Council of Bagel and Bialy Bakeries

National Labor Relations Board - Board Decisions

May 8, 1969

175 N.L.R.B. 902 (N.L.R.B. 1969)

902 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Council of Bagel and Bialy Bakeries and its
Employer Members and Bakery Drivers Union
Local 802, Affiliated with International
Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America, and
George R. Raaf.
Council of Bagel and Bialy Bakeries and its
Employer Members and Bagel Bakers Union Local
338 of the Bakery and Confectionary Workers of
International Union of America. Cases
29-CA-923-1, 29-CA-837, and 29-CA-887-2
May 8, 1969
DECISION AND ORDER
BY CHAIRMAN MCCULLOCH AND MEMBERS
BROWN AND JENKINS
On July 24, 1968, Trial Examiner Joseph I.
Nachman issued his Decision in the above-entitled
proceeding, finding that the Respondents had
engaged in and were engaging in certain unfair labor
practices, and recommending that they cease and
desist therefrom and take certain affirmative action,
as set forth in the attached Trial Examiner's
Decision. Thereafter, the General Counsel and the
Employer Respondents, as individuals, filed
exceptions to the Trial Examiner's Decision and
supporting briefs.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
powers in connection with this case to a three-
member panel.
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 Trial
Examiner's Decision, the Respondents' exceptions
and briefs, the General Counsel's exceptions and
brief, and the entire record in this case , and finds
merit in the exceptions of the Respondents.
1. Respondent employers are five bagel
manufacturers (Famous, Bagel Mine , Seaview,
Kelton, and House of Bagels ) who along with eight
other employers formed an employer association,
the Council of Bagel and Bialy Bakeries, in October
1965. For some time prior to the fall of 1965, most
employers in the industry, including the five here
involved, were members of another association,
Bagel Bakers Council of Greater New York,
through which they bargained with Bagel Bakers
Union Local 338 and Bakery Drivers Union Local
802, as a multiemployer group. The record shows
that if the operations of these five Respondent
employers were to be considered separately, only the
business of Kelton Bagel Bakery would satisfy the
Board 's jurisdictional standards. However, after
considering the jurisdictional question, the Trial
Examiner found that the Respondent employers had
evidenced their intention to be bound by group or
multiemployer action, rather than individual action,
and he concluded that the Council of Bagel and
Bialy Bakeries was a multiemployer bargaining
group, as the Board uses that term, justifying the
assertion of jurisdiction over the five Respondents
here involved.' We disagree with his conclusion that
a true multiemployer unit may be found on the facts
of this case.
Upon examination of the Articles of Association
of the Council of Bagel and Bialy Bakeries (which,
although they had a space for Seaview's signature,
were never signed by Seaview), we note that the
Council was established "to join together and to
foster and promote the interests of those individuals,
partnerships, firms, associations and corporations
who are engaged in the business of operating bagel
and bialy bakeries in the Greater New York area."
Among other purposes listed, the Council was
intended "to promote unanimity in dealing with the
unions affecting their business and to insure
industrial harmony among its members." However,
no provision specifies that the individual members
intended to be bound in collective bargaining by
group action. The employer's testimony as to
delegation of authority to the Council was that there
was in fact no intention to bind the individual
employers by group bargaining; that each employer
retained the right to accept or reject a contract; and
that group bargaining was merely done in the hope
of achieving common contract provisions. The Trial
Examiner apparently, found as a fact that the
members of the Council never authorized the latter
to execute a collective agreement on their behalf and
reserved the right to sign or refuse to sign any
agreement which the Council negotiated.
The Council, as a bargaining agency, negotiated
only one set of contracts, for the year 1966-67, with
Local 802, and these individual contracts were
signed by only four of the Respondent employers,
with Kelton abstaining.' Moreover, Local 802
appeared to question the authority of the
Association to act as the bargaining representative
of the individual Respondents, when, in November
1966, the Union sent each employer a notice
terminating the then-existing contract. As for its
dealings with Local 338, the Council and that Union
never reached terms on a 1966-67 contract, and the
five employers separately signed stipulations on
different dates to cover the 1966-67 term, after
being individually approached by the Union to do
so. It appears that the Council was abandoned by its
members and ceased to function at least by 1967.
'N.L.R.B. v. Gottfried Baking Co.. 210 F.2d 772 (C.A. 2), enfg. as
modified 103 NLRB 227; Dover Tavern Owners Association . 164 NLRB
No. 130.
'Although Kelton was not asked to sign the contract in March 1966,
when the others did, because Local 802 was then striking the Kelton firm,
the evidence shows that Kelton was not requested by the Union to sign the
contract once the strike had been terminated.
175 NLRB No. 148
COUNCIL OF BAGEL AND BIALY BAKERIES
In these circumstances , where there has been only
one prior contract signed by less than all of the
members of the group, where the formal articles of
association make no provision for the individual
members to be bound by group action, where there
is evidence that there was no such intention, and
where the conduct of the Unions otherwise fails to
establish that they were dealing on a true
multiemployer basis, we-find it difficult to conclude
that the employer Respondents may be said to have
created with the consent of the Unions a
multiemployer bargaining unit. It appears, rather,
that the Association was formed merely for the sake
of convenience in bargaining , and that it cannot be
concluded that the members of the,group indicated
an unequivocal intention to be bound in collective
bargaining by group rather than individual action.'
Therefore, we find that the Council of Bagel and
Bialy Bakeries is not a true multiemployer
bargaining group which for jurisdictional purposes
must be viewed as standing in the position of a
single employer and accordingly dismiss all of the
Trial Examiner's findings of violations against
Respondent Council and four of its members
(Seaview, House of Bagels , Famous, and Bagel
Mine), over whom, separately, the Board will not
assert jurisdiction.
2. As previously noted, although the complaint
will be dismissed as'to four of the Respondents, the
individual operations of Kelton Bakery satisfied the
Board's jurisdictional standards. The Trial Examiner
found that Kelton Bagel Bakery violated Section
8(a)(3) of the Act by locking out employees on
February 1, 1967, and that Kelton violated Section
8(a)(3) and, through Respondent Council, violated
Section 8(a)(5) of the Act, by establishing an
automated bagel- making operation at Nanuet, New
York, and by failing to give Local 802 notice or an
opportunity to bargain with respect to that matter.
We disagree.
Benjamin Kelton, owner of the Kelton Bagel
Bakery, testified that about 6 months prior to
February 1967, plans for the establishment of an
automated bagel bakery at Nanuet, New York, were
begun, and that said bakery was ready for operation
in late January or early February 1967. Kelton
testified that his only interest in the Nanuet facility
was as manager , and that ownership thereof was
vested in four persons : two of Kelton's
sisters-in-law; the wife of a coowner of Bagel Mine,
Harold Hershman; and Kelton's nephew, who is the
son of the attorney for the Respondent Council. The
Trial Examiner notes that there is evidence that
neither the sisters-in-law nor Nashman's son took
any part in the - operation or management of the
Nanuet facility. The- record is silent as to the part
played by Mrs. Hefshlnan. When the Nanuet
operation began on February 1, 1967, the date on
which Kelton Bagel Bakery permanently closed,
'Weyerhaeuser Company , 166 NLRB No. 7.
903
-Kelton donated a truck to Triangle Distributing
Corp., which, Kelton testified, purchased bagels
from Nanuet and sold them at wholesale to
customers in the New York City area, including
those formerly serviced by Kelton. However, the
Nanuet facility also services a wider range of
customers than those formerly served by Kelton.
The record does not indicate that Kelton or Nanuet
have any interest in, or control over, Triangle.
Benjamin Kelton testified that he had no financial
interest in the Nanuet operation. Although the
evidence he gave was not controverted by any other
witness, the Trial Examiner did not credit his
testimony in this regard. He found, instead, that
Kelton owned the facility at Nanuet. Initially, we
note that the complaint contains no allegations
concerning the establishment of the Nanuet facility.
