Cole National Corp.Download PDFNational Labor Relations Board - Board DecisionsMay 16, 1969175 N.L.R.B. 1059 (N.L.R.B. 1969) Copy Citation GATE CITY OPTICAL CO. Gate City Optical Company , a Division of Cole National Corporation and Warehousemen, Mail Order , Ice, Cold Storage , Soft Drink, Waste Paper , Distribution Workers, Egg Breakers, Candlers, Miscellaneous Drivers & Helpers, Affiliate of International Brotherhood of Teamsters , Chauffeurs, Warehousemen and Helpers of America , Local 838 , Petitioner. Case 17-RC-5749 May 16, 1969 DECISION ON REVIEW AND ORDER By CHAIRMAN MCCULLOUGH AND MEMBERS BROWN, JENKINS,. AND ZAGORIA On June 13, 1968, the Acting Regional Director for Region 17 issued a Decision in the above-entitled proceeding in which he found that the contract between the Employer and United Optical Workers Union No. 878, affiliated with the International Union of Electrical, Radio & Machine Workers, AFL-CIO, hereinafter called the Optical Workers, is not a bar to the petition, and he accordingly directed an immediate election. Thereafter, the Employer in accordance with Section 102.67 of the National Labor Relations Board Rules and Regulations, Series 8, as amended, filed with the National Labor Relations Board a timely request for review of the Acting Regional Director's Decision, contending that he erred in finding that the contract was not a bar to the petition. The Board by telegraphic Order' dated September 4, 1968, granted the Employer's request for review. Thereafter, Petitioner filed a brief on review. The Board has considered the entire record in the case with respect to the issues under review and makes the following findings: The Petitioner seeks to represent a unit of production employees at the Employer's Kansas City, Missouri, plant. The Employer contends that its contract with the Optical Workers executed January 12, 1968, is a bar to the petition. The Acting Regional Director found that since the parties agreed that Optical Workers has become defunct and since Petitioner has not agreed in writing to assume Optical Workers contract, that contract is not a bar. In requesting review, the Employer essentially argues that since Optical Workers and Petitioner are in effect one and the same , the contract executed by Optical Workers should stand as a bar to an election. We agree. The Employer is engaged in the manufacture, fabrication, and assembly of optical prescriptions. For many years Optical Workers had represented its production employees and a separate unit of the stockroom employees which is not involved herein. The contract covering the production employees which is urged as a bar to the petition was executed on January 12, 1968, to be effective from January 1, 1968 to December 31, 1970. 1059 The record indicates that a number of employees in the unit , who, according to several witnesses at the hearing , were dissatisfied with the representation by Optical Workers and with the terms of the new agreement , contacted Petitioner in January 1968 and requested it to represent them . Thereafter, Petitioner , on January 16, 1968 , filed a petition in Case 17-RC-5652 seeking to represent the Employer ' s employees . The Regional Director, however , on January 26, 1968 , administratively dismissed the petition on the ground that the contract was executed on January 12, 1968 , prior to the date that the petition was filed. Subsequent to the dismissal of the petition in Case 17-RC-5652, the members of Optical Workers, which included employees of, other employers besides the Employer herein , took action to disband Optical - Workers and affiliate with Petitioner and its sister Local No. 688 . Thus, the record indicates that the Optical Workers was "disbanded, dissolved and disestablished" on April 14, 1968. This action was reflected in a resolution which was placed in evidence at the hearing without objection by any party. The resolution further recites that the dissolution proceeding took place at a duly called regular meeting of the members of Optical Workers and that the affiliation of Optical Workers with the International Union of Electrical , Radio and Machine Workers , AFL-CIO, was "revoked, discontinued and disavowed" by the unanimous vote of those present . In the same resolution, the members of the Optical Workers voted to seek membership immediately in Teamster 's Local Union No. 688 , affiliated with International Brotherhood of Teamsters , Chauffeurs , Warehousemen and Helpers of America. Although Petitioner itself (Teamsters Local 838) is not mentioned in the resolution , the effect of the resolution upon Petitioner was explained in a letter on the stationery of Teamsters Local Union No. 688, addressed to the Regional Director and signed by "Thomas E. Andert, President and Director."' This letter, which was also received in evidence at the hearing , states that the meaning of the "affiliation" provision of the resolution was that former members of Optical Workers would join the appropriate local of the Teamsters . For members in St. Louis , the letter explained , the appropriate local would be the one mentioned in the resolution, i.e., Local No. 688, and for members in Kansas City, where the Employer is located , the appropriate local would be Teamsters Local No. 838, the Petitioner herein. A letter on the stationery of District 