehow dissipated by the

actual closing of the Berea plant a few

~36—

months after the election. The legality

of the actual closing did not, of course,

make the Company's pre-election threat

lawful nunc pro tunc. Nor could it

detract from the well-accepted principle

that a threat of plant closure is perhaps

the most devastating form of pre-election

coercion an employer may use to bully

workers out of support for a union.

Gissel at 611, n.31; Amalgamated Cloth.

Workers of America v. NLRB, 174 U.S. App.

D.C. 20, 527 F.2d 803 (1975), cert.

denied sub nom. Jimmy-Richard Co. v.

NLRB, 426 U.S. 907 (1976); Axton Candy

& Tobacco Co., 241 NLRB No. 163 (1979).

The Sixth Circuit in the present case in

fact acknowledged that the threat of a

plant closure "is one of the most coer-

cive actions which a company can take in

seeking to influence an election." (A7).

The fact that an actual plant closing

aFJa

followed the Company's threat was at

least as likely to reinforce, rather than

dissipate, the effect of the threat.

It is ironic that the Sixth

Circuit cited as the mitigating factor

the Company's beneficient act of find-

ing the employees at the closed plant

other jobs at no economic loss. This

reasoning by the court demonstrates a

complete misunderstanding of the field of

labor relations and the effect of employer

actions. The Board and this Court have

frequently discussed the common employer

anti-union tactic of the carrot and the

stick. The employer both threatens and

promises, takes away rights and grants

benefits at the same time. One does not

dissipate the other: rather, each act

heightens the effect of the others. The

employer shows his power over the liveli-

hood of his employees and demonstrates

~-38<

that if they avoid the union, they will

be rewarded. The remainder of the

message is that if they embrace the union

they will be punished -- perhaps by plant

closive and the permanent loss of jobs.

In the present case the Company

threatened prior to the election to close

one plant and asserted its right to close

them all. No mention was made at that

time that the employees would be found

other jobs. After the election -- which

the union lost -- the employer showed his

power by closing one plant, but rewarded

the employees and solidified his own

support by granting them other jobs with

no loss of benefits. For the Sixth

Circuit to hold that these actions

dissipate the effects of his illegal

threats is to ignore both the logic of

labor relations and an entire body of

case law.

~~,

Even if the closing were some-

how construed to have alleviated the

effects of the threat, the Sixth Circuit

would still stand alone in permitting an

employer to evade its bargaining duty by

manipulating its workers with a carrot

and stick approach. Compare E. S.

Merriman & Sons, 219 NLRB 972 (1975),

mod. sub nom. NLRB v. E. S. Merriman &

Sons, No. 75-3731, 99 LRRM 2634 (9 Cir.

1978); NLRB v. Copps Corp., 458 F.2d

1227 (7 Cir. 1972).

In the present case, the Sixth

Circuit has not only endorsed an adjudi-

cative rule that rewards an employer for

inducing lengthy litigation, but has gone

further by permitting an employer's self-

serving interruption of his unlawful con-

duct to justify relief from the Board-

ordered remedy. The Court could not ask

for a more ripe opportunity to restore

-40-

the bargaining order as an effective, pre-

dictable remedy for employer misconduct.

THE COURT IGNORED THE SUBSTANTIAL

EVIDENCE THAT THE COMPANY UNLAWFULLY

THREATENED TO ENGAGE IN BAD FAITH

BARGAINING WHICH WOULD FORCE THE

EMPLOYEES TO STRIKE

The Court of Appeals had the

duty to review the Board's findings on

the basis of the now familiar "sub-

stantial evidence" test described in

Universal Camera Corp. v. NLRB, supra.

But the "substantial evidence" test does

no more than permit the Court of Appeals

to review the record as a whole. This

Court has specifically barred the Courts

of Appeal from electing to "displace the

Board's choice between two fairly con-

flicting views, even though the court

would justifiably have made a different

choice had the matter been before it

~4]<

de novo." Id. at 488. See also NLRB v.

Walton Manufacturing Co., 369 U.S. 404,

405 (1962). Thus, where substantial

evidence supports either of two conflict-

ing inferences, a Court of Appeals

cannot substitute its choice for the

Board's. See, e.g., Local Union No.

2338, Int. Bro. of Electrical Workers v.

NLRB, 162 U.S. App. D.C. 406, 499 F.2d

542 (1974).

In the present case, the

court stood this rule on its head by its

refusal to enforce the Board's ruling

that the Company had unlawfully threa-

tened to engage in sham bargaining. The

Court not only dismissed the Board's

lengthy recitation of passages from the

September 8 speech (see pp. 13-15, supra),

but went so far as to rest its exonera-

tion of the Company on less than six

lines of what the Board characterized as

-42-

"a long, rambling discussion ...."”

None of the passages relied upon by the

Court detracts in any way from the

Board's conclusion. Indeed, the deci-

sion of the Court of Appeals rests on

less evidence than does the ruling of

the Board rejected by the Court.

The Sixth Circuit based its

decision regarding the Company's speech

on the fact that in the course of the

speech the Company stated that he would

"bargain in good faith." In so doing,

the Court closed its eyes to the fact

that in the same speech the Company had

defined bargaining "in good faith" in an

illegal and threatening way:

"That is negotiating in good

faith, because all you've got to do,

I am sure, is keep talking and keep

talking and keep saying no until

finally you all decide to go on and

step outside and stand outside the

Same stake that this union is trying

to get in, but now my employees step

out and join them and they stand out

-43-

there, outside of that stake.

fEmphasis supplied. ]

"Don't forget. You can't step

on our front lawn, and we'll put up

a few more stakes to be sure that

our own employees don't come back in

again...."(A15-Al6).

Thus, each time the Company promised to

bargain in the way it considered to be

"in good faith,” this threat was repeated.

The Sixth Circuit, rather than the Board,

ignored the context of the Company's

statements.

In ruling that the speech

violated the Act, the Board overruled

the Administrative Law Judge. The Court

of Appeals preferred the Administra-

tive Law Judge's interpretation of the

speech. In treating the issue of the

speech, the Court used the ALJ's decision

as a starting point, noting that he

quoted from the speech and considered

testimony regarding employees' percep-

tions of it. The Court never states

Seimei encima a

-44-

that the Board's ruling is unsupported by

substantial evidence, but merely chooses

to “agree with the Administrative Law

Judge . « e« e”

In Universal Camera, this Court

ruled that an Administrative Law Judge's

report on a case constitutes a part of

the record. Howeover, "[t]he signifi-

cance of his report depends, of course,

largely on the importance of credibility

in the particular case." 340 U.S. at

496. The Court of Appeals in the present

case ignored the Ninth Circuit's admoni-

tion that, "We must still start with the

finding made by the Board and accept

it if it is supported by substantial

evidence." NLRB v. Pacific Grinding

Wheel Co., Inc., 572 F.2d 1343, 1347 (9

Cir. 1928). The Court merely preferred

the ALJ's ruling even though credibility

was not at issue as far as the speech

was concerned. The ALJ simply chose to

-45-

give a contrary interpretation to a

speech, the contents of which were not

at issue. The First Circuit, like the

Ninth, has clearly ruled that courts

should give little weight to an ALJ's

opinion rejected by the Board where the

disagreement "is confined to drawing

different inferences or legal conclu-

sions as opposed to questions of fact

or credibility." NLRB v. Matouk Indus-

tries, Inc., 582 F.2d 125, 128 (1 Cir.

1978), citing cases from the District of

Columbia, Seventh and Ninth Circuits.

"([I]£ the Board can point to. evi-

dence which supports its inference,

. courts have allowed the Board's

finding to stand despite the fact

that the Administrative Law Judge

interpreted the facts contrary to

the inference drawn.” NLRB v.

Pacific Grinding Wheel Co., Inc.,

supra, at 1347. «

See also, e.g., NLRB v. Central Machine

& Tool Co., 424 F.2d 542 (10 Cir. 1970),

cert. denied 407 U.S. 910 (1972); Russell-

-46-

Newman Mfg. Co. v. NLRB, 407 F.2d 247

(& Cir. 1969).

The Court of Appeals in the

present case has thus committed two

glaring errors in reviewing the Board's

finding regarding the speech. Most

basically, it substituted its own chosen

interpretation of the speech for the

Board's even though the Court could not

point to anything in the record which

would negative the Board's inferences.

In addition, the Court usurped the

Board's role as reviewer of an Adminis-

trative Law Judge's findings by analyzing

the case as though the order of the ALJ,

rather than that of the Board were before

it. In so proceeding, the Sixth Circuit

deviated from the methodology of numerous

other courts of appeal. By these two

fundamental errors, the Court misappre-

hended the substantial evidence rule in a

way which requires correction by this

Court.

III

THE COURT OF APPEALS IMPROPERLY

THRUST ITSELF INTO THE ADMINI-

STRATIVE PROCESS BY DECLINING

TO REMAND THE CASE TO THE BOARD

The Court of Appeals sustained

all of the Board's findings regarding the

Company's violations of §8(a)(1) except

for the threat of sham bargaining. These

unfair labor practices included:

- The granting of the benefit of

arbitration of disputes;

- The granting of the benefit of

assistance in obtaining bank

loans;

- The threat to close the company's

operations;

- Interrogating and threatening

employee Steyer.

Although the Court did not disturb these

findings, it reversed the Board's rul-

ing that in the September 8 speech the

-48-

Company's president unlawfully threatened

to engage in sham bargaining.

At that point, proper defer-

ence to the Boards expertise in the field

of labor relations required that the

Court remand the case to the Board for

reconsideration of the bargaining order

remedy. In Gissel, this Court specifi-

cally held that consideration of the need

for a bargaining order should be left,

in the first instance, to the Board.

The Board entered the bargaining against

the Company on the basis of the serious-

ness of all of the unfair labor prac-

tices. The Board has never had an

7. The statement by the Court of Appeals

that "it is clear that the [Board's]

Gecision [to order the Company to

bargain] was determined to a large

extent by the finding that there had

been a threat of sham bargaining"

(A9) has no support in the record.

The Board's decision shows that no

one of the several 8(a)(1) violations

was isolated as decisive. (Al9-20).

-49-

opportunity to decide whether remedia-

tion of the remaining unfair labor

practices, including the threat to close

the plant, required a bargaining order

notwithstanding the legality of the

September 8 speech. The Court of Appeals

has deprived the Board of this oppor-

tunity by refusing to remand the case and

claiming for itself the power to deter-

mine the remedy in the first instance.

The Courts of Appeals for the

Second and Third Circuits have followed a

contrary procedure. In Hedstrom Co. v.