Furthermore, although some evidence relating to the
question of ownership was admitted at the hearing,
the only positive evidence on the matter was that
Kelton had no ownership interest in the Nanuet
operation. We cannot sustain the Trial Examiner's
inference of Kelton's ownership, and his consequent
conclusion that 'Nanuet was, in effect, a "runaway
shop," on the scant evidence appearing in this
record. The burden is upon the General Counsel to
establish a prima facie case that Kelton transferred
his entrepreneurial interest from Manhattan to
Nanuet, New York (cf. Garwin Corporation, 153
NLRB 664), and this burden is not satisfied simply
by the Trial Examiner's disbelief of Kelton's sworn
denial that he did so.
The record reveals that the Kelton Bagel Bakery
became an unprofitable venture toward the latter
part of 1966. For all that appears, Benjamin Kelton
simply decided to close down that facility for
economic reasons, on a date which coincided with
the expiration of the Local 338 and Local 802
contracts, and accept employment with the newly
opened Nanuet plant. The coincidence in timing and
the close relationships between Kelton and the four
purported owners of the Nanuet plant certainly raise
suspicions as to the equitable ownership of the
facility, but nothing more than suspicions. The
matter was susceptible of proof, and the proof was
not supplied. -
Since we cannot find that Kelton transferred his
business from the New York-'City bakery to
Nanuet, we further conclude that- Kelton's closing of
Kelton Bagel Bakery on February 1, 1967, must be
considered a permanent termination of that business
and not, as the Trial Examiner found, an unlawful
lockout in violation of Section 8(a)(3). We need not
determine whether, as found by the Trial Examiner,
Kelton violated Section 8(a)(5) of the Act by closing
his bakery without prior notification to the Unions
and an opportunity to bargain. We do not consider
that this issue has been sufficiently raised here, since
it was neither alleged in the complaint nor
consciously litigated by the parties.
904 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
It follows from the foregoing discussion that the
complaint against Respondent Council and the five
individual Respondents must be dismissed in all
respects.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board hereby orders that the complaint
against Respondents, Council of Bagel and Bialy
Bakeries, The Bagel Mine, Famous Bagel Bakery,
Inc., Seaview Bagel Company, Inc., The House of
Bagels, Inc., and Kelton Bagel Bakery, Inc., be, and
it hereby is, dismissed in its entirety.
TRIAL EXAMINER'S DECISION
STATEMENT OF THE CASE
JOSEPH I. NACHMAN, Trial Examiner: These separate
complaints consolidated for trial by the Regional
Director's order of July 18, 1967, were tried before me at
Brooklyn, New York, between March 4 and 8, 1968,' and
the record was closed by my order of April 10, 1968, after
receipt of a stipulation executed by all parties. These cases
involve the same unions but a different group of
employers from those involved in Bagel Bakers Council
of Greater New York, which is now pending before the
Board on exceptions to my decision in that case. See 174
NLRB No. 101. Basically the same issues are presented in
both cases, although the facts while in some instances
similar, are in other respects quite different.
The complaint in Cases 29-CA-937 and 29-CA-923-1,
issued pursuant to Section 10(b) of the National Labor
Relations Act, as amended (herein called the Act), alleges
in substance, that Council of Bagel and Bialy Bakeries
(herein the Council), and Famous Bagel Bakery, Inc., The
Bagel Mine , Seaview Bagel Company, Inc., Kelton Bagel
Bakery, Inc., and The House of Bagels, Inc. (herein
Famous, Bagel Mine, Seaview, Kelton Bagel and House
of Bagels, respectively and together with Council called
Respondents), employer members of Council,' violated
Section 8(a)(1), (3), and (5) of the Act by threatening
employees with plant closure and other reprisal because of
their membership in and activity on behalf of Bakery
Drivers Union Local 802, affiliated with International
Brotherhood of Teamsters, Chauffeurs, Warehousemen
and Helpers of America' (herein called Local 802 or
Drivers), locking out and discharging employees because
of their membership in and activity on behalf of Local
802, and refusing to bargain with Local 802, the
recognized collective bargaining representatives of their
employees in an appropriate unit.
'In Cases 29-CA-837, and 29-CA-923-1, which were consolidated by the
Regional Director, the complaint issued on June 30 , 1967, on charges filed
January 3 and March 17, 1967, respectively. In Case 29-CA-887-2, the
complaint issued on June 30, 1967, on a charge filed February 8, 1967, and
amended May 19, 1967.
%
'Appendix A to each complaint, as amended by the Regional Director's
order of January 5, 1968, lists Famous Bagel Bakery , Inc., The Bagel
Mine, Seaview Bagel Company, Inc., Kelton Bagel Bakery , Inc., and the
House of Bagels, Inc., as employer members of the Council herein
proceeded against.
'The caption to this complaint shows Bakery Workers to be affiliated
with the AFL-CIO. I have been advised that said Union is not affiliated
with AFL-CIO. See exceptions to my Decision in Bagel Bakers Council of
In Case 29-CA-887-2, the complaint alleges that
Respondents violated Section 8(a)(1), (3), and (5) of the
Act by terminating and ceasing to give effect to an
existing contract with Bagel Bakers Union Local 338 of
the Bakery and Confectionary Workers International
Union of America (herein Bakers or Local 338), without
complying with Section 8(d)(3) of the Act; refusing to
bargain with Local 338 for a renewal contract; and
locking out and discharging the employees represented by
Local 338 because of their assistance to and support of
said union.
By answer Respondent employers admitted certain
allegations of the complaints, but denied the commission
of any unfair labor practice. At the trial, all parties except
the Council' were represented by counsel, were afforded
full opportunity to adduce evidence, to examine and
cross-examine witness, and to argue orally on the record.
Briefs submitted by the General Counsel, and by
Respondent employers have been received and duly
considered.
Upon the entire record in the case, including my
observation of the demeanor of the witnesses, I make the
following:
FINDINGS OF FACT'
1. BUSINESS OF RESPONDENTS
Respondents are engaged in the metropolitan area of
New York City, in the production of bagel and related
products which they distribute both at wholesale and
retail. Stipulations as to the volume of business of the five
employer members of the Council disclose the following:
1. From June 1966, when Kelton began business, to
January 31, 1967, the termination dates of the last union
contracts, and when the principal events here involved
occurred, Kelton had gross revenue of $134,000, of which
$80,000 was wholesale. Of the latter amount $67,200 was
sold to Pechter Baking Company and Daitch Crystal
Dairies. The parties stipulated that Pechter and Daitch
each had gross annual revenue in excess of $500 ,000, and
had gross annual purchases directly from outside the State
of New York in excess of $50,000.
2. Seaview, during the year from February 1, 1966, to
January 31, 1967, had gross revenue of $237,000, of which
$75,000 was wholesale, and the remainder retail. Of the
wholesale business $10,000 represented sales to Packer's
Super Markets, Inc. The latter has gross annual sales in
excess of $500,000, and gross annual purchases directly
from outside the State of New York in excess of $50,000.
3. During the year beginning February 1, 1966, House
of Bagels had gross sales of $207,000, of which $86,000
Greater New York, 174 NLRB 101. Also, the charge filed by this Union
does not show an affiliation . Accordingly, I have eliminated all reference
to the affiliation.
'The Council neither answered the complaints , nor appeared at the
hearing.
'No issue of labor organization or appropriateness of unit is presented.
Respondents stipulated that both Local 338 and Local 802 are
organizations which admit employees to membership and exist for the
purpose of bargaining with employers concerning wages, hours , and terms
and conditions of employment of their employee members. It was further
stipulated that the units pleaded in par . 6 of the separate complaints, were
units appropriate for the purpose of collective bargaining . I find these facts
to be as stipulated. The stipulation so reached were made with the
understanding that the issue of multiemployer bargaining units was open
for litigation.
COUNCIL OF BAGEL AND BIALY BAKERIES 905
was wholesale.
