Allis-Chalmers Manufacturing Co.

National Labor Relations Board - Board Decisions

Aug 26, 1953

106 N.L.R.B. 939 (N.L.R.B. 1953)

ALLIS-CHALMERS MANUFACTURING COMPANY
CONCLUSIONS OF LAW
939
1. Deep Freeze Appliance Division , Motor Products Corporation is, and at all times
relevant herein was, engaged in commerce within the meaning of Section 2 (6) and (7) of
the Act.
2. Respondent has not engaged in any unfair labor practices within the meaning of the Act.
[Recommendations omitted from publication.]
ALLIS-CHALMERS MANUFACTURING COMPANY and OFFICE
EMPLOYEES INTERNATIONAL UNION, LOCAL NO. 19 AFL.
Case No. 8-CA-570. August 26, 1953
DECISION AND ORDER
On October 24, 1952, Trial Examiner Charles W. Schneider
issued his Intermediate Report in the above -entitled proceeding,
finding that the Respondent had engaged in certain unfair labor
practices and recommending that it cease and desist therefrom
and take certain affirmative action, as set forth in the copy of
the Intermediate Report attached hereto. The Trial Examiner
also found that the Respondent had not engaged in certain other
unfair labor practices and recommended that those allegations
of the complaint be dismissed. Thereafter, the Respondent
filed exceptions to the Intermediate Report and a supporting
brief, and the Union filed a brief. The Respondent also requested
oral argument . This request is denied as the record and briefs,
in our opinion , adequately present the issues and positions of the
parties.
The Board has reviewed the rulings of the Trial Examiner
made at the hearing and finds that no prejudicial error was com-
mitted. The rulings are hereby affirmed. The Board has con-
sidered the Intermediate Report, the exceptions and briefs and
the entire record in the case, and hereby adopts the conclusions
and recommendations of the Trial Examiner, with the following
additions and modifications:
We agree with the Trial Examiner's finding that clauses XIII
and XIV of the Respondent's proposed contract did not involve
bargainable issues, and therefore were not demands uponwhich
the Respondent could insist to the point of impasse during con-
tract negotiations . As set forth in the Intermediate Report,
clause XIII provided that if the parties did not agree upon a
new contract after the term of the initial agreement , the Union
could not strike unless a majority of the employees in the unit
voted in favor of strike action. Clause XIV required that a sim-
ilar majority of all employees must ratify any contract before
it could become binding upon the Respondent.
It is now well settled that employer insistence upon contract
ratification by the employees is a violation of Section 8 (a) (5)
of the Act. As the Board and the courts have held, the vice in
such conduct is that the employer thereby attempts to detract
106 NLRB No. 151
940 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
from the authority of the chosen bargaining agent and, in effect,
refuses to accord to the majority representative of the em-
ployees that exclusive recognition with the statute makes
mandatory.'
As to clause XIII , the strike -vote provision, the Respondent's
adamant position was no less than insistence that after the con-
tract ceased to exist, the employer should be free to grant or
withhold economic benefits at will, while at the same time the
union should be deprived of its right to resort to an unfettered
use of conventional strike action in any attempt to enforce its
economic demands . As the Trial Examiner fully and correctly
explains , such a demand makes impossible that equality at the
bargaining table which the Act is designed to achieve in the
interests of industrial stability.
Moreover , in addition to curtailing the Union ' s freedom of
action at a time when the Respondent was bound by no con-
tractual obligation towards the Union , the strike -vote clause,
like the ratification clause, imposed an unlawful limitation upon
the Union ' s right to act onbehalf of the employees . The contract
ratification clause put in question the Union ' s right to speak
on behalf of the employees as to all aspects of their employment
conditions , and the strike - vote clause put in issue the Union's
right to voice their desires as to strike action. As the Board
has held , "employees ' designation of a collective -bargaining
representative and the Board's certification thereof would be
futile and meaningless, could an employer, shortly thereafter,
at any designated stage of the bargaining process, demand
proof that the exclusive representative was acting in accordance
with the desires of the employees."'
In essence , the strike -vote clause was tantamount to an
attempt to bypass the Union and to deal with the employees
instead. It is true that the Respondent urged the clause upon
the Union , was willing to have the Union conduct the election,
and did not approach the employees directly . Nevertheless,
although the employees were to be reached through their union,
the Respondent wanted to ask them, instead of their union,
whether they wished to strike . It is now well established that
an employer may not deal with the employees while there is in
existence, and without the voluntary approval of, a majority
represnetative .9 If the employer may not lawfully deal with the
employees in this situation , necessarily it may not lawfully
insist upon a contractual right to do so. In sum, the net effect
of the strike-vote clause was to reserve to the Respondent the
right to place its last offer , in future contract negotiations,
before the employees directly , for them to accept or reject.
lUnion Manufacturing Co., Inc., 27 NLRB 1300. See also Interstate Steamship Co., 36
NLRB 1307; Corsicana Cotton Mills, 178 F. 2d 244 (C. A. 5).
'Union Manufacturing Co., Inc., supra.
3 May Dept. Stores Co. v. N. L. R. B., 326 U. S. 276; Medo Photo Supply Corp. v. N. L. R. B.,
321 U. S 678.
ALLIS-CHALMERS MANUFACTURING COMPANY 941
Upon the entire record we find, like the Trial Examiner, that
the Respondent, by insisting upon discussing its proposed
clauses XIII and XIV, and by such insistence causing the bar-
gaining negotiations with the Union to cease, refused to bargain
with the Union and thereby violated Section 8 (a) (5) of the Act.
ORDER
Upon the entire record in the case, and pursuant to Section
10 (c) of the National Labor Relations Act, as amended, the Na-
tional Labor Relations Board hereby orders that the Respondent,
Allis-Chalmers Manufacturing Company, its officers, agents,
successors, and assigns, shall:
1. Cease and desist from:
(a) Failing or refusing to bargain collectively with the Union
as the exclusive bargaining representative of the appropriate
unit with respect to conditions of employment.
(b) Insisting, in collective-bargaining negotiations with the
Union, upon articles XIII and XIV of its proposals, or any pro-
posal not involving conditions of employment, to the point of
breakdown in the negotiations.
(c) In any like or related manner interfering with, restraining,
or coercing employees in the exercise of rights guaranteed in
Section 7 of the Act.
2. Take the following affirmative action which the Board finds
will effectuate the policies of the Act:
(a) Upon request, bargain collectively with the Union with re-
spect to rates of pay, wages, hours of employment, and other
conditions of employment, and if understanding is reached, em-
body such understanding in a signed agreement.
(b) Post at its branch office at Toledo, Ohio, copies of the
notice attached to the Intermediate Report marked "Appendix
A."4 Copies of said notice, to be furnished by the Regional
Director for the Eighth Region, shall, after being signed by the
Respondent's representative, be posted by the Respondent and
maintained by it for sixty (60) consecutive days thereafter, in
conspicuous places, including all places where notices to em-
ployees are customarily posted. Reasonable steps shall be taken
by the Respondent to insure that said notices are not altered, de-
faced, or covered by any other material.
(c) Notify the Regional Director for the Eighth Region in
writing, within ten (10) days from the date of this Order, what
steps the Respondent has taken to comply herewith.
Chairman Farmer and Member Styles took ,no part in the
consideration of the above Decision and Order.
4This notice, however, shall be, and it hereby is, amended by striking from line 3 thereof
the words "The Recommendations of a Trial Examiner" and substituting in lieu thereof the
words "A Decision and Order." In the event that this Order is enforced by a decree of a
United States Court of Appeals, there shall be substituted for the words "Pursuant to a
Decision and Order" the words "Pursuant to a Decree of the United States Court of Appeals,
Enforcing an Order."
942 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Intermediate Report
STATEMENT OF THE CASE
This proceeding is based upon a complaint issued April 24, 1952, by the General Counsel
of the Board, pursuant to charges filed August 15, 1951, by Office Employees International
Union, Local No. 19 AFL, a labor organization within the meaning of Section 2 (5) of the
Act, alleging inter alia that the Allis-Chalmers ManufacturingCompany, Milwaukee, Wisconsin,
refused to bargain with the Union as representative of a bargaining unit comprised of office
employees in its branch office and warehouse located in the city of Toledo, Ohio, and further
alleging consequent violations of Section 8 (a) (1) and (5) of the National Labor Relations Act,
61 Stat. 136.
Upon due notice a hearing was held in Toledo, Ohio, from May 20 to 28, 1952, inclusive.
The General Counsel, the Company, and the Union participated in the hearing. All parties were
afforded opportunity to examine and cross-examine witnesses and to introduce relevant
evidence. i Opportunity was likewise afforded to argue the issues orally upon the record and
to file briefs and proposed findings. A brief was received from the Company on September 12,
1952.
Upon all the evidence in the case I make the following findings:
1. THE COMPLAINT
The complaint alleges the following conduct on the part of the Company occurring after
March 1, 1951, to be in violation of Section 8 (a) (1) and (5):
(1) Refusal to meet with the Union for a period of some months, delaying and post-
poning meetings with the Union, and engaging in dilatory tactics;
(2) Unilaterally granting salary increases to employees in the bargaining unit without
consultation with the Union, their designated bargaining agent;
(3) Insisting for a period of approximately a year that any agreement reached be
limited to an oral understanding and refusing during that time to enter into a written
agreement;
(4) Refusing for a period of approximately a year to make any counterproposals;
(5) Insisting during negotiations on reserving the exclusive rightto increase job rates,
ranges, and salaries of individual employees, and to promote and demote employees and
make other changes in conditions of employment;
(6) Insisting that any agreement reached between the Company and the Union be rati-
fied by a majority vote of all employees in the unit whether or not members of the Union,
and insisting that said vote be conducted on Company premises;
(7) Insisting that any strike ballot taken by the Union be taken on Company premises
during working hours at Company expense and further insisting that any strike vote be
ratified by a majority of the employees in the unit whether or not members of the Union;
(8) Insisting that elections of certain union representatives be conducted by secret
ballot on Company time and premises and subject to other company-imposed terms and
conditions; and
(9) Insisting over the objections of the Union on recording by a steno-typist of a
bargaining meeting held on April 11, 1952.
11. THE COMPANY'S OPERATIONS
The Company is a Delaware corporation having its principal office and place of business in
the city of Milwaukee, Wisconsin, and engaged in the business of manufacturing and selling
general machinery and farm equipment. In that connection, the Company owns and operates 10
manufacturing plants located at West Allis and LaCrosse, Wisconsin; Springfield, Illinois, La
Porte and Terre Haute, Indiana; Gadsden, Alabama; Pittsburgh, Pennsylvania; Norwood, Ohio;
Boston, Massachusetts; and Oxnard, California. The Company maintains approximately 100
district and branch offices throughout the United States for the sale and servicing of its
products. It employs a total of approximately 35,000 employees.
'During the course of the hearing ruling was reserved on the admission of Respondent's
Exhibits Nos. 49A and 49B. These documents are now admitted into evidence.
ALLIS-CHALMERS MANUFACTURING COMPANY 943
The Company maintains a tractor division branch office and warehouse in Toledo, Ohio,
the facility here involved , for the purpose of servicing farm-equipment dealers located in
eastern Michigan and northwestern Ohio. It there employs approximately 20 persons who are
under the direct supervision of the branch manager . This branch is under the further super-
visory control of the eastern territory manager of Milwaukee , Wisconsin , who has the respon-
sibility of overseeing branches located in 21 States and 2 Canadian provinces.
It is conceded that the Company's operations, including the Toledo branch, affect commerce.
III. THE UNFAIR LABOR PRACTICES
Since 1937 the Company has had collective -bargaining relationships with various unions,
and at the time of hearing in this proceeding it had labor agreements in effect covering 14
collective-bargaining units in 9 manufacturing plants . Other than the bargaining unit under
consideration here there has been no union organization in the branch offices.
A. The certification of the Union ; the request to open
negotiations
On November 6, 1950, in an election conducted by the Board with the consent of the Company
at the Toledo branch office, a majority of the employees in the bargaining unit (then comprised
of 9 office employees but later reduced to 7) designated the Union as their collective-bargaining
representative. On November 17, 1950, the Board certified the Union as such representative.
The appropriateness of the unit and the Union 's representative status are not contested.
On November 27, 1950, John Richards, president of the local union, submitted the Union's
contract proposals to the Company by mail, and requested a meeting for the purposes of nego-
tiation thereon On December 4, in the course of a telephone conversation between Richards
and S. O. Anderson, manager of the Toledo office, concerning the transfer of an employee from
the warehouse to the office , Anderson advised Richards that the union proposal had been for-
warded to the Milwaukee office for consideration . In subsequent telephone conferences during
either December 1950 or January 1951, or both, Anderson told Richards that negotiation
meetings would have to be postponed until such time as Willis Scholl, the eastern territory
manager, could be present . In the early part of January 1951, Anderson and Richards, upon
the suggestion of Richards, conferred for several hours in reviewing the Union 's proposals.
This meeting was devoted to an explanation by Richards of the various clauses in his draft.
In a later telephone conversation , an understanding was reached that a meeting with Scholl
would be held toward the end of the month of January. However, on January 29, 1951, the presi-
dent of the Company died. Anderson then informed Union President Richards that Scholl would
be required to remain in Milwaukee for the time being but that a meeting would be arranged as
promptly as possible. About mid-February, Anderson informed Richards that Scholl had been
promoted to another position , and that negotiation meetings would consequently have to be
held in abeyance until a new eastern territory manager was appointed.2
1. The first phase March 1, 1951 to July 23, 1951
In early March 1951, Branch Manager Anderson advised Union President Richards that he
was going to Milwaukee to make arrangements for a meeting.3
On March 8, 1951, Anderson telephoned Richards to advise him that Frank Mussell would
assume the position of eastern territory manager on April 1; Anderson further suggested a
meeting on April 10, to permit Mussell to become acquainted with the situation . To this
Richards agreed.
a. The April 10, 1951, meeting
The April 10 meeting was held at the Toledo branch office from 9:30 a. m. to 12:30 p. m.