NLRB, 558 F.2d 1137 (3 Cir. 1977), the

Court reversed the Board's ruling concern-

ing some, but not all, of the unfair

labor practices committed by the Company.

Unlike the court below in the present

case, however, the Third Circuit did not,

on its own, reevaluate the bargaining

order in this changed legal setting.

-50-

Rather, it remanded the case to the Board

for reconsideration of the remedy.

Similarly, in NLRB v. General Stencils,

Inc., 438 F.2d 894 (2 Cir. 1971), the

Court remanded the case to the Board

after reversing the Board's findings on

some of the unfair labor practices

underlying the Board's decision.

The present case presents

this Court with the opportunity to

delineate the allocation of responsibil-

ity between administrative agencies and

reviewing courts. This Court has already

directed the Courts of Appeals not to

step in and impose their judgment on an

issue statutorily assigned to an agency

in the absence of agency action. See,

e.g., F.T.C. v. Sperry and Hutchinson

Co., 405 U.S. 233, 248-50 (1972); Securi-

ties and Exchange Com. v. Chenery Corp.,

318 U.S. 80, 88 (1943). To date, how-

-5l-

ever, this Court has not addressed the

question of administrative law raised

when a reviewing court reverses one of

several factual bases upon which an

agency bases its order.

Such reversal effectively

creates a new legal and factual setting

not previously considered by the agency.

When reviewing courts decide the new

remedy-related issues on their own,

without guidance from the agency in-

volved, they "intrude upon the domain

which Congress has exclusively entrusted

to an administrative agency." Id. The

importance of this question to all areas

of administrative law cannot be over-

stated.

CONCLUSION

The decision of the court below

radically rewrites the standards for

8 Se

issuance of a bargaining order in a

manner which will encourage employers to

commit unlawful acts which will destroy a

union's majority. The reasoning of

the Court of Appeals leads inexorably to

the conclusion that employers may violate

the Act as dramatically as they wish

prior to a representation election if

only they cease their coercive activity

after their goal, the union's defeat

in the election, is achieved. The Sixth

Circuit, like several other courts of

appeal, has squarely rejected the Board's

analysis of the factors relating to the

issuance of bargaining orders, resulting

in serious difficulties in the admini-

Stration of this Court's Gissel decision.

Eleven years having passed since the

decision in Gissel, the time is ripe to

reassert the importance of protecting

employees' rights to representation by

=5 3<

the chosen agent of their majority in the

face of unlawful behavior. The court

below sanctioned a violation of those

rights by an astonishing misreading of

its role as an appellate court, in both

its misuse of the substantial evidence

test and its failure to give the Board an

opportunity to apply its expertise on the

new state of facts found by the Court.

Respectfully submitted,

James F. Gill

230 Park Avenue

New York, New York 10017

Of counsel:

Robinson, Silverman, Pearce

Aronsohn & Berman

Michael F. O'Toole

Andrew Irving

Appendix

;

}

No. 77-1269

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

Donn Propucts, Inc. and ) On Permon for re-

AMERICAN METALS Corp. view and Cross-Ap-

Petitioners,| plication for Enforce-

v. ment of an Order of

NaTIOoNAL Lasor RELaTions Boarp, | The National Labor

Respondent.) Relations Board.

Decided and Filed January 17, 1980.

Before: Weick, Livety and Kerrn, Circuit Judges.

LrvEty, Circuit Judge. Donn Products, Inc. and a subsidiary

(collectively, the company) have petitioned for review of a

decision and order of the National Labor Relations Board

(the Board). In its decision and order, which is reported at

229 NLRB No. 9, the Board found that the company had

violated sections 8(a)(1) and 8(a)(5) of the Labor Manage-

ment Relations Act of 1947, as amended, (the Act), 29 U.S.C.

§ 151 et seq. The Board ordered the company to desist from

enumerated unfair labor practices. It further ordered that

an election which Local 450 of the United Furniture Workers

of America, AFL-CIO (the union) had lost be set aside and

that the company be required to bargain with the union, upon

request, without the necessity for a rerun election.

The organizational campaign began in March 1975, the

union claimed a majority on the basis of authorization cards

as of July 9th and the election was held on September 10,

1975. The union filed exceptions to the conduct of the elec-

tion and the Board issued an unfair labor practices complaint.

A consolidated hearing was held before an administrative law

judge in July and August 1976. In his decision filed October

18, 1976, the administrative law judge found that from the

beginning of the campaign heavy barrages of propaganda

were aimed at the employees of the company from both

sides. The employees were importuned relentlessly with

both written and spoken arguments in favor of, and in oppo-

sition to, unionization. Based upon a voluminous record the

administrative law judge found that the company had vio-

lated section 8(a)(1) of the Act, 29 U.S.C. § 158(a)(1),"

by several of its activities which took place in the period

immediately prior to the election. Acts found to be illegal

promises of benefits were the unilateral grant of binding

arbitration as the final stage of an established grievance

procedure, the announcement of a “preferred loan” plan, the

announcement of a new plant-wide bonus system, and the

promise to look into a dental insurance program. Acts found

to be coercive were a discussion by the company’s president

of the possibility of moving production from one of the plants

in the bargaining unit to another plant and closing the former,

interrogation of two employees about union activities by a

management employee, and a threat to discharge one of

these employees and to prosecute the other for distributing

union literature on company premises.

Contrary to the claim of the union, the administrative law

judge found that the company never told the employees

that if it were required to bargain with the union, it would

refuse to do so in good faith. The administrative law judge

referred to this claim as a “blunderbus [sic] assertion” based

on the “totality of [the company’s] conduct.” Considering

1 Section 8(a) (1) makes it an unfair labor practice for an employer

“to interfere with, restrain, or coerce employees in the exercise of”

their right to organize for purposes of collective

the union’s claim that a fair election would be impossible

because of the unfair labor practices of the company, the

administrative law judge found that there were no “flagrant”

or “egregious” violations of the Act and that the violations

which did occur fell within the “minor category” described

by the Supreme Court in N.L.R.B. v. Gissell Packing Co., 395

U.S. 575, 615 (1969). Concluding that the violations did

not preclude the holding of a fair election at the time of his

decision, the administrative law judge recommended entry of

a cease and desist order, but held that an affirmative order to

bargain was not warranted.

The decision of the Board affirmed the findings and decision

of the administrative law judge except with respect to the

issues of sham bargaining and remedy. The Board found

that the administrative law judge failed to consider the tran-

script of a September 8, 1975 speech of the company’s

president, which had been admitted into evidence. After

quoting selectively from ten short paragraphs of the speech,

which covers 50 pages in the appendix, the Board concluded,

“Thus, Respondent [the company] repeatedly stated that it

intended to engage only in sham bargaining and force the

employees into a position where they had to strike.” Finding

this “threat of sham bargaining” a section 8(a)(1) violation,

the Board stated that it disagreed with the finding of the

administrative law judge that the unfair labor practices “were

not serious enough to prevent the holding of another election.”

In its petition for review the company contends that the

union never established that it had a majority within the

bargaining unit. There were 288 eligible employees and the

administrative law judge found that 156 had signed authori-

zation cards. Though the company contends the evidence

relied upon to authenticate a number of the cards was not

sufficient, the record does not support its position. There

could be no disagreement as to what the clear language of

the cards authorized. Those who signed them indicated their

choice of the union as their collective bargaining representa-

tive. There was no evidence which required a finding that

employees were told the cards were just to secure an election

or that any inducements were offered which violated the rule

set forth in N.L.R.B. v. Savair Manufacturing Co., 414 U.S.

270 (1973). The finding that the union represented a ma-

jority of the employees on or about July 9, 1975 is affirmed.

The company also contends that the Board erred in finding

it guilty of any unfair labor practices. Though the evidence

on which some of the findings were based is marginal, we

conclude that each of the section 8(a)(1) violations found by

the administrative law judge and affirmed by the Board is

supported by substantial evidence. We conclude, however,

that the finding of the Board, in disagreement with the ad-

ministrative law judge, that the company threatened to

engage in sham bargaining is not supported by substantial

evidence when the entire record is considered.

It is the position of the General Counsel of the Board and

of the union, which apeared as intervenor, that the record

demonstrates conclusively that the administrative law judge

did not consider the transcript of the company president’s

speech to the employees and their spouses on September 8,

1975. This deduction is based on the fact that the adminis-

trative law judge described the evidence of sham bargaining

as “nebulous, vague, [and] indirect,” and that he referred to

witness testimony about the speech in his opinion. This argu-

ment overlooks several significant portions of the opinion of

the administrative law judge. In calling the evidence “nebu-

lous, vague, indirect” the administrative law judge was clearly

referring to union claims based on “the totality” of the record,

not on the September 8th speech alone. Among the items

included in this “totality,” the administrative law judge

specifically identified “the extended speeches to assembled

employees and the unending writings handed to each of them.”

On the other hand, in dealing with the September 8th speech,

he showed a familiarity with its content and used at least

one verbatim quotation from it. It is clear that the admin-

istrative law judge considered the transcript of the speech.

However, he also dealt with the employees’ perception of

the speech and referred to testimony from these sources.

This was a relevant consideration since it was claimed that the

speech was intended to interfere with the right of employees

to organize by telling them in advance that there would be

no good faith bargaining by the company. N.L.R.B. v. Gissell

Packing Co., supra, 395 U.S. at 619. It is interesting that

several witnesses remembered that the speaker affirmed the

company’s duty to negotiate in good faith.

In its decision the Board quoted portions of the speech

from which an intention not to bargain in good faith might be

inferred, if those statements had stood alone. However, the

decision did not quote or even mention statements which

indicated that good faith bargaining would take place if the

union won the upcoming election. In describing “what really

happens at a bargaining table,” the speaker said that the

union would start high and the company would start low. He

described the process of give and take by both parties and

then said, “So we have to hit somewhere in the middle, so

this is what you call negotiating time.” After pointing out

that “a lot of it is for show,” the president stated, “. . . there’s

tactics involved at a bargaining table. ‘I will give you this

and you take this,’ and back and forth back and forth.” The

Board decision emphasized the statements which indicate

that the company intended to engage in hard bargaining and

that an impasse might be reached, resulting in a strike.

However, when the speech is considered in its entirety, we

agree with the administrative law judge that it cannot be

considered an advance threat not to bargain in good faith

if the union should be certified.