4. For the year beginning January 1, 1966, Famous
Bagels had gross sales of $129,000, which includes sales at
wholesales of $3847, to Pechter Baking and Waldbaum
Foods Stores, both of whom meet the Board's
jurisdictional standards.
5. From March 1 to December 31, 1966, Bagel Mine
had gross sales of $65,000. This included $16,142 sold at
wholesale to Levy Baking Co., General Baking Company,
and Waldbaum Foods Stores, each of whom meet the
Board's jurisdictional standards.
Although the stipulated facts established that the Board
would assert jurisdiction at least over Kelton, the General
Counsel's complaints are predicated on the theory, which
Respondents deny, that the employers involved have,
through the Council, banded together as a multiemployer
bargaining unit for the purposes of collective bargaining
with Locals 338 and 802. As this is one of the principal
issues to be decided, my conclusions with respect to
commerce are deferred until the issue of multiemployer
bargaining units is hereafter considered and resolved.
A. Background and History of Bargaining
For some time prior to the fall of 1965, most employers
in the industry, including the five here involved, were
members of Bagel Bakers Council of Greater New York
(herein called the Glass Group), through which they
bargained with Local 338 and Local 802, as a
multiemployer group." By identical letters to Local 338
and Local 802, dated October 19, 1965, Alex Nashman,
attorney for the Council, advised said Locals of the
formation of Respondent Council by some 17 employers
in the industry, including the five Respondents in this
case, most whom had been members of the Glass Group.
Nashman's letters, also identified the officers of the
Council, and stated:
This Association is ready to discuss any matters,
problems or situations which may arise concerning any
member of this Association with any of their employees
for the purpose of insuring industrial tranquality.
Should a situation arise which may disturb, in any
manner, the employer and employee relationship of any
member of this Association, we would appreciate if you
would contact any of the officers herein named for the
purpose of amicably seeking a solution to such
problems.`
There is no evidence, nor is there any contention that
Nashman's letters were unauthorized or in excess of his
authority as counsel for the Association or its members.
In October 1965, when the Council was organized,
there was in effect a contract negotiated between 338 and
the Glass Group, with which the members of the Council
had been affiliated, which contract they had signed. The
term of that contract was from February 1, 1965, to
January 31, 1966. On November 30, 1965, the Council, on
behalf of its member employers sent Local 338 a notice
terminating the aforementioned contract as of January 31,
1966. Following said notice, committees of the Council
and Local 338 met on several occasions and discussed
terms of a renewal agreement, but when the termination
"See my decision issued March 28, 1968 , in Bagel Bakers Council of
Greater New York, 174 NLRB No. 101, now pending before the Board.
'in a subsequent letter dated November 16 , 1967, from Nashman to
both Local 338 and Local 802, the above -quoted paragraphs were
reiterated, after advising that the name of the Council had been changed
from Bagel and Bialy Bakers Council , to Council of Bagel and Bialy
Bakers.
date of the contract arrived and no agreement had been
reached, Local 338 struck all employers who had not
signed a stipulation agreeing to comply with and be bound
by any agreement thereafter reached, retroactive to
February 1, 1966. Among the members of the Council
who signed such a stipulation and the date of such signing
were: Seaview on January 31, 1966;' Famous on February
6, 1966; House of Bagels on February 11, 1966; Kelton on
February 25; and Bagel Mine on March 4, 1966. At the
time of signing these stipulations each of these employers
told Local 338 that they were represented by the Council,
and not by the Glass Group. Thereafter, in the summer of
1966, Local 338 sent to all employers in the industry a
formal contract for signature, effective from February 1,
1966 to January 31, 1967, and thereafter until a new
agreement was signed, subject to the right to either party
to terminate on 60 days' notice which was not to be
effective before January 31, 1967. None of the five
employers here involved signed such contract, but they did
comply generally with all its terms and provisions.
The bargaining between the Council and the Local 802
followed substantially the same course. At the time the
Council was organized in October 1965, there were in
effect two contracts binding Respondents, which had been
negotiated between the Glass Group and Local 802, which
were effective for the term February 1, 1965, to January
31, 1966. One of the contracts covered a unit of drivers,
and the other a unit of helpers. In November 1965, Local
802 gave the Council notice of termination of these
contracts as of January 31, 1966. In due course
committees of the Council and Local 802 negotiated, and
in March 1966, agreement on terms of contracts to
January 31, 1967, was reached. The drivers' agreement
was signed by all members of the Council except Kelton,
and the helpers' agreement by all members of the Council
except Kelton and Famous! Both during and after these
negotiations, Council President Hershman told Strauss
that he wanted to be advised of any problem affecting any
member of the Council, and to be included in any
discussions of those problems. Strauss agreed.
B. Current Facts
1. Refusal by Bagel Mine and Famous to employ
members of Local 338 and Local 802, while 1966-67
contract is in effect
After the 1966-67 contracts were negotiated, but before
their expiration on January 31, 1967, several disputes
arose between Council members, Bagel Mine and Famous
on the one hand, and either Local 338 or Local 802, on
the other. The details of such disputes are:
1. On June 29, 1966, Bagel Mine wrote Local 802 that
it was terminating all Local 802 employees as of July 8.'
Early in July, George Raaf, a Local 802 member
employed by Bagel Mine, was told by Bagel Mine owners
Hershman ahd Reiter, that they had a dispute with Local
802, and because of that dispute were not going to use
'As Seaview signed the stipulation before February 1, 1966, it was not
struck, but the remaining Respondent employers were struck until they
signed the stipulation.
'Local 802 President Strauss credibly testified that Famous was not
required to sign the helpers' agreement because of its claim that it
employed no helpers, and that Kelton was not asked to sign either
agreement because a strike by Local 802 was then in progress against
Kelton. The issues in that strike are not here material, but it is material, as
Strauss credibly testified , that after the last mentioned strike ended, as
hereafter set forth , Kelton abided by the terms of both agreements.
'The letter stated that the action was being taken because of Local 802's
906 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Local 802 or Local 338 members anymore, and for that
reason no longer needed his services . 10 Regarding the
action by Bagel Mine as a lockout of its employee
members, Local 802 struck and picketed Bagel Mine and
Famous, taking that action against Famous because it
regarded the two firms as commonly owned operations
and because in its view Famous was performing delivery
function for Bagel Mine which the latter' s employees
theretofore performed." The dispute between the parties
was brought to arbitration and a hearing in connection
therewith was commenced before an agency of the State
of New York. Before the hearing was concluded, the
parties adjusted their dispute, one of the provisions of the
settlement being that members of Local 802 return to
work as of August 25,12 and they apparently did so.
2. On or about September 30, 1966, Local 338 struck
Bagel Mine and Famous because of a dispute over pension
and welfare payments pursuant to the then current
contract. Raaf and Kleinman, Local 802 member
employed by Bagel Mine, were scheduled to work a shift
beginning late in the evening of September 29, and
extending into daylight hours of the following day. Several
hours before Raaf was scheduled to report, he received a
phone call at his home from his helper Kleinman, who
informed him that the bakery was closed. Raaf went
immediately to the bakery, and then with Kleinman to
Hershman's home, asking why the bakery was closed.
Hershman replied, in substance, that he had a dispute
with Local 338 and had to close down; that he was very
angry with both Local 338 and 802 and had "intentions of
breaking both Union," and that he was going to
straighten things out his own way. Hershman then sent
Raaf and Kleinman to the home of his partner Harry
Reiter, to get their paychecks. Arriving there, they were
told by Reiter that he was "very disgusted with Local
338," and "tired of making Local 338 rich men." At this
point Raaf mentioned that he had heard rumors about the
establishment of an automated bagel operation, to which
Reiter replied , "Never mind , this industry is going to
undergo a great change , it will either make me or break
"unwarranted interference in our wholesale business . . . making it
uneconomical for us to continue ...," and that the notice was being sent
pursuant to art . 15(b) of the "Collective-Bargaining Agreement in
existance between us." Art. 15(b) provides:
If for any other reason , the Employer finds it necessary to discharge or
lay off an employee , he shall first notify the Union in writing of his
intentions. Such notice shall be given at least one (1) week in advance.