Mussell and Anderson represented the Company and Richards represented the Union . Richards
2 The events of the period prior to March 1, 1951, are not alleged as unfair labor practices.
They are referred to herein for an understanding of the issues and as background for the
evaluation of subsequent events.
3Richards testified that he believed that he informed Anderson early in March that he
would file an unfair labor practice charge unless a meeting date was established . This was
denied by Anderson. I conclude that Richards was probably mistaken as to time.
944 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
requested and Anderson furnished current salary data for all employees in the bargaining unit
including cost -of-living increases . TheUmon's proposal was reviewed paragraph by paragraph,
explained by Richards , and viewpoints exchanged thereon. For mutual convenience it was agreed
to hold subsequent sessions in the evening. In view of Mussell 's schedule , which required ex-
tensive traveling to other branch offices , May 9 was the earliest date on which he could con-
veniently return to Toledo. That date was agreed upon for the next meeting.
b. The May 9 meeting
This meeting was held at the same location, with the same representatives from 8 :30 p. m.
to 1:30 a . m. The Union 's proposal was again reviewed paragraph by paragraph . The Company
indicated that several of the provisions were acceptable as written ; that some were either
superfluous or unacceptable ; and requested minor changes of language in others.
Sharp disagreement developed with respect to demands of the Union for seniority based on
straight length of service , and promotion , demotion , and layoff of employees on the basis there-
of; minimum and maximum salary for each job classification with automatic progression based
on length of service ; unlimited sick leave with pay; union shop; appeal of discharges under
grievance procedure ; vacations ; and holiday pay. On those items in which the parties were in
disagreement , Mussell stated the Company's arguments against accepting the Union's
proposals . In somecases these arguments were based upon the nature of the work at the branch
office ; in others upon the fact that they represented deviations from uniform company policies.
So far as the intrinsic merit of Mussell 's arguments are concerned , they strike me as
reasonable.
Upon several of the clauses in the Union's proposal , however, while rejecting them and
stating his reasons therefor , Mussell 's testimony does not indicate whether he would agree to
any provision at all on the subject , and if so what kind. These are subjects covered by company
contracts with other labor organizations in effect at that time , for example , seniority. The
Union's proposal was for straight seniority with promotions or layoffs to be in order of
seniority. Mussell 's position with respect to this was simply that it be deleted . Other contracts
with other unions contained provisions of varying kind recognizing length of service in some
fashion as a factor in certain personnel action . Another example is the discussion with respect
to grievance procedure . The Union proposed and Mussell indicated acceptance , with modifi-
cations , of a grievance procedure . The Union's proposal, however, contained a clause to the
effect that an employee discharged for cause might appeal within 24 hours , the appeal to be
submitted to a joint conference of the Company and the Union ; with further provision for
reinstatement and back pay if the appeal were sustained . Mussell objected to the latter
provision , no doubt with reason : the clause apparently would permit the Union to participate
in the determination as to whether the discharge would be effective . Mussell's position
apparently was that the matter should not be subject to the grievance procedure : a position
inconsistent , as I interpret them , with the provisions of other company contracts. Another
example is the Union 's wage clause. This contained a number of provisions , all but one of
which (to the effect that employees should continue to be paid on a semimonthly basis) were
rejected by Mussell , most with evident reason . Mussell 's testimony, however, does not in-
dicate any statement of willingness to contract even for continuation of the existing wage
rates . His testimony as to increases , in sum, is that all would be on merit and reviewed
twice yearly.
The testimony of Union President Richards and Union Representative Daugherty, who
participated in later meetings , is to the effect that on many of the substantive and important
clauses of the contract such as promotions , demotions , and wage increases , Mussell stated
either expressly or in effect that these company "prerogatives ." However, in the absence
of a statement or indication by Mussell to the effect that the Company would not bargain
about its "prerogatives " I see little significance in the characterization.
At the conclusion of the May 9 meeting , the parties agreed to meet again on May 31, 1951.
On May 31, however , Mussell telephoned Richards from Harrisburg, Pennsylvania , to advise
Richards that he would be detained because of an accident involving a dealer and requested
Richards to postpone the meeting scheduled for that evening and to arrange with Branch
Manager Anderson for another date. Richards agreed. Richards ' attendance being required
at an International Union convention in'Ibronto, Canada, in the early or middle part of June,
a meeting was arranged for June 28.
ALLIS-CHALMERS MANUFACTURING COMPANY 945
c. The June 28 meeting
This meeting was held in Toledo from 8 p. m. to 10:40 p. in. Anderson and Mussell again
represented the Company; Richards, accompanied by R. M. Daugherty, international repre-
sentative , represented the Union. The Union 's proposal was again reviewed paragraph by
paragraph and the Company's position thereon restated for the benefit of Daugherty, who was
appearing in the negotiations for the first time . Mussell repeated previous suggestions he had
made for a verbal arrangement for settlementof differences on a local level between Richards
and Anderson. Richards requested, and Anderson furnished, detailed salary data for employees
in the bargaining unit, including a cost-of-living adjustment increase for the month of June,
due to be paid on July 1. The Company agreed to give the Union advance notice of future cost-
of-living adjustment increases. The Union requested the Company to submit a written counter -
proposal and to place in writing the policies which Mussell had described during the course of
negotiations.4 The Union requested that these be presented at the next meeting. Mussell either
promised to comply (Richard's and Daugherty's version) or to consider it (Mussell's and
Anderson's version). I do not think the conflict of critical importance. Alternative dates of
July 16 and July 23 were tentatively agreed upon for the next meeting, subject to further
confirmation.
On July 3, 1951, however, Mussell advised Anderson that he was unable to be in Toledo on
July 16, the meeting date preferred by the Union, and requested confirmation of the July 23
date. Richards confirmed. On July 18, Mussell and Anderson conferred in Toledo concerning
the possibility of preparing a counterproposal
d. The July 23 meeting
This meeting was held at the same place with the same representatives , from 8 p. m. to
11:20 p. m. The Union asked for the Company's counterproposals. Mussell replied that he
had none, giving as explanation either (a) lack of time to prepare them (Daugherty's version);
(b) that he had none to offer because the Company's position had not changed (Richard's
version at one point; at another he could not recall the reason given); (c) that in view of the
Union's "must" demands the Company had concluded that it could not prepare a counter-
proposal acceptable to the Union (Mussell's and Anderson's version). It is unnecessary to
decide which version is correct since the Union specifically asked for counterproposals
and for the Company's cited position and policies to be set down in writing. Whatever the
reason given at the July 23 meeting, the Company's failure to comply with the Union request
was not the result of misunderstanding of the union position. It appears from a letter to the
Regional Office from Company Vice President and General Attorney H. W. Story, dated
September 21, 1951, that the reason counterproposals were not submitted was that "the
appropriate time had not arrived for action of that kind." Daugherty accused the Company of
not bargaining in good faith and threatened to file unfair labor practice charges. However,
further discussion was had on certain ofthedisputed union demands and the parties ' positions.
The possibility of holding another meeting was discussed. Daugherty was dubious about the
value of further meetings unless the Company submitted counterproposals or indicated possi-
bility of changing position , but suggested 9 a. m. the next morning. Mussell countered with the
suggestion that they begin at 8 a . in. because of his planned departure at noon the following
day. The Company also offered to meet on August 9, but none of the various suggestions was
followed up, and the meeting seems to have ended on an inconclusive note.
2. The second phase July 23 to November 13, 1951
a. The Union files charges; negotiations are resumed
Nothing further occurred until August 15, 1951. On that date the Union filed charges of re-
fusal to bargain and discrimination.5 On the same date the Regional Director advised the
4Anderson and Mussell testified that the Union specified that certain demands "must" be
complied with in principle in the Company 's counterproposals . Richards and Daugherty
admitted that the word "must" was used by them in connection with a request for a counter-
proposal but merely related to the subjects to be covered therein. I conclude that Anderson
and Musseil were mistaken. The kind of proposal envisioned in their testimony would be
nothing less than agreement to the Union ' s demands , and scarcely a counterproposal.
5The discrimination charge is not contained in the present complaint; presumably for the
reason that the Regional Director's investigation disclosed it to be unfounded.
946 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Company of the filing of the charge and requested a statement of the Company's position
thereon. On September 21, 1951, H. W. Story, vice president and general attorney for the
Company, replied in detail denying the validity of the charges; stated the Company's willing-
ness to negotiate at any reasonable time and place; to present counterproposals when appro-
priate; and to sign any agreement reached if desired by the Union.
On September 27, Union Representative John Taylor telephoned Branch Manager Anderson
and told him, inter alia that he was replacing Richards as the union negotiator; that he was
expecting to confer with Field Examiner Grupp on October 4; and the Union might thereafter
want to reopen negotiations.
On October 23, the Company made available to the Union a copy of Vice-President Story's
letter of September 21 to the Regional Director. On the same day Taylor called on Anderson
and asked for resumption of negotiations at an early date. Anderson replied that he thought
that arrangements could be made and that he would contact Milwaukee. About October 29
Anderson called Taylor and told him that Mussell would be in Toledo on November 4 or 10
days later, but that he would not be able to stay long on either occasion. Taylor suggested
that he would like to have both dates. However, November 13 was finally selected.
3. The third phase November 13, 1951, to February 13, 1952
a. Further negotiations; Mussell withdraws as negotiator
(1) The November 13 meeting
On November 13, 1951, the parties met in the Secor Hotel in lbledo from 10 a. m. to 1:45
p. m., with Mussell and Anderson representing the Company and Taylor representing the Union.
Mussell had to leave after noon, so the meeting was devoted largely to becoming acquainted.
At this meeting Taylor presented a new draft of the Union's proposed contract, using the
current agreement between the Company and Local 248 of the United Automobile Workers CIO
at the West Allis plant as a model; but with significant variations. Taylor requested that the
Company review his proposals and submit counterproposals at the next meeting with respect
to any provision it did not approve. Taylor asked for another meeting "in the light of past
experience . . . as soon as possible so that we would't extend them as they had been." How-
ever, Mussell's itinerary prevented any meeting before Thanksgiving (November 22), so
Taylor agreed to meeting "as soon after as possible"; Taylor to contact Anderson later as
to the date . Thereafter a meeting was arranged for December 4.
(2) The December 4, 1951 meeting
This session was held at the branch office in Toledo from 9:30 a. m. to 12:30 p. m. with
the same negotiators plus Lucille Corbett, an employee, for the Union. 6 Most, but not all, of
the Unions proposal was reviewed, paragraph by paragraph. Some clauses were passed over
without discussion because the parties were pressed for time, Mussell having to leave for
Detroit in the afternoon. The Company indicated that several of the provisions of the union
proposal were acceptable as written and that some were not. Certain deletions and changes
were agreed upon. In general most ofMussell's positions were in accordance with existing pol-
icy at the branch office or provisions in the West Allis agreement. In some cases, however,
his position differed from provisions of the West Allis agreement. Thus he declined the Union's
proposed maintenance-of-membership clause; checkoff; a provision that the Company would
not aid or support employees attempting to undermine the Union; a seniority clause; and an
arbitration clause as to grievances; all being matters which appear in some fashion or other
in the West Allis agreement, though often with significant variations from the Union's
proposals. Generally Mussell cited reasons for these rejections. On the merit of these I do not
pass. In appropriate situations rejection by a party of principles which he has accepted at other
times and places may be proper evidence of and establish bad faith. However, the conclusion
must be arrived at with caution: The former bargain may represent a trade, or a capitulation
to pressing circumstance, or even error in judgement. Adjustment of differences may be
hindered if precedent or ad hoc solution become a strait-jacket on the negotiator for the future.
6 At the outset Mussell questioned the right of Corbett to be present, and the right of the
Union to hold meetings at the home of a confidential secretary excluded from the bargaining
unit, but apparently did not press any objections, and the issue was dropped.
ALLIS-CHALMERS MANUFACTURING COMPANY 947
I am not persuaded in the instant case that the circumstances warrant the conclusion that in
rejecting the aforesaid union clauses Mussell was rejecting collective bargaining.
During this meeting Taylor asked Mussell whether the Company would submit counterpro-
posals. Muss ell responded that it would do so "at the proper time." By the end of the meeting
discussion of theUnion's draft had not been completed. Taylor asked for another meeting before
Christmas. Mussell, however, was leaving for Washington for an indefinite time at the con-
clusion of the meeting, and an operation was to be performed on his wife during the holidays.
He therefore asked Taylor to keep in touch with Anderson as to another meeting date. During
the remainder of December, Taylor called Anderson several times concerning the date but on
each occasion Anderson said that Mussell had not yet been able to arrange a definite time.
Finally, on January 2, 1952, Anderson called Taylor and told him that Mussell had been
appointed to a position with the National Production Authority, on leave of absence from the
Company, and that he would therefore no longer be able to participate in the negotiations. Tay-
lor asked about continuing negotiations. Anderson replied that he would contact Milwaukee to
arrange for assistance. Taylor sugested that Anderson carry on the negotiations. Anderson's
exact reply is disputed, but he either told Taylor that he did not have authority to carry on
alone, (Taylor's version) or that he preferred to have assistance, (Anderson's version). The
conflict does not seem material?
On January 10 or 11, 1952, Anderson called Taylor, or vice versa, and said that a meeting
would be arranged as soon as someone from Milwaukee was available to participate, but that
he would know definitely by January 16.8 A conference in Cleveland between Company and
regional office representatives was held on January 15. On the following day Anderson, on
instructions from Milwaukee, called Taylor and arranged a negotiating meeting in Toledo on
February 13, 1952. On February 12 Anderson called Taylor to advise him that he had been
notified that company attorneys were going to assist in the negotiations and to give Taylor an
opportunity to arrange for counsel if he so desired.