The Supreme Court made it clear in N.L.R.B. v. Gissell

Packing Co., supra, 395 U.S. at 602, that an election remains

A-6

the preferred method of determining the choice by employees

of a pear bargaining representative. However, the Court

recognized two categories of cases where an employer m

be ordered to bargain with a union which has oo toned

representation election. Gissell, 395 U.S. at 613-15. See

Automated Business Systems v. N.L.R.B., 497 F.2d 262. 267

(6th Cir. 1974). In the present case the administrative law

judge found that the unfair labor practices committed by the

company were neither “flagrant” nor “egregious,” and were

in fact “minor.” Thus he concluded that the violations should

be placed in the third Gissell category, which will not sustain

a bargaining order. Gissell, supra, 395 U.S. at 615.

The Board treated the unfair labor practices in the present

case as properly falling in the second Gissell category. In

this category, if the union demonstrates that it had a ma-

jority “at one point,” the Board may issue a bargaining order

in cases where the unfair labor practices are not “outrageous”

or “pervasive,” but which “nonetheless still have the tendency

to undermine majority strength and impede the election

processes.” Id. at 614. In disagreeing with the conclusion

of the administrative law judge on the seriousness of the

company’s violations, the Board stated, “In our view there

is little or no likelihood that a second and fair election could

be conducted in the face of the Respondent’s far-reaching

unfair labor practices. . . .” This conclusory statement was

followed by this explanation:

Here, Respondent’s unlawful conduct began early in

the union campaign, continued through the election, and

resulted in the dissipation of the Union’s majority status.

Thus, Respondent interrogated and threatened to dis-

charge Steyer, a member of the union organizing com-

mittee, and threatened to prosecute employee Wasik for

distributing union literature in the plant. It granted

benefits to employees by instituting an arbitration pro-

cedure during the campaign and by materially assisting

employees to obtain personal bank loans. Finally, Re-

spondent made repeated threats that it would engage in

sham bargaining should the Union be selected, and

threatened economic retaliation by closing the plant in

the event the Union won the election.

We have determined that the finding with respect to sham

bargaining was not supported by substantial evidence. Only

two out of 288 employees who worked in three separate

plants were interrogated or threatened with discipline or

discharge. No one was discharged and there were no gen-

eral threats to punish employees for union activities. F urther,

there were no section 8(a)(3) violations? The effect of

the unilateral institution of arbitration, the arrangement for

assisting employees to obtain bank loans, and the promise of

a plant-wide bonus system can be eliminated from a future

election by a cease and desist order. What the Board char-

acterized as a threat of economic retaliation by closing a

plant if the union won the election would not be a factor in

a future election. Even though the union lost the election

of September 10, 1975, the company did close the plant and

it offered all employees there transfers to other nearby plants.

All the affected employees accepted the offer. The Board

found that the decision to close the plant was based on

economic factors and declined to order the company to reopen

it.

There is nothing in the record to indicate that any of the

violations are of a continuing nature. We recognize that a

threat of economic retaliation by closing a plant is one of

the most coercive actions which a company can take in

seeking to influence an election. Automated Business Systems

v. N.L.R.B., supra, 497 F.2d at 276 (Edwards, J., dissenting

in part). Nevertheless, the plant has now been closed without

harm to any employee, and it is difficult to understand how

2 Section 8(a) (3) makes it an unfair labor ce for an employer

to vray my, hey discourage membership in a r union by discrim-

ination in hire, tenure or any term or condition of employment.

A-8

this could interfere with a fair rerun election. The Board

made no findings or detailed analysis as to the residual impact

or continuing effect, or the likelihood of recurrence, of any

of the unfair labor practices. Cf. First Lakewood Associates

v. N.L.R.B., 582 F.2d 416, 423 (7th Cir. 1978); Hedstrom Co.

v. N.L.R.B., 558 F.2d 1137, 1152 (3d Cir. 1977). While we

are required to respect the special expertise of the Board,

particularly in the formulation of remedies, courts are not

required to enforce bargaining orders based on conclusory ©

Statements unsupported by sufficient facts. See N.L.R.B. v.

East Side Shopper, Inc., 498 F.2d 1334 (6th Cir. 1974); Auto-

mated Business Systems v. N.L.R.B., supra; N.L.R.B. v. Essex

Wire Corp., 496 F.2d 862 (6th Cir. 1973); N.L.R.B. v. Jamaica

Towing, Inc., 602 F.2d 1100 (2d Cir. 1979); N.L.R.B. v.

General Stencils, Inc., 438 F.2d 894 (2d Cir. 1971) and 472

F.2d 170 (2d Cir. 1972) (following remand to Board); Hed-

strom Co. v. N.L.R.B., supra; First Lakewood Associates v.

N.L.R.B., supra; N.L.R.B. v. American Cable Systems, Inc.,

27 F.2d 446 (5th Cir.), cert. denied, 400 U.S. 957 (1970).

Our study of the entire record convinces the court that

this was not a proper case for a bargaining order. There was

a hard-fought campaign, but the classic tactics of discharge

and widespread discrimination against and harassment of

union sympathizers were not present. Though we have

sustained the finding that there was a threat of plant closing,

the Board has determined that the actual closing which

followed the union’s loss of the election was for economic

reasons. The unfair labor practices which occurred were of

a kind whose effect would quickly dissipate.

If the record merely caused doubt as to the Board’s reasons

for ordering bargaining we would remand for further explica-

tion of its reasons. See Automated Business Systems v.

N.L.R.B., supra; N.L.R.B. v. General Stencils, Inc., supra, 438

F.2d 894; Hedstrom Co. v. N.L.R.B., supra. However, though

the Board gave little explanation for its decision in the

nt case, it is clear that the decision was determined to

hal extent by the finding that there had been a threat of

sham bargaining. With this violation eliminated we agree

with the administrative law judge that a bargaining order was

not justified. It has now been more than four years since

the election was held. We believe yo purposes of the Act

ill be best served by an early rerun election.

ar findings of section 8(a)(1) violations by the Board,

with the exception of the finding of a threat of sham bargain-

ing, are affirmed. The finding by the Board of a section 8(a)

(5) violation is reversed. The order of the Board is enforced

with the exception of oppress l(a), 1(d), ay gatsige

orcement of these excepted provisions of the

— The notice to employees which the Board ordered

posted will be modified to reflect the partial denial of enforce-

ment. This will require deletion of all references to bar-

gaining with the union and removal of literary paragraphs 1,

4, 12, 14 and 15 from the notice.

No costs allowed.

A-10 A-1l

9 : D-2352

wrayer Westlake , Ohio filed exceptions and a supporting brief,

| and the Respondent filed a reply to the

UNITED STATES OF AMERICA | General Counsel's and the Charging

Party's exceptions. The Charging

Party filed a brief in opposition to

the Respondent's exceptions.

Pursuant to the provisions of

Section 3(b) of the National Labor

Relations Act, as amended, the National

BEFORE THE NATIONAL LABOR RELATIONS BOARD

DONN PRODUCTS, INC. &

AMERICAN METALS CORPORATION

pig Cases

8--CA-9464 Labor Relations Board has delegated its

a and authority in this proceeding to a three-

8--RC--9998 | member panel.

LEE SE. Eee Aree The Board has considered the record

ee ee and the attached Decision in light of

the exceptions and briefs and has de-

DECISION AND ORDER cided to affirm the rulings ,* findings , >

On October 18, 1976, Administrative and conclusions* of the Administrative

Law Judge Thomas A. Ricci issued the Law Judge to the extent consistent

herewith.

attached Decision in this proceeding.

Thereafter, the General Counsel, the

Respondent, ? and the Charging Party “The Administrative Law Judge credited the

testimony of employee Gerald Waskik with respect

to Company President Brown's remark regarding

l D °

Ee a ' plant relocation. Although he admitted a trans-

subsidiary, American Met rporation, are cxtué OF thine tii labile” ha

referred to herein collectively as Respondent. no reference to it. It is however, not necessary

A-12

footmote continued

to make any modification in the Administrative

Law Judge's finding since Wasik's recounting

of Brown's remarks is substantially the same

as the transcribed account.

3The Respondent has excepted to certain

credibility findings made by the Administrative

Law Judge. It is the Board's established

policy not to overrule an Administrative

Law Judge's resolutions with respect to

credibility unless the clear preponderance

of all of the relevant evidence convinces us

that the resolutions are incorrect. Standard

Dry Wall Products, Inc, 91 NLRB 544 (1950),

enfd. 188 F. 2d 362 (C.A. 3, 1951). We have

carefully examined the record and find no basis

for reversing his findings.

“we agree with the Administrative Law Judge's

conclusion that Brown's remarks regarding plant

relocation were in violation of Sec. 8(a) (1)

of the Act. They occurred against a background

of threats, interrogations, and promises and

grants of benefits. In this context, Brown's

talk about Respondent's ability to move the

plant wherever it wanted constituted a threat

of economic reprisal in the event the Union

won the election.

A-13

1. The Administrative Law Judge

found that Respondent's president, Donald

Brown, did not announce in advance that

if the Union were certified Respondent

would not bargain in good faith.

The General Counsel and the Charging

Party have excepted, contending that the

Administrative Law Judge incorrectly

failed to consider the entire record on

this issue, particularly the transcripts

of the Union's tape recording of

speeches made by Brown at employee

meetings on September 5 and 8, 1975.

They argue that, although he properly

admitted these transcripts into evidence,

he ignored them and incorrectly sub-

sequently referred to the evidence on the

issue of bad faith bargaining as "nebu-

lous, vague, indirect." We find merit

in these exceptions.

Brown's speech on September 8 is

a long rambling discussion. On several

occasions he made statements that

Sail named months and dates refer to

1975, unless otherwise indicated.

A-14

indicate he was willing to engage in a type

of bargaining which amounts to no more

than a show. Thus Brown stated:

As I mentioned to you before,

I am not inclined to be forced to do

anything. It is a free country, I am

a free man, and I believe that I ought

to be able to do what I believe I have to

do and, that is, I'll bargain; but it's

like leading a horse to water. When he's

got his head underwater, you don't know

for sure he is drinking, but then you've

got to practically drown the horse before

he drinks enough water, before you bring

him out.

So this is how the battle starts....

ao * * + * *

The length of negotiations has

to do with how long do you hold the

horse's head under the water. Finally

he wants a drink of water and he comes

up, so he talks for a little bit, a little

while, and goes back and forth. And,

as I pointed out, a lot of it is for show.

A-15

Brown then went on to make it clear

that the employees' only hope of obtaining

an agreement was to call a strike with the

possible loss of jobs:

.(I]£ I decide I'm not going

to do something and it doesn't matter

what it is, there's no law in this

country that says I have to.

So then we start down the line: "How

far are we going to carry this out?" Well,

this is what happens---it's very simple---

we reach the point of impasse. That's

really easy to [rJeach, a point of

impasse.