11, International Union of Electrical , Radio & Machine Workers , AFL-CIO, addressed to the Regional Office and signed by Orville Munzer, Field Representative, was also received in evidence at the 'Apparently the same Thomas E Andert , who the record elsewhere indicates had 'formerly been the President and Director of Optical Workers 175 NLRB No. 172 1060 DECISIONS OF NATIONAL LABOR RELATIONS BOARD hearing and advises that Optical Workers is defunct? After the foregoing evidence was received at the hearing the parties stipulated that Optical Workers is defunct. Having admitted the defunctness of Optical Workers, the Employer stated on the record that it is willing to recognize Petitioner as the representative of its production employees but only on the condition that Petitioner assume the Optical Workers contract of January 12, 1968. The Employer has already recognized Petitioner in a unit of the Employer's stockroom employees, and Petitioner has assumed the former Optical Workers contract covering that unit. Based on all the evidence and the parties' stipulation, the Acting Regional Director found that Optical Workers is defunct and he, accordingly, concluded that its contract with the Employer, dated January 12, 1968, is not a bar to the petition. In support of this determination the Acting Regional Director primarily relied upon the holding in Hershey Chocolate Corporation, 121 NLRB 901, 911, that a collective-bargaining agreement between a defunct labor organization and an employer will not bar an election petition. We find, contrary to the Acting Regional Director, that the Hershey "defunctness" rule is inapplicable in the circumstances of this case. For Optical Workers is not defunct in the normal sense. That is, while it ceased to exist as an affiliate of International Union of Electrical, Radio and Machine Workers, AFL-CIO, as the result of the action of its membership on April 14, 1968, that same membership, as a body, simultaneously took action to, and did, affiliate with Petitioner and its sister local.' Viewing this matter realistically Optical Workers has, as the result of the action of its membership," 'Optical Workers did not appear at the hearing. 'In its brief on review Petitioner contends that the action of April 14, 1968, by the Optical Workers membership should not be considered binding on the employees in the production unit here involved for the reason that there is no evidence in the record that any of these employees were present at the meeting at which such action took place. Our dissenting colleague finds merit in this contention. We, however, reject it. The resolution describing that action was received in evidence without objection by Petitioner or any party and recites that the action took place "at a regular meeting duly called " and that said action resulted from the unanimous determination of the members present . Petitioner presented no evidence at the hearing - nor does it now proffer any - that the action was other than fair and regular or that it was not binding upon all members including those employed by the Employer . And, according to the record , virtually all the employees of the Employer were required to be members of Optical Workers . In these circumstances we find that the action was binding on the Employer 's production employees . The Board, in any event , does not normally concern itself with determining whether a membership meeting was held in strict conformity with a union's constitution and bylaws absent a clear showing, not present here, of substantial irregularity . See Waterway Terminals Corporation , 120 NLRB 1788. 'Our dissenting colleague feels that a substantial change in identity has occurred despite the action of April 14, 1968, and related factors. However, we observe that even he notes in support of his other arguments that Andert is the president of Petitioner 's sister local and that Petitioner become merged with Petitioner and its sister local in circumstances which do not raise a question concerning representation; nor does any party claim the facts raise any substantial question as to the identity of the collective-bargaining representative of the Employer's production employees.' Stated another way, Petitioner occupies the Optical Workers' status as the bargaining agent for the production employees on the same basis that it has succeeded in fact, as the parties agree, to Optical Workers status as the collective-bargaining representative of the Employer's composing room employees. In view of this circumstance there can be no question that Petitioner is entitled, as the Employer proposes, to be lawfully recognized as bargaining representative in this unit and to administer the Optical Workers contract of January 12, 1968.