4. The fourth phase February 13 to April 24, 1952
a. The February meetings
On February 13 a meeting was held in the Secor Hotel in Toledo beginning at 9:30 a. m. and
lasting to 5 p. m. J. L. Waddleton, W. J. McGowan, Anderson, and his assistant, Walter
Buescher, represented the Company. Taylor and employee Lucille Corbett represented the
Union. W addleton and McGowan were the principal spokesmen for the Company. Taylor brought
a revised union proposal to this meeting. The Company, however, presented its own proposals,
one section at a time, for discussion. Taylor objected to the procedure and asked to be given a
complete draft of the contract as a whole. He was not successful, and the negotiations continued
on the Company's basis.
Further meetings were held on February 14, 20, 21, and 22; at each of winch the Union was
given seriatum successive sections of the Company's proposals, followed by discussion of the
section. Among the proposals presented on February 13 or 14 was section E, providing for
union guarantees to insure democratic and fair operationof union elections of representatives
operating under the contract. Taylor tentatively accepted this, subject to approval by the
International Union--which disapproved early in March.
By the end of the meeting on February 22 the Union had finally seen all sections of the
Company's proposed contract. During these sessions the various provisions were discussed
as they were presented, viewpoint exchanged, and tentative agreement reached on a number
of issues. Though no complete meeting of the minds was arrived at up to the time the Com-
pany's last two clauses were presented on February 22 the negotiations were apparently pro-
ceeding so well that the Union anticipated rapid agreement. Thus, during the February 14
meeting Taylor either requested or suggested that, because the employees lived at scattered
locations, he would like to have a union meeting on company premises to ratify the contract--
ratification being required by the union constitution. Anderson at first demurred, but later
7Anderson in fact had authority to negotiate, according to his testimony.
8 There is dispute, unnecessary to resolve, as to whether Taylor told Anderson in this
conversation that since the company attorneys were conferring with Board representatives
in Cleveland on January 15, he would prefer to postpone any meeting until after the outcome
of that conference. Even if Taylor made the statement, which he denies, it could not have been
the reason for the Company's decision to give a definite answer on January 16.
322615 0 - 54 - 61
948 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
agreed to reconsider when Taylor pointed out that section E of the company proposals pro-
vided for union elections of representatives under the contract to be held on company premises.
The really serious trouble developed on February 22 when the Company presented its articles
on duration and modification, later numbered XIIandXIV, which, along with section E, became
known as the "democratic processes " clauses . Taylor strenuously opposed these clauses , flatly
declared them unacceptable, stateJ that he would not approve them unless specifically ordered
by the International Union, and rejected them with some heat on the ground that they constituted
interference in the Union's internal affairs. Article XIV provided, in sum, for ratification of
the contract by affirmative vote of a majority of the employees in the bargaining unit in a
supervised election on company time and prerruses . ArucleXIII provided , in sum , for similar
approval before the Union could call a strike after the expiration of the contract. The pro-
visions were discussed and viewpoints exchanged at length.
The February 22 meeting concluded with the mutual understanding that the Company would
prepare a complete draft of theproposed agreement covering all the proposals presented, dis-
cussed and revised in the meetings . This revised proposal was forwarded to the Union by the
Company on March 3, 1952.
b. The March and April 1952 meetings; the breakdown
On March 15, 1952, Taylor informed the Company that the March 3 draft had been reviewed
by the International Union and its Counsel and that he was prepared to resume negotiations
thereon on March 20. The meeting was held on that date . Discussion centered principally
around the 3 clauses : Section E (which the International had in the interim disapproved), and
articles XIII and XIV, which the International had also disapproved. The Union asked for their
deletion. The Company sought to persuade the Union to accept these provisions, and advanced
strenuous arguments in support of its position . View points were exchanged at length.
Virtually the entire session was devoted to effort by the company representatives to "sell"
the clauses to the Union. At the conclusion Daugherty stated that it was useless to argue the
matter further: the clauses were completely unacceptable and he indicated that there was little
point to further discussion or meeting if the Company was going to persist in its position.
McGowan insisted, however, thatanother meetingbeheld in an effort to resolve the differences
and in this he prevailed.
Another meeting at the urging of the Company was held on March 28 with much the same
result , and a final meeting on April 11 , at each of which the Union insisted on deletion of the
disputed clauses with viewpoints again being exchanged and the respective positions explored.
The April 11 meeting adjourned with the understanding that the Company would consider sub-
mission of revised counterproposals.
Such a revision was submitted by the Company on April 17, making some changes, described
hereinafter , in its prior proposals, including the disputed clauses. On April 24, Mortimer
Riemer , union attorney , by letter, broke off negotiations for the stated reason that the Company
was insisting on the objectionable principles of the disputed clauses as a condition of agree-
ment. The Company replied with a telegram to the effect that Riemer was in error in his inter-
pretation of the proposals. The negotiations thus terminated.
The parties did not reach complete agreement during the 1952 negotiations on contract terms.
Though they reached tentative agreement on a number of issues other than the clauses on
which the negotiations broke down, on some others they had not bargained out all their
differences.
But even though the parties had not reached agreement on the other substantive terms of
contract , the negotiations broke down , in my opinion , over the strike and ratification issues.
The Union, particularly in the March 20, 28, and April 11 meetings, stated its view that such
provisions constituted an interference with its internal processes, and demanded that they be
withdrawn. The Company, stating its conviction that it could "sell" the Union on the clauses,
persisted in negotiating them , along with all theother clauses . In sum , the Company wished to
negotiate on all the outstanding questions ; the Union refused on and after April 11 to negotiate
further on the election clauses.
Conclusions
A. Fringe issues
Before disposing of the more salient problems , it will be well to dispose of a number of other
allegations raised by the complaint.
ALLIS-CHALMERS MANUFACTURING COMPANY 949
1. The " insistence" upon an oral agreement
The evidence with respect to this issue, viewed in the light most favorable to the General
Counsel, is to the effect that on numerous occasions during the April to July 1951 nego-
tiations , Eastern Territory Manager Mussell suggested that the parties orally agree to let all
problems be resolved by Branch Manager Anderson on the local level, as they arose. 9
Adoptions of this suggestion , which the Union rejected , would, of course, have resulted in no
written agreement or any commitment to fixed terms . Mussell did not state or indicate, how-
ever, that the Company would not sign a contract.
A request for an oral agreement is not unlawful . What is illegal under the Act is to refuse
to sign a contract after agreement has been reached , or evidenced intention not to enter into
a written agreement . The evidence here not warranting either conclusion it will be recom-
mended that this allegation of the complaint be dismissed. See The Todd Co., 71 NLRB 192
enfd. 173 F. 2d 705 (C. A. 2), and cases there cited.
2. The cost-of-living wage increases
In July 1950 , pursuant to negotiation with unions at the other plants , the Company adopted
a cost-of-living and improvement factor plan for wage increases, which it then extended to
all employees including those at Toledo. It will be recalled that the Toledo employees at that
time had no bargaining representative . This plan, as originally established , provided for (1)
adjustments in the wage scale in January and July of each year in accordance with fluctua-
tions in the cost-of-living index; and (2) annual automatic improvement factor wage increases
in July of each year.
In December 1950 , after the Union had been certified at Toledo , the plans were modified in
anticipation of a wage freeze resulting from the Wage Stabilization program . The changes were
made applicable to Toledo and were as follows: (1) The cost-of-living adjustment was put on
a quarterly, rather than semiannual basis; (2) the increase due in January 1951 was accel-
erated 1 month to December 1950; and (3) the improvement factor increase due in July 1951
was advanced to December 1950. No notice was given to the Union by the Company of these
modifications in the plan at Toledo or of the increases themselves.
Further cost-of-living increases pursuant to the plan were given at Toledo in March 1951.
Again the Union was not notified by the Company. In the meeting of June 28, 1951, Union
President Richards told the Company that the increases should have been brought to the
attention of the Union. Thereafter such notice was given. The General Counsel contends that
failure to give notice of the March 1951 action was a refusal to bargain. None of the other
action with respect to the plan is alleged as an unfair labor practice.
When employees have designated a representative, that representative is entitled to be
notified before bargainable conditions of employment are revised. It must have authentic and
current information as to conditions of employment if it is to perform its representative
function in an adequate and intelligent manger. Moreover, unilateral action on bargainable
conditions is in the ordinary circumstance the antithesis of collective bargaining. The Union
was therefore entitled to notification and an opportunity to discuss the matter before the plan
was revised and the increases effected . Notice may be waived, however, and unilateral action
acquiesced in.
Richards' testimony , as linterpretit , is thathe learned from employees about the December
increase at the time it was given, and had no objection because the Union had no interest in
depriving employees of raises. On each occasion on which Richards asked for salary date
the Company supplied it, with the increases noted thereon. In January 1951, in one of their
initial meetings, Anderson's testimony is, he informed Richards of the cost-of-living plan.io
On the first occasion that Richards asked for prior notification in the future, the Company
complied. Since Richards was informed of the plan, knew of the prospect of quarterly adjust-
ment, indicated no interest in it until June, and had no objection to the December increase--
thus indicating acquiescence to the unilateral announcement--it is found that the failure to
give notice of the March 1951 cost of living adjustment was not a refusal to bargain.
9Mussell's testimony as I interpret it, is that he made this suggestion at "all of our
discussions ," when the parties seemed to be in severe disagreement , and there appeared
no likelihood of a meeting of the minds.
10 Richards could not recall having the plan explained to him before the June 28 meeting.
I conclude that Richards ' recollection was mistaken.
950 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
It will therefore be recommended that this allegation of the complaint be dismissed. The
Todd Co., supra; Landis Tool Co., 193 F. 2d 279 (C. A. 3), Burns Brick Co., 80 NLRB 389.
3. The stenographic record
At the opening of the negotiatmg session of February 13, 1952, Waddleton discussed with
Taylor the advisability of having the negotiations recorded stenographically. Taylor stated
that he had no objection provided that the Company defrayed the cost and supplied the Union
with a copy of the transcript. However, the Company was unable to procure a stenographer,
and the negotiations proceeded without reporting.
On April 10, 1952, Anderson called Taylor to advise him that the Company planned to have
a court reporter present at the meeting on the following day. Taylor indicated no objection.
However, at the opening of the April 11 session Union Attorney Riemer objected to the re-
cording of the negotiation, but proceeded through the morning session under protest. At the
opening of the afternoon session the Union renewed its objections, stating that it did not wish
to proceed further if the reporting was continued. Ultimately the Company excused the re-
porter and the rest of the negotiations were continued off the record. The Company there-
after supplied the Union with a transcript of so much of the session as was recorded.
The General Counsel, in reliance on the case of Reed and Prince Mfg. Co., 96 NLRB 850,
contends that this incident constituted a refusal to bargain. In the Reed and Prince case the
Board found that insistence upon stenographic recording of the negotiations, in the circum-
stances there presented, constituted evidence of bad faith. In that situation, however, the de-
mand occurred in a context indicating that it was advanced in order to impede effective
negotiation. I see no reason to infer the operation of such a motive here. The Reed and Prince
case is further distinguishable on the following grounds: There, the employer insisted upon a
stenographic transcription at each negotiating session; refused to meet without it; refused to
provide copies for the Union; and the proceedings were fully recorded. Finally the Board
found the insistence in the Reed case "not in itself conclusive evidence of bad faith bargain-
ing," but only when viewed as part of a total pattern evidencing general bad faith. I find no
such pattern here and regard the Reed case as inapplicable.
It will therefore be recommended that this allegation of the complaint be dismissed. It
is unnecessary to consider other justifications advanced by the Company.
4. Insistence on retention of certain rights
The complaint alleges refusal to bargain in insistence by the Company
on reserving to itself the exclusive right to increase job rates and ranges, the salaries
of individual employees, and the exclusive right to promote and demote employees and
make other changes in the conditions of employment.
In the April to July 1951 negotiations the Company, in response to the Union's demands on
those subjects, proposed that final decision on questions of seniority, promotion, demotion,
termination, and merit increases be reserved to the Company, with provision for advance
discussion with the Union before changes were effected. Demand for the reservation of final
authority in the Company on these matters is not indicative of bad faith where accompanied
by proposal for advance discussion. Rather than evidencing a purpose to avoid bargaining the
proposal constitutes a warranty to engage in it. It is obviously impossible to provide in a
contract a final solution to all possible problems arising under it. Absent such resolution
the final judgement on conditions of employment necessarily remains with management--un-
less binding arbitration or joint decision are provided for. As I see it, an employer's in-
sistence that his judgment be final, when accompanied by his promise to negotiate the question
before judging, is ordinarily no more than an assertion that he will not consent to binding
arbitration. It is true that in some circumstances refusal to agree upon fixing a term or
condition of employment for a reasonable period of time may evidence a purpose of avoiding
any agreement at all. The present situation is not, however, in my judgment, one of those
evidencing actual purpose to avoid agreement. It is therefore found that the April--December
1951 negotiations do not substantiate the instant allegation of the complaint.
In the 1952 negotiations the Company's proposals were somewhat different. Here it offered
inter alia: (1) A guaranteed annual wage increase; (2) periodic salary adjustment based on
cost-of-living indices; and (3) a guarantee of maintenance of present salaries--subject to
ALLIS-CHALMERS MANUFACTURING COMPANY 951
cost-of-living adjustment. Finally it asked the right to increase minimum occupational classi-
fications and salaries.