You say, "Well, you got to keep

talking,'' and you've got to keep talking

and negotiating with the union or you've

got to be continuing to negotiate in

what they call good faith. I am an

expert. That is negotiating in good

faith, because all you've got to do,

I am sure, is keep talking and keep

talking and keep saying no until finally

you all decide to go on and step outside

and stand outside the same stake that

this union is trying to get in, but now

my employees step out and join them and

A-16

they stand out there, outside of that

stake. [Emphasis supplied. ]

Don't forget. You can't step

on our front lawn, and we'll put up a

few more stakes to be sure that our own

employees don't come back in again,

because when you are on strike it's

no longer your company, it's not your

company any more. You have dicided that

you are going to go somewhere else and

you won't come back to work unless you

get whatever your demand is.

Brown then told the employees in

effect that he would resist any union

proposal by asking it to take less. He

again told the employees that if they

selected the Union they would face a

long strike and the loss of benefits

they vresently enjoyed:

Well, how do you cause the company

to hurt? You try and get even with us

for not negotiating as much as you think

you would like to have and, therefore,

you go out on strike, and you step out,

pick up your signs, and there you are.

Now, it's very simple. When are you

going to come in? We'll come in when our

demands are met.'"' [Emphasis supplied. ]

A-17

"When are your demands met?"' You

know I am going to have to be the one to

meet them. So, now time goes by and the

talk behind the scenes naturally is, "I

wonder when they are going to be tired of

losing money by sitting out there and

wanting to come in, and how much do they

think they are going to get? How much

extra do they think they are going to

get?" And all these favoritisms and all

these other little things that you are

talking about, and some of them are precty

small, how long are you going to stay out

there? Well, it's your guess; it's my

guess.

Thus, Respondent repeatedly stated

that it intended to engage only in sham

bargaining and force the employees into

a position where they had to strike.

Respondent thereby conveyed to employees

the futility of choosing union repre-

sentation and presented them with only

a choice between striking and no union.

In so doing, Respondent restrained and

coerced employees in violation of

Section 8(a)(1) of the Act.’

6 Boaz Spinming Company, Inc., 177 NLRB 788(1969).

A-18

footnote continued

‘Princeton Sportswear Corporation of

Pennsylvania, 220 NLRB 1345, 3347 (1975);

St. Anne's Home, Division of De Paul

Commmity Health Center, 221 NLRB, 839, 844

(1975)

A-19

2. The Administrative Law Judge

found, and we agree, that the Union

represented a majority of Respondent's

employees when its demand for recognition

was refused on July 9. However, he found

that while Respondent's unfair Labor

practices warranted the setting aside

of the election they were not serious

enough to prevent the holding of another

election. We disagree. In our view

there is little or no likelihood that a

second and fair election could be

conducted in the face of the Respondent's

far-reaching unfair labor practices, and

a bargaining order therefore is required

to protect the employees' representational

rights.

Here, Respondent's unlawful conduct

began early in the union campaign, con-

tinued through the election, and resulted

in the dissipation of the Union's majority

status. Thus, Respondent interrogated

and threatened to discharge Steyer, a

member of the union organizing committee,

and threatened to prosecute employee Wasik

for distributing union literature in the

plant. It granted benefits to employees

A- 20

by instituting an arbitration procedure

during the campaign and by materially

assisting employees to obtain personal

bank loans. Finally, Respondent

made repeated threats that it would

engage in sham bargaining should the

Union be selected, and threatened

economic retaliation by closing the

plant in the event the Union won the

election.

These unfair labor practices,

directly affecting all of Respondent's

employees, were intended to, and did in

fact, undermine the Union's majority

strength. In these circumstances,

we find that''employee sentiment, once

expressed through cards, would, on

balance, be better protected by a bar-

gaining order ."8

Having determined that the Union

represented the majority of the employees

in the appropriate unit, we find that

Respondent violated Section 8(a)(}) and

(1) of the Act by refusing the Union's

Oy LLR.B. v. Gissel Packing Co., Inc., 395

U.S. 575 (1969).

A-21

demand for recognition. We further find

that Respondent is required to presently

bargain, upon request, concerning any

terms and conditions of employment, as

to which it would have been required to

bargain had the Union been recognized

on July 9, 1975, the date on which the

Union demanded and was refused recogni-

tion. We need not require bargaining as

to anything prior to July 9, 1975, since

all of the violations committed prior to

that date are otherwise remedied.

3. Inasmuch as the Union has been

the exclusive representative of the

employees in the appropriate unit since

July 9, we find that Respondent violated

Section 8(a)(5) and (1) of the Act by

incorporating the arbitration procedures

into an employee manual distributed in

August. We shall order Respondent to

return to the status quo ante by rescind-

ing the arbitration procedure. We also

find that Respondent violated Section

"trading Port, Inc., 219 NLRB 298 (1975).

Chairman Fanning, in accordance with his con-

curring opinion in Trading Port, finds that

the obligation to bargain arose on the date of

demand, July 9, 1975.

A-22

8(a)(5) and (1) of the Act by materially

assisting employees to obtain personal

bank loans. We further find Respondent

violated Section 8(a)(5) and (1) of the

Act by unilaterally transferring the

work at its Berea, Ohio, plant to the

plants in Westlake and Medina, Ohio,

in December, without bargaining with the

Union as to the decision to transfer and

its effects on the employees represented

by the Union. While we now order Res-

pondent to bargain with the Union over

the decision to transfer and its effects,

we find it ummecessary to order that

Respondent reestablish the Berea plant

inasmuch as the decision to transfer

was based on economic factors, all the

36 employees involved accepted transfers

to Respondent's other plants, and it

would place an undue burden on Respondent

+0 We also find

it unnecessary to award a backpay remedy,

to reopen the Berea plant.

since the employees at the Berea plant

1Q¢. Burroughs Corporation, 214 NLRB 571 (1974).

A-23

have accepted transfers to Respondent's

other locations without financial loss,

and the Union has retained its bargain-

ing strength by continuing to represent

the employees at the Westlake plant. ?+

ORDER

Pursuant to Section 10(c) of the

National Labor Relations Act, as amended,

the National Labor Relations Board here-

by orders that the Respondent, Donn

Products, Inc. & American Metals Corpor-

ation, Westlake, Ohio, their officers,

agents, successors, and assigns, shall:

1. Cease and desist from:

(a) Failing and refusing to bar-

gain collectively in good faith with

United Furniture Workers Local 450,

United Furniture Workers of America,

AFL-CIO, hereinafter the Union, as the

exclusive representative of its em-

ployees in the appropriate unit set

forth herein below concerning the

decision to close the Donn Products, Inc.,

Ilc¢ Mobil Oil Corporation, 219 NLRB 511

(1975); Interstate Tool Co., Inc. 177 NLRB

686 (1969).

A-24

plant at Berea, Ohio, and the effects

of the discontinuance of the plant on

such employees. The appropriate unit is:

All production and maintenance en-

ployees, including shipping and receiv-

ing employees, plant janitor, the

paint technician, the chief inspector,

assistant foremen, leadmen and proba-

tionary or production trainee employees

of the Respondent at its two facilities

in the Cleveland area, namely, Donn

Products, Inc. and American Metals

Corporation, 1000 Crocker Road, West-

lake, Ohio, excluding office clerical

employees, technical employees, en-

gineers and draftsmen, production clerk,

foremen, and all professional employees,

guards and supervisors as defined in

the Act.

(b) Unilaterally, without prior

notice to or consultation with the Union,

instituting a binding arbitration pro-

cedure.

notice to or consultation with the Union,

establishing a system of materially

A-25

assisting employees to obtain personal

bank loans.

(d) Refusing to bargain collect-

ively with the Union as the exclusive

bargaining representative of the em-

ployees in the appropriate unit.

(e) Granting its employees a bind-

ing arbitration procedure in order to

dissuade them from prounion activities,

establishing an unprecedented system of

materially assisting employees to obtain

personal bank loans, threatening to move

its business to other locations,

interrogating employees about their

union activities and about the union

activities of other employees, threaten-

ing to discharge employees and to

prosecute them because of their union

activities, telling employees they

would be disciplined more harshly be-

cause of their union activities, promis-

ing employees an improved bonus

system to induce them to abandon the

Union, or threatening to bargain in

bad faith.

A-26

(£) In any other manner interfering

with, restraining, or coercing employees

in the exercise of the right to self-

organization, to form, join, or assist

the Union, or any other labor organiza-

tion, to bargain collectively through

representatives of their own choosing,

and to engage in other concerted activi-

ties for the purpose of collective

bargaining or other mutual aid or pro-

tection, or to refrain from any and all

such activities.

2. Take the following affirmative

action necessary to effectuate the

policies of the Act:

(a) Upon request, recognize and

bargain with the Union as the exclusive

representative of all employees in the

appropriate unit with respect to rates

of pay, wages, hours, and other terms

and conditions of employment, and, if

an understanding is reached, embody

it in a written signed agreement.

(b) Upon request, bargain in good

faith with the Union with respect to the

decision to transfer all the work from

the Respondent's plant at Berea, Ohio,

A-27

to the Respondent's plant at Medina, Ohio,

and the effects of the decision on unit

employees, and, if an understanding

is reached, embody it in a written

signed agreement.

provisions which were formally incor-

porated into Respondent's employee

manual distributed in August 1975.

(d) Post at its places of business

in Westlake and Medina, Ohio, copies

of the attached notice marked "Appen-

ui2 Copies of said notice, on forms

dix.

provided by the Regional Director for

Region 8, after being duly signed by

Respondent's representative, shall be

posted by the Respondent immediately

127, the event that this Order is enforced by

a Judgment of a United States Court of Appeals,

the words in the.notice reading ''POSTED BY ORDER

OF THE NATIONAL LABOR RELATIONS BOARD’ shall

read "POSTED PURSUANT TO A JUDGMENT OF THE

UNITED STATES COURT OF APPEALS ENFORCING AN

ORDER OF THE NATIONAL LABOR RELATIONS BOARD."

A-28

upon receipt thereof, and be maintained

by it for 60 consecutive days thereafter,

in conspicuous places, including all

places where notices to employees are

customarily posted. Reasonable steps

shall be taken by it to insure that said

notices are not altered, defaced, or

covered by any other material.

(e) Notify the Regional Director

for Region 8, in writing, within 20

days from the date of this Order, what

steps the Respondent has taken to comply

herewith.

IT IS FURTHER ORDERED that the

election in Case 8-RC-9998 be, and the

same hereby is, set aside, and the

petition filed in Case 8-RC-9998 be, and

the same hereby is, dismissed.