The Union shall then investigate the charges preferred, or the reasons
given , and make known its decision to the Employer immediately.
Should there be any dispute as to discharge of an employee , said dispute
shall be arbitrated pursuant to Article 16.
"Based on the credited testimony of Raaf . Hershman did not testify
regarding this conversation , and while Reiter denied that he made such a
statement , he did so in reply to questions relating to a subsequent period of
time. To the extent that Reiter 's testimony may be regarded as in conflict
with that of Raaf, I do not credit it.
"There is no evidence that the employers mentioned took any action
against Local 338 members at this time.
"The settlement agreement , which was signed by Hershman on behalf of
both Bagel Mine and Famous , further provided for the payment by the
employers to the Union of $1,000 on August 24 , the further sum of $1,000
in four installments of $250 at stated intervals, for distribution among the
employees as the Union might determine . The testimony is uncontradicted
that only the first payment was made, and that on November 3, the Union
asked the State agency to reactivate the arbitration proceeding because of
the employers' noncompliance with the settlement agreement . By letter
dated November 7, the employers objected to reactivation of the
arbitration proceeding . Whether the proceeding was in fact reactivated, and
if so the result thereof, the record does not disclose.
me."" During the period of this strike by Local 338,
Bagel Mine and Famous continued to operate, using
nonmembers of Local 338 for their baking operations.
Who made deliveries, the record does not disclose, but it
does appear that Local 802 members were not employed
for that purpose.
Sometime in November, Local 338's dispute with Bagel
Mine and Famous was settled. Part of the settlement
agreement was that Local 338 would not insist that these
employers immediately employ a full crew of three men,
but that the Union would dispatch one or two men as the
circumstances might require. For several days Local 338
dispatched one man to Bagel Mine , and one man to
Famous. In each case the man reported for work as
directed, but at each shop was informed that his services
were not needed. In one of the shops the Local 338
member who reported for work saw a nonunion baker
performing baking operations at the bench." Although the
record is not entirely clear , apparently Bagel Mine and
Famous, thereafter also refused to employ members of
Local 802.
2. The refusal-to-bargain allegation
a. The Local 338 case
(1) The 8(d) aspects
By letter dated November 21, 1966, Council Attorney
Nashman, wrote Local 338, that in accordance with the
terms of the then current contract, notice was given that
"the members of the Council" had elected to terminate
said contract as of January 31, 1967. Respondents
stipulated that no notice was given the Federal Mediation
and Concilation Service, or the New York State
Mediation and Conciliation Service of the existence of a
contract dispute as required by Section 8(d)(3) of the
Act.15 The evidence further shows that after February 1,
1967, no members of Local 338 was permitted to work in
the shop of any of the five Respondents involved in this
proceeding, but with the exception of Kelton, such shops
continued to operate with the owners or nonmembers of
Local 338 doing the work which the members of Local
338 theretofore performed."
"Based on the credited testimony of Raaf . As heretofore stated
Hershman did not testify regarding such conversation , and while Reiter
denied that he had any conversation with Raaf at this time , I do not credit
his denial.
"Based on the composite of the credited and uncontradicted testimony of
Amster and Schecter.
"Counsel for Respondents Kelton, Famous, Bagel Mine and House of
Bagels, while admitting that the State Mediation Service did not have
written notice of said dispute, argues in his brief that said Service "had
verbal notice thereof," stating that such was "conceded by the many times
it appears in the testimony." No record references were given to support
these statements and my reading of the record revealed no support
therefor . Certainly the General Counsel made no such concession formally.
Perhaps, by the foregoing statements , Counsel means that the State
Service must have had some notice of this dispute because under its
auspices the parties were brought together for bargaining in the hope that
a contract might be agreed upon . If this is what was meant, the contention
is irrelevant for the reasons stated in my discussion of the legal issues.
"The General Counsel pleads in his complaint, and in accordance
therewith I find, that Respondents Seaview , Famous and Bagel Mine
ceased the lockout of Local 338 members on or about June 15, 1967, and
thereafter reinstated and continued to employ members of Local 338 in
their baking operations.
COUNCIL OF BAGEL AND BIALY BAKERIES 907
(2) Tjle alleged refusal-to promptly meet and confer,
and the subsequent failure to bargain in good faith
In addition to the contention that Respondents violated
Section 8(a)(5) of the Act by terminating their contract
with Local .338 and locking out the employee members
thereof without complying- with Section 8(d) of the Act,
the General Counsel argues that Respondents further
violated Section 8(a)(5) of the Act by unduly delaying
contract negotiations with Local 338, and when such
negotiations did begin , Respondents did not negotiate in
good faith. The facts on this aspect of the case are as
follows:
The Council's- letter of contract termination was dated
November 21, 1966. A few days following receipt of that
letter, Local 338 Business Agent Amster telephoned
Council President Hershman and asked the latter to fix a
time for the commencement of contract negotiations.
Hershman replied that he would have to arrange a time
convenient to his people , and that he would call Amster as
soon -as he could make arrangements . Following this
telephone conversation , but before December 21, 1966,
Amster telephoned Hershman "several times" regarding a
meeting , but Hershman always responded that he had
been unable to get his people together for a meeting, but
would keep trying.
By letter dated December 21, 1966, Council Attorney
Nashman wrote Local 338, and after calling attention to
the fact that the then current contract was scheduled to
expire on January 31, 1967, stated:
. the Council of Bagel and Bialy Bakeries is ready to
sit down with you for' the purpose of negotiating a new
contract covering the members of this Association, for
the period beginning February 1, 1967.
The record is silent as to the response , if any, the
Union made to this letter .11 All that appears is that
about this time , or shortly thereafter, charges (the
nature of which is not disclosed), were filed by Local
338 against Respondents with the New York State Labor
Board , and that pursuant thereof the parties appeared
before that Board on January 25, 1967. Present at the
time were Amster, Laskowitz and Attorney Sasnoff
representing Local 338, Harry Reiter, a management
official of both Famous and Bagel Mine; Tobickman, a
management official of Seaview; and Attorneys Nashman
and Kriesberg , the former introducing himself as
counsel for the Council, and the latter as attorney for
Seaview and 'co-counsel -for the Council. After a few
informal remarks , the State Board agent suggested that
the parties attempt to negotiate an agreement ,' and for
that purpose provided, -the parties with a room. The
parties had been together only a short time when the
employer representative asked for a recess to enable
them to formulate demands . When the meeting resumed
the employers presented a list of demands which
included , inter aliiz^, the elimination of a number of
holidays, that the baker perform certain work
theretofore performed only by the helper, the right to
"Amster testified that after receipt of this letter he called Hershman
several times but when these calls were made or what was said , the record
does not show.
"At an annual membership meeting of Local 338, held about January
15, new officers were elected. Amster, who had been business agent, did
not seek reelection and Laskowitz was elected to succeed him. At that
point Amster, although no longer an elected official of the Union , agreed
to remain for a period to assist Laskowitz in the performance of his new
duties.-
bring in raw bagels from a union or nonunion shop which
the bakers would bake, the elimination of overtime for
work on a holiday, and the elimination of piece work.
Upon reviewing these demands, Amster remarked,
"suppose I agree to this, would this be all?" Nashman
replied "oh, no, that not all we have, we have more."
Amster then stated that absent a complete set of
demands, he had no basis for bargaining. The parties
then adjourned to meet at the Union's office on January
30, to enable the employers to prepare a complete set
of demands.
On January 30, 1967, the parties met as agreed, the
employers' representatives consisting of Council President
Hershman, its Attorney Nashman, and employers Reiter
and Kelton; the Union's committee being Business Agent
Laskowitz, former business Agent Amster," and executive
board members Fleishman, Horowitz, and Organ. At this
time the employers gave the Union committee a
typewritten document consisting of over two pages,
detailing the changes they sought in the existing contract.