The Union objected particularly to this last clause, Taylor stating that there was no pro-
vision for notice to the Union, and asserting that the provision permitted the Company to take
unilateral action. The Company then revised the proposal to provide, in sum, for notice to the
Union of any changes in classifications and salaries. In the March 28, 1952, meeting Taylor
reiterated his objection, stating that the Union desired negotiation on any such increases. The
record does not disclose that the Company made any response to this suggestion. It is there-
fore found that the clause envisioned retention of right in the Company to give merit increases
and change classifications at will, and without obligation to negotiate or discuss the question
with the Union, provided that it gave the Union notice of such action. It is possible- -but not
certain--that the Company's proposed grievance procedure could be construed to permit an
employee aggrieved by the Company's action to process the issue by way of grievance to the
point of binding decision by an impartial referee. That remedy, however, would not reach the
root of the matter if there was original wrong. Improper unilateral action is not cured by
opportunity to litigate the equity of its consequences. But I am persuaded that the Company's
demand was not unlawful.
An employer may ask for the reservation of right to give unilateral merit increases during
the term of an agreement, at least in the absence of such adamant insistence thereon as to
preclude agreement. Alabama Marble Co., 83 NLRB 1047; Standard Generator Service. 90
NLRB 970. Whether the American National Insurance Company case, 343 U. S. 395, is to be
construed as giving an employer even broader latitude with respect to such a demand, it is
unnecessary to determine at this time. In the instant case, the negotiations terminated be-
fore the parties had reached final agreement on economic issues.
In such a circumstance it cannot be said that the Company's proposal for retention of right
to give merit increases and reclassifications, subject to notice to the Union, constituted such
adamant insistence thereon as to preclude agreement.
The Company's proposed contract in the 1952 negotiations also contained a proposal giving
the Company "sole right to make promotions and demotions"; subject to Union right to
"question any [such] action of the Company," to present its views, and to have the matter
reviewed; final decision resting with the Company. An identical provision is contained in a
collective-bargaining contract for a technical unit at the West Allis plant, and similar pro-
visions are in collective-bargaining contracts at the Pittsburgh , Norwood, and Boston plants.
The Union counter to the Company's demand was that promotion and demotion be subject to
the grievance procedure, which provided for arbitration at the terminal point. In the case of
American National Insurance Company where the Union demanded an arbitration clause, an
employer 's insistence to the point of impasse on a clause providing inter alia that promotion
and demotion were company prerogatives to be exercised by the employer subject to grievance
procedure review, final decision resting with the employer, was held to be lawful, in the
absence of a showing of specific bad faith. I find no specific bad faith here in insistence upon
a clause similar to one which had been negotiated into other company bargaining contracts.
B. Whether the Company otherwise bargained
Apart from the foregoing contentions, the General Counsel argues that the Company failed
to comply with the obligation to bargain in other respects during both the 1951 and the 1952
negotiations.
1. The 1951 negotiations
As to the 1951 negotiations the assertion is that after March 1 the Company refused to
meet with the Union for some months, delayed and postponed meetings, engaged in dilatory
tactics , and refused to make counterproposals.
Section 8 (d) of the Act defines the obligation to bargain collectively, in part as follows:
For the purposes of this section, to bargain collectively is the performance of the mutual
obligation of the employer and the representative of the employees to meet at reasonable
times and confer in good faith with respect to wages, hours, and other terms and con-
ditions of employment, or the negotiation of an agreement, or any question arising
thereunder, and the execution of a written contract incorporating any agreement reached
if requested by either party, but such obligation does not compel either party to agree to
a proposal or require the making of a concession ....
952 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Section 204 of the IMRA imposes the duty upon employers, employees and their repre-
sentatives, in industries affecting commerce, inter alia to "exert every reasonable effort"
to arrive at collective-bargaining agreements , and to settle disputes expeditiously in order
to prevent or minimize interruptions to commerce.
The parties to collective bargaining are under a greater duty than merely to meet and
confer without positive desire to avoid coming to agreement. Collective bargaining is an
affirmative, not a negative concept. As the statute says, the obligation is to meet at "rea-
sonable times," and to exert "every reasonable effort" to arrive at agreement; and "reason-
able" imports something more than "convenient."
In my judgment the Company did not fulfill its bargaining obligation in the 1951 negotiations,
though I do not find sustained the theory that it deliberately engaged in dilatory tactics. I
think Mussell and Anderson were willing to meet with the Union when convenient to do so
and willing to enter agreement if a meeting of the minds could be arrived at. But more than
that was required. In my opinion, up to the time of the entrance of Waddleton and McGowan,
the Company's conduct of the negotiations did not measure up to the standard of effort re-
quired for genuine collective bargaining.
The grounds for my conclusion are as follows: The Union was certified as the collective-
bargaining representative on November 17, 1950. Ten days thereafter it forwarded its con-
tract proposals and asked for the opening of negotiations. Excluding the occasion in January
1951, when Richards came to thebranch office and explained the Union 's proposals to Anderson,
the first real negotiating meeting was not held until April 10, 1951, 4j months later. The
parties met on that occasion for 3 hours.u They met again on May 9, 1951, 5 '̀ hours; on
June 28 for 2 hours and 40 minutes, and on July 23 for 3 hours and 20 minutes; after which
meeting the Union broke off negotiations. Thus over a period of 8 months, less a few days,
from the time the Union first asked for negotiations to be opened, there were 4 meetings,
totaling 141 hours of negotiations. Even after negotiations were finally begun they averaged
1 meeting a month until broken off. I do not think this is meeting at reasonable times and
exerting reasonable effort to arrive at an agreement.
Some of that delay, it is true, was unavoidable or not the Company's fault. Thus the death
of President Geist on January 29 was understandably responsible for some of it, the accident
to the Harrisburg dealer prevented Mussell from keeping the May 31 appointment, and the
International Union convention made Richards unavailable in the early part of June. But the
basic cause of the delay in holding meetings was the inability of the eastern territory manager,
first Scholl, then Mussell, because of the press of other duties or commitments to come to
Toledo, or because for a period of time there was no eastern territory manager. As has been
seen, the duties of the eastern territory manager required substantial travel between and
supervision of branch offices in 21 States and Canada. With the exceptions previously noted,
the meeting dates were arranged primarily to meet the eastern territory manager's traveling
schedule and other commitments.
In the case of J. H. Rutter Rex Co., 86 NLRB 470. the Board adopted the following language:
The obligation to bargain collective surely encompasses the affirmative duty to make
expeditious and prompt arrangements, within reason. for meeting and conferring. Agree-
ment is stifled at its source if opportunity is not accorded for discussion or so delayed as
to invite or prolong unrest or suspicion. It is not unreasonable to expect of a party to
collective bargaining that he display a degree of diligence and promptness in arranging
for collective bargaining sessions when they are requested, and in the elimination of
obstacles thereto, comparable to that which he would display in his other business affairs
of importance.
It is true, as the Company says, that the meeting dates were agreed to by the Union. But the
significance of that fact is not immediately evident. Other than to protest and become un-
pleasant before the negotiations had evenbegun,orto file charges immediately, it is not clear
what the Union could have done but agree. From the standpoint of its own statutory obligation
the-Umon may have been lax in not protesting; any judgment on the point now will necessarily
be complicated by the clearer vision of hindsight. It was not conducive to the avoidance of
n There is no allegation in the complaint, and no finding here, of refusal to bargain prior
to March 1, 1951. The lapse of time from November 27, 1950, to March 1, 1951, must,
however, be considered in determining whether the Company's conduct after March 1 met
the statutory standard.
ALLIS- CHALMERS MANUFACTURING COMPANY 953
dispute for either side to permit the meetings to be so delayed , so separated in time and so
sporadic . The Union itself has a duty to pursue negotiations promptly and to see that they do
not become laggard. A representative is certified upon the assumption that it will diligently
represent the employees and strive to secure an agreement stablizing conditions . Otherwise
there is scarcely enough public profit in the transaction to justify the expense . But the Company
is not excused from its own obligation merely because of the Union does not assume the role
of gad -fly. The Company 's contention is sound that the Union should not be permitted to hill
it into an agreed course of action in order to establish a basis for unfair labor practice findings
if the bargaining does not prove fruitful . I do not, however, think that situation is presented
here. At worst I think theUnion was excessively amenable on the subject of meetings , possibly
in the hope that amenity in that respect would bring dividends in others.
It is understood that the scope of the Company's operations is such that its representatives
are daily confronted with urgent problems requiring immediate attention and necessitating
handling some matters on a priority basis . That is so in any responsible enterprise. But
labor relations are urgent matters too . It is one of the functions of collective bargaining to
arrive at an understanding that will tend to prevent emergency situations from arising.
These are not matters of secondary importance to be disposed of in spare or convenient
moments . If the duties of the eastern territory manager made it impossible for him to de-
vote adequate time to reasonably prompt and continuous negotiations , it was the duty of
the Company to provide someone 'who could. The 1952 negotiations seem to indicate that
it was able to do so if need be. Thus, after Mussell left the negotiations, Waddleton and
McGowan, obviously experienced and informed negotiators, took over. The record of the
negotiations after their entrance is in great contrast to the prior course of affairs . Meetings
were promptly arranged , the Company's role in the bargaining was active , affirmative--even
dynamic; adequate sessions were provided for; in sum the 1952 negotiations were handled with
the dispatch to which the problem was entitled.
The matter of arriving at agreement with the Union was at least of equal importance with
the Respondent 's ordinary affairs and was entitled to as prompt disposition . In the case of
Burgle Vinegar Company , 71 NLRB 829, where delay in arranging to meet with the bargaining
representative was occasioned by the illness of the employers ' president , the Board said the
following:
. .. notwithstanding the unfortunate predicament in which it was placed by the serious
illness of its president , the respondent was under a positive legal duty to commence
bargaining with reasonable promptitude after the certification and the Union 's request
for a meeting. The regrettable handicap under which the Respondent labored due to
Burgie's illness , did not apparently impair its ability to deal with matters related to
its ordinary affairs , and therefore, does not afford convincing excuse for its admitted
failure to enter into bargaining negotiations with the Union until more than 5 months
after the Union's initial request.
In the same case the Board commented on the importance of prompt meeting , saying:
In labor relations a delay in commencing collective bargaining entails more than mere
postponement of an ordinary business transaction, for the passage of time itself, while
employees grow disaffected and impatient at their designated bargaining agent's failure
to report progress , weakens the unity and economic power of the group , and impairs the
Union's ability to secure a beneficial contract. The Act, which was designed to equalize
bargaining power between employees and employers , does not permit an employer to
secure , even unintentionally , a dominant position at the bargaining table by means of
unreasonable delay.
Delay may even affect a union's representative status. A certified union which fails to
consumate a contract within 1 year after certification is subject to displacement. Central
California Ice Co., 85 NLRB 1205. Prompt negotiation is thus of personal importance to
the Union as well as of public concern.
Nor was there any improvement in the manner of conducting the 1951 negotiations after
they were resumed in November. During the period from July 23, to November 13, 1951,
there was a hiatus by reason of the Union having broken off negotiations and having filed
charges. Upon receiving a copy of the Company's September 21, 1951, letter to the Board's
954 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Regional Office in which the Company indicated willingness to negotiate at reasonable times
and places and to submit counterproposals when appropriate, Union Representative Taylor
asked Branch Manager Anderson for resumption of negotiations. This was on October 23.
After contacting Milwaukee, Anderson informed Taylor that Mussell would be in Toledo
either on November 4, or 10 days thereafter, but for limited periods on both occasions. Ulti-
mately November 13 was agreed upon. At theconclusion of this meeting, which Mussell had to
leave after noon, Taylor asked for a prompt follow-up; suggesting that he did not want a rep-
etition of the prior experiences. But Mussell's itinerary prevented a meeting before Thanks-
giving (November 22), so ultimately December 4 was selected.
The December 4 meeting was a morning meeting, Mussell having to leave for Detroit in
the afternoon. Because of Mussell's pending trip to Washington and his understandable concern
about his wife, no further meetings were arranged in December. In January 1952 the Union
was notified that Mussell had withdrawn and that he would be replaced by someone else from
Milwaukee. Though having authority to proceed alone, Anderson declined the Union's suggestion
that he do so. Finally, on February 13, 1952, the negotiations were resumed, and began again
from scratch. Two meetings totaling 7 hours, in a period of almost 4 months, scarcely seem a
fulfilment of the representation to meet at reasonable times.
Fifteen months, less 3 days, had now passed since the Union had been certified. If the hiatus
from July 23 to October 23 is excluded, the elapsed period is still substantially a year. During
this time 6 negotiating sessions had been held totaling about 21 hours. Even making all possible
allowances, I cannot conceive that this reflective of the Company's usual diligence in pursuing
affairs which it is desirous of concluding. And, has been seen, this was an affair of more than
ordinary importance.
Though it is not found that the failure to schedule meetings before March 1951 was for
invalid reasons, the very fact that such a long time had elapsed between the Union's request
for opening negotiations and the first meetingput a special responsibility upon the Company to
see once the original emergency was out of the way and negotiations begun--that they were
conducted thereafter with more than ordinary dispatch. While an emergency is recognizable
cause for delay, routine is not. The passage of time made the need for reasonable continuous
negotiation more--and not less--urgent. But the impression left by the record is that, in
general, the negotiating meetings were arranged so as not to interfere with regular company
routine; and if there was conflict between the two, it was the former and not the latter which
was subordinated.
Furthermore--without aspersion on the bona-fides of the Company's representatives--the
1951 negotiations do not reflect a course of action likely to result in agreement. These nego-
tiations were devoted entirely to the Union's draft proposals. In the June 1951 meeting the
Union asked for counterproposals. In November the Union reiterated its request. It was not
until February 1952 that the Union received any.