Dated: Washington, D.C. April 20, 1977

John H. Fanning, Chairman

John A. Penello, Member

Betty Southard Murphy,

Member

(SEAL) NATIONAL LABOR RELATIONS BOARD

A-29

APPENDIX

NOTICE TO EMPLOYEES

Posted by Order of the

National Labor Relations Board

An Agency of the United States Government

WE WILL NOT fail or refuse to

bargain collectively in good faith with

United Furniture Workers Local 450,

United Furniture Workers of America,

AFL-CIO, as the exclusive representative

of our employees in the appropriate unit

set forth below concerning the effect

of the decision to close the Donn

Products, Inc., plant at Berea, Ohio,

and the effects of the discontinuance

of the plant on such employees. The

appropriate unit is:

All production and maintenance

employees, including shipping and

receiving employees, plant janitor,

the paint technician, the chief

inspector, assistant foremen, lead-

men and probationary or production

trainee employees of the Respondent

at its two facilities in the

A- 30

Cleveland area, namely, Donn Products,

Inc. and American Metals Corporation,

1000 Crocker Road, Westlake,

Ohio, excluding office clerical

employees, technical employees,

engineers and draftsmen, production

clerk, foremen, and all profession-

al employees, guards and supervisors

as defined in the Act.

WE WILL NOT unilaterally, without

prior notice to or consultation with the

Union, institute a binding arbitration

agreement. ;

WE WILL NOT unilaterally, without

prior notice to or consultation with the

Union, establish a system of materially

assisting employees to obtain bank loans.

WE WILL NOT refuse to bargain

collectively with United Furniture

Workers Local 450, United Furniture

Workers of America, AFL-CIO, as the

exclusive bargaining representative

of the employees in the unit described

above.

WE WILL NOT grant our employees

a binding arbitration agreement in order

A-31

to dissuade them from prounion activities.

WE WILL NOT establish an unprece-

dented system of materially assisting

our employees to obtain personal bank

loans to curb their union activities.

WE WILL NOT threaten to move our

plant to other locations to discourage

union activities.

WE WILL NOT interrogate our em-

ployees about their union activities or

about the union activities of other

employees.

WE WILL NOT threaten to discharge

employees or to prosecute them because

of their union activities.

WE WILL NOT tell our employees

that they will be disciplined more

harshly in the future because of their

union activities.

WE WILL NOT promise an improved

bonus system to induce our employees

to abandon the Union.

WE WILL NOT threaten to bargain

in bad faith.

WE WILL NOT in any other manner

interfere with, restrain, or coerce

our employees in the exercise of their

A-32

right to self-organization, to join or

assist United Furniture Workers Local 450,

United Furniture Workers of America, AFL-

CIO, or any other labor organization, or

to engage in cther concerted activities

for the purpose of collective bargaining

or other mutual aid or protection or

to refrain from any and all such activi-

ties.

WE WILL, upon request, recognize

and bargain with the United Furniture

Workers Local 450, United Furniture

Workers of America, AFL-CIO, as the

exclusive representative of the

employees in the appropriate wnit with

respect to rates of pay, wages, hours,

and other terms and conditions of enm-

ployment and, if an understanding is

reached, embody it in a written signed

agreement.

WE WILL, upon request, bargain

collectively in good faith with United

Furniture Workers Local 450, United

Furniture Workers of America, AFL-CIO,

as the exclusive representative of our

employees in the appropriate unit con-

cerning the decision to close the Donn

A-33

Products, Inc., plant in Berea, Ohio,

and the effects of the decision on unit

employees, and, if an understanding is

reached, embody it in a written signed

agreement.

WE WILL rescind the arbitration

provision which were formally incor-

porated into our employee manual dis-

tributed in August 1975.

DONN PRODUCTS, INC. &

AMERICAN METALS CORPOR-

ATION

(Emp Loyer)

Dated

(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

compliance with its provisions may be

A-34

directed to the Board's Office, Suite

1695, Anthony J. Celebrezze Federal

Building, 1240 East Ninth Street,

Cleveland. Ohio 44199, Telephone

216-522-3126. i”

A-35

JD-672-76

Westlake, OH

UNITED STATES OF AMERICA

BEFORE THE NATIONAL LABOR RELATIONS BOARD

DIVISION OF JUDGES

DONN PRODUCTS, INC. &

AMERICAN METALS CORPORATION

wens Cases 8-CA-9464

UNITED FURNITURE 8-RC-9998

WORKERS LOCAL 450,

UNITED FURNITURE WORKERS OF

AMERICA, AFL-CIO

Charles Z. Adamson, Esq.,

and John S. Chindlund, Esq.,

for the General Counsel.

Peter O'Connell, Esq., of

Robinson, Silverman, Pearce,

Aronsohn, Sand & Berman, of

New York City, NY, for the

Charging Party.

Thomas J. McDermott, Esq., and

Joseph F. Ruggie, Jr., Esq.,

of Thompson, Hine & Flory, of

Cleveland, OH, for the

Respondent.

A- 36

DECISION

Statement of the Case

THOMAS A. RICCI, A.L.J.: A hearing

in this consolidated proceeding was held

at Cleveland, Ohio, on July 12 and 13,

and on August 16 and 17, 1976. The

complaint in Case 8-CA-9464 issued on

May 4, 1976, against Donn Products, Inc.

& American Metals Corporation, here

together called the Respondent, on a

charge filed on September 18, 1976, by

United Furniture Workers Local 450,

United Furniture Workers of America,

AFL-CIO, here called the Union. In

Case 8-RC-9998 a Board-conducted election

was held on September 10, 1975; the

Union filed objections to conduct

allegedly affecting the results of the

election. The Regional Director direct-

ed a hearing on the objections, and the

two cases were then consolidated for

single hearing. The issues presented

are: (1) Whether the Company inter-

fered with the election, which the Union

lost, so that the results must be set

A-37

aside and a new election held; (2)

whether the Respondent restrained and

coerced the employees in violation of

Section 8(a)(1) of the Act; and (3)

whether such unfair labor practices were

so aggravated and pervasive that the

Respondent must be ordered now to bar-

gain with the Union without any other

election being held. Briefs were filed

only by the Charging Party and the

Respondent.

Upon the entire record and from

my observation of the witnesses, I make

the following:

Findings of Fact

I. The Business of the Company

Donn Products, Inc., and its wholly-

owned subsidiary called American Metals

Corporation, are engaged in the pro-

cessing and production of ceiling and

partition systems, with their principal

place of business in Westlake, Ohio.

Annually the two companies, together here

constituting the Respondent, shipped

products valued in excess of $50,000

directly to points outside the State of

A- 38

Ohio. I find that Respondent is engaged

in commerce within the meaning of the

Act.

II. The Labor Organization Involved

I find that United Furniture Workers

Local 450, United Furniture Workers of

America, AFL-CIO,is a labor organization

within the meaning of Section 2(5) of

the Act.

III. The Unfair Labor Practices

A Picture of the Case

The Union started an organizational

drive among the Respondent's employees in

about March 1975, and in August it filed

a petition with the Board requesting an

election. The Respondent consented to an

election and it was held on September 10,

the Union losing by a vote of 148 to 115.

The Union then filed formal objections

to the election and a charge accusing the

Company of unfair labor practices,

including unlawful refusal to bargain on

request. The activities of the Res-

pondent's agents said to have constituted

both interferences warranting setting the

election aside and violations of the

A-39

statute are virtually the same. For this

reason, and because he felt there was

merit in the unfair labor practice charge,

the Regional Director ordered a hearing

on the objections and issued a complaint,

and then consolidated the two proceedings.

From the start of the Union's cam-

paign and continuing to the date of the

election, there was a barrage of pro-

poganda, both written and oral, poured

upon the employees by both the Union and

the Company. Leaflets of all sorts were

distributed, by union agents and an

employee organizing committee on the

one hand, and by management representa-

tives on the other. The Union held many

employee meetings and the Company did the

same. And of course, as always, the

Union kept telling the employees why they

should select the Union as their bargain-

ing agent, and the Company advanced one

argument after another why they should

vote against union representation. No

charge is made that the Union violated

the law in anything it told the employees

in its campaign activities; the case is

solely against the Company. Did any of

— A=40

the things it said to the employees--in

writing or in speeches-- exceed the limits

of that freedom of speech spelled out in

Section 10(c) of the statute? Did it pro-

mise any improvements in conditions of

employment, or threaten to take away any

existing benefits, in order to improperly

influence the employees' votes? If so,

were such promises and/or threats such

as to violate Section 8(a)(1) of the Act?

If the Company's propaganda fell short of

illegal conduct, was it nevertheless such

as to amount to interference with the

election?

The complaint also alleges that on

July 9, 1975, the Union demanded recog-

nition as exclusive bargaining agent in an

appropraite unit, which is precisely spell-

ed out in the complaint. The answer ad-

mits the appropriateness of the bargain-

ing unit there described, and admits

the fact of refusal to bargain. The

parties stipulated that there were, at

the critical time of such demand and

refusal, 287 rank-and-file employees in

the unit. The General Counsel placed

into evidence 156 regular authorization

A-41

cards, all signed by employees within the

unit before the day of refusal to bar-

gain. There is an attack by the Res-

pondent upon the validity of these cards.

But assuming, for the moment, that the

cards are valid, at least enough of them

to establish majority status in the

Union, the question is then presented

whether what violations of Section

8(a)(1) were committed were sufficiently

"flagrant,'' or outrageous as to justify

an affirmative bargaining order in

remedy. See, N.L.R.B. v. Gissel Packing

Co. , Jee 0.8. S75,

Violations of Section 8(a) (1)

There is testimony by employees about

two major meetings of employees held by

the Company shortly before the election,

one on about September 5 and another on

September 8, 2 days before the balloting.

Principal spokesmen for the Company were

Donald Brown, president, and Francis Mar-

tin, manufacturing manager. The second

meeting was a dinner party, of the kind

the Company holds annually, but this time

the wives of the employees were for the

first time also invited. Brown and Martin

A-42

spoke at length, and the employee wit-

nesses repeated what they remembered

hearing, very often of necessity para-

phrasing what they had heard. The Gen-

eral Counsel placed into evidence about

10 leaflets -- some distributed by the

Company throughout the plant and some

mailed to the homes of the employees

individually. The Charging Party then

added to the record exhibits about 17

more pieces of campaign literature given

out by the Company, again to each and

every employee, almost 300 persons. The

Union had to be given greater latitude

in offering its evidence because an em-

ployer may very well do things before

an election which may sustain objections

to the election but fall short of amount-

ing to unfair labor practices.