This document, which is entitled "Renewal Demands by
Council of Bagel and Bialy Bakers," included, not only
the demands which Nashman voiced on January 25, but a
complete alteration of the existing contract, including
changing the method of compensation from a piece rate to
an hourly rate. In addition to the specific demands, the
final paragraph of the document given the Union on
January 30, read:
Failure to specifically refer to any specific provision
in the [prior] contract does not constitute an acceptance
thereof and the Council reserves the right to negotiate
the terms of the entire contract and the wording
thereof.
After looking over the demands which the employers had
presented, a member of the Union's committee made a
vulgar remark, unnecessary to repeat here, and the
employers committee thereupon walked out." No further
negotiations looking toward a renewal of the contract,
took place.
Regarding the contract with Local 338 as having
expired on January 31, Respondents Seaview, Kelton, and
House of Bagels , thereafter refused to permit Local 338
members to work.20 Thus, at House of Bagel , the baker
reporting for work on February 1, found that place empty
except for a sales girl and porter who stated that they had
orders from the boss not to let any of the workers in; and
it is of some relevency that one of the owners of this
establishment is Benjamin Kelton's wife.2' At Kelton,
when the employee members of Local 338 reported for
work on February 1, they found a padlocked iron grated
across the back door, and the lock on the front door
changed so that those employees provided with keys to
enable them to gain entrance to the premises were unable
to do so.22 At Seaview, the members of 338 who had
worked there for extended periods prior to February 1,
were told by Tobickman, the owner of Seaview, when they
reported for work that date, that the contract had expired,
"My findings with respect to the meetings of January 25 and 30, are
based on the composite of the credited testimony of Amster, Laskowitz,
and G.C. Exh. 8.
"As above stated, Respondents Bagel Mine and Famous had been
refusing to employ 338 members since November 1966, and as noted in fn.
16, supra , their refusal in that regard ceased on or about June 15, 1967.
"This finding based on the credited and uncontradicted testimony of
Morns Kleiner.
"Based on the credited and uncontradicted testimony of Rubin Amster
and Leonard Moskowitz. The close operations between Kelton Bakery and
its retail outlet Allerton Bagel Bakery, is hereafter discussed.
908 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
and that their services were no longer needed."
Tobickman, in his affidavit to the Board, admitted that
since February 1, 1967, he has employed his nephew and
two other men, nonmembers of Local 338, to assist him in
producing bagels and other products.
b. The Local 802 case
As heretofore stated, when the Council was formed in
October 1965, there were in effect contracts with Local
802, negotiated by the Glass Group, which Respondent
employers had signed. For the year, February 1, 1966, to
January 31, 1967, the Council negotiated new agreements
which its member employers signed and/or complied with."
On November 30, 1966, Local 802 sent each employer a
notice terminating the then existing contract as of January
31, 1967. On the same date Local 802 gave the notices
required by Section 8(d)(3) of the Act to the Federal and
State Mediation Services . In December , Union Agent
Azzaro telephoned Council Attorney Nashman and asked
when the Union could expect to hear from him about
negotiating a new contract . Nashman replied that he
would have to check with his group, and would let Azzaro
know." At this time Nashman also referred to the fact
that there as yet been no negotiations with Local 338, and
suggested that the parties wait until the course of those
negotiations become more apparent. Azzaro did not object
to this suggestion. About mid-January Azzaro, not having
heard from Nashman, called him again , and after noting
that the January 31 expiration date of the contract was
drawing near, inquired whether Nashman 's group was
ready to negotiate . Nashman replied that he did not think
there was anything to negotiate about, because they first
had to negotiate a contract with Local 338. Again, Azzaro
raised no objections. The evidence fails to disclose any
further contact between Local 802 and Respondents prior
to the expiration of the contract on January 31, 1967. The
General Counsel and Local 802 concede that for some
years it had been the custom and practice in the industry
for the Local 338 and Local 802 contracts to expire on the
same day, and for the employers to defer negotiations
with Local 802 until agreement was reached with Local
338, or at least until the course of the latter negotiations
became apparent.
After the expiration of the Local 802 contract, Seaview,
Kelton and House of Bagel ceased to employ members of
Local 802, as Famous and Bagel Mine had theretofore
done as above set forth . The evidence shows, as the
employee members of Local 802 testified, that when they
reported for work at Seaview , Kelton and House of
Bagels on February 1, to take out merchandise for their
routes, they found the place locked or were otherwise
prevented from obtaining merchandise for deliveries.
Those who had keys which they normally used to gain
access to the bakery, found that their key would not
operate the lock. Moreover , the testimony is clear that at
"Based on the credited testimony of Mastel and Stugatch. Tobickman's
testimony that he asked the members of Local 338 to work , and that they
refused , is not credited.
"At the time of these negotiations, Local 802 requested a letter from the
Council stating what employers the Council represented . By letter dated
March 8 , 1966, the Council by Attorney Nashman , wrote Local 802 listing
some 11 employers , including the five Respondents in this proceeding, as
employers represented by the Council.
"On this occasion also Azzaro asked Nashman dust what employer the
Council represented, and Nashman again referred to his letter of March 8,
1966, mentioned in In . 24 supra
least in the case of Seaview the bakery operated after
February 1, 1967, with members of the family of the
owner and/or nonunion help being used to do the baking
and such deliveries as were necessary.2"
C. Other Facts Relevent to the Issue of Good Faith
Bargaining
1. The status of Allerton Bagel Bakery and the
commencement of an automated operation of Nanuet
Kelton Bagel Bakery operated at 681 Allerton Avenue,
Bronx, New York. These premises are divided into two
parts; in one part Kelton produced bagels and sold them
at wholesale, and in the other part Allerton Bagel Bakery
(herein Allerton), sold bagels to the retail trade only. All
bagels sold by Allerton were acquired from Kelton.
Although Benjamin Kelton testified that there were some
ovens in the portion of the premises occupied by Allerton,
he admitted that prior to February 1, 1967, they were
operated only by Local 338 members employed by Kelton.
At one point Benjamin Kelton testified that the ownership
of Allerton was vested in himself and Joe Apucco (not
otherwise identified in the record), but at another point he
testified that the same people owned both Allerton and
Kelton. There is no evidence that any person other than
Benjamin Kelton has any ownership interest in Kelton
Bagel Bakery. According to Kelton, after February 1,
1967, Allerton suspended operation for about 3 weeks,
and thereafter operated as a retail outlet for bagel, but
that Kelton Bagel Bakery ceased operations.
Benjamin Kelton admitted that about 6 months prior to
February 1967, plans for the establishment of an
automated bagel bakery at Nanuet, New York,2" were
begun, and that said bakery was ready for operation in
late January, or early February, 1967. The evidence shows
that the plans to establish the Nanuet bakery were kept
secret from both Unions until it opened for business, and
there was no notice thereof to either Union regarding the
same. Indeed the meeting of January 30, 1967, with Local
338, at which Benjamin Kelton was present, the subject
was not mentioned. Kelton testified that his only interest
in the Nanuet facility was of manager, and that ownership
thereof is vested in four persons, namely Ethel Urnell and
Jennie Rothbard, his sisters-in-law, Eva Hershman the
wife of Harold Benjamin Kelton's nephew Robin
Nashman, the son of Attorney Alex Nashman. There is
no evidence that Ethel Urnell, Jennie Rothbard, or Robin
Nashman took any part in the operation or management
of the Nanuet facility, or indeed, that they were ever
there. When the Nanuet facility began operation about
February 1, and which incidentially coincided with the
expiration dates of the Local 338 and Local 802 contracts
Benjamin Kelton donated a truck theretofore used in
making the wholesale deliveries for Kelton Bagel Bakery,
to Triangle Distributing Corp., which, Kelton testified,
purchased bagels from Nanuet and sold them at wholesale
to customers in the New York City area, including those
formerly serviced by Kelton with drivers who were
members of Local 802." From the time the Nanuet
operation began it has sold raw frozen bagels to, among
"Based on the composite of the credited testimony of Braunstein, Adler,
Sullivan, and O'Connell To the extent that the testimony of Tobickman is
to the contrary, it is not credited.