The Company was not, of course, required to make any concessions. Likewise it was not
required to submit counterproposals if the Union's demands made it evident that such action
would have been futile. But it will be the rare case in which it can be said with any conviction
that the submission of counterproposal is useless. If they serve no other purpose, counter-
proposals provide a complete framework of issue around which the parties can debate. The
12 See Globe Cotton Mills , 103 F . 2d 91 (C. A. 5):
... the duty is on the [Employer] to join in formulating [ a contract ] to which both
[parties ] can agree , fixing as definitely as possible , and for such time as may be agreed
on wages, hours and conditions of employment, whether on the present basis or a new
one. We are of the opinion that the evidence does not show a wilful refusal on the [em-
ployers' part to do this . . . A formal counterproposal to embody in a contract the
Mills then established wages and hours , ( with its outstanding promise as to shorter
hours ) and its established policy as to child labor , and seniority subject to circum-
stances , would have put beyond question the Mills ' willingness to comply with the
Act . . . . But a counterproposal is not indispensable to a bargaining where from the
discussion it is apparent that what the one party would thus offer is wholly unacceptable
to the other Cf. N. L. R. B. v. Sands , 58 S. Ct. 508, 83 L. Ed 682. Still when a counter-
proposal is directly asked for, it ought to be made, for the resistance in discussion may
have been only strategy and not a fixed final intention Because of the refusal on the part
of the Mills to make any proposal for an agreement touching wages, hours and conditions
of employment , we will uphold and enforce [ the appropriate part of the Board ' s order.]
ALLIS-CHALMERS MANUFACTURING COMPANY 955
Union's proposals in the instant case did not do that; nor did the Company's statements on the
subjects thus raised. They merely provided the framework for some of the issues. Thus, it
was not until 8 months after its original request for counterproposals that the Union first
received indication that the Company desired clauses on a number of important questions not
previously raised; particularly those on which the negotiations ultimately broke down in 1952.
In additon, when finally reduced to writing, the Company's position was not in all cases the
same as that previously indicated orally: possibly through misunderstanting, but nevertheless
indicative of the value of written proposals.
The Union actually had no complete picture of what the Respondent desired in the way of
contract clauses until February 1952, over a year after the Union had first presented its own
proposals, and almost a year from the time negotiations began. Whether by way of formal
written counterproposal or by oral statement, there should have been indication from the Com-
pany during the 1951 negotiations as to all the major terms it desired in an agreement. Unless
there are such exchanges within a reasonable time, negotiations become mere exercises in
verbal gymnastics, never really framing the issues, or disclosing basic difference or perhaps
basic agreement. In my judgement, when the Union in the instant circumstances asked for a
counterproposal the Company was under a duty to state, either in writing or otherwise, the
complete terms of agreement to which it would be willing to subscribe. Whether such a
course would in actual fact have helped to produce agreement, or instead would only have
hastened a breakdown, no one can now confidently say. Much would depend on what the Com-
pany proposed. And that may or may not have been the same as what it ultimately did offer.
If the assumption is that what the Company would have proposed in writing in June or July 1951
would have been no different from what it offered in writing in February 1952, then it is indeed
difficult to escape the conclusion that throughout the 1951 negotiations the Company was only
sparring with the Union; and that the parties never really came to grips with the issues in the
1951 negotiations. No indication is given in the testimony as to why, at least, the Company
could not, as requested, have reduced to writing those policies which it had adverted to in
discussing the Union's proposals.
It is my judgment that from March 1, 1951, to February 13, 1952, the Company did not pro-
vide adequate and reasonable opportunity to meet with the Union for the purpose of collective
bargaining, did not act with reasonable and expectable diligence to negotiate an agreement, and
failed to provide a complete statement of its bargaining demands or counterproposals when re-
quested; and that by this action the Company failed and refused to bargain collectively with the
Union; thereby interfering with, restraining, and coercing employees in the excercise or rights
guaranteed in Section 7 of the Act.
2. The 1952 negotiations
There remains for determination the question whether the Company fulfilled obligation to
bargain the 1952 negotiations. As to this, the General Counsel's contentions are: (1) That the
Company did not bargain with the end of reaching accord with the Union but rather sought under
the guise of negotiating to avoid agreement; (2) that even if that contention is not sustained it
was a refusal to bargain as a matter of law, and irrespective of the Company's bona fides, for
the Company to persist in negotiating the "democratic processes" clauses to the point of
breakdown in the negotiations; and (3) that it in fact did negotiate them to breakdown. The
latter contentions are based upon the principle, enunciated in Board and court decisions, that
certain contract demands, though bargauiable, may not be insisted upon as a condition of
agreement upon any contract.
a. As to whether the Company sought to avoid agreement in the 1952 negotiations
I am persuaded, however, that the Company did not seek to avoid agreement in the 1952
negotiations. It is my judgment that Waddleton and McGowan proposed and argued for the
critically disputed clauses in the good-faith belief that: (1) The clauses were desirable
and valuable; and (2) the Company was entitled to press for them to the point of impasse.
In addition it is specifically found that Waddleton and McGowan affirmatively negotiated
on all subjects at issue: that they entered into the negotiations in good faith, made counter-
proposals, considered the Union's position, modified their proposals as a result of the
negotiation and eliminated completely some provisions which the Union found unacceptable.
In sum, if the issues are of such character that the Company was entitled to insist upon
acceptance of its view to the point of impasse or breakdown, I would have no question that
956 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Waddleton and McGowan fulfilled the Company's obligation to bargain in the 1952 sessions.
This leaves for determination (1) whether the Company's contract demands were of a kind
which could be lawfully pressed to the point of breakdown in the negotiations; and (2) whether
it so pressed them.
(1) The "democratic processes" clauses
The rock upon which the 1952 negotiations foundered lay in the "democratic processes"
clauses proposed by the Company
In its original proposal of February 1952 the Company offered, inter alia, the following
provisions: (1) A no-strike, no-lockout clause as follows
Section F. During the life of this agreement, the Union shall not cause or support,
nor shall any employee or employee' take part in any action against the Company
such as a strike, intentional slowdown in rate of production, or any other interference
with or stoppage of the Company's work The Company shall not conduct a lockout
during the term of this agreement.
There seems to have been no controversy over that clause and it was accepted. 13
(2) A section relating to internal union practices, as follows:
Section E. Union Elections and Democratic Processes
1 The Union shall conduct elections of the Union representatives designated in this
agreement in accordance with the general safeguards of the International Union Con-
stitution and Local Union By-Laws, on the date of signing this agreement, including
adequate notice of nominations and elections, adequate opportunity to nominate candi-
dates, reasonable eligibility requirements for nominees and adequate protection against
fraud and error in the determination of election results. A "reasonable eligibility
requirement" for the said offices shall be defined in the international Union Consti-
tution and the Local Union By-Laws. The said elections shall be conducted by secret
ballot by the Union on the Company's premises. The Company shall furnish suitable
facilities No deduction from salary shall be made for time lost from work in voting.
A voting schedule shall be arranged in accordance with the practices of the National
Labor Relations Board in effect on the date of signing this agreement.
2 Union membership and the membership right to hold and vote for the officers
specified in this Section shall not be abridged because of any Act or failure to act in
the exercise of such employees legal or civil rights (consistent with the protection
of the existence and legitimate purposes of the Union) and except pursuant to a fair
hearing conducted in the manner provided in the International Union Constitution and
Local Union By-Laws on the date of signing this agreement.
The union representatives referred to in the section were those operating under the
grievance procedure. Taylor tentatively agreed to this clause, subject to approval of the
International Union, which later disapproved it.
This provision however, was completely abandoned by the Company in its final proposal
of April 1952.
(3) A duration clause conditioning the Union's right to call a strike, after expiration of
the contract, upon prior secret ballot approval by majority vote of all employees in the
bargaining unit:
Article XIII
Duration
Subject to the provisions of Article below, this agreement shall remain in force
until inclusive , and thereafter from year to year unless, within the ten (10) day
13 Taylor's copy of the original draft bears the following notations opposite this clause in
his handwriting: "No" and "subject to approval of union attorneys." Taylor's testimony is
that the provision was tentatively approved. In subsequent correspondence specifying company
clauses to which it objected the Union made no reference to the no-strike clause. I conclude
it was accepted
ALLIS-CHALMERS MANUFACTURING COMPANY 957
period immediately preceding the sixty (60) days prior to any date of termination
written notice of termination is given by either party.
If a new agreement cannot be reached within the sixty (60) day period , then the agree-
ment shall be automatically extended for an additional thirty (30) days.
If a new agreement cannot be reached within such thirty (30) day period, the Union
shall have the right to conduct a strike for any lawful demand in the area of collective
bargaining , provided ( 1) a duly supervised secret ballot strike referendum is held
(after said thirty (30) days period) on Company premises during working hours and at
Company expense and (2) a majority of the employees in the bargaining unit have voted
in such referendum in favor of a strike.
The term "strike" as used in this Article shall mean the concerted action of em-
ployees constituting a majority of the bargaining unit in remaining away from the
Company's premises for the purpose of obtaining a settlement of the demands speci-
fied above.
The Union had no objection to the first 2 paragraphs of article XIII.
This section XIII was ultimately modified by the Company in the following respects:
(a) "One year " was inserted in the first paragraph as the duration period.
(b) The third paragraph was revised to read as follows:
If a new agreement cannot be reached within such thirty (30) day period or thereafter,
the Union shall have the right to conduct a strike provided a majority of the employees
in the bargaining unit shall have voted in favor thereof in a secret ballot referendum
held under the supervision of an impartial State or Federal Agency designated by the
Union . If desired by the Union , such vote may be conducted on Company premises
during working hours at Company expense.
As thus revised the section was continued in the Company's 1952 proposal.
The revisions , though not meeting the Union ' s basic objections , removed two of its sub-
sidiary ones (1) They put supervision under a governmental agency and not the Company;
and (2) they removed the mandatory requirement that the balloting be on company premises.
(4) The final original clause, article XIV, provided inter alia for contract ratification-
Executed this day 1952, subject to ratification by the affirmative
vote of the majority of the employees in the unit in a secret ballot on the next work
day following the date of execution , conducted on Company premises under the super-
vision of the Federal Mediation and Conciliation Service or other agency mutually
satisfactory to the parties
This clause was also subsequently modified by the Company. In its final form it read
as follows:
Executed this day of 1952 , subject to secret ballot , or written, rati-
fication by a majority of the employees in the bargaining unit If desired by the Union
a ratification vote by supervised secret ballot may be conducted on Company premises.
The revisions thus wrought were (1) to permit written ratification as an alternative to
secret ballot , and (2) making the use of company time and premises for the balloting permis-
sive, rather than mandatory . The second modification removed one of the Union ' s complaints.
As has been seen, Taylor had previously indicated his desire to hold a union ratification
meeting on company premises , if a contract was negotiated . The Local Union's constitution
and bylaws require, in substance , approval by the affected member-employees of any con-
tract negotiated on their behalf is
14 The deletion of the adjective "affirmative" modifying "vote" in the final draft of article
XIV had no significance. The company proposals consistently envisioned ratification by
affirmative votes of 4 of the 7 employees in the unit. A similar kind of majority was con-
templated in article XIII.
958 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(2) The background for the clauses
At the West Allis plant Local 248 ofthe United Automobile Workers Union, C. LO. (UAW) was
recognized by the Company in 1937 The evidence here is that thereafter dictatorial control,
undemocratic practices, and subversive aims of the local's leadership deprived the rank-and-
file of genuine trade union representation and effective voice in the local's affairs. The testi-
mony is that a bitter strike in 1941 was, at least in part, in pursuance of and a result of these
aims and practices of the leadership. There were other abuses, as well.
The Wisconsin Employment Relations Act required a favorablevote by employees before the
calling of a strike A vote was taken by Local 248 officers prior to the 1941 strike and the
result announced as overwhelmingly in favor of striking In a subsequent investigation however,
the Wisconsin Employment Relations Board found that there had been wholesale forgery of
ballots and directed a new strike election.
In 1946, during contract negotiations, another strike vote was taken by Local 248, and an-
nounced as carried, under circumstances which, the evidence indicates, cast considerable doubt
on the probity of the stated result. Ultimately that strike was terminated by the execution of a
new contract.
As a result of these experiences the Company, in its 1946 negotiations at West Allis, unsuc-
cessfully proposed a clause similar in some principles to articles XIII and XIV in the present
case, but with significant differences. The 1946 proposal at West Allis was that if a new agree-
ment was not negotiated during a 30-day extension period provided after the expiration date,
the contract would be automatically extended for another year, unless a majority of the em-
ployees in the bargaining unitvoted in the election to authorize a strike. Rather than condition-
ing the right of the Union to call a strike after the expiration of the contract (as in the instant
case) the West Allis proposal was in effect a provision for automatic renewal subject to a
condition subsequent--refusal by the employees It bears some relation to both articles XIII
and XN of the present case; but different in substantial respects.
In 1946 a variant of the West Allis proposal was negotiated into the contracts at the Spring-
field, LaCrosse, Pittsburgh, and Boston plants, and in 1949 at Norwood. The unions involved
were the United Electrical Workers, C.LO., United Farm Equipment Workers, and the C.I.O.
Those contracts provided for one reopeningduring theirterm for further negotiations on wages,
during the reopening the contract continued in effect except that the employees could strike in
support of their wage demands provided that a majority so voted in a secret referendum.
Presumably these contracts contained general no-strike clauses.
In the same year both the West Allis and Springfield clauses were negotiated into a con-
tract at the LaPorte Works with the United Farm Equipment union.
The UAW contract at the Gadsden works in the year 1948 contains the following clause
not readily interpretable:
If a new agreement cannot be reached within such thirty (30) day [extension] period
the Union shall, prior to a strike, conduct a strike vote under the supervision of the
Federal Mediation and Conciliation Service.