° Accordingly, we do not believe that it would effectuate the policies of the act to conduct an election. On the contrary, an election at this time would only tend to disrupt conditions already stablized by the existing contract. For it is the avowed purpose of the employees, as testified at the hearing, to cause Petitioner, if successful in an election, to use its resultant certification as a vehicle to terminate the existing contract and to bargain for an entirely new agreement. To permit such a result in circumstances such as are here present would exalt the form of Optical Workers "defunctness" over the reality of the continued substatl'tial identity of the collective-bargaining representative and would be plainly at odds with the statutory policy of promoting stability in labor relations. And it could only serve to encourage employees disgruntled with the terms of their existing contract and desirous of obtaining a more favorable one, to seek escape from lawful contractual commitments by the device of filing a certification petition to the Board. The Hershey Chocolate Company "defunctness" rule, we hold, was not designed to be, and is not to be construed as being, applicable to situations where, as here, the mere formal "defunctness" of an incumbent is created as a strategem' to achieve an end inimical to policies of the Act." has assumed Optical Workers contract in the Employer 's composing room unit without an election. 'See Charles Beck Machine Corporation, 107 NLRB 874, and cases there cited . See also C. A. Olsen Manufacturing Company, 118 NLRB 362, fn. 2; Waterway Terminals Corporation, supra . Pepsi-Cola Bottling Co. of Chattanooga, Inc., 132 NLRB 1441, cited by the Acting Regional Director, is distinguishable , for in Pepsi-Cola, there was no attempt to use the petition as a stratagem to achieve an end inimical to policies of the Act. 'See Charles Beck Machine Corporation. supra at 876. 'See News Press Publishing Co., 145 NLRB 803. The Board has been vigilant in other analogous situations in guarding_ against having its normal rules abused for the purpose of evading legitimate contractual obligations . Thus the Board precludes a union or an employer which is party to a contract from relying on the Board 's normal contract -bar duration rule (now 3 years) to escape from its obligations under a contract of longer duration through the device of filing a certification petition with the Board . See, e.g., Montgomery Ward & Co., Incorporated, 137 NLRB 346; Absorbent Cotton Co., 137 NLRB 908. GATE CITY OPTICAL CO. 1061 In reaching a contrary conclusion our dissenting colleague emphasizes certain evidence indicating that it was the practice of the parties to require employees ratification of prior contracts and that the Employer was warned not to sign the instant contract unless it was so ratified. We need not recite the countervailing evidence on this point, for it suffices to state that under settled doctrine of this Board, the whole line of parol evidence on this point is immaterial and irrelevant to the issue here involved. Thus, in the Appalachian Shale case,' which codified contract bar principles in this regard, the Board held that evidence of prior ratification is only material where the contract by its express terms makes such ratifications a condition precedent to its validity. Here, it is conceded that the contract contained no such provision. Our dissenting colleague also urges that Petitioner, regardless of its assurance of voluntary recognition by the Employer, is entitled to an election and certification under the Board's General Box'" rule which permits an already recognized labor organization to obtain the benefits of certification pursuant to Section 9 of the Act. The short answer to this argument is that Petitioner does not seek an election, for this purpose. If it does, it may always take appropriate action to obtain such relief." In refusing to order an election herein we hold that, given the circumstances of this case - particularly the outstanding collective-bargaining agreement of January 12, 1968; the vote by the Employer's employees as a unit to obtain representation by the Teamsters; the subsequent voluntary and unified action of the former members of Optical Workers in electing to transfer their affiliation from the Optical Workers to the appropriate local of the Teamsters, and the reciprocal action of Petitioner and its sister local in accepting such affiliation; and the Employer's concession that the Petitioner enjoys majority status - there is no question concerning representation to be resolved by an election.': 'Appalachian Shale Products Co, 121 NLRB 1160, 1163 "General Box Company, 82 NLRB 678. This is not the type of case wherein an incumbent labor organization's purpose in filing its petition is to obtain those benefits which certification offers but voluntary recognition does not . Compare Community Publications.. Inc., 162 NLRB 855, and cases cited therein . This is rather a case wherein Petitioner's purpose, as expressed by its witnesses several times at the hearing , is to escape the contract dated January 12, 1968, even though the latter agreement still has almost 2 years to run, and to require the Employer to bargain with it for a new contract . But this the Petitioner - which now stands in the shoes of the incumbent union - cannot do by means of a Board election, Cf. Montgomery Ward & Co, Incorporated, supra. "Our dissenting colleague asks whether the Board is prepared to find that Petitioner is legally obliged to assume Optical Workers contract and bargain with the Employer for the production employees. That question is not before us. All that we must decide is whether there is a question concerning representation to be resolved by an election. We have found that there is none. Both the Petitioner and the Employer agree that the Petitioner now enjoys majority status. Accordingly, we