"I take official notice of the Rand, McNally Company road maps which
show that Nanaet is in Rockland County, New York, just off the New
York thruway, approximately 40 miles from midtown New York City.
"The relationship, if any, between Triangle, Nanuet, and Kelton, is not
shown by the record
COUNCIL OF BAGEL AND BIALY BAKERIES
others, House of Bagels and Allerton Bagel Bakery, the
latter selling said products at retail after they had been
baked by their employees who were not members of Local
338. Indeed since February 1, 1967, Allerton's sole source
of supply of bagels has been the Nanuet operation.
Although Benjamin Kelton denied that he had any
financial interest in the Nanuet operation , and also denied
that it was organized in anticipation of the expiration of
the Local 338 and 802 contracts in order to undermine
said Unions, and while the evidence he gave was not
controverted by any other witness, I do not credit his
testimony in that regard . Kelton ' s demeanor while
testifying was not such as to inspire my confidence in his
credibility. Accordingly, upon consideration of the entire
record , and being so convinced , I find and conclude (1)
that Kelton Bagel Bakery and Allerton Bagel Bakery
operated as a single intergrated enterprise of which
Benjamin Kelton was the owner ; (2) that the operation of
Allerton after February 1, 1967, are in fact the operations
of Benjamin Kelton ; (3) that Benjamin Kelton is the
owner of the Nanuet facility and (4) that the Nanuet
facility was conceived , organized and subsequently
operated with the intent and purpose of undermining the
majority representative status of Local 338 and Local 802
in the industry involved."
2. Statements of employee Raaf
In March 1967, Raaf, theretofore employed by
Hershman , by chance , met Hershman and his wife on the
street, and the latter invited Raaf to breakfast with them.
During the meal Raaf asked Hershman why he did not
bargain with Local 802 . Hershman replied , in substance,
that he would be happy to bargain with them, but only on
his terms . Hershman also told Raaf that Local 338 had
lost many of its members and was on the verge of going
broke, that it was just a matter, of time before both
Unions would be eliminated, and that "if he had the
opportunity it would be done because he was so
disgusted ." Hershman offered to permit Raaf to job
bagels for him, but' did not offer Raaf reinstatement.3 It
may be noted, as heretofore found, that at the time of this
conversation Hershman was being supplied with frozen
bagels by the Nanuet facility.
II. CONTENTIONS AND CONCLUDING FINDINGS
A. The Jurisdictional Issue
The General Counsel admits that if the operations of
the five Respondent employers is considered separately,
only the business of Kelton Bagel Bakery satisfies the
"That a trier of fact may, based on credibility resolution , find the
contrary of what an uncontradicted witness testified to, is settled. As the
Supreme Court said in N.L.R.B. v Walton Manufacturing Company, 369
U.S. 404, 408, citing with approval the language of Judge Learned Hand
in Dyer v. McDougal 201 F.2d 265, 269 (C.A. 2),
For the demeanor of a witness ". . . may satisfy the tribunal , not only
that the witness ' testimony is not true , but that the truth is the opposite
of his story; for the denial of one who has a motive to deny, may be
uttered with such hestitation , discomfort , arrogance or defiance, as to
give assurance that he is fabricating , and that if he is, there is no
alternative but to assume the truth of what he denies "
"Based on the credited and uncontradicted testimony of Raaf. As
heretofore noted Hershman did not testify on this point.
909
Board's jurisdictional standards." However, he relies on
the rule that where a group of employers expressly or by
implication indicated an intention to be bound in
collective bargaining by group, rather than individual
action, they are regarded as a multiemployer bargaining
unit and the total business of the entire unit may be
considered in determining whether the Board's
jurisdictional standards are met. N.L.R.B. v. Gottfried
Baking Co., 210 F.2d 772 (C.A. 2), enfg. as modified 103
NLRB 227; N.L.R.B. v. Sightseeing Guides Union, 310
F.2d 40 (C.A. 2), enfg. 143 NLRB 596, cert. denied 379
U.S. 830; Dover Tavern Owners Association, 164 NLRB
No. 130; Korner Kafe, Inc., 156 NLRB 1157, 1160;
Marble Polishers Local 121, 132 NLRB 844, fn. 1;
Western Council of Lumber and Sawmill Workers,
AFL-CIO, 166 NLRB No. 7, petition to review and set
aside Board's order denied Western States Regional
Council No. 3 v. N.L.R.B., 398 F.2d 770 (C.A.D.C.). Nor
is it material in deciding whether a multiemployer
bargaining unit exists to determine whether there has been
formal authorization to a formally organized association,
to act for and bind the group, or that the individual
employers may have reserved to themselves the right to
decide whether or not they would sign the agreement
negotiated by the group. Sightseeing Guides Union, supra;
Western Council of Lumber and Sawmill Workers,
AFL-CIO, supra; American Publishing Corp., 121 NLRB
115.32
The salient evidence in this record show, as heretofore
found, that the Council had for at least one of its
purposes, collective bargaining with Local 338 and Local
802, by the Council's membership through the Council.
Not only did Tobickman33 state in his affidavit to the
Board's agent on March 8, 1967, that he "was aware that
a purpose of this Council was to engage in collective
bargaining with Local 338, and Local 802," and that any
agreement reached as a result of such bargaining would be
subject to the approval of the membership by submission
to them for signature, but Nashman, attorney for the
Council, in his letters of October 19, 1965, addressed to
each of the Unions, made it plain that collective
bargaining on behalf of the Council's membership with
said Unions, was the principle function which Respondent
employers vested in the Council. Unless Nashman's
aforementioned letters be so regarded they served no
purpose. The fact that the membership of the Council
never authorized the latter to execute a collective
agreement on their behalf, and reserved the right to sign
or refuse to sign any agreement which the Council
"As above stated , in the first 8 months of Kelton's operations, it had
wholesale sales of over $67,000 to two chain store operations which are
themselves within the Board's jurisdiction This, in and of itself, is
sufficient to sustain the assertion of jurisdiction over Kelton Taylor
Baking Company, 143 NLRB 566
"In American Publishing Corp, the Board said [121 NLRB at 1181
We agree that the Association was not authorized to bargain in behalf of
the Employer in negotiating the 1956 contract . This, however, does not
preclude a finding that the employers acted as an informal group . .
And the fact that negotiations were by such an informal group rather
than a formal association does not preclude a finding that the informal
group constitutes a single Employer for the purposes of collective
bargaining . Nor is a finding required that there is no multiemployer
bargaining history because once negotiations were concluded and the
final agreement drawn up, each employer executed the contract itself
rather than delegate the right to execute the agreement to a
representative with power to bind the group.
"Owner of Respondent Seaview
910 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
negotiated, does not negate a finding of multiemployer
bargaining history. American Publishing Corp., 121
NLRB 115, 118-120. Additionally, when the contract for
the year February 1, 1965 to January 31, 1966, which was
current when the Council was organized, was about to
expire, it was the Council which, on behalf of its
members , gave notice of their decision to terminate the
same, and when, in the negotiations looking toward a new
contract, Local 338 refused to participate because of the
presence of certain individuals, it was the Council which
protested and urged Local 338 to arrange for "new
meetings between our respective negotiating committees
and honestly discuss the problems existing so that a
collective bargaining agreement acceptable to all can be
arrived at." Again, when the contract for the year
February 1, 1966, to January 31, 1967, was nearing its
termination date, it was the Council which on November
21, 1966, gave notice of the election to terminate said
contract as of January 31, 1967, and by letter of
December 21, 1966, informed Local 338, that the Council
was "ready to sit down with you for the purpose of
negotiating a new contract covering the members of this
Association, for the period beginning February 1, 1967."