At the -Union's request, such vote may be conducted on Company premises during
working hours at Company expense
It is not immediately clear whether this clause prohibits or conditions union strike action
after the expiration of the extension period.
The first contract in which there appears a clause like the article XIII originally proposed
in the instant case seems to be the 1950 agreement at West Allis In the same year the UAW
accepted the clause in the Pittsburgh, Springfield, LaCrosse, and Gadsden agreements,
the International Union of Electrical Radio and Machine Workers, C.LO., at the Norwood
and Boston plants, the Pattern Makers League AFL, the International Brotherhood of Elec-
trical Workers AFL, the International Brotherhood of Firemen and Oilers AFL, and the
Independent Engineers' and Draftsmen's Association at West Allis; and the Farm Equipment
union a somewhat similar clause at LaPorte.
The Union elections clause, section E, first appears in the 1950 contracts and has been
accepted at 6 plants (West Allis, Springfield, Norwood, LaCrosse, Gadsden, Pittsburgh)
by the UAW, the UE, the IBEW, the Pattern Makers, the Firemen and Oilers, and the In-
dependent Engineers. This was apparently the first time the Company proposed such a
provision.
ALLIS-CHALMERS MANUFACTURING COMPANY 959
The 1952 negotiations with the instant union represents the first attempt of the Company
to secure acceptance of the ratification voting clause in article XIV of its proposals in its
present form
It is thus seen that the clauses offered here by the Company on these subjects reflect
a continuous, developmental, and largely successful policy of several years standing to
negotiate the principles of the proposals into its collective-bargaining contracts.
b Whether "insistence" upon the disputed clauses is a refusal to bargin
The Act imposes upon employers and representative unions the duty to bargain collectively
in respect to "wages, hours, and otper terms and conditions of employment." The subject
matter of compulsory bargaining is limited by the statute to such items National Labor.
Relations Board Thirteenth Annual Report, p. 62 See also Sixteenth Annual Report p. 195-6.
These are matters on which negotiation is mandatory, and the obligation to bargain with re-
spect to them may therefore not be evaded Inland Steel Co. v N. L. R. B., 170 F 2d 247
(C. A. 7) (pensions), N. L. R. B. v J. H. Allison, 165 F. 2d 766 (C. A. 6) (merit wage in-
creases), except that, once agreement on terms is memorialized in a contract neither party
is required to discuss modification of them effective during the contractual period. Section 8
(d), Jacobs Mfg Co , 94 NLRB No 380, enfd. 194 F. 2d 680 (C. A. 2), Hughes Tool Co.,
100 NLRB No 208. This is not to say that the collective bargainer under the Act is com-
pelled to accede to or to compromise demands on the subjects on which he is required to
negotiate. He is free to accept or reject, however, unreasonable other may regard him, so
long as he bargains in good faith; and if impasse results he may, if he is the employer,
establish his own terms as the applicable condition of employment; at least within the
limits of his proposals to the Union. N. L. R. B. v. Crompton Highland Mills, Inc., 337
U. S. 217. The parties' freedom of contract is preserved in their right to refuse to agree.
What is denied is a choice to refuse to discuss
Since the statute as construed defines the mandatory subjects of bargaining, it is a neces-
sary corollary that on issues outside that perimeter the parties are not required to bargain;
though they may do so if they choose. Board decisions recognize the right of a bargainer
under the Act, within limits, to propose, negotiate for, or to enforce agreed upon clauses not
strictly definable as "wages, hours, and other terms and conditions of employment." Taor-
mina Co., 94 NLRB 884 (request by employer, readily agreed to by union, for withdrawal of
certain member of the union negotiating committee), Shell Oil Co., 93 NLRB 1187 (agreement
of union limiting its representation on grievance committee); Briggs-Indiana Corporation,
73 NLRB 1270 (agreement by union in contract for production and maintenance employees
not to represent plant -protection employees).
Most typical problem has arisen in cases where the employer has proposed contractual
provisions construable as modifying, waiving, or abandoning rights granted unions or em-
ployees in the statute Those situations raise problems of conflict of policies, on the one
hand the congressionally declared guarantee of certain rights (as for example, to strike or
to designate representatives) and imposition of certain obligations (such as the continuing
duty to bargain, insofar as unaffected by Section 8 (d)), and on the other hand the unexplicated
but desirable policy that the area of negotiation be as boundless as reason and sound prin-
ciple will permit.
In the beginning , the Board and the courts could have taken any one of several possible
views of the bargaining provisions of the Act: that (1) They merely compelled appearance at
the bargaining table and genuine negotiation, leaving the parties completely free to negotiate
to impasse, not only the terms of agreement, but the agenda and subjects of discussion as
well; >s (2) the Act limited the area of discussion strictly to hours, wages, and conditions of
employment, and that any attempt to secure agreement on other subjects was a refusal to
bargain as a matter of law; (3) the area of discussion was limited only by the requirement
that the demanded provisions (a) not be violative of the law or its underlying policies, or
15Some commentators , while conceding that the law is now otherwise, have argued that
such an interpretation would have been preferable; basing their opinion both on legal and
policy grounds. Cox and Dunlop, Regulation of Collective Bargaining by the National Labor
Relations Board, 63 Harvard Law Rev. 389 (1950); and see also Brown, National Labor
Policy 52 (1950) For a contrary opinion see Findling and Colby, Regulation of Collective
Bargaining by the National Labor Relations Board- -Another View, 51 Columbia Law Rev.
170 (1951).
960 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(b) require the waiver or abandonment of rights conferred by the statute, or (c) reasonably
relate to an industrial relations problem; (4) while the area of discussion was not limited to
the statutory agenda , the scope of discussion on subjects not related to conditions of employ-
ment was circumscribed; that is that on such matters the demands, while negotiable, could
not be pressed to the point of impasse , or be made a condition of contracting on substantive
terms of employment or hinder their negotiation.
Despite almost 2 decades of judicial interpretation and substantial congressional amend-
ment of the original Act, the scope of bargaining rights and obligations has not yet been so
clearly delineated that one can say with certainty what solution will ultimately become
settled law. The fact is that as our labor relations policy has matured the bargaining area of
the Act has become the subject of extensive exploration only relatively recently. The phrase
"conditions of employment ," for example , has not yet acquired precise definition. Similarly
imprecise is the line between what is basic statutory policy--which must prevail--and what
is merely a statutory privilege--which may be subordinated.
But of the various possible views enumerated above, the cases show that 1 and 2 have been
thus far rejected. Considerations supporting such a rejection may be summarized as follows:
(1) An objective of the Act is, by the negotiation of agreement on conditions of employment,
to avoid industrial disruption : an objective defeated if disruption is permitted to ensue
over negotiation, even in good faith, of matters not germane to such conditions; (2) unlimited
scope of negotiation would permit enactment of clauses violative of the law itself, (see
N. L. R. B. v. National Maritime Union, 175 F 2d 686 (C.A. 2) cited in footnote 15 N. L. R. B.
v. National Insurance Co., 343 U. S. 395); (3) would permit contractual nullification
of status determined by Congress as a matter of national policy. See McQuay-Norris Co.,
116 F. 2d 748 (C. A. 7), cert den 313 U. S. 565; (4) terms and conditions of employment have
historically been the most fruitful source of labor controversy, and it is to the resolution of
those disputes that the bargaining provisions of the status are primarily directed
The desirability of leaving the parties as free as possible, consistent with the Act, to
fashion their own destiny, is presumably the basis for rejection of No. 2. In so dynamic a
field, while firm concepts are necessary for orderly development, they must be elastic
enough to meet changing conditions and to keep pace with industrial problems The real
contributions of collective bargaining to industrial peace will come largely from its mutual
acceptance as a method of resolving controversy , and not from the creation of precepts
insulating the controversy from resolution.
The policy thus far actually adopted by the Board and the courts appears to be a combina-
tion of parts of views 3 and 4 Thus, negotiation of a contract discriminating against em-
ployees in violation of the Act is unlawful , and the Board may order a union to cease demand-
ing such a clause National Maritime Union, 175 F. 2d 686 (C. A. 2), cert. den An employer
may not bargain over the extent of recognition to be accorded a statutory representative--as,
for example , to recognize it only for its members and not for the entire bargaining unit. The
Seventh Court of Appeals has held that "the recognition required by [Section] 9 (a) is not a
bargaining matter ." McQuay Norris Co , 116 F. 2d; cf Grower-Shipper Vegetable Asso-
ciation, 122 F. 2d 368, (C. A. 9) (mere presentation of the proposal, with nothing more, is
not a refusal to bargain.)
In these situations bargaining is apparently prohibited . The soundness of the result does
not seem questionable . Public policy would appear to forbid agreement legalizing what
Congress has forbidden or nullifying statutory provisions basic to effectuation of its pur-
poses The problem lies in assessing the proposals.
In all other applicable situations thus far to have come before the Board and the courts,
involving the right of a party to bargain about subjects neither clearly mandatory nor con-
trary to a basic policy, it has been held that such right exists, but may not be pursued to the
point of impasse. The terms that have generally been used to indicate the limitation are that
the particular clauses may not be "insisted," or "adamantly insisted" upon, or may not be
made a "condition of agreement." The cases are collected in Colby and Findling, opus
cited, supra. The right to seek agreement on these subjects exists even though its acceptance
would amount in practical effect to a waiver or abandonment by the accepting party of a
right guaranteed by the Act. Illustrative situations are agreements by unions not to represent
certain groups of employees (Essex County News Co., 76 NLRB 1340), and clauses to refrain
from union solicitation on employees' free time (W. T. Smith Lumber Co., 79 NLRB 606).
Here also there may be difficulty in determining which protected prerogative is a waivable
right or privilege , and which is a basic nonwaivable status There is no refusal to bargain,
however , in mere presentation or negotiation of the proposals. The conduct must extend
ALLIS-CHALMERS MANUFACTURING COMPANY 961
beyond "insistence." See, as illustrative , Alabama Marble Co , 90 NLRB 790, where the
Board said:
We are unable to conclude , on this record , that the Respondent ' s demands [ for reserva-
tion of right to take unilateral action with respect to working hours and wage increases
for apprentices] were beyond the negotiation stage and that an impasse had been reached
on these proposals ... In these circumstances , we cannot view the Respondent's
demands in question as reflecting on its good faith bargaining "
The general principle may be thus stated : Parties are free under the Act to demand in
good faith, and to contract for, any collective -bargaining provision not violative of'the Act
or its underlying policies; but on matters not subject to compulsory bargaining, these
demands may not be made a condition of agreement or of bargaining on mandatory subjects,
or insisted upon to the point of impasse or break down in the negotiations.
In no case thus far does this general principle appear to have been challenged , though
there have been understandable differences as to its applicability Thus, the case of Amer-
ican National Insurance Co., 343 U. S. 395
In that case the union involved presented contract demands calling for arbitration as the
terminal point of grievances procedure . The Company, resisting arbitration , proposed a
so-called " management function" clause listing matters such as hiring , promotion , disci-
pline, and work scheduling , as the responsibility of management , and excluding such matters
from arbitration , though subjecting the company 's actions in that regard to the grievance
procedure and to review by management . The Union took the position that it would not agree
to such a clause ; the Company that it would not contract without it. The Union would not
recede from its demands for arbitration . The Board there ordered the employer to cease
"insisting as a condition of agreement " upon such a provision The Fifth Court of Appeals
denied enforcement of the Board order and the Supreme Court affirmed. It will be noted that
that case involved dispute over a clause dealing with terms and conditions of employment;
and that the Company 's proposal was a counter to a union demand for terminal arbitration
from which the Union seemingly never receded . As I interpret its opinion the Supreme
Court held that it is not per se a refusal to bargain for a party to negotiate to impasse in
good faith for a management functions clause covering some conditions of employment.
Nothing in the Supreme Court's opinion suggests , however, that a collective bargainer may,
under the Act, negotiate to impasse any clause which he in good faith proposes - - irrespective
of whether or not it involves conditions of employment or is at odds with a basic statutory
policy. As a matter of fact the Fifth Court of Appeals , whose refusal of enforcement the
Supreme Court affirmed in the American National Insurance case, has held in at least two
cases that insistence to the point of impasse upon certain clauses not related to conditions
of employment is not compliance with the bargaining obligation : Corsicana Cotton Mills,
178 F. 2d 344 (company insistence upon provision to the effect, inter alit that nonunion
employees should have the right to vote at union meetings on union decisions as bargaining
agent); Dalton Telephone Co., 187 F. 2d 811, cert . den 342 U. S. 824. ( Insistence that union
register under State code). Good faith is not a defense in such situations In the Dalton case
the court of appeals said:
Respondent cannot legally make its agreement depend upon an improper condition. The
Act requires the employer to bargain with the duly chosen representative of the em-
ployees as to "wages, hours , and other terms and conditions of employment " In the
course of bargaining negotiations , the parties may reach an impasse on certain terms
or conditions of employment and the Courts may not compel them to agree . There are
certain things about which the parties may bargain or negotiate , but which cannot be
insisted upon as a condition precedent to the making of a contract . The present case
presents such a situation Respondent , by insisting that the Union become an entity
amenable to suit in the State Courts left the sphere of "terms and conditions of em-
ployment ," and conditioned his willingness to sign the agreement on a matter outside
the area of compulsory bargaining w
'6See also Hill v. Florida, 325 U. S. 538, holding unconstitutional as in conflict with the
National Labor Relations Act a State statute requiring union business agents to secure a
license . The Supreme Court cited with approval theBoard ' s decision in Eppinger and Russell,
56 NLRB 1259, where the Board found a refusal to bargain in the conditioning of recognition
upon compliance with the State law.