shall dismiss the petition. ORDER It is hereby ordered that the petition filed herein be, and it hereby is, dismissed. MEMBER FANNING, dissenting: The facts in this case are briefly as follows: For many years these employees were represented by United Optical Workers Union Local 878, IUE, AFL-CIO, which also included among its members employees employed by other employers in St. Louis, Missouri, where Tom Andert, its president, was stationed. On December 7, 1967, Company officials met with a committee of employees, led by William Yardley, Optical Workers' Kansas City representative, to negotiate a new contract. At this meeting the Company offered a 25-cent package to be divided up over a 3-year period. Thereafter, according to Company counsel Arnson, the Company was informed by Yardley that the employees had met and rejected this offer. Another offer of 30 cents was also rejected by Yardley on behalf of the employees. A third offer of 32 cents was made to an attorney hired by Yardley to assist in bargaining. At this point Tom Andert, who had been in and out of the hospital, called the Company's attorney and assumed personal responsibility for negotiating the contract. He had negotiated previous contracts and signed them for Optical Workers Local 878. However, it is the uncontradicted testimony of Francis Cox, one of the employee members of Optical Workers' Kansas City negotiating committee, that all contracts for the past 15 years had been approved by the employees before signature by an authorized union official. Employee Olwin Right further testified that he had stated to Company official Welsh that Tom Andert had once signed a contract without ratification by the employees and added, "He had better not sign this one." In his testimony Welsh conceded that he had received information "possibly from Mr. Right" that Andert had better not sign this contract. Right indicated that the single occasion when Andert had signed a contract without ratification occurred in 1933. In the face of this long established practice and, with respect to the instant contract, specific notice to the Company that ratification by the employees would be required Andert and the Company executed a new contract without such ratification on January 12, 1968. In an unsworn document dated January 31, 1968 and admitted into evidence Andert asserts that he signed the contract to avoid a strike at Gate City, alleges that he had secured the approval of employee Cox for such action, and concludes, "Again I offer no apologies for my actions. I would do the same thing again." Dissatisfied with Andert's conduct and the manner in which he had represented them over the years, the Gate City employees sought membership in Teamsters Local 838, the Petitioner. 1062 DECISIONS OF NATIONAL LABOR RELATIONS BOARD As one employee • put it, "We didn't ask for this contract like it is... and we still got it shoved ..." On January 16, 1968, Petitioner filed a petition seeking to represent these employees. That petition was dismissed by the Regional Director on the ground that the January 12 contract of Optical Workers was a bar. An attorney hired by the employees was unable to assist them in their effort to repudiate the Optical Workers." Thereafter, for reasons not apparent in this record, the Optical Workers were duly called to a regular meeting on April 14, 1968 and voted to disband and dissolve and further resolved that the membership seek membership in` Teamsters Local Union No. 688, whose territorial jurisdiction included the St. Louis, but not- the Kansas City area. It cannot reasonably be inferred that this meeting was sought or called by the Gate City employees to avoid the consequences of the January 12 contract for it does not appear from the record that any Gate City employee attended this meeting or , indeed, that Gate City employees were notified that such a meeting was to be held. It may even be questioned whether they still remained members in good standing of Optical Workers in view of their failure to pay dues during this entire period. Nevertheless, in an explanatory letter to the Regional Director, Andert, now President of Teamster Local No. 688, volunteered the information that the Resolution of April 14 was intended to ;channel Optical Workers' members into different Teamsters Local Unions, including Local 688 in St. Louis and Local 838 in Kansas City. On April 29 the Petitioner filed the instant petition, supported by, an adequate showing of interest. All parties at the hearing stipulated that United Optical Workers Union Local No. 87.8 is defunct. Despite the above. stipulation, the Employer has taken the position that the Petitioner cannot lawfully represent these employees unless it is willing to assume the January 12 contract of the defunct Optical, Workers. The Employer contends that the Petitioner is the legal successor to the latter union . The Petitioner argues, first, that it is not the successor to the Optical Workers and, second, that it is unwilling in' any event to adopt the January 12 contract because the employees are adamant in their position that the contract was not authorized by them and Was foisted on them by Andert. With respect to "another contract, signed by Andert in April 1967, covering a unit of stockroom employees, the Petitioner has agreed to assume this