That the foregoing facts demonstrate an intention on
the part of Respondent employers to be bound by group
or multiemployer action, as distinguished from individual
action, is clear. Respondents argue, however, that a
finding of multiemployer bargaining is inappropriate in
the instant case because assuming that the Council was
initially organized for purpose, the Council ceased that
function in February or March 1966, and thereafter
existed only for the purpose of obtaining group insurance
for its members, and when that proved not to be feasable,
the Council was abandoned by its members and ceased to
exist after about November 1966. The difficulty with this
contention is that it does not square with the record facts,
and for that reason, among others, must be rejected.
I find no credible evidence in the record that for the
period of approximately ten months after February 1,
1966, the Council existed only for the Purpose of
obtaining group insurance for its membership. ' Nor does
the evidence support a finding that after November 1966
the Council ceased to exist for any purpose. While the
evidence shows that after November 1966, no members of
the Council paid dues, this does not require a finding that
the Council thereafter ceased to exist for any purpose, and
the evidence shows that it did in fact continue to act as
the bargaining agent for its members. As heretofore
pointed out, the Council by its letter of November 21,
1966, gave Local 338 notice of intention to terminate the
then existing contract; and the Council by its letter of
December 21, 1966, proposed that Local 338 negotiate
with it, on behalf of its members, for a new contract.
Even on January 30, 1967, when a committee of the
Council met with Local 338, ostensibly to negotiate a new
contract, the demands which they presented to Local 338
were headed "Renewal Demands by Council of Bagel and
Bialy Bakers," and it is to be noted that nothing in these
demands indicate that they were intended to apply only to
the employers then present, but rather the language
indicates that they were demands to be applicable to all
members of the Council. And even as late as February 23,
1967, when Bagel Mine Bakery, through Harold
Hershman, its secretary-treasurer, and who was also
"Benjamin Kelton did so testify , but as indicated above , I do not credit
his testimony.
president of Council, completed and returned to the Board
the usual commerce questionnaire, in reply to the request
for the name and address of any employer association
with which his firm was affiliated, replied, "Council of
Bagel and Bialy Bakers." If the Council had in fact
ceased to function in February 1966, or even as late as
November 1966, it is inconceivable that Hershman, the
president of the Association would have been unaware of
that fact when on February 23, 1967, he replied to the
Board's enquiry.
Considering the entire record in light of the principles
above stated I must and do find and conclude that in
negotiating with Local 338 and Local 802, Respondent
employers evidenced their intention to be bound by group
or multiemployer action, rather than individual action;
that accordingly, the business of the entire employer group
may be considered in determining whether the Board's
jurisdictional standards are met; and that on the basis of
the facts heretofore stated, which are not in dispute, both
the wholesale and retail jurisdictional standards of the
Board are satisfied.
B. The Local 338 Case
The Refusal to Bargain
1. The 8(d) aspects
Section 8(d) of the Act 35 requires, in substance, that the
parties shall continue any existing contract in full force
and effect until its expiration date, or for a period of 60
days after the required notices, whichever occurs later.
Where there is noncompliance with the notice provisions
of the Section, the existing' contract continues in effect by
operation of law, any intervening lockout by an employer
being an unfair labor practice proscribed by Section
"The material portions of Sec. 8 (d) provide:
For the purposes of this section , to bargain collective 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 conditions 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 : Provided , that where there is in effect a
collective-bargaining contract covering employees in an industry
affecting commerce , the duty to bargain collectively shall also mean that
no party to such contract shall terminate or modify such contract, unless
the party desiring such termination or modification -
(I) serves a written notice upon the other party to the contract of the
proposed termination or modification sixty days prior to the expiration
date thereof, or in the event such contract contains no expiration date,
sixty days prior to the time it is proposed to make such termination or
modification;
(2) offers to meet and confer with the other party for the purpose of
negotiating a new contract or contract containing the proposed
modifications;
(3) notifies the Federal Mediation and Counciliation Service within
thirty days after such notice of the existence of a dispute and
simultaneously therewith notifies any State or Territorial agency
established to mediate and conciliate disputes within the State or
Territory where the dispute occured , provided no agreement has been
reached by that time; and
(4) continues in full force and effect , without resort to strike or
lockout, all the terms and conditions of the existing contract for a period
of sixty days after such notice is given or until the expiration date of
such contract whichever occurs later; ...
COUNCIL OF BAGEL AND BIALY BAKERIES
8(a)(3) and (5) of the Act. Fort Smith Chair Company,
143 NLRB 514; Retail Clerks International Association,
109 NLRB 754; and cf. Carpenters District Council of
Denver and Vicinity, 172 NLRB No. 87.
In the instant case the evidence is clear that
Respondent employers, acting through the Council, is the
one who gave the November 21, 1966, notice of intention
to terminate the then current contract. The duty therefore
rested with Respondents to give the necessary notices to
the Federal and State Mediation Services. Fort Smith
Chair Company, supra; Cream Top Creamery, Inc., 147
NLRB 264, 272. That Respondents did not give the
required notice to the Federal and State Mediation
Services, was stipulated. But Respondents argue against a
finding of violation on this branch of the case apparently
on two grounds: (1) that the State Mediation Service had
actual knowledge of the dispute because the bargaining
session which the parties held on January 25, was
arranged by the State agency; and (2) that in any event
Respondents in good faith thought that they were not
subject to the Board's jurisdiction, and that it would be
inequitable to impose a remedial order upon them just
because they were in error. I reject both of these
contentions as without merit.
Turning first to the contention that the State Agency
had notice of the dispute, and assuming arguendo that
informal notice is sufficient to satisfy the requirements of
Section 8(d), there is nothing in the record to indicate
when such notice came to the attention of the State
service, and Section 8(d)(3) requires that such notice be
given "within thirty days" after the notice of termination
or modification pursuant to Section 8(d)(1) - in this case
no later than December 21, 1966. There is no evidence
from which it can be inferred that the informal notice to
the State Agency reached it by that date. Moreover, even
if it be assumed that Respondents fully complied with
Section 8(d)(3) so far as notice to the State Agency is
concerned, there is no showing, indeed Respondents
stipulated that no notice whatever was given to the
Federal Service. That there was, therefore, a failure to
comply with the mandate of Section 8(d)(3), is plain. The
contention that Respondents' violations of the Act should
be excused because they allegedly in good faith thought
they were not subject to the Board's jurisdiction, has been
rejected by the Board. Sands Motor Motel, 162 NLRB
No. 66.
Accordingly, for the reasons stated, I find and conclude
that having failed to give the Federal and State Services
notice of the contract dispute with Local 338, as required
by Section 8(d)(3) of the Act, and by abrogating on
February 1, 1967, the then current contract with Local
338, and then locking out their employee members of said
Local, as herein found, Respondents refused to bargain
with Local 338, in violation of Section 8(a)(5) of the Act.
2. The remaining 8(a)(5) allegations as to Local 338
The General Counsel contends that Respondents'
bargaining with Local 338 was additionally violative of
Section 8(a)(5) of the Act because of the undue delay in
the commencement of negotiations with Local 338, and
also because Respondents' participation in the minimal
bargaining which did take place, was for the purpose of
avoiding rather than reaching an agreement. I find and
conclude that the record supports the General Counsel's
contentions in those respects. I base this conclusion upon
the totality of the following facts.
911
1. The letter of November 21, 1966, giving Local 338
notice of Respondents' decision to terminate the then
current contract as of January 31, 1967, made no mention
of negotiations for a new contract. Several days following
receipt of that letter, and several times thereafter but prior
to December 21, 1966, Union Agent Amster called
Council President Hershman and asked the latter to
arrange for negotiation meetings. Hershman always
replied that he had been unable to contact certain
individuals, but that he would continue his efforts to
arrange a meeting, and would call Amster as soon as he
could. Hershman did not so call. By letter to Local 338,
dated December 21, 1966, Council Attorney Nashman
advised that the Council was ready to meet with Local
338 to negotiate a new contract. It is to be noted that this
letter failed to suggest any time for such a meeting.
Following receipt of the last mentioned letter, Amster
again, on several occasions, called Hershman regarding a
meeting, but each time was told by Hershman that the
latter had been unable to communicate with certain
individuals, but promised to continue his efforts and call
Amster back, but never did so. In all, between November
21, 1966, and January 25, 1967, when the parties met at
the State Labor Board, Amster had approximately 10
such conversations with Hershman, and it may be noted
Amster's testimony regarding the number and nature of
these conversations stands undenied on the record. Such
conduct on the part of an employer plainly fails to
comport with the duty imposed by Section 8(d) of the Act
"to meet at reasonable times" with a view of reaching
agreement on contract terms. See Bartlett-Collins
Company, 140 NLRB 202, and the cases there cited.
2. When the parties did finally meet on January 25,
1967, under the auspices of the State Labor Board,
Respondents were unable or unwilling to disclose more
than a few of their demands. And when the parties met
again on January 30, after an opportunity to Respondents
to fully formulate their demands, the demands which were
then presented encomposed substantial and major changes
in virtually every provision of the basic contract, and in
the last paragraph stated that there were further but
unspecified demands which Respondent might attempt to
negotiate. The failure to negotiate at all until shortly
before the scheduled expiration of the contract, and then
presenting demands of the nature just set forth,
demonstrates that Respondents did not want a contract to
result before January 31, 1967. Rather, what Respondents
wanted was for the old contract to expire in order to take
the work away from employees represented by Local 338,
as well as those represented by Local 802, as Hershman
told Raaf, would be the case. Such a purpose does not
comport with the statutory obligation to confer in good
faith in an honest effort to reach agreement. N.L.R.B. v.
Herman Sausage Co., 275 F.2d 229, 232 (C.A. 5). If
further evidence be needed that such was Respondents'
purpose, it is supplied by Kelton's handling of the Nanuet
facility which he had ready for operation at the time he
was allegedly bargaining with Local 338, or with a few
days thereafter, and which facility immediately became
the supplier for Bagel Mine, as well as Allerton, Kelton's
retain outlet, nonmembers of Local 338 performing the
very work which members of that Local, theretofore
performed.
3. The 8(a)(3) allegations as to Local 338
I have heretofore found that subsequent to November
912 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
1966, when the dispute between Local 338 on the one
hand , and Bagel Mine and Famous on the other, was
settled , and pursuant to which the members of Local 338
were to return to work, said employers refused to permit
their employee members of Local 338 to work, although
nonunion employees were being used to perform the work
which members of Local 338 theretofore performed. I
have further found that on and after February 1, 1967, all
the Respondents refused to permit members of Local 338
to perform baking operations in their establishments. The
General Counsel contends that the November 1966,
refusal of Bagel Mine and Famous to permit Local 338
members to work constituted a lock out of the latter, and
that in February 1967, Seaview, Kelton and House of
Bagel merely joined the other two employers in the lock
out already in progress . While I agree with the General
Counsel that Respondents ' refusal to permit the members
of Local 338 to work on and after February 1, 1967,
constituted a lockout violative of Section 8(a)(3) and (1)
of the Act (Quaker States Oil Refining Corporation, 121
NLRB 337; The Great Atlantic & Pacific Tea Company,
145 NLRB 361), I find it unnecessary to decide whether
the November 1966, refusal by Bagel Mine and Famous
to permit members of Local 338 to work , was a lockout
in the true sense . In any event such was a discriminatory
refusal to employ because of membership in Local 338,
which discouraged membership in that Local, and hence
was violative of Section 8(a)(3) of the Act, I so find and
conclude.
Having found and concluded that the Nanuet operation
was conceived and established with the intent and purpose
of undermining the status of Local 338 as the
representative of the employees , and without notice to it
and an opportunity to bargain with respect to that matter,
Respondent further violated Section 8(a)(5), and
Respondent Kelton also violated Section 8(a)(3) of the
Act.
Respondents ' contention that their lockout and/or
refusal to employ members of Local 338, was only to
pressure that Local into agreeing to Respondents'
economic demands, and therefore lawful under American
Ship Building Co. v. N.L.R.B., 380 U.S. 300, I find
without merit . In the concluding paragraph of its opinion
in American Ship Building , the Supreme Court
summarized its holding thus [380 U.S. at 318]:
Accordingly, we hold that an employer violates neither
[Section] 8(a)(1) nor [Section ] 8(a)(3) when, after a
bargaining impasse has been reached , he temporarily
shuts down his plant and lays off his employees for the
sole purpose of bringing economic pressure to bear in
support of his legitimate bargaining position. [Emphasis
added.]
I take this to mean that where an employer's bargaining is
lacking in good faith, or otherwise unlawful, as I have
found Respondents ' bargaining to have been, a lockout
and/or discriminatory refusal to employ is not legitimate
employer action , but inherently discriminatory and
violative of Section 8(a)(3) and (1) of the Act, absent
special circumstances ." No such special circumstances
were shown here.
For the reasons stated , I find and conclude that
Respondents ' lockout and/or refusal to permit members
"The fact that Respondents ' bargaining was (1) not in good faith; (2)
unlawful for failure to comply with Sec. 8(d)(3) of the Act; and (3) the
circumstances under which the Nanuet operation was established,
distinguishes this case from Darling and Co.. 171 NLRB No. 95.
of Local 338 to work , as hereinabove set forth, was
violative of Section 8(a)(3) and ( 1) of the Act.
C. The Local 802 Case
1. The refusal -to-bargain allegation
As heretofore stated , it has for some time been the
custom and practice in the industry for the Local 338 and
Local 802 contracts to expire on the same date , and for
the employers to bargain first with Local 338, and when
agreement was reached with the latter , or perhaps when
the economic course of that bargaining became apparent,
the bargaining with Local 802, which had in the interim
been held in abayence by tacid consent , would then begin.
The evidence shows that such practice was followed in the
instant case . When Business Agent Azzaro called Council
Attorney Nashman in mid December 1966, and again in
mid January 1967, and inquired when bargaining with
Local 802 might commence , Nashman took the position
that no tentative agreement had been reached with Local
338, and that bargaining with Local 802 was , therefore,
premature . Not only did Azzaro fail to take exception to
Nashman 's position , but by implication at least , concured
in it for he admitted that he told Nashman that he
(Azzaro) was not trying to push him on it, and that he
was just trying to find out how the negotiations with
Local 338 were progressing.
In the prior case involving Bagel Bakers Council of
Greater New York, 174 NLRB No. 101, I held that in
view of the acquiescence by Local 802 in the delay in
bargaining with it until the employers had reached
agreement with Local 338, its prior general demand for
bargaining was not sufficient to impose a bargaining
obligation upon the employers , which is necessary to
support a violation of Section 8(a)(5). It was there pointed
out (fn . 41) that the only conceivable theory that would
support a refusal to bargaining violation on the facts
mentioned , would be a finding that the employers
purposely protracted the negotiations with Local 338, and
prevented agreement with the latter , in order to avoid the
event which would impose upon the employers the duty to
bargain with Local 802. While I there concluded that
evidence did not support such a finding , in the instant case
I am convinced and find that such is precisely what
Respondents intended and sought to accomplish.
Hershman 's statement to Raaf and Kleinman in
September 1966, that he intended to break both Local 338
and Local 802, and Reiter 's statement the same day to
said employees that the industry was going to undergo a
great change; Respondents ' long and unwarranted delay in
bargaining with Local 338 at all, and the fact that the
limited bargaining which did eventually take place was for
the purpose of avoiding rather than reaching agreement
with Local 338; the secrecy with which the Nanuet facility
was established