The end result of all of this is that

the record as a whole is a massive con-

glomeration of repetitive vituperation

by the Company, maligning criticism of

the Union, its agents, its representatives

and its methods. Many of the Company's

attacks upon the Union, and assertions of

why it would be against the interests of

A-43

the employees to join, are belabored

again and again without limit. Ina

sense, there is an implied suggestion

in this case that careful analysis of

each and every phrase uttered, or written

by management, will reveal prohibited

coercion and restraint -- a sort of

argument that if one will look carefully

maybe unfair labor practices can be

found. I do not think the scheme of the

statute calls for such a search by the

Hearing Examiner to unearth proof of

misconduct by such a technique. I think,

rather, given the massive quantity of the

evidence as a whole, that a proper pro-

cedure would be to consider those com-

plaint allegations which specify with

some precision what it is about the

Respondent's activities that is now to

be faulted. I can only consider the

contentions actually advanced and

evaluate them in the light of the proof.

l. To start with, can it be said

that when an employer bombards the

employees with too many leaflets, too

many letters, criticizing the Union and

urging the employees against collective

bargaining, the fact of such massive cam-

paign of itself removes its activities

from the realm of permissible expression

of opinion and places them in the pro-

hibited category instead? Maybe so, but,

as will appear below, that question need

not be answered in this case.

2. A number of times throughout its

literature, the Company referred to the

unioneers as "defectors," "disloyal,"

"con-men, con-artists,'' and even "sons

of bitches.'' The unioneers were called

"rabblerousers.'' More than once the

Union is called a "parasite union."' The

argument is made, more by the Union than

by the General Counsel, that the mere use

of such offensive and divisive words is

a form of coercion, and therefore an

unfair labor practice. But the question

is not whether one or the other of

the contestants in a Board election

behaves nicely, politely, as though it

were all a "tea party," to use an

ancient phrase. Ome need not act res-

trained in voicing a contrary opinion in

the area of industrial relations; indeed

one seldom does. Moreover, it has long

been held by now that the American worker

A-45

is sufficiently sophisticated to pay

little attention to inflammatory words.

He does not hesitate to use them himself

on the picket line.

3. In a June 17 letter to all

employees President Brown wrote that

whatever the Union was offering them

they could as well receive directly from

the Company. Adding that the Union might

offer to obtain arbitration for the em-

ployees, he then said he had investigated

the possibility himself, through the

American Arbitration Association, that

he had finalized arrangements with that

group, and that thenceforth whenever "a

dispute arises which can not be settled

with the Company . .'' it would be dis-

posed of through arbitration. The

Respondent then formally incorporated the

new arrangement with the employees in a

revised employee manual distributed in

August, the month proceeding the election.

By thus surrendering a part of its uni-

lateral authority over the employees'

conditions of employment, the Respondent

gave them a direct benefit they had not

previously enjoyed. That Brown, the

president, did this for the express

A-46

purpose of curbing the employees' pro-

union resolve is conceded. I find that

by granting this binding arbitration

arrangement to the employees, the

Respondent violated Section 8(a)(1) of

the Act. Cf. N.L.R.B. v. Exchange

Parts, 375 US 405.

4. Another widely distributed

Company circular, also passed out in

August, announced that in order to

provide "a little extra cash" for the

employees, the Company had “arranged for

a preferred loan plan with National Cit»

Bank.'' The brochure then advised "if

you need the money now, just call our

personnel dept. and Mrs. Fouts will

arrange for your loan."

A number of employees did obtain

loans. At the hearing Martin, the plant

manager, said that the invitation for

employees to go to the personnel depart-

ment meant only that Mrs. Fouts would

then tell the employees the name of the

bank officer to ask for when he went

to the bank to apply for the loan.

Martin also added the Company had

A-47

arranged with the bank for the borrower

to repay the loan by payroll deductions,

courtesy of the Respondent, which in

fact the Company has been doing.

There is no other evidence in the

record on this subject. If Martin told

the truth, the announcement of a "pre-

ferred loan,"' and that "Mrs. Fouts

would arrange for your loan," was a fraud

upon the employees. More likely what

it all meant was that the Company gave

assurance to the bank that there would

be payroll deductions -- in all probabil-

ity arranged in advance with the borrow-

er's signature, a form of assistance to

the employee in obtaining money when he

needed it. It was a clear benefit con-

ferred, again clearly to buy the good-

will of the employees against their pro-

union resolve. I find that by such

announcement and the arrangement, the

Respondent violated Section 8(a)(1) of

the Act.

5. A precise allegation in the

complaint is that at the September 8

dinner meeting, where President Martin

A-48

spoke at length on why the Union should

be rejected 2 days later, he announced

that the employees ‘'could form a committee

for the purpose or solving problems as

to food vending machines in the plant."

The only evidence on this point is

agreement by Brown, at the hearing, with

the following leading question put to

him by the General Counsel: "Q. You

said something to the effect, ‘One of

the things we can do is form a small

committee of you fellows at the shop,

because it is your money and your food,

and I really don't care.'" "A. Exact-

ly.

came about the record is silent. If

On whether any such committee ever

this suggestion by Brown was tantamount

to an unfair labor practice, it was a

weak one indeed.

6. In late August, the Respondent

distributed to all the employees a 14

page printed document replete with ex-

tended statements detailing the nature

of collective bargaining, the duties and

prerogatives of the employer when dealing

with a union, the Company's past methods

of treating the employees, its plans for

i ————

A-49

the future, and, in general, explaining,

once again, why the employees would be

better off without the Union. Among

the messages thus conveyed there was one

saying clearly that in place of the

present system of "plant wide" bonuses,

the Company was preparing, and hoped to

put in effect "in the near future," a

production bonus, or an operator's

bonus, which would be more advantageous

to the employees. At the hearing

Manager Martin explained away this

critically timed statement to the

employees so shortly before the election

as no more than reference to a long

standing idea of the Respondent, and

added, without contradiction, that up

to the day of the hearing nothing had

been done about the proposal, no new

system of any kind had been devised or

put in effect.

I agree with the complaint allegation

that by thus promising the employees an

added benefit in their employment --

regardless of whether it was ever granted--

in the middle of its antiunion campaign--

privileged as it may have been, the

A-50

Respondent violated Section 8(a)(1) still

again. A comparable promise, also a viola-

tion of the statute, was voiced by Presi-

dent Brown on September 8, about dental

insurance to the employees, when, among

much more, he said "the dental program

is something we should be looking at

as time goes by, because it is going

to get to the point where it is within

the realm of possibility."

7. Another act of the Respondent,

called illegal in the complaint, is that

in December of 1975 it closed its Berea

plant and moved the employees from there

to its other two locations. Prior to

that day the Company operated in three

locations--Berea, Westlake, and Medina,

and the employees of all three were

included in the organizational campaign

and together, as all parties agreed,

constituted the appropriate unit. The

complaint says the Respondent violated

the Act when it closed the Berea location

because it did so unilaterally, without

first bargaining with the Union about the

move, This means that before it can be

cound that the Act was violated in this

A-51

respect, it must be found that the Company

was obligated to bargain in December not-

withstanding the results of the election--

adverse to the Union. There is no alle-

gation the move constituted restraint and

coercion per se. On this point Gerald

Wasik, an employee, testified that during

a speech to the Berea location employees

before the election President Brown said

"he could take the company and move it any-

where he pleases at any time," "he could

just take off and move the company any-

where he chooses at any time." Brown

did not contradict this testimony. But

Martin, the manager of manufacturing,

who was also present at the September 5

meeting, quoted Brown as saying there

was a possibility the Berea plant might

have to be closed and its operations

moved to Medina for economic reasons, as

there were insufficient orders for work

there and the place was too expensive to

continue. And when the Berea plant was

closed, in December, all its employees--

about 36--were offered transfer to the

other locations and all accepted. No

one was hurt economically by the move.

A-52

Economically justified as the move may

have been, and there is no basis for

questioning that explanation by Martin,

there was no reason for the president to

have talked about the possibility in terms

that would of necessity tend to intimidate

the employees just 5 days before the

balloting. I credit Wasik's version of

Brown's words, and I find that the presi-

dent chose to speak of the projected move

in such a way as to give the employees to

understand that the Company would exercise

its managerial prerogative to their dis-

advantage. The talk Brown was giving

that day was essentially for the purpose

of persuading the employees to vote

against the Union. It was not the right

moment to promise plant closure on any

basis. I find Brown violated Section

8(a)(1) of the Act by what was in effect

a threat of reprisal.

8. Dale Steyer, a member of the

employee organizing committee, testified

that one day early in the campaign Martin

called him into the office to ask was it

true he had passed out union literature

A-53

"specifically part of the Heartley Act."

When he answered yes, Martin asked did he

know "it is against the law."' Martin

closed with saying "as long as you

admit it [passing out union literature],

I want to make it perfectly clear to you

that if you are to ever do it again that

you can be fired." Steyer's final

statement as a witness was that he knew,

when Martin thus talked to him, the

supervisor was talking about distri-

bution of union literature on Company

time.

Wasik also recalled a talk with

Martin in May or June about union

activities: "he told me that he did not

care about any union affiliation, but

if he caught me doing anything outside

the law, he would prosecute me to the

fullest extent of the law.'' The wit-

ness's earlier affidavit states Martin's

admonition to him somewhat differently.

" . . he told me that he didn't care

what my views were regarding a union

and what activity I engaged in regarding

the union as long as it was legal, but

that if I engaged in any illegal activity,

A-54

he would prosecute me to the full extent

of the law."

I find that by interrogating Steyer

about his union activity and by threaten-

ing to discharge Steyer and to prosecute

Wasik for distributing union literature

in the plant, Martin violated Section

8(a)(1) of the Act. There was no rule

in effect at the time regulating union

solicitation or distribution on the

Company premises, and, as Steyer testi-

fied, without contradiction, there had

never been any such rule during prior

organizational campaigns. When an

employer voices direct threats of dis-

charge for union activity in the plant,

vague and oblique references to "the law,"

or to "Taft-Heartley,'' will not serve to

remove the outright intimation from the

area of prohibited restraint and coer-

cion. If an employer wishes to reserve

working time for work, as is its right,

it must do so clearly, without equivo-

cation or ambiguity. Hyland Machine Co.,

210 NLRB 1063. Here, not only was there

no understandable rule announced in

advance of the union activities, but the

A-55

manager took no pains to assure the em-

ployees of their protected rights.

9. Twice in August, when Steyer

was in the office of Allen, the pro-

duction manager superintendent, Allen

started talking of the Union with the

employee. According to Steyer, the

first time "He asked me, 'I understand

there wasn't too many people showed up

at the meeting. How was the turnout

last night?'" Steyer answered "I would

like to terminate that part of the con-

versation." Allen continued neverthe-

less as follows: ‘Not too many guys

showed up . . . Was it the same old

crowd?"' A week later: . he made

reference to the union again, and that

I was becoming pretty heavily involved

in the union campaign. I said, ‘Well,

by now, that's pretty common knowledge.

