Atlantic Research Corp.

National Labor Relations Board - Board Decisions

Aug 27, 1963

144 N.L.R.B. 285 (N.L.R.B. 1963)

ATLANTIC RESEARCH CORP., DESOMATIC PRODUCTS DIV. 285
WE WILL NOT interrogate employees concerning their union activities, ask
employees to report to management concerning the union activities of other
employees, tell employees that they will be discharged for union activities, or
tell employees that their union activities are under surveillance by management.
WE WILL NOT in any other manner interfere with, restrain, or coerce our em-
ployees in the exercise of their right to self-organization, to form, join, or assist
any labor organization, to join or assist Textile Workers Union of America,
AFL-CIO, to bargain collectively through representatives of their own choosing,
to engage in concerted activities for the purpose of collective bargaining or
other mutual aid or protection, and to refrain from any or all such activities,
except to the extent that such right may be affected by an agreement requiring
membership in a labor organization as a condition of employment, as authorized
in Section 8 (a) (3) of the National Labor Relations Act.
WE WILL offer Robert E. Wright immediate and full reinstatement to his
former or substantially equivalent position, without prejudice to his seniority
and other rights and privileges, and make him whole for any loss of pay he may
have suffered as a result of the discrimination against him.
All our employees are free to become, or remain, or to refrain from becoming
or remaining members of any labor organization, except to the extent that this right
may be affected by an agreement executed in conformity with Section 8(a)(3) of
the Act.
BURLINGTON INDUSTRIES, INC.,
VINTON WEAVING COMPANY PLANT,
Employer.
Dated------------------- By-------------------------------------------
(Representative) (Title)
This notice must remain posted for 60 consecutive days from the date of posting,
and must not be altered, defaced, or covered by any other material.
Employees may communicate directly with the Board's Regional Office, 707 North
Calvert Street, Sixth Floor, Baltimore, Maryland, Telephone No. 752-8460, Ex-
tension 2100, if they have any question concerning this notice or compliance with
its provisions.
Atlantic Research Corporation , Desonlatic Products Division
and International Union of Electrical , Radio and Machine
Workers, AFL-CIO . Case No. 5-CA-2183. August 27, 1963
DECISION AND ORDER
On May 6, 1963, Trial Examiner Paul Bisgyer issued his Interme-
diate Report in the above-entitled proceeding, finding that the Re-
spondent had not engaged in the unfair labor practices alleged in the
complaint and recommending that it be dismissed, in its entirety as
set forth in the attached Intermediate Report. Thereafter, the Gen-
eral Counsel and the Charging Party filed exceptions to the Interme-
diate Report and a supporting brief, and the Respondent filed a reply
brief.
Pursuant to the provisions of Section 3 (b) of the Act, the Board has
delegated its powers in connection With this case to a three-member
panel [Chairman McCulloch and Members Rodgers and Fanning].
The Board has reviewed the rulings made by the Trial Examiner at
the hearing and finds that no prejudicial error was committed. The
rulings are hereby affirmed. The Board has considered the Interme-
diate Report, the exceptions and briefs, and the entire record in this
144 NLRB No. 39.
286 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
case and hereby adopts the findings, conclusions, and recommenda-
of the Trial Examiner.
[The Board dismissed the complaint.]
INTERMEDIATE REPORT AND RECOMMENDED ORDER
STATEMENT OF THE CASE
This proceeding was heard by Trial Examiner Paul Bisgyer on October 9 and 10,
1962, in Washington, D C., on the complaint of the General Counsel issued on the
basis of a charge filed on June 1, 1962, and the answer of Atlantic Research Cor-
poration, Desomatic Products Division, herein called the Respondent or Desomatic.
The issue litigated was whether the Respondent, in violation of Section 8(a) (5) and
(1) of the National Labor Relations Act, failed to perform its statutory duty to bar-
gain in good faith with International Union of Electrical, Radio and Machine Workers,
AFL-CIO, herein called the Union, the duly certified representative of the Re-
spondent's employees in an appropriate unit, with respect to rates of pay, wages,
hours, and other conditions of employment. The parties waived oral argument.
Thereafter the General Counsel and the Respondent filed briefs which were carefully
considered. The Respondent's motion to dismiss the complaint, on which I reserved
decision at the hearing, is now granted in accordance with my findings and conclu-
sions set forth below.
Upon the entire record and from my observation of the witnesses, I make the
following:
FINDINGS AND CONCLUSIONS
1. THE BUSINESS OF THE RESPONDENT
The Respondent, a Virginia corporation, is engaged in the manufacture of indus-
trial dehumidifiers and other products at its Desomatic Products Division in Alex-
andria, Virginia. It annually receives at this plant shipments of goods valued in
excess of $50,000 directly from points located outside the Commonwealth of Virginia.
The products manufactured in this plant valued in excess of $50,000 a year are
shipped to points outside that State.
Accordingly, I find that the Respondent is engaged in commerce within the mean-
ing of Section 2(6) and (7) of the Act and that it will effectuate the policies of the
Act to assert jurisdiction herein.