contract in view of the.,employees ' recognition of the legality of this agreement. On these facts the Acting Regional Director directed , an, immediate election. He concluded that the contract, of January 12 was not a bar for several reasons . First, citing long established precedents, he "The majority's reference in footnote 3 to the testimony of Right relates to this unsuccessful attempt to repudiate the Optical Workers. No evidence warrants the conclusion that the Gate City employees' unhappiness with their contract led to the dissolution meeting of April 14. held that a contract executed by a defunct union is not a bar to a petition or an election sought by another union. Second, he ruled that Petitioner was not the successor to defunct Optical Workers. Third, assuming such successorship, he concluded that existing precedents with respect to employer purchasers indicates that a successor is not necessarily bound by a contract executed by its predecessor. I find the Acting Regional Director's opinion most persuasive. The majority's contrary decision, reversing his Direction of Election and dismissing this petition, does not seem to me to be supportable on this record. In the first place, at no time has the Employer taken the position, as the majority asserts, that the "Optical Workers and the Petitioner are in effect one and the same." Clearly, the Employer's position on the record is that the Petitioner is the legal successor to the defunct Optical Workers and, as such, bound to assume the latter's contract. The Acting Regional Director rejected this argument and the majority does not pass on it, holding, in the alternative, that "Optical Workers has, as the result of the action of its membership, become merged with Petitioner and its sister local in circumstances which do not raise a question concerning representation . " But the record is perfectly clear that the April 14 Resolution dissolved the Optical Workers as an organization completely and finally, with the additional resolve of the group that they "seek membership" in Teamsters Local 688. There is no evidence on this record from which it can reasonably be concluded that the Optical Workers transferred its affiliation from one International Union to another. Nevertheless, the majority insists, despite the stipulation of the parties, that the Optical Workers is not defunct and, indeed, has not even changed its identity to any substantial extent. Relying upon a gratuitous letter of Tom Andert, written after the April 14 meeting, the majority accepts his bare statement that the April 14 Resolution "means" that Teamsters Local 838 should be substituted for Teamsters Local 688 as a haven for members of defunct Optical Workers in Kansas City. As indicated above, there is no evidence that Gate City employees participated in, or were aware of, the April 14 meeting. Nor is there any evidence that Teamsters Local 838 was a party to those events. The record does not otherwise support the majority's statement that members of Optical Workers "took action to disband Optical Workers and affiliate with Petitioner and its sister Local No. 688." If the majority is correct, Optical Workers is not dead, but as a viable labor organization lives on dichotomously in the recipient bodies of Teamsters Local No. 688 and, by virtue of Tom Andert's explanatory letter, Teamsters Local No. 838. To the extent the decision of this Board has the force of law, these unions , without action or acquiescence on their part, have become responsible GATE CITY OPTICAL CO. for the obligations and conduct of the defunct Optical Workers and may be held, I assume, jointly and severally on that account. Understandably, they may be reluctant to be saddled with legal responsibilities they never assumed and an identity they never sought. There are • other grave consequences. For instance, this Employer may file charges against Local 838, alleging a violation of Section 8(b)(3) in that it refuses to adopt or administer the Optical Workers' contract in accordance with the majority's instant decision. Does not the majority's decision, dismissing this petition on the ground that the January 12 contract is a bar, mean that Teamsters Local 838, the Petitioner, is, as a matter of law, the Optical Workers under a different name? Is the Board prepared to find that the Petitioner, with or without an election, with or without valid evidence of majority status, nevertheless is legally obliged to assume this contract and bargain with this Employer because of a letter written by the former president of a defunct union urging these employees to seek membership in the Petitioner? The majority asserts that no question concerning representation exists because the Petitioner occupies the status of the Optical Workers" and "there can be no question" (emphasis supplied) that Petitioner is entitled to be recognized as the representative of these employees. An important proviso is that the Petitioner must agree to administer the contract signed without the employees' approval by the president of the Optical Workers on January 12, 1968. As indicated above, the record does not show that the Optical Workers has merged, affiliated, or been absorbed into the Petitioner. Indeed, apart from the petition, there is no evidence as to how many employees of this Employer have joined