I am on the Organizing Committee.'

He said, ‘Well, you know, people in

the front office are making remarks

people around here have long memories,

and if you people should happen to lose,

then .. . ina year, they have long

memories ... everybody breaks rules

A-56

now and then, and for the most part, if

they are not serious violations, they

will let it go .. . Perhaps in your

case they may not let it fly by.'"

Allen's story is that it was Steyer

who always started talking union be-

cause he was worried about how "secure"’

his position was, about possible ‘re-

prisals" by the Company against a mem-

ber of the employee organizing committee.

At one point the superintendent said it

was always Steyer who brought up the

subject of the Union in their talks. But

he also said the employee came in "'

peatedly after anytime we would have

one of our handouts, a meeting in which

his name was named, he would come in

."" It then became clear that what

the witness was saying was that Steyer

re-

has been discussed by management in its

meetings always just before the Union was

discussed between the two in private

conversation.

Q. You did mention something that

Dale [Steyer] would come in

whenever his name would come

up in a meeting?

A-57

A. That's true.

Q. That his name was used in

meetings by the Company then?

A. Not so much his name as the

group of organizers in the

plant.

Their names came up quite a bit?

It was a general kind of thing,

perhaps not specifically named

but addressed to the organizing

committee in the plant.

If the superintendent talked of

the Union with Steyer after the employee's

name had been discussed in the inner-

councils of management, it follows it

had to be Allen who started the talk.

How else could Steyer know that he had

been the subject of comment by his super-

visors in conference? With this, plus

Allen's general demeanor at the hearing,

I credit Steyer and I find that Allen

interrogated him about the union activi-

ties of other employees and threatened him

with possible sterner discipline in the

A-58

future if he persisted in his activities

with the organizing committee. By such

conduct of Allen the Respondent again

violated Section 8(a)(1) of the Act.

10. A final complaint allegation is

a blunderbus assertion that by the

totality of its conduct -- including the

extended speeches to assembled employees

and unending writings handed to each of

them -- the Respondent made them under-

stand that if ever it were faced with the

legal duty to bargain with the Union it

would simply refuse to do so in good

faith, that it would arbitrarily frus-

trate the entire collective bargaining

process -- Section 8(a)(5) or no

Section 8(a)(5). On this score the

evidence is nebulous, vague, indirect,

and the oral testimony of employees

more argument than clear statement of

fact. Again and again they spoke of

what management agents said "in effect,"

gave their understanding of what they

were being told in words without end, and

simply responded to conclusionary leading

questions. On the very lengthy testimony

and voluminous documents here received,

A-59

this question is comparable to the fre-

quent issue of whether an employer bar-

gains hard or in bad faith.

Brown did say '' you can lead a horse

to water, but you couldn't make him

drink." ". . . you could force the horse

to drink, but at times you almost drown

the horse before he will take a drink of

water.'' He also spoke of what happens

when unions strike, and how the Res-

pondent would prepare to defend. econom-

ically against such pressure, dramati-

cally explaining how employees suffer in

such cases. A critical phrase, quoted

by the employees a number of times, was

that the bargaining would start "from

scratch."' At the start the witnesses made

ever effort to convey the thought that

what the president was saying was that

his first position in possible negotia-

tions would be that the employees work

for nothing, receive no benefits at all

for their work, but would only get

anything if the horse were forced to

drink. It then became clear that the

managers told the employees both in

writing and orally that whatever wages

or other benefits they were then enjoying

A-60

would in no event be lost, and only that

raises or other new benefits would have to

be extracted with difficulty.from the em-

ployer. This one aspect of the general

charge of "bad faith promised" illustrates

much of the testimony.

After carefully considering all the

record, I do not think a factual finding

is warranted that the Respondent did

announce in advance that if the Union

were certified it would violate the Act

by not bargaining in good faith. In

fact, the witnesses even admitted that at

times Brown said exactly those words:

that he would bargain "in good faith."

Refusal to Bargain: Affirmative

Bargaining Order?

In the light of the unlawful res-

traint and coercion type of unfair labor

practices committed by management before

the election, it is clear there is merit

to the Union's exceptions and that the

results of the election must be set aside.

If the Union desires a new election must

be held when the Regional Director deems

proper.

A-61

But the real, substantive question

in this case is whether the unfair Labor

practices committed were of such a

character that it must be held they now

"preclude the holding of a fair election"'

Restated, the question becomes whether it

can reasonably be expected that the

Board's usual remedial order -- posting

of notices and a cease and desist order

directed to the Respondent -- will serve

to dissipate the intimidating and co-

ercive effect of the past improper con-

duct by management representatives. It is

an area of Board law where no single prior

decision of the Board can be determinative

precedent for a following one because no

two sitatuions are ever truly parallel.

No one was actually hurt or prejudiced in

his employment despite the unending talk

carried on by the Respondent. There was

no violation of Section 8(a)(3) of the

Act; indeed none is alleged. The move of

the Berea employees to Medina was not

illegally motivated; it was caused by

economic necessity, and concession on

this point by the General Counsel logically

means the employees were equally aware of

A-62

such objective reality. And what benefits

were promised were more illusory than real.

Brown spoke of one day establishing a

better production bonus system, but

nothing was ever done about that. The

right to arbitration over employee con-

plaints is a thing of value, and interro-

gation is a form of coercion. But if,

as the Supreme Court said in U.S. v.

Gissel, supra, unfair labor practices

are to be classed into minor and major

categories, surely the ones committed

here must fall into the lesser class,

those which may not be called "flagrant,"

or "egregious."' After careful considera-

tion of all the factors relevant here to

this basic issue, I conclude that an

affirmative order to bargain in remedy

is not warranted.

Were is necessary to decide, I would

find that the Union in fact had been

authorized to bargain on their benefit

by a majority of the employees in the

appropriate bargaining unit on July 9,

1975, when, as the complaint alleges and

as the Respondent admits, there occurred

the demand and refusal. The parties

A-63

stipulated that there were that day 287

employees at work; an exhibit listing the

names was placed in evidence. To this

number must be added Michael Kalus, be-

cause the parties also agreed his "ter-

mination date" was July 9.

There were received into evidence

156 regular authorization cards, all

dated on or before July 9, 1975, all

alike, and all in unambiguous language

authorizing the Union to bargain forth-

with on behalf of the individual en-

ployees who signed them. The cards all

read as follows:

United Furniture Workers of America

Local 450, AFL-CIO

I hereby request and accept mem-

bership in the above-named Union, and of

my own free will authorize it, its

agents or representatives to act for me

as collective bargaining agency in all

matters pertaining to pay rates, wages,

hours of employment and other conditions

of employment.

A-64

Of thes~ cards, 50 were authenticated

at the hearing in person by the employees

who signed them. The signatures to 29

additional cards were authenticated by

the oral testimony of witnesses who said

they saw the employees sign the cards.

And 77 cards were authenticated by wit-

nesses who testified in each instance

that the cards were handed to them by the

signing employees within moments after

they had signed, in intimate gatherings

where the cards were passed out in

solicitation and where immediate signing

took place.

The Respondent attacks the validity

of these cards on two asserted grounds.

The first is that employees did not

intend what the plain printed language

says - i.e., that the Union be their

bargaining representative, but only

that an election might be held. The

test now, of course, is not what employees

may later say their intent once was, but

rather what they were told at the time of

signing the cards. Absent clear and pro-

bative proof that union representatives,

or other solicitors to signatures, ex-

A-65

pressly told the employees at the time

that the sole reason for signing was to

obtain an election, it is the wording

of the cards -- the plain English there

written and which everyone of the em-

ployees involved read before signing --

that must govern.

Several union meetings were held in

March, when about half of the cards were

signed, and a number of meetings took

place later. Donald Rieger, international

representative of the Union, was present

at all the meetings. Robert Sebera,

business representative, was present at

six or eight meetings. I do not believe

there is adequate evidence to impair any

of the cards on the ground the employees

were told the purpose was solely for an

election. Both Riger and Sebera testi-

fied clearly and convincingly that a

number of times the employees were told

the cards were to be used to make immedi-

ate demand for recognition, and that only

in the event recognition were not achieved,

would the Union move towards an election.

Each of the union agents denied they ever

told the employees the purpose of the

A-66

cards was only to bring about an election.

Several employees who authenticated

their cards also spoke on this subject but

their testimony cannot offset the writing

on the cards they read before signing.

They did recall there was talk of an

election, and yet, from Larry Doehr: "All

it was an indication that you are inter-

ested in obtaining this particular union

as a bargaining agent."’ Neil Barrett

said he heard an organizer say that "if

you sign that then they need, I think,

50 percent or something that they were

telling me and that would be enough to

vote for a union, to have the vote for

a union."' Another employee, Donald

Ulrich, quoted an organizer as saying

"that if a certain percentage of the

cards were turned in, there would be

an election," and that "they would like

a certain percentage of the cards in

before they would even try for an

election, ... ."' Randolf Rusnak

started by saying no one from the

Union told him why they wanted the cards

signed, and then added: "They just

wanted to take like a poll to see how

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many people would be interested."

The second contention adverse to

the validity of the cards is that the

Union illegally bribed the employees by

promising them freedom from initiation

fees or dues on condition that they sign

before the election, or before the Union

won recognition. On this score, too,

the testimony of the two most active union

agents who ran the organizational cam-

paign could not be clearer. Riger testi-

fied he told the employees: ‘Dues were

$8 a month. Employees were told that.

They were also told there was no initiation

fee for any present employees."' He denied

telling any employees "if they signed, a

union card they would not have to pay

union dues .. . initiation fees." "We

said that dues would be first collected

after a contract was signed, and we said

there would be no initiation for any

present Donn employees, and we also stated

that in the leaflet as well.'' From the

testimony of another employee, Terrence

Keane: "Somebody told me the rule, and I

can't tell you who told me, but somebody

told me that anybody who was working, that

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is working at the company when the Union

gets in, doesn't have to pay. It is who-

ever comes in afterwards."' And the other

union agent, Sebera, said: "We told the

people present that definitely in all

cases that there will be no Union dues or

no initiation charge up until the time

that the contract is consummated with the

Company."

The union meetings started in

March, and the campaign continued for

several months thereafter. On April 1

the Company distributed to each of the

almost 300 employees a printed document

entitled Opinion Poll, with the following

statement:

I understand there is a rumor being

circulated through the plant con-

cerning the payment of the union

initiation fees. A loyal employee

informed me that you have been told

if you did not sign a union card now

that in the event the union wins an

election you would be required to pay

an initiation fee and those who did

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sign the card would not have to pay

any fee.