962 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
I conclude that this principle is not affected by the decision in the American National
Insurance case . It is therefore found that bargaining demands for lawful clauses on subjects
other than conditions of employment , while negotiable , may not be insisted upon , even in
good faith , as a condition of agreement or to the point of breakdown in the negotiations. 17
(1) Whether the clauses related to conditions of employment
The provisions of the Company ' s final draft of article XIV are, in my view , indistinguish-
able in principle from the clause which the Fifth Court of Appeals found in the Corsicana
case to constitute a withholding of recognition from the Union , even though there sought--as
in the instant case- - in good faith . I therefore find the Corsicana decision applicable to
article XIV.
Section E need not be discussed at this point- -since it :s disposed of post on other grounds.
Article XIII also , in my judgment- -at least insofar as it touches upon the instant issue--
appears to be within the scope of the Corsicana and Dalton principles.
The fact that the Company could propose articles XIII and XIV and if voluntarily secured
presumably enforce them, is not dispositive of the issue . Nor would the fact that article XIV
was drafted in response to Taylor 's suggestion or request for the use of company premises
for a union ratification meeting . There is a substantial difference between a voluntary
arrangement of that kind relating to union members , and a compulsory one conferring rights
of participation in union affairs upon nonmembers Though the compulsory feature was
removed in the last draft , the provision still constituted a regulation of an essentially inter-
nal union matter , and a condition upon the exercise of the Union ' s authority as bargaining
representative . There is thus no necessary inconsistency in the Union ' s position. ie
It is true--as I understand the Board's decision in the Shell Oil Co . case , 77 NLRB 1306,
that a no-strike clause effective during the term of the substantive agreement is bargainable
to the point of impasse ; and an employer may refuse to contract without it 19 But that is not
the issue here . As I understand their positions, the parties had already agreed on such a
clause operative during the term of the agreement . The issue raised by the Union as to
article XIII was not the right of the Company to bargain for a no-strike clause , nor whether
there should be such a clause in the contract , but as to who should decide whether to author-
ize the Union ' s strike ; a question ordinarily reserved to an organization ' s membership or
officials This seems to me predominantly an issue as to internal union administration, and
not one affecting a condition of employment The principle of the Corsicana case therefore
appears as applicable to article XIII as to article XIV. Indeed , possibly more so the non-
union employee is bound by the ratification votes of union members, but he is not bound by
their strike votes He may continue to work, the employer willing , so long as the plant
operates , but he may not choose to work under conditions different from the contract.
Other considerations seem confirmatory Thus , article XIII constitutes a limitation of
normal union rights, one, its right to strike , the second , its right to prescribe its own lawful
rules . Even though not so intended--the clause results in an interference in what is essen-
tially an intraunion matter, though an employer may have an interest in it . Finally, article
XIII raises question whether, in its presented form , it effectuates statutory policy.
17 Possibly still open is the extent of the principle enunciated in the American National
Insurance case. For example , may an employer in good faith insist to the point of impasse
upon a clause reserving to himself complete unilateral action during the term of contract on
all conditions of employment. It is unnecessary, however, to decide that question here, though
it would seem evident that an affirmative answer would be little for collective bargaining to
operate upon
There may be situations in which the subject matter, as presented, though having the
complexion of a condition of employment, yet infringes so substantially upon a basic statu-
tory policy as to require that the latter be given overriding effect.
18 On the question of consistency there may be difference of opinion as to whether the
Company's provision for affirmative majorities advances its objectives to secure greater
employee participation in union affairs--since the clause puts a premium on nonparticipa-
tion. Though the original LMRA contained a requirement for affirmative majorities in union
shop elections, that situation seems distinguishable.
19See Senate Report on LMRA, Rept No. 105, 80th Cong , 1st Sess., pp. 17-18: "A no-
strike clause in a contract is certainly a point to be bargained over."
ALLIS-CHALMERS MANUFACTURING COMPANY 963
After the expiration of the 30-day extension period, article XIII becomes in effect a
one-clause contract binding the Union to what ever conditions the employer chooses to estab-
lish- -while depriving the Union of its most effective method of protest. While there would no
doubt be consideration in the legal sense for such a contract--the union is without considera-
tion in a statutory sense. After the expiration of the extension period the Company is bound
to nothing: there is no wage agreement , no grievance procedure-- not even a recognition
clause. Until it could persuade the employees to break its fetters, the Union would be vir-
tually shackled, the employer altogether free of commitments. Thus the clause is interpret-
able as permitting the employer to refuse recognition while forbidding the Union from
striking for it. Certainly a contract containing that sole provision would not be a bar to a
claim by a rival union 20 I do not think a clause prohibiting a union for an indefinite period
from striking, or conditioning its right to strike upon events beyond its control, unaccom-
panied by a contract covering recognition and substantive terms of employment is a clause
involving, within the meaning of the Corsicana and Dalton cases, a term or condition of
employment upon which an employer may insist to the point of breakdown in the negotiations.
It is in the public interest and conducive of industrial peace that no-strike clauses in
bargaining contracts be encouraged and enforced. But the premise behind that recognition,
I have always understood, is that such a provision be accompanied by mutually binding agree-
ments fixing substantive terms for the same period. These are the essentials of true labor
relations stability. Without reciprocal rights and obligations the collective agreement has
neither mutuality nor capacity to allay unrest; the only premises for its existence.
Unless a union's refusal of a clause like article XIII has the effect of requiring the elimi-
nation of the objectionable matter, I do not think defects are removed by the fact that the
Union is free in the first instance to decline the agreement. For if the employer persists the
Union's only recourse is either to abandon its effort to get a contract or to strike. Nor do I
believe the problem is met by the provision that the employees may cancel the Union's
obligation. Absent any legal impediment thereto, the Union has its own right to strike. A
deprivation of that right, if unwarranted, is not remedied by possibility of its elimination by
the action of others. 21
The Company calls attention to a number of statutory provisions of related bearing in
support of the legality of the clauses. Thus the Wisconsin Employment Relations Act, section
111 06 (2) (e), makes it an unfair labor practice for employees to strike unless a majority
in the bargaining unit have voted to do so The War Labor Disputes Act (5d U. SCA 1508)
also contained provision for compulsory strike balloting and section 203 (c) of the LMRA
directs the Federal Mediation and Conciliation Service to induce disputants to
seek other means of settling the dispute without resort to,strike, lockout, or other
coercion, including submission to the employees in the bargaining unit of the employer's
last offer of settlement for approval or rejection in a secret ballot.
Likewise, section 208 of the Act authorizes the issuance of an injunction restraining national
emergency strikes for a period of 80 days.
The Wisconsin Act, however, does not supersede the National Labor Relations Act in the
field of interstate commerce The War Labor Disputes Act was emergency legislation in
time of war Section 203 (c) of the LMRA demonstrates that it is not inappropriate for the
Mediation Service to suggest the polling of employees on the employer's last offer in an
effort to secure voluntary settlement But that is scarcely a provision forbidding a strike
unless the employees authorize it. As to Section 208, that involves only national emergency
situations affecting the economy as whole, and even there the strike ban is limited to a
definite-time I do not find those authorities dispositive of the present issue.
Most persuasive of the legality of article XIII is the fact that it has been accepted by large
international unions, and represents negotiated policies. History and current practices are
strong, sometimes conclusive, evidence as to what are appropriate subjects of negotiation.
The law of collective bargaining will be of little public utility if it ignores settled bargaining
20 This is not to suggest that the Company sought the provision with these purposes
2i By referring to the foregoing policy considerations I do not mean to suggest that article
XIII is so at variance with statutory policies as to make it bad per se. Its consonance with
policy is a factor to be considered, however, in evaluating it Nor do I say that it could not
be so drafted as to eliminate the objectionable features. In disposing of it here it must be
considered as it was--and not how it could be- -presented.
322615 0 - 54 - 62
964 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
practices not intrinsically unlawful In some instances those practices may be of such com-
mon standing as to be of controlling weight in determining the legal breadth of the obligation
to bargain In all instances they must at least be considered and weighed. I have tried to so
evaluate them here, conscious of the fact that a company policy seemingly acceptable to a
fairly representative group of labor unions is not to be lightly questioned or airily rejected.
But to hold that the Company cannot retard negotiation of terms and conditions of employment
by insistence upon clauses like articles XIII and XIV is not to hold that it may not bargain for
and persuade unions to accept them. The record would seem to indicate that up to this point
the Company has been quite successful in doing just that Either that, or the unions involved
have for some compelling circumstance deemed acceptance necessary for the sake of larger
gain . On balance, I find that the bargaining history does not establish that articles XIII and
XIV represent conditions of employment bargainable to the point of impasse. zz
Finally, the consequences of a decision subjecting the bargaining process to collapse over
issues dealing with the representative authority or the internal affairs of the parties, must
be considered. If the employer can compel such solutions at the bargaining table, the Union
is equally free to do so. However praiseworthy the objectives, authorizing such bitter end
and to the death intrusion by employers and unions into each other's internal operations and
authority, constitutes an advance into a field of policy which--if empowered--I am not pre-
pared to initiate.
It is consequently found that articles XIII and XIV, insofar as they provided that any agree-
ment reached between the Union and the Company be ratified by majority of all employees in
the bargaining unit, whether or not union members; and insofar they conditioned the right of
the Union to strike after expiration of the agreement and at a time when there was no collec-
tive-bargaining agreement covering recognition or conditions of employment in effect, did
not involve conditions of employment, and were not matters upon which the Company could
insist in bargaining as a condition of agreement, or condition of negotiation on conditions of
employment; or upon which it could insist to the point of breakdown in the negotiations.
(2) Whether the breakdown in negotiations was caused by the Company's
insistence upon these clauses
It has been seen that the company proposal for the union elections and democratib proc-
esses clause, section E. was withdrawn in its April 17 contract draft. It is therefore found
that the Company did not insist upon that provision as a condition of agreement, or of bar-
gaining with respect to terms and conditions of employment, or to breakdown in the negotia-
tions The allegation in the complaint of refusal to bargain with respect to that issue should
therefore be dismissed As to articles XIII and XIV, however, it is my conclusion that the
Company insisted upon them beyond the permissible point.
The testimony and record of the 1952 bargaining conferences do not, in my view, establish
that the Company refused to contract unless the Union consented to the disputed clauses. Nor
do they disclose that the Company refused to discuss terms and conditions of employment.
22 A number of Canadian firms have executed contracts with the UAW and the Operating
Engineers Union, AFL, containing the so-called "Rand formula"; which, in essence, is a
trade of compulsory check off from all employees in the bargaining unit in return for a
provision for a governmentally supervised strike ballot among all employees in the unit
before striking The formula was devised by Justice Rand of The Canadian Supreme Court
in a 1946 arbitration proceeding between the UAW and the Ford Motor Company of Canada.
In the Basic Steel dispute in this country in March 1952, the Wage Stabilization Board
suggested to the parties that they consider the Rand formula as a possible basis for settle-
ment of the union-shop issue. Though relevant, and considered, to show the degree of accept-
ance of strike ballot provisions in collective bargaining generally, this evidence does not
appear to be of dispositive weight via a vis the issues presented here. In the first place the
Rand solution represented a bargaining trade for a form of union security. In the instant
case the Company's testimony is that its strike-vote clauses were not trades for union-
security provisions; and it is clear that theproposal was not so put forwarded here. Secondly,
the Rand clause is apparently applicable only for the term of the agreement; thirdly, it may
have been a substitute for a general no-strike clause. (It is not clear, whether this is so or
not); fourthly, there would appear to be more substantial reason for guaranteeing to an
employee under legal compulsion to support a union a voice in that union's decisions; than
in the case of an employee who is legally free to decline to support or participate in it.
ALLIS-CHALMERS MANUFACTURING COMPANY 965
On the contrary they establish that the Company genuinely bargained about the clauses in an
attempt to "sell" them to the Union To meet some of the union objections it modified the
clauses, finally abandoning the one altogether The Union bargained about them too. Though
it consistently opposed the provisions and asked their elimination the Union did not defini-
tively refuse to discuss them until the final session; though it stated several times in the last
few meetings that the matter had been extensively aired, the positions on both side fully
developed, and that no useful purpose would be served by further discussion of the clauses.
It asked that the subjects be dropped and discussion concentrated exclusively on the substan-
tive provisions of the contract The record of the April 11 meeting and the exchange of
correspondence between Riemer and Waddleton following the submission of the Company's
last proposal reflect some sparring and jockeying between the parties to fix responsibility
for the breakdown. Thus, at the April 11 meeting the Union asked elimination of the clauses;
the Company asked the Union's reasons the Union declined to state them, saying that they
had been amply stated before, and in turn asked the Company for an answer on the demand
for elimination; the Company responded with a request that the clauses be set aside for the
time being and discussion pursued on other issues; the Union replied by reiterating its
request for an answer; the Company countered with the suggestion of further discussion.
Thus to some extent each side sought to pinpoint its own demands, and to avoid pinpointed
replies to the other's
These maneuvers aside, it is evident that the negotiations broke down over the Union's
refusal to discuss the disputed clauses further; the Company insisting that negotiations be
continued on them and on all other subjects.
Specifically the April 11 meeting closed with the Company seeking to elicit further elabo-
ration of the Union's objections to article XIII, and the Union declining discussion of that
subject. The meeting then ended with the positions unchanged, but with the understanding
that the Company would contact the Union in a few days. On April 17, 1952, the Company
submitted its last proposals. In his acknowledgment of April 24, breaking off negotiations,
Riemer stated in part:
We have now received your modified proposals which still contain proposed provisions
to which we must object. Your Article XIII, we must assume, still represents the
Company's insistence that a strike vote must be taken by a majority, not of our mem-
bers, but of all of the employees in the unit in a referendum under the supervision of
some outside tribunal. Article XIV we must assume, represents the Company's insist-
ence that even if agreement on the contract was reached, it would only be ratified by a
majority, not of our members, but of all the employees in the unit. As previously indi-
cated this represents an attempt on the part of your company for forced participation of
employees who are non-members in the internal affairs of the union. This is contrary
to our Constitution and By-Laws and is completely unacceptable.