If. THE LABOR ORGANIZATION INVOLVED
It is not contested , and I find, that the Union is a labor organization within the
meaning of Section 2 (5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. The evidence'
1. The Union's certification; summary of subsequent events
Pursuant to a consent election held on February 23, 1962,2 the Union was certified
on March 7 as the exclusive bargaining representative of the Respondent's employees
at its Desomatic Products Division, excluding office clerical employees, salesmen,
guards, watchmen, professional employees, and supervisors as defined in the Act.
Desomatic is one of about 12 divisions located at the Respondent's Edsal Road
industrial complex in Alexandria, Virginia,3 and employs about 30 employees in
the bargaining unit. As of the time of the hearing, Desomatic was the only division
the Union had organized.4 The Union's campaign to organize employees of other
i Unless otherwise indicated, the factual findings herein are based on substantially un-
contradicted testimony.
2 All events herein occurred in 1962
"In addition to the divisions in this industrial complex, the Respondent also owns and
operates Prewitt Plastics Division which is located some 300 yards from Desomatic • a
part of Solid Propellant Division which is in Gainesville, Vir R+inia ; Sloane Division and
U.S Flare Division, which are in California, and Northeastern Division in New Hampshire.
4 The only other unionized division In the Respondent's entire operation Is the Sloane
Division in California which is under a collective-bargaining contract with the Rubber
Workers Union
ATLANTIC RESEARCH CORP., DESOMATIC PRODUCTS DIV. 287
divisions, which was in progress during the contract negotiations for Desomatic em-
ployees related below, has not met with similar success.
Shortly after its certification, the Union sent the Respondent a letter requesting
negotiations. Enclosed therein was the Union's proposed contract which contained
some 35 articles embracing a wide range of subjects commonly found in collective-
bargaining agreements, including a demand for a general wage increase of 30 cents
an hour and other economic benefits. The proposed contract served as a basis for
discussion at the ensuing bargaining sessions which began on March 21 and continued
through May 17. In all the parties held nine meetings during this period,5 the last
two being attended by a Federal conciliator. Because of the parties' inability to reach
agreement on a contract, the Union broke off negotiations on the latter date. In an
effort to resolve fundamental differences, a so-called "summit" meeting between Dr.
Sloan, chairman of the Respondent's board of directors, and Mr. Hartnett, secretary-
treasurer of the Union, was held 2 weeks later at the suggestion of the Federal con-
ciliator. This, too, proved fruitless. Thereafter, on June 1 the Union filed the
charges herein with the Board, alleging that the Respondent unlawfully refused to
bargain in good faith with the Union.
Following the filing of the charges and for about 4 months, contract negotiations
remained in a state of suspension. During that period, the Respondent notified the
Union that, in accordance with its established pay review procedures, it recommended
a number of employees for merit increases. The Union assented or did not object
to the contemplated increases mentioned in the earlier notifications. However, it
requested negotiations with respect to the later proposed increases. Also during
this hiatus in bargaining, the Respondent, after securing the Union's approval, created
a leadman job classification and promoted four employees to those jobs and made
available to Desomatic employees the benefits of a newly acquired companywide
accident insurance plan. On September 26, at the Union's request,6 a final meeting
was held which also was unproductive. Substantially the same matters that caused
a stalemate in the earlier negotiations between the parties were stumbling blocks to
this renewed attempt to reconcile their differences.
The General Counsel attributes this inability to achieve agreement to the Respond-
ent's bad-faith bargaining. He urges that this attitude is reflected in the positions
the Respondent took at the bargaining table relating to merit increases, overtime after
8 hours work in a day, holidays, vacations, and the Christmas bonus; its disposition
to take unilateral action; and its disparagement of the Union and its officers in
literature it distributed or posted in the Desomatic shop while the Union was seeking
to organize other divisions of the Respondent. These matters will be separately
treated below.
2. The Respondent's bargaining positions
There is no question that the Respondent was willing to, and at all times did,
confer with the Union when requested to do so. It is equally clear that the Re-
spondent discussed all propsals put on the bargaining table, fully explained its
positions and offered counterproposals dealing, not only with the subjects to be
considered below, but also with such matters as the scope of arbitration, hours,
call-in pay, restrictions on work that supervisors and nonunit employees may perform,
premium pay for Saturday and Sunday work, and job classifications. As a result
of the negotiations, the parties were able to agree on some items and to concur in
principle on others with details to be worked out in later negotiations. However,
they were far apart on many other matters, including a general wage increase, other
monetary items, arbitration, and checkoff. As indicated above, the General Counsel
singles out the Respondent's positions with respect to five subjects as demonstrating
an attitude of disregard of its statutory bargaining obligation. We now turn to
these subjects.
a. Merit increases
One of the most serious obstacles to agreement was the parties' irreconcilable dif-
ferences respecting merit increases. Upon acquiring the Desomatic plant in 1961,
the Respondent instituted a formalized merit pay review system as a method of
evaluating an employee's work performance for the purpose of determining his
5 These meetings were held on March 21 and 29; April 3, 4, 10, 24, and 25; and
May 16 and 17.
e Apparently due to a misunderstanding between International Representative John R
Sullivan, the chief negotiator for the Union, and James W. Crowley, manager of the
Respondent's legal department, as to whether Sullivan had conditioned the resumption of
negotiations upon the Respondent's changing its bargaining position with respect to merit
increases, there was a short delay in reopening negotiations
288 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
eligibility for a wage increase. Under this system, the employee is rated regularly
at 7-month intervals on the basis of quality of work, quantity of production, depend-
ability, judgment, cooperation, and potentiality.? Area wage standards are also
taken into consideration, as well as the nature of the employee's duties in order
to correct inequities due to a large extent to the absence of job classifications. This
latter situation was remedied during negotiations by the parties' ability to agree upon
job descriptions for all but about two classifications.