the Petitioner or whether a majority of these employees desire that the Petitioner represent them for the purposes of collective bargaining. In these circumstances I think there is a very real question whether the Employer must recognize the Petitioner without an election. Moreover, I find no basis in this record to support the conclusion that these employees have embarked upon a "strategem" to avoid their lawful contractual obligations by dissolving the Optical Workers or that they have deliberately and consciously schemed to flout the statutory policy of this Act. Rather, I am of the opinion, as was the Regional Director, that the filing of the instant Petition is entirely in accord with long established Board precedent, sound labor relations, and the clearest statutory policy. Defending its refusal to permit these employees to select or reject the Petitioner as their lawful bargaining representative, the majority contends that an election now would disrupt "conditions already stabilized by the existing contract." Is it stability for these employees to be totally unrepresented for 1 1/2 years? Is a contract signed under the conditions which I have described above and as to which the 1063 majority declines to cite "countervailing evidence" a stabilizing factor at this plant? Would it be unlawful for this Petitioner to demand bargaining for an entirely new agreement if it is successful in a Board election? Is it proper for the Board to insist that this Petitioner assume a representative status at this plant only on condition that it agree to administer the existing contract? For more than 16 years the Board has held that an employer has a statutory obligation to bargain with the newly selected representative of its employees without regard to the existence of a previous contract.15 For 19 years the Board has held that a new bargaining representative cannot be accorded conditional certification through a requirement that it administer an existing contract." In my opinion, by refusing to conduct an election at this time, the majority, in effect, directs the Petitioner and these employees to yield to a principle long rejected by the Board." The Board's traditional refusal to condition the certification of a union is based in large part upon the legislative history of the amended Act. A requirement that a new union must adhere to the terms of an unexpired contract was considered and rejected by the framers of the amended Act. In reporting to the House the House conferees explained the deletion of such a provision as follows: Under the House bill, in section 9(t)(8), it was provided that if a new representative were chosen while a collective bargaining agreement was in effect with another representative, certification of the new representative should not become effective unless such new representative became a party to such contract and agreed to be bound by its terms for the remainder of the contract period. Since the inclusion of such a provision might give rise to an inference that the practice of the Board, with respect to conducting representation elections while collective contracts are in effect, should not be continued, it is omitted from the conference agreement.' S "In a somewhat inconsistent finding the majority refers to the "mere formal" defunctness of the Optical Workers . Whether formal defunctness is to be accorded less weight than informal defunctness or whether there is a distinction between these terms is a matter upon which I express no opinion "American Seating Company, 106 NLRB 250 at 255. In that case, answering a contention of the Employer that a new union be certified to bargain only after the expiration date of the existing contract, the Board said " If the Respondent 's contention is sound, a certified bargaining representative might be deprived of effective statutory power as to the most important subjects of collective bargaining for an unlimited number of years as the result of an agreement negotiated by an unwanted and repudiated bargaining representative . There is no provision in the statute for this kind of emasculated certified bargaining representative Moreover, the rule urged by the Respondent seems hardly calculated to reduce 'industrial strife' by encouraging the 'practice and procedure of collective bargaining' the declared purpose of the National Labor Relations Act, as amended " " " Boston Machine Works, 89 NLRB 59. Even if the Optical Workers is only formally defunct , as the majority contends , but nevertheless lives on in the Petitioner , the latter is certainly entitled to certification by the Board under well established and unchallenged precedent General Box , 82 NLRB 678 "H Conf Rep. 510 on H R 3020 at 50 1064 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Obviously, Congress has indicated its desire that terms of existing contracts, in accordance with the Board continue to hold elections during the established contract bar rules, but deemed it unwise to direct the new union to administer such a contract, a result which the majority seeks to accomplish in this case. Accordingly, for the foregoing reasons, I must dissent from the majority's decision to dismiss the petition filed herein. I would affirm the Regional Director's Decision and Direction of Election. Copy with citationCopy as parenthetical citation