Our views on this have been presented at great length at past meetings and are well
known to you. Your revised proposals, therefore, represent in essence nothing new.
Since you give no indication of departing from this unalterable position, we are forced,
therefore, to reject your proposals. With regret, we decline any further meetings in
view of your consistent position on these matters
I do not think that the evidence sustains the assertion that the proposals represented the
Company's "unalterable position" on the inclusion of the clauses, but I do think it establishes
the Company' s unalterable position that discussion of them be continued . Thus, the events of
the April 11 meeting, and the Company's reply to Riemer's April 24 letter:
As we read your letter of April 24, it is your position that the union does not choose
to make any counter-proposal to the Company's proposal transmitted in our letter of
April 17, 1952 to Mr. John C. Taylor.
Stated differently, you indicate that an , impasse has been reached on the basis of
negotiations as they exist at this time.
Under the circumstances, we have no alternative other than to accept the union's
decision to break off negotiations even though we are ready and willing to continue them.
However, we wish to point out that your statements concerning the meaning and import
of two of the clauses in our latest proposal are erroneous.
Upon these facts it is my conclusion that the negotiations were broken off by the Union
because of the Company's insistence or continued discussion of articles XIII and XIV after
966 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the question of their inclusion had been extensively negotiated, and after the Union had stated
that it would not discuss them further.23 The sum of the situation, I find, is that the Company
declined to continue bargaining about terms of employment except upon condition that the
Union continue to bargain about terms other than employment. This, I think, was violative of
the Act.
These not being subjects involving terms or conditions of employment, they were not
proposals upon which the Company could insist to the point of breakdown in the negotiations.
This is not to pass adverse judgment on the objectives of the Company's proposals. Its
prior success in negotiating provisions similar to article XIII with strong international
unions made the clauses reasonably, in the Company's view, as Waddleton put it, collective-
bargaining "currency." But as has been seen, any topic of mutual concern, or potential
source of controversy is, so long as its resolution produces no illegal result, collective-
bargaining "currency" under the Act if the parties can come to agreement on it.
But insistence upon bargaining about conditions other than employment may not be per-
sisted in as a condition of bargaining about terms of employment. It is possible, I think, that
the Company might not have persisted in its demands for articles XIII and XIV if the dis-
cussions had been continued. But its failure to indicate any such possibility in its final com-
munication indicates that it was prepared to stand upon them; in the good faith but firm
belief that it had complied with its obligations under the law.
It is also true, I think, that the Company's insistence upon the clauses was not out of
motives of meddling in union affairs: considering its past unhappy experience, the State of
Wisconsin law upon the subject of employee voting, and the Company's previous success in
negotiating such clauses And I conclude that the Company was equally as desirous as the
Union of arriving at an agreement But these facts do not reach the issue as to whether the
clauses could be pressed to the point of breakdown in the negotiations.
The Company contends, in effect, that no finding can be made that the negotiations broke
down or reached an impasse over the "democratic processes" clauses, for the reason that
final agreement had not yet been reached on all other issues I do not think this contention
sustained A meeting of the minds on conditions of employment is not a prerequisite of
finding that the Company did not bargain collectively with respect to conditions of employ-
ment, anymore than it is a prerequisite to finding a refusal to execute a written agreement.
The Todd Co., 71 NLRB 192 Moreover, there is reason to believe that but for the Company's
position vis-a-vis the two clauses, the parties would have come to terms on the remainder
of the Company's proposals 24
23 The Company contends that the negotiations broke down only over article XIII, and not
over article XIV. The basis for this contention is testimony of Union Representative Daugherty
to the effect that in reviewing the last proposal he did not read beyond article XIII, and was
consequently unaware, when he concluded that the new proposals were unacceptable, that
article XIV had been modified. However, the modifications did not remove the substantial
basis for the Union's objections to article XIV.
24 Thus Daugherty's testimony as to the April 11 meeting:
I think I opened the discussion after the reporter left by asking the Company to delete
these articles from the contract so that we could get back on a basis of true collective
bargaining.
I think I further stated that I didn't think we would have too much trouble with the
other issues that had been left open that there had been some discussion on in the
morning if we could get these articles [E XIII, XIV] out of the way. (Emphasis supplied,)
And the following exchange shown by the transcript of the meeting:
Mr. Taylor: As I say, we are not trying the case here.
Mr. Mcgowan: But we can reach an agreement.
Mr. Taylor: We can if you will give us an answer and you won't do it, and I have been
trying to get it for two months and you won't give it to me,
Mr. Waddleton: What is that, if you care to tell us9
Mr. Taylor: The answer to take out those objections. If you will take those out, we
will go along with you. (Emphasis supplied.)
ALLIS-CHALMERS MANUFACTURING COMPANY 967
Finally, the Company urges that the pendency of the litigation fortified the Union "in a
determination not to negotiate the Company's proposals on the merits based on assurance
that a complaint would be issued if negotiations did not result in an agreement."
It is unfortunate that the negotiations had to take place under the shadow of litigation, but
I do not see how that could have been prevented As far back as January 1952 the Regional
field examiner had advised the Company that in his view issuance of complaint was war-
rantedon the refusal-to-bargain charge In February he advised the parties that a hearing had
been scheduled for May 12 on the charges, and inquired of the Company as to the possibility
of arriving at a negotiated agreement making formal proceedings unnecessary. In early
March 1952 the Regional chief law officer reiterated to the Company--at a time when it
moved the Regional Director for dismissal of the charges--the view that a complaint was
justified The Company further asserts that he said that one would be issued about April 1
unless the parties reached agreement.
Assuming these facts and accepting that they made negotiations trying--it is difficult to
see how the situation could have been avoided, or how the Company was prejudiced in law.
That in conference with company representatives, particularly when asked to dismiss the
charges, Regional Office representatives should have expressed an opinion that formal action
was warranted, and announced intention to issue a complaint, scarcely seems improper. If
agreement was reached between the parties obviously the case became moot in large part
and litigation would have been of little useful result.
I do not understand exactly what the Regional Office could. or should have done or refrained
from doing under the circumstances, other than what it did. If, as the Company suggests,
knowledge of the views of the Regional Office vis-a-vis the merits of the charges, "hard-
ened" the attitude of the Union, it was no more than corroboration of the Union's view that it
was correct on the law, and that it need not surrender fundamental rights under the compul-
sion of securing no agreement otherwise. It must be remembered, in this connection, that the
Union had already been seeking for a year to obtain agreement.
But I do not find the hypothesis sustained that the Union was determined not to negotiate the
company proposals on their merits I think the evidence establishes that the disputed clauses
were fully--indeed exhaustively- -negotiated before the Union broke off negotiations.
It is found that by insisting upon articlesXlll and XIV of its proposals to the point of break-
down in the 1952 negotiations the Company failed and refused to bargain collectively with the
Union, thereby interfering with, restraining, and coercing employees in the exercise of rights
guaranteed in Section 7 of the Act
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
The activities of the Company set forth in section III, above, occurring in connection with
the operations of the Company previously described, have a close, intimate, and substantial
relation to trade, traffic, and commerce among the several States, and tend to lead labor
disputes burdening and obstructing commerce and the free flow of commerce.
And see Taylor's testimony on cross-examination by Company counsel concerning the
situation at the end of the February 14,1952, meeting, at which time he had not yet seen articles
XIII and XIV, but had apparently been given other Company proposals.
Q. Now, Mr. Taylor, this meeting concluded around the noon hour on February 14?
A. Yes, sir.
Q. And you recall that you thought that substantial progress had been made in the
negotiations and probably at the next meeting they might be concluded.
A. I hoped so.
Note also that during this period Taylor, in apparent anticipation of imminent agreement,
suggested or requested that he would like to have a union meeting on company premises for
ratification of the contract.
And see the Company's brief, p. 62: "Furthermore, the Union has indicated that if the
Company will agree to deletion of the 'democratic processes' proposals that no difficulty
will be encountered in arriving at a mutual agreement on the remainder of the Company's
proposals." Somewhat to the same effect is a motion to dismiss the charges filed by the
Company with the Regional Director under date of March 6, 1952.
968 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
V. THE REMEDY
It having been found that the Company failed and refused to bargain collectively with the
Union, it will be recommended that it bargain with the Union upon request, and if understand-
ing is reached , embody such understanding in a signed agreement.
With regard to the 1952 violation it will also be specifically recommended that the Com-
pany, in collective-bargaining negotiations with the Union, cease insisting upon articles XIII
and XIV of its proposals, or any proposal not involving conditions of employment, to the point
of breakdown in negotiations.
In view of the fact that in the 1952 negotiations the Company presented a complete set of
counterproposals and provided adequate opportunity to meet with the Union for collective
bargaining , I think it unnecessary to recommend any more specific order respecting the
1951 violation
With regard to the allegations in the complaint heretofore found not sustained, it will be
recommended that those be dismissed
Upon the basis of the foregoing findings of fact, and upon the entire record in the case, I
make the following:
CONCLUSIONS OF LAW
1 Office Employees International Union, Local No 19, AFL, is a labor organization
within the meaning of Section 2 (5) of the Act.
2. All office and clerical employees at the Allis-Chalmers Manufacturing Company tractor
branch, Toledo, Ohio, excluding branch manager, assistant branch manager, service manager,
parts foreman, office manager, warehouse foreman, accountant, guards, outside salesmen,
secretary to branch manager, confidential employees, warehouse, receiving, and shipping
employees, professional employees, and supervisors as defined in Section 2 (11) of the Act,
as amended, constitute a unit appropriate for the purposes of collective bargaining within the
meaning of Section 9 (b) of the Act.
3. At all times since November 17, 1950, the Union has been the exclusive representative
for the purposes of collective bargaining of all employees in the appropriate unit
4 By failing and refusing to bargain collectively with the Union since March 1, 1951, the
Company has engaged in and is engaging in unfair labor practices within the meaning of
Section 8 (a) (5) of the Act.
5. By the above-described unfair labor practices the Company engaged in and is engaging
in unfair labor practices within the meaning of Section 8 (a) (1) of the Act.
[Recommendations omitted from publication]
APPENDIX A
NOTICE TO ALL EMPLOYEES
Pursuant to the recommendations of a Trial Examiner of the National Labor Relations
Board , and in order to effectuate the policies of the National Labor Relations , Act, we hereby
notify our employees that:
WE WILL bargain collectively with Office Employees International Union Local No. 19,
A.F.L., for the appropriate bargaining unit named herein, with respect to rates of pay,
wages, hours of employment, or other conditions of employment, and if an understanding
is reached, embody such understanding in a signed agreement.
WE WILL NOT insist, in collective-bargaining negotiations wi^'i the Union, upon
articles XIII and XIV of our April 17, 1952, proposals to the Union, or upon any proposal
not involving conditions of employment, to the point of breakdown in the negotiations
WE WILL NOT in any like or related manner interfere with, restrain, or coerce any
employees in the exercise of rights guaranteed in Section 7 of the National Labor
Relations Act.
All our employees are free to become, remain, or refrain from becoming, members of the
above-named Union or any other labor organization, except to the extent that the right to
KLINKA'S GARAGE 969
refrain may be affected by an agreement in conformity with Section 8 (a) (3) of the National
Labor Relations Act.
The appropriate bargaining unit is:
All office and clerical employees at the Allis-Chalmers Manufacturing Company
tractor branch, Toledo, Ohio, excluding branch manager, assistant branch manager,
service manager, parts foreman, office manager, warehouse foreman, accountant,
guards, outside salesmen, secretary to branch manager, confidential employees,
warehouse, receiving and shipping employees, professional employees and super-
visors as defined in Section 2 (11) of the Act, as amended.
ALLIS-CHALMERS MANUFACTURING COMPANY,
Employer.
Dated........... By ...............................................................
(Representative) (Title)
This notice must remain posted for 60 days from the date hereof, and must not be altered,
defaced, or covered by any other material.
JOHN A. KLINKA, An Individual doing business as KLINKA'S
GARAGE and INTERNATIONAL UNION, UNITED AUTO-
MOBILE WORKERS OF AMERICA, AFL. Case No. 13-CA-
1259. August 26, 1953
DECISION AND ORDER
On May 28, 1953, Trial Examiner Eugene F. Frey issued. his
Intermediate Report in the above-entitled proceeding, finding
that the Respondent had engaged in and was engaging in certain
unfair labor practices within the meaning of Section 8 (a) (1), (3),
and (5) of the Act and recommending that it cease and desist
therefrom and take certain affirmative action as set forth in the
copy of the Intermediate Report attached hereto. The Trial
Examiner also found that the Respondent had not engaged in
certain other unfair labor practices as alleged inthe complaint.
Thereafter, the Respondent filed exceptions to the Intermediate
Report with a supporting brief and the General Counsel filed a
memorandum in opposition to Respondent's exceptions.
The Board has reviewed the rulings of the Trial Examiner
made at the hearing and finds that no prejudicial error was
committed. The rulings are hereby affirmed. The Board has
considered the Intermediate Report, the exceptions, brief,
and memorandum of opposition, and the entire record in
the case, and adopts the findings, conclusions, and recom-
mendations of the Trial Examiner to the extent consistent
with the findings, conclusions, and order hereinafter.'
1The following minor corrections of the Trial Examiner's findings are noted:
(1) The Intermediate Report states, in its text following footnote 1, that "All purchased
parts and accessories are shipped to Respondent from points within the State of Wisconsin."
(Emphasis supplied.) The parties stipulated at the hearing, however, as correctly found by the
Trial Examiner elsewhere, that the motor vehicles and accessories sold by Respondent are
106 NLRB No. 156.