Extensive discussions were had on the subject of merit increases and the Union's
related wage demands. The Union proposed a general wage increase 8 and provision
for certain automatic increases. The Respondent's response was to reject any idea
of a general wage raise, although it was prepared to give certain increases to adjust
inequities. Instead, it insisted on reserving to itself as a management prerogative
the right to grant individual periodic merit increases pursuant to its established pay
review system, which it urged was basic to its philosophy of rewarding meritorious
performance.9 It, however, offered to discuss and negotiate with the Union every
contemplated increase and the amount, explain the reasons, and consider the Union's
position. Because of its fundamental opposition to the theory of individual merit
increases, the Union refused to accept the Respondent's proposal. It expressed the
firm view that the Respondent's offer to negotiate merit increases, as indicated above,
was not realistically an offer to bargain, as the Union understood bargaining to be,
for the reason that the Respondent retained the final word on whether or not to
grant an increase. However, the Union's chief negotiator, International Representa-
tive John R. Sullivan, stated that the Union could go along with individual merit
increases if the Respondent would agree to submit to arbitration, or to some "other
effective negotiating means," any controversy involving the Respondent's decision
to grant or refuse an increase. Although the Respondent was amenable to resolve
other disputes by arbitration and offered a written proposal to that effect, it refused
to relinquish to an arbitrator or other third party its right finally to decide, after
discussion with the Union, whether or not an employee was entitled to a merit in-
crease, with one exception, where a charge of discrimination, as defined in the
Union's proposed contract, was involved. In the latter event the Respondent was
willing to go to arbitration. At the last bargaining session which resumed on
September 26, the Respondent modified its earlier proposal to agree to a three-step
automatic progression to a fixed job rate and restricting a given merit increase
to an amount not in excess of 10 percent of the job rate. The proposed modification
was not acceptable to the Union which adhered to its position that "some effective
way to appeal . . . [the Respondent's] decisions" had to be provided if negotiations
under the Respondent's proposal could be "fruitful." It is also noted that throughout
the negotiations the criteria for determining eligibility for a merit increase under
the Respondent's system were never questioned by the Union because, as Sullivan
testified, "we never agreed to merit increases" as such.
b. Overtime in excess of 8 hours a day
As of the time of the hearing, the Respondent's business has been predominantly
of a Government nature. Under the Walsh-Healey Act, only such work, as dis-
tinguished from private work, performed by employees in excess of 8 hours a day
must be compensated at the rate of time and a half. Because a small percentage of
its business has been private, the Respondent has found it infeasible to maintain
7If an individual does not receive a rating entitling him to a wage increase, he is put
on what is called a consideration list and his work performance is reviewed every 30 days
until a change is made.
8 Originally, the Union requested a 30-cent-an-hour wage increase across the board from
which it later receded at one of the bargaining sessions in favor of a 15-cent economic
package. Presson Shane, the Respondent's vice president in charge of Desomatic, admitted
that he indicated at that meeting that the 15-cent package looked attractive to him.
However, according to his uncontradicted testimony which I credit, after being advised by
the Respondent's other negotiators that the Union's certification and checkoff demands
were still open questions, Shane immediately asked International Representative Sullivan
for his position on those matters and when Sullivan declined to commit himself, Shane
became noncommittal on the economic package.
9 A. provision in the Respondent's contract with the Rubber Workers Union covering the
Company's employees at the Sloane Division in California recognizes the Company's right
to grant increases "within the merit range" on the basis of the Company's evaluation of
the employees' performance. That contract also provided that the granting or failure to
grant a merit increase may not be a basis of a grievance subject to the grievance procedure.
ATLANTIC RESEARCH CORP., DESOMATIC PRODUCTS DIV. 289
separate work records. As a result it has been its practice to pay its employees time
and a half for all work over 8 hours a day, whether Government or not.
In the negotiations the Union insisted that the Respondent write this practice into
the contract. The Respondent agreed but with the qualification that provision be
made for the contingency-not immediately foreseeable-when the proportion of
private work materially increased, in which event it would be free to eliminate
premium rates for that type of work. The Union, however, declined to accede to
this qualification. 10
c. Holidays
It has been the Respondent's practice to recognize eight holidays as so-called
observable holidays when the plant is normally closed down. If the holiday falls
on a weekday or a Sunday when it is celebrated the next day, employees are paid
for that day. He is not, if it falls on a Saturday. There is also another exception
to this practice in case all eight observable holidays occur, or are celebrated, on a
weekday.li In that event, the employees do not receive holiday pay for one holiday,
usually Veterans Day, November 11, when the plant is kept open.12
To furnish a fund for holiday pay (and this also applies to vacation pay), the
Respondent uses an accrual system whereby, in accordance with a set formula, a
sum of money is credited monthly to each employee's account at the rate he is then
earning. Since holiday pay is computed on the basis of his rate of earnings when
the holiday occurs, there may be occasions when the employee's account is insufficient
to provide holiday pay at his latest rate due to a wage increase or promotion received
earlier in the year. In such a case, the Respondent permits him to overdraw his
account to the extent of his weekly wages, which the Respondent normally withholds
as a matter of policy. Such overdraft remains as a liability to the Company which is,
in effect, secured by the employee's withheld wages.
As part of its economic proposals, the Union initially demanded nine paid holidays.
This proposal it later reduced to eight. The Respondent, on the other hand, offered
six guaranteed paid holidays at the employee's then rate of pay, regardless of the
day on which the holiday fell or the state of the account.13 In support of its pro-
posal the Respondent discussed at length with the Union its existing accrual system,
its dissatisfaction with its operation, which was unduly complex and confusing to
both rank-and-file and higher level employees , and its desire to replace it with a
guaranteed pay plan.14
According to the testimony of James W. Crowley, manager of the Respondent's
legal department, the Company arrived at six guaranteed holidays after studying its
actual experience with the accrual system and concluded that this figure was the
nearest whole number to equal the maximum of seven accrued holidays the Company
paid under that system. The Union, however, was not persuaded by the Respondent's
proposal or explanation , insisting that the net effect of that proposal was to give
Desomatic employees two holidays less than those enjoyed by employees of other
divisions in the same industrial complex.15
11 It is also noted that the parties were In disagreement , among other things, with respect
to time and a half for Saturday and double time for Sunday work, and over the question
of voluntary as against compulsory overtime.
11 According to the testimony of James W. Crowley, manager of the Respondent's legal
department , this happens about once in 7 or 8 years.
13 Crowley also testified that he Inadvertently failed to mention this practice in the
letter he sent to the Union in compliance with the Union 's request for information con-
cerning terms and conditions of employment at Desomatic.
13 Employees at the Respondent's nearby Prewitt plant and at its Northeastern plant
also are given six guaranteed paid holidays, although the employees of the other divisions
in the Edsal Road industrial complex are entitled to paid holidays in accordance with the
accrual system It appears that within the past few years 1959 was the only year when
six holidays fell or were celebrated on a weekday.
"Crowley testified that the Company 's personnel office had recommended to the Com-
pany's executives and accounting department the abandonment of the holiday and vaca-
tion accrual system in all divisions . However, because of the opposition of the accounting
department , which views the accrual system as necessary to facilitate the closing out of
Government cost -plus contracts , the required executive approval for the companywide
change could not be secured . However , Desomatic , whose business is predominantly
fixed fee as distinguished from cost-plus, has obtained the required approval for the pro-
posed change from the divisional management , which is all that Is required.
15 There is conflicting testimony by Sullivan and Crowley , which I find unnecessary to
resolve, as to whether the Union In supporting its position for eight guaranteed holidays,
290 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Notwithstanding extensive discussion and argument on both sides neither party
would budge from its position until the September 26 meeting. After the Union
unsuccessfully renewed its demand for eight paid holidays, which it asserted the
Respondent had granted the Rubber Workers Union at its Sloane plant in California,
the Union requested the Respondent to continue its accrual system and incorporate
it in a consummated agreement. The Respondent, however, reiterated its decision
to terminate the accrual system and rejected the Union's proposal.16
d. Vacations
At the time of the hearing the Respondent's vacation policy was based on the
accrual theory previously discussed in connection with holiday pay. However, the
formula, according to which vacation pay accrued, was different. The policy allowed
employees to accrue 2 weeks' vacation pay after 1 year of service and 3 weeks'
vacation pay after 6 years of service, at the wage rate they were earning at the time
of the monthly accrual.
Apparently, the Union was not initially interested in this vacation plan and offered
its own proposal whereby employees would receive a 1-week paid vacation for 6
months' service; a 2-week paid vacation for 1 year's service; a 3-week paid vacation
for 5 years' service; and a 4-week paid vacation for 10 years' service. The Re-
spondent countered with a vacation plan similarly predicated on the idea of guar-
anteed payments at the wage rate earned at the time the employee takes his vacation
but less generous than that proposed by the Union. Specifically, the Respondent
offered a 1-week paid vacation at the completion of 1 year of service; a 2-week paid
vacation at the completion of 3 years of service; and a 3-week paid vacation at the
completion of 7 years of service.17 As in the case of holidays, the Respondent ex-
plained in detail its dissatisfaction with the then existing vacation accrual system.
While conceding that its proposed 1-week vacation provision was virtually a reduction
in benefits, the Respondent expressed the view at the negotiations that guaranteed
benefits for the senior employees were better than those given under the accrual
system. The Union, on the other hand, rejected the Respondent's proposed vacation
plan for the asserted reason that it reduced benefits that were then allowed employees.
Since the Union made no headway with its proposal, it offered at the final Septem-
ber 26 meeting to accept the vacation accrual system then in effect but to no avail
because of the Respondent's asserted desire to terminate it.
e. Christmas bonus
It has been the Respondent's practice to grant employees a Christmas bonus based
on the employee's length of service, initiative, and his contribution to the Company's
advancement. As a result of such distribution the previous year at Desomatic 80
percent of the employees received a bonus of approximately $40 and 20 percent
received an additional sum up to $20 as a reward for merit. The Union's contract
proposal provided for bonuses to be "applied on a uniform basis and are to be com-
puted on a percentage basis of yearly earnings." The Respondent offered to con-
tinue its policy of determining the gross amount of the bonus, the recipients and the
specific sums to be allocated without any discrimination as defined in the Union's
pointed out during the discussions that the Union was only negotiating for a year during
which eight holidays under the Respondent's accrual system fell or were celebrated on a
weekday for which employees would be paid
16 There is some testimony by Sullivan to the effect that certain of the Respondent's
representatives stated during negotiations that the Respondent was willing to continue its
present holiday and vacation benefits as long as a contract was not concluded On cross-
examination, Sullivan testified that at the final bargaining session when the Company re-
jected the Union's request to write into the contract its accrued holiday and vacation
system, Sullivan asked the Respondent's spokesman what the Company would do with
respect to the accrual system if no agreement was reached, and the spokesman answered
it would stay as it was for the time being at least. In view of all the testimony in the
record relating to the discussions at the bargaining table, I am not convinced that the
Respondent proposed discontinuance of its accrual system only for the purpose of contract
negotiations and to prevent consummation of an agreement.
17 The Respondent has no provision for 3-week paid vacations at the Prewitt, North-
eastern, or U.S. Flare plants Under the Sloane contract, 10 years' service is a pre-
requisite for a 3-week vacation However, all the divisions at the Edsal Road industrial
complex use the accrual vacation plan with the benefits outlined above.
ATLANTIC RESEARCH CORP., DESOMATIC PRODUCTS DIV. 291
proposed contract. The Union rejected this offer, insisting on negotiating the amount
of the bonus and the recipients.18
3. Alleged unilateral action
a. Merit increases
After the Union's certification, the Respondent, pursuant to its periodic pay review
system, rated and authorized a merit increase for four employees effective April 1.
At the April 3 bargaining session, the Respondent requested the Union to approve
these increases, which it did.19 Further merit increases were apparently not given
while negotiations were in progress. After negotiations broke down on May 17,
the Respondent, by letter dated July 27, notified the Union as the employees' collective-
bargaining representative that, in accordance with its established merit system, it had
reviewed and recommended specified wage increases for four-named employees, and a
merit promotion for a fifth employee, all effective as of July 1. Although the Respond-
ent did not request negotiations respecting these increases,20 neither did the Union,
which did not answer the letter.
On August 21, the Respondent again notified the Union as its employees' representa-
tive that similar pay reviews under its existing merit system were made with respect
to seven-named employees and specified increases were recommended for them effec-
tive as of August 1. In this letter, the Respondent also asked for its approval or
expression of views. In reply, the Union proposed that these merit increases should
be negotiated when contract negotiations, which it had previously requested, were re-
sumed 2' On September 17, written notice of six additional contemplated increases 22
effective September 1 was given to the Union whose approval or statement of views
was also solicited. Because of the Union's indicated position, the Respondent with-
held the August and September increases. However, when negotiations were resumed
on September 26, these increases were not brought up for consideration.
b. Accident insurance plan
Sometime before July 10, the Respondent made arrangements with an insurance
carrier for a new accident insurance plan available to employees in all the Respond-
ent's plants at a reduced group rate. Under this plan the Respondent did not
contribute to the payment of any premiums. The Respondent thereafter distributed
to all its employees, except those at Desomatic, a memorandum dated July 10 in which
it set forth the advantages of this plan, its provisions, and the substantial savings made
possible by group participation. Also attached was an application to be completed
if the employee wished to take advantage of this program.
Because Desomatic employees were represented by the Union, the Respondent on
July 13, submitted the insurance plan to the Union for its approval before making it
available to the Desomatic employees for their participation. By letter dated July 30,
the Union stated that "we will not stand in the way of your insurance program,"
although it was a subject for negotiation. Upon receipt of this letter, the Respondent
made the plan available to Desomatic employees.
' At a recess during the final September 26 meeting, one of the Respondent's negotiators
testified, the Respondent's bargaining team formulated a proposal whereby the Respondent
would continue to determine the total amount to be allocated but which, as the Union
proposed, would be distributed uniformly among unit employees on a fixed percentage of
yearly earnings. However, since this new proposal required approval of the Company's
board of directors, it was not communicated to the Union at that meeting
10 According to the credited testimony of Respondent's Vice President Shane, who im-
pressed me as a reliable and accurate witness, it has been the Respondent's practice not
to notify employees in the unit of contemplated increases before discussing the matter
with the Union
20 Vice President Shane credibly testified that he relied on advice of company counsel
that, since there was a bargaining impasse, it was not necessary to request negotiations
on the subject.
n Gaynor Tipple was one of the beneficiaries of the increases As vice president of the
local union, Tipple, who was also acting chairman of the shop negotiating committee, was
given a copy of this letter by the Company, as it was customary to do
22 Employee Gregory J. Gonsolves, who was in this group and was recommended for an
increase, was about a month earlier denied an increase because of insufficient production
and put on probation after a unilateral review by the Respondent
727-083-64-vol. 144-20
292 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
c. Establishment of leadmen classification; promotions
On July 24 the Respondent wrote the Union that in its management judugment
it determined that it was necessary to designate leadmen in certain departments. It
therefore proposed establishing such a job classification, set forth the additional duties
leadmen would be required to perform, and provided a 25-cent hourly differential.
In addition, the letter named four employees whom it proposed to fill these jobs. In
the July 30 letter, in which the Union consented to the application of the insurance
plan to Desomatic employees , the Union also agreed to "upgrading leadmen."
4. Respondent's antiunion literature
As indicated previously, the General Counsel relies on certain antiunion literature
distributed among employees or posted on the Company's bulletin board in the
Desomatic shop some time after the Desomatic representation election and before
contract negotiations were instituted , as evidence of the Respondent 's reluctance to
bargain in good faith with the Union. It appears that during that time the Union
was engaged in a drive to organize employees of other divisions, although, according
to David Delker, head of the Respondent's labor relations office, the only actual
campaign of which the Respondent was aware was that conducted at the Gainesville,
Pine Ridge, plant.
It is undisputed that, in opposing the Union's organizational campaign, the Respond-
ent distributed among employees at plants other than Desomatic a memorandum dated
February 28 addressed to "All Atlantic Research Employees," and a letter dated
March 5, directed to "Dear Fellow Employee." 23 There is also credible testimony 24
that Pat Mayo, foreman of the Desomatic shop, passed out copies of the letter dated
March 5 to employees in his shop and that a copy of the February 28 memorandum
was posted by an unidentified person on the shop's bulletin board above the employees'
timeclock for about a week or a week and a half. In the February 28 memorandum,
the Respondent's president referred to the Union's success at the Desomatic shop;
stated that the selection of the Union means that outsiders will try to dictate the
relationship between the Company and employees and that the Company's long-
established policy of providing advancement based on merit was not possible under
union rule; and finally, importuned employees not to sign an authorization card for
the Union as it will be the "first step in bringing a strife-ridden union into your divi-
sion." The March 5 letter brought to the attention of employees editorial comment
relating to the Union's "bargaining and strike history" and intraunion rivalry which
"makes this union totally unworthy" of their support. As counterpoint, the letter
also emphasized that the Company will always recognize the employees' right to
join or not to join a union.
There is also uncontradicted testimony in the record that after the Desomatic
election a cartoon was posted by an unidentified individual on the same shop bulletin
board over the timeclock. This cartoon, which remained there for a few weeks,
showed a group of humorous figures, sometimes described as "nebbishes," with the
subtitle "NOW THAT WE'RE ORGANIZED-WHAT THE HELL DO WE DO?"
B. Contentions of the parties-concluding findings
The General Counsel contends , in substance, that the Respondent , in violation of
Section 8(a) (5) and ( 1) of the Act, failed to discharge its bargaining obligation in
three respects-by insisting during negotiations on reserving to itself the right to
grant merit increases to the employees in the unit ; by bargaining in bad faith as
reflected in the Respondent's total conduct; and by taking unilateral action regarding
merit increases , leadman promotions , and the institution of a group accident insurance
plan . The Respondent , on the other hand , denies that it was remiss in any manner
in performing its bargaining obligation.
It has long been settled that an employer violates Section 8 (a) (5) and (1) of the
Act if it fails to bargain in good faith with its employees ' representative or, absent
any contractual provision permitting it, takes unilateral action with respect to any
term or condition of employment without affording the Union an opportunity to
23 According to the uncontradlcted testimony of David Delker, which I credit, another
document dated March 16 was distributed among employees at the Gainesville plant only.
In it the Respondent attacked the Union's asserted irresponsibility and salesmanship
24 The Respondent did not produce as a witness Pat Mayo, admittedly a supervisor, to
contradict the above testimony if it was untrue.
ATLANTIC RESEARCH CORP., DESOMATIC PRODUCTS DIV. 293
negotiate concerning such matters.25 This principle is generally embodied in Sec-
tion 8(d) which defines the bargaining obligation as requiring the parties, inter alia,
"to meet at reasonable times and confer in good faith with respect to wages, hours,
and other terms or conditions of employment, or the negotiation of an agree-
ment .. .." Although this obligation does not "compel either party to agree to a
proposal or require the making of a concession," it does contemplate, as the Board
and the courts have uniformly held, a willingness to enter the discussions "with an
open mind and purpose to reach an agreement consistent with the respective rights
of the parties." 26 Simply entering "upon a sterile discussion of union management
differences," 27 is not sufficient. Essentially then, the "ultimate issue whether the
Company conducted its bargaining negotiations in good faith involves a finding of
motive or state of mind which can only be inferred from circumstantial evidence." 28
On the basis of all the facts and circumstances in this case, I find that the pre-
ponderance of the evidence does not establish that the Respondent failed to perform
its statutory bargaining obligation. As fully discussed earlier in this report, the
Respondent met and conferred with the Union at 10 bargaining sessions and 1 top-
level meeting, at which extensive discussions were had on a variety of subjects, re-
sulting in agreement on some matters and disagreement on others. I am unable to
find, as the General Counsel urges, substantial basis for inferring bad faith in the
positions taken by the Respondent in the areas of disagreement relating to merit in-
creases, overtime in excess of 8 hours a day, holidays, vacations, and the Christmas
bonus. Specifically, the Respondent's insistence on reserving to itself as a manage-
ment prerogative the right to grant individual merit increases was not in derogation
of its bargaining obligation. There is no question that there was full negotiation and
a complete exchange of views regarding this subject 29 Moreover, apart from the
fact that the Respondent modified its original proposal and offered an initial three-
step automatic increase and a limitation on the amount of merit increases above the
job rate, its proposal did not exclude the Union from bargaining over individual merit
increases. Concededly, the Respondent offered to discuss in advance with the Union
any contemplated increase, its reasons and amount, and to furnish it with necessary
information. However, the Union rejected the proposal unless the Respondent also
agreed to submit disputes involving merit increases to an arbitrator or some other
third party to whom the Union could "effective[ly]-appeal" the Respondent's de-
cisions." Although the Respondent was willing to submit to arbitration such con-
troversies only where based on charges of discrimination for union or personal rea-
sons, as well as grievances involving other subjects, it would not agree to make merit
increase disputes otherwise arbitrable for it meant surrendering to third parties the
right to determine such increases. Undoubtedly, this position was not barred by
the Act,30 nor will it support an inference of bad faith.
I also do not find evidence of spurious bargaining in the Respondent's proposal
regarding overtime in excess of 8 hours a day.31 The record is clear that the Re-
zs It has been held that an employer's unilateral action without consulting the Union
not only is a manifestation of bad faith (N.L R B. v. Crompton-Highland Mills, Inc., 337
U.S. 217), but also is itself a circumvention of his statutory duty imposed by Section 8(d)
of the Act to "meet . . . and confer" with the employees' bargaining representative, re-
gardless of the employer's state of mind (N L.R B. v. Benne Katz etc., d/b/a Williamsburg
Steel Products Go, 369 U.S. 736). Moreover, even where there has been bargaining to
impasse on a subject, the employer has no license to grant a greater benefit than that
offered the union at the bargaining table without affording the union an opportunity for
further bargaining (ibid).
20 L. L. Majure Transport Company v. N L.R B., 198 F. 2d 735, 739 (C.A. 5) ; see
also, NL.R.B. v. Darlington Veneer Company, Inc, 236 F. 2d 85, 88-89 (CA 4).
27N L R.B. v. American National Insurance Co., 343 U.S. 395, 402
28 N L R B v. Reed & Prince Manufacturing Company, 205 F. 2d 131, 139-140 (C.A. 1),
cert. denied 346 U.S. 887.
^ Contrary to the General Counsel's contention, the evidence does not show that the
Respondent refused to bargain about the criteria to be followed under the pay-review
system. This subject was never raised by the Union because as Sullivan, its chief spokes-
man, testified, "we never agreed to merit increases."
80 Cf N.L.R.B. v. American National Insurance Co., supra. It is quite clear that the
Respondent was not obliged to yield to the Union's demands simply because the Respond-
ent's pay-review system was a source of great dissatisfaction to the Desomatic employees
and was one of the cardinal reasons for the Union's success in organizing them, as
Sullivan testified, or because the Union was engaged during negotiations in a drive to
organize employees of the Respondent's other divisions.
31 It is noted that the parties were far apart on the Union's other overtime proposals,
as for example, time and a half for Saturday and double time for Sunday work.
294 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
spondent was willing to write into a consummated contract its practice of paying
premium rates for such overtime , whether the work performed was Government or
private. However , it sought to reserve the right to discontinue paying such daily
overtime rates when the proportion of private work compared to Government work
substantially increased . I find this proposal not so unreasonable as to impugn the
Respondent's bargaining attitude , although generally it is not for the Board to pass
judgment on the merits of a proposal 32
With respect to holidays and vacations , the Respondent offered as a counter-
proposal to the Union 's proposal of guaranteed paid holidays and vacations a similar
plan but definitely not as liberal . After lengthy negotiations in which neither party
would retreat from its position , the Union finally requested that the Respondent's
accrual system be incorporated in a contract. This the Respondent refused to do
because of its desire to abandon the accrual system which proved to be confusing
and unsatisfactory to Desomatic management and employees. While it may well be
that the Respondent 's proposal did not provide benefits equal to those allowed under
the accrual system , which reduction in benefits under other circumstances may mani-
fest bad-faith bargaining , I am not persuaded that in light of the facts in this case the
Respondent's proposal was dictated by a "cast of mind" 33 intent on preventing agree-
ment, or by a desire to discriminate against represented employees.
Nor am I convinced that the Respondent 's proposal to continue its existing Christmas
bonus practice reflected a determination not to reach agreement with the Union. As
previously indicated, under this practice, the Respondent's board of directors fixed
the gross amount of the bonus which it divided among the employees in a manner
awarding a modest additional sum for merit. This method of allocation was not
acceptable to the Union which proposed that the amount of the bonus be negotiated
and that individual bonuses be uniformly computed on the basis of a percentage of
yearly earnings 34
Turning to the alleged unilateral action, it is clear from what I have previously
found that the Respondent did not take unilateral action with respect to merit increases
determined in accordance with its pay review system , leadman promotions, or the
institution of the accident insurance plan, without securing the Union's assent.35
In those cases where the Union refused to give assent and requested bargaining (i.e.,
respecting the August and September proposed increases ), the Respondent withheld
granting them . Significantly , when negotiations were reopened the following Septem-
ber 26, the Union did not even bring up these matters for discussion.36 In the cir-
cumstances , the Respondent 's conduct can scarcely be regarded as the antithesis of
good-faith bargaining . Moreover, in disagreement with the General Counsel, I find
no compelling evidence of bad faith in the fact that the Respondent , in accordance with
custom developed during the negotiations, furnished employee officers of the local
union, who were also on the shop negotiating committee , copies of the letters sent to
the Union in which it proposed the above action . Obviously , this was not bypassing
the Union or calculated to undermine it.
In view of the foregoing , I am not entirely persuaded that the Respondent engaged
in sham negotiations or otherwise disregarded its bargaining obligation . In so doing,
I find that the literature distributed to Desomatic employees or posted on the shop
bulletin board before negotiations were instituted insufficient to warrant a contrary
33 Cf N L R B. v Reed & Prince Manufacturing Company, supra, at p 134
33 N.T R B v Benne Katz, etc ., d/b/a Williamsburg Steel Products , 369 U.S 736, 747
34 The General Counsel's contention is patently untenable that the Respondent did not
vest its negotiators with authority to bargain as required by the Act simply because the
Respondent's negotiators withheld submitting a modified Christmas bonus proposal formu-
lated at a recess during the September 26 meeting until they first received approval from
the Company's board of directors. The record plainly shows that the Respondent's repre-
sentatives possessed adequate authority to negotiate a collective bargaining agreement
Nor do I find supported by the record the General Counsel 's assertion that the Respondent
during negotiations reneged on its acceptance of a 15-cent-an-hour economic package and
thereby also displayed bad-faith bargaining. As previously discussed, there was never an
unequivocal acceptance of that economic package.
3s Although the Respondent's July 27 letter notifying the Union of contemplated in-
dividual merit increases did not also specifically request its approval or expression of
views as did the Respondent's later letters concerning other contemplated increases, the
Union did not respond or otherwise request bargaining on thoseincreases Cf. N L R B v
United Brass Works, 287 F. 2d 689, 697.
36 Contrary to the General Counsel's contention , I do not regard the Respondent 's periodic
review of employee Gonsolves ' performance , its decision not to give him a merit increase,
and its warning to improve , as constituting unilateral action prohibited by the Act
ROBBINS & MYERS, INC. 295
conclusion . In the final analysis, it appears to me that Respondent 's attitude through-
out the negotiations was one of hard bargaining which the Act plainly does not
forbid.
Accordingly, as I find that the General Counsel has failed to sustain the allegations
of the complaint , I shall recommend dismissal of the complaint.
RECOMMENDATION
Upon the basis of the foregoing findings and upon the entire record in the case,
I recommend that the complaint herein be dismissed.
Robbins & Myers, Inc. and International Union , United Auto-
mobile , Aerospace and Agricultural Implement Workers of
America , AFL-CIO, Petitioner. Case No. 9-RC-5310. August
27, 1963
DECISION AND DIRECTION OF ELECTION
Upon a petition duly filed under Section 9(c) of the National
Labor Relations Act, a hearing was held before Cassius B. Gravitt,
Jr., hearing officer. The hearing officer's rulings made at the hearing
are free from prejudicial error and are, hereby affirmed.
Pursuant to the provisions of Section 3(b) of the Act, the Board
has delegated its powers in connection with this case to a three-
member panel [Chairman McCulloch and Members Rodgers and
Brown].
Upon the entire record in this case the Board finds :
1. The Employer is engaged in commerce within the meaning of
the Act.
2. The labor organization involved claims to represent certain em-
ployees of the Employer.
3. A question affecting commerce exists concerning the representa-
tion of the employees of the Employer within the meaning of Section
9(c) (1) and Section 2 (6) and (7) of the Act.
The Petitioner, which represents the production and maintenance
employees, seeks a unit of office and plant clericals and technical em-
ployees. Alternatively, it seeks an election in any unit or units the
Board finds appropriate. The Employer objects to the single unit,
contending that three separate units of office clerical, plant clerical, and
technical employees, respectively, are appropriate. While the prin-
cipal issue is the composition of the unit or units, the parties also dis-
agree on the exclusion of certain individuals alleged to be supervisory
or professional employees, as noted hereafter.
The Employer's Operations
The Employer manufactures electric motors, fans, pumps, hoists,
cranes, and ventilation equipment in its five plants comprising some 60
144 NLRB No. 32.