This paper then asked each employee

to check whether this statement by the

employer was or was not his "“understand-

'" Ten employees checked the affir-

mative box in reference to that question.

How many of the other 277 employees said

"No,'' the record, of course, does not

ing.

show.

These 10 answers are of no signifi-

cant weight against the validity of the

cards, including those signed by the

special 10 employees. Rumor, absent

factual evidence, will not suffice to

support what is essentially an affirma-

tive defense. One must also ask: ‘What

is a rumor? Who starts a rumor?" When

an employer floods the plant with a flat

statement that there is a rumor, who is

it that has started the rumor?! It was

‘the nature and ingenuity of man is unchanged

as Of old. Cf. Virgil, Aeneid,BK. IV, L. 160-

161; Rossini, The Barber of Seville, Act 3,

'"LaCalunnia."'

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an obvious device to create, and implant

into the minds of the employees, what is

now called a Savair defense. See N.L.R.B.

v. Savair Mfg. Co.,414 U.S. 270.

The Respondent called some witnesses

who, in part of their testimony, said

they heard the union agents tell the en-

ployees in the one or two meetings they

attended, that dues and fees would be

waived only if they signed now. I

do not credit these witnesses against

the clear testimony of Rieger and Sebera.

Givens, chief inspector of quality

control, said he heard Rieger say "if any-

body would get a Union card and mail it

in at this time, that they would be exempt

from paying any initiation dues." The

witness added this was the only meeting he

attended, and that he did not stay

throughout.

Keifer, assistant foreman, testified:

"He said that if union cards were signed

now, that there wouldn't be any initiation

fee if you signed a card now.'"' This

witness said he heard no talk in the shop

to this effect. He could not recall what

date or what month he went to the meeting,

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what questions he asked or what questions

the other employees asked.

Mehlman, an inspector, said: "

at one of the meetings it was stated that

if we had a card signed and in by the

time the election came up, we would not

be liable for initiation dues."' The wit-

ness then added Sebera, at a meeting,

"confirmed it."' And then, on cross-

examination, came the following:

Q. Do you recall at any of these

meetings, either Mr. Rieger or

Mr. Sebera stating that there

would be no dues or initiation

fees until a contract was

signed between the Company and

the Union?

A. Yes, I heard that also.

Kaniecki, then quality control

assistant foreman and now quality

control foreman, started by saying that

at a meeting he heard Rieger and Sebera

say "that any of the guys that signed a

petition card during a campaign would be

exempt from paying initiation fees.'' Like

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Mehlman before him, Kaniecki then reversed

himself:

Q. Did you hear Mr. Rieger or Mr.

Sebera make a statement that

no employee would have to pay

a Union initiation fee until

after a contract had been

signed with Donn Products?

A. Tee.

Lee Townsend,an ordinary employee,

was also called by the Respondent. Asked

in his opening statement what the employ-

ees were told in the meeting about payment

of initiation fees, he answered: "That

they would be after negotiations were

taken care of.'' With some prodding by

Company counsel the witness then said that

those who signed cards would not have to

pay. His later answer followed a series of

leading questions. Finally, Townsend said

he arrived late at the meeting, and did not

recall with exactness what was said.

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With talk, as was to be expected,

about the plant, of rumors of one kind

or another, the Union promptly dis-

tributed another leaflet, clearly re-

assuring the employees of its earlier

message that there would be no dues or

initiation costs on anybody until after

the Union had become established. Where

the testimony of the Company's five

witnesses as shown above conflicts with

that of the union agents, I credit

Rieger and Sebera.

On the total record, I find that

the Union in fact represented a majority

of the 287 employees in the bargaining

unit on July 9, 1975, when the Respondent

refused to extend exclusive recognition

on request.

The Effect of the Unfair Labor

Practices upon Commerce

The activities of the Respondent

set out in section III, above, occurring

in connection with the operations of

Respondent described in section I, have

a close, intimate and substantial relation

to trade, traffic and commerce among the

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several states and tend to lead to labor

disputes burdening and obstructing

commerce and the free flow of commerce.

Conclusions of Law

l. By granting its employees a

binding arbitration agreement in order

to dissuade them from prounion activi-

ties, by establishing an unprecedented

system of materially assisting employees

to obtain personal bank loans, by

threatening to move its business to other

locations, by interrogating employees

about their union activities and about

the union activities of other employees,

by threatening to discharge employees and

to prosecute them because of their union

activities, by telling employees they

would be disciplined more harshly be-

cause of their union activities, and by

promising employees an improved bonus

system to induce them to abandon the

Union, the Respondent has engaged in

and is engaging in violations of

Section 8(a)(1) of the Act.

2. The aforesaid unfair labor

practices are unfair labor-practices

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affecting commerce within the meaning of

Section 2(6) and (7) of the Act.

Upon the foregoing findings of fact,

conclusions of law and the entire record,

and pursuant to Section 10(c) of the Act,

I a issue the following recommend-

ed:

ORDER

The Respondent, Donn Products, Inc.

& American Metals Corporation, Westlake,

Ohio, its officers, agents, successors

and assigns, shall:

1. Cease and desist from:

(a) Granting its employees a

binding arbitration agreement in order to

dissuade them from prounion activities,

establishing an unprecedented system of

materially assisting employees to obtain

In the event no exceptions are filed as pro-

vided by Section 102.46 of the Rules and Regula-

tions 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 become its findings, conclusions and

Order, and all objections thereto shall be deemed

waived for all purposes.

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personal bank loans, threatening to move

its business to other locations, interro-

gating employees about their union

activities and about the wnion activities

of other employees, threatening to dis-

charge employees and to prosecute them

because of their union activities, telling

employees they would be disciplined more

harshly because of their union activities,

or promising employees an improved bonus

system to induce them to abandon the

Union.

(b) In any other manner inter-

fering with, restraining, or coercing

employees in the exercise of the right

to self-organization, to form, join,

or assist United Furniture Workers

Local 450, United Furniture Workers of

America, AFL-CIO, or any other labor

organization, to bargain collectively

through representatives of their own

chosing, and to engage in other con-

certed activities for the purpose of

collective bargaining or other mutual

aid or protection, or to refrain from any

and all such activities.

Seater eee eeeenmTer pean —

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2. Take the following affirmative

action necessary to effectuate the

policies of the Act:

(a) Post at its places of

business in Westlake and Medina, Ohio,

copies of the notice attached hereto

and marked “Appendix. "> Copies of said

notice on forms provided by the Regional

Director for Region 8, after being duly

signed by its representatives, shall be

posted by the 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 are customarily

3 Im the event that the Board's Order is en-

forced by a Judgment of a United States Court

of Appeals the words in the notice reading

"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."

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posted. Reasonable steps shall be taken

by it to insure that said notices are

not altered, defaced or covered by any

other material.

(b) Notify the Regional Director

for Region 8, in writing, within 20 days

from the date of receipt of this Decision,

what steps the Respondent has taken to

comply herewith.

In the light of this total record

I find no merit in the Respondent's con-

tention that because a copy of the

Union's objections to the election in

Case 8-RC-9998 was served upon it be-

latedly, the misconduct now shown to have

occurred before the election should be

ignored. Accordingly, I recommend that

the results of the election be set aside

and that the Regional Director conduct a

mew election when in his judgment he

deems proper.

Dated at Washington, D.C.

Thomas A. Riccl

Administrative Law

Judge

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APPENDIX

NOTICE TO EMPLOYEES

Posted by Order of the

National Labor Relations Board

An Agency of the United States Government

THE NATIONAL LABOR RELATIONS BOARD HAVING

FOUND, AFTER A TRIAL, THAT WE VIOLATED

THE FEDERAL LAW BY COMMITTING ACTS OF

ILLEGAL COERCION:

WE WILL NOT grant our employees a binding

arbitration agreement in order to

dissuade them from prounion activities.

WE WILL NOT establish an unprecedented

system of materially assisting our

employees to obtain personal bank loans

to curb their union activities.

WE WILL NOT threaten to move our plant

to other locations to discourage union

activities.

WE WILL NOT interrogate our employees

about their union activities or about

the union activities of other employees.

WE WILL NOT threaten to discharge enm-

ployees or to prosecute them because of

their union activities.

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WE WILL NOT tell our employees that they

will be disciplined more harshly in the

future because of their union activities.

WE WILL NOT promise an improved bonus

system to induce our employees to

abandon the Union.

WE WILL NOT in any other manner inter-

fere with, restrain or coerce our em-

ployees in the exercise of their right

to self-organization, to join or assist

UNITED FURNITURE WORKERS LOCAL 450,

UNITED FURNITURE WORKERS OF AMERICA, AFL-

CIO, or any other labor organization, or

to engage in other concerted activities

for the purpose of collective bargaining

or other mutual aid or protection or to

refrain from any and all such activities.

DONN PRODUCTS, INC. &

AMERICAN METALS CORPORATION

(Employer

Dated By

Representative

Title

This is an official notice and must

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not be defaced by anyone.

This notice must remain posted for

60 consecutive days from the date of

posting and must not be altered, de-

faced, or covered by any other material.

Any questions concerning this notice

or compliance with its provisions may be

directed to the Board's Office, Suite

1695, Anthony J. Celebrezze, Federal

Building, 1240 E. 9th Street, Cleve-

land, Ohio 44199 (Tel. No. 216-

522-3739).

A-82

No. 77-1269

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

DONN PRODUCTS INC. and

AMERICAN METALS CORP. ,

Petitioners,

Vv. ORDER

NATIONAL LABOR RELATIONS BOARD,

Respondent.

BEFORE: WEICK, LIVELY and KEITH,

Circuit Judges.

On petition for review and Cross-

Application for Enforcement of an Order

of the National Labor Relations Board,

This cause came on to be heard on

the record of proceedings before the

National Labor Relations Board and was

argued by counsel.

On consideration whereof, it is

now ordered, adjudged and decreed by

this Court that the findings of section

8(a) (1) violations by the Board, with

the exception of the finding of a

threat of sham bargaining, are affirmed.

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The finding by the Board of a section

8(a)(5) violation is reversed. The

order of the Board is enforced with

exception of paragraphs l(a), 1l(d),

2(a) and 2(b). Enforcement of these

excepted provisions of the order is

denied. The notice to employees which

the Board ordered posted will be modi-

fied to reflect the partial denial of

enforcement. This will require deletion

of all references to bargaining with

the union and removal of literary

paragraphs 1, 4, 12, 14 and 15 from

the notice.

No costs allowed.

ENTERED BY ORDER OF THE

COURT

(John P. Hehman)

Clerk

Filed January 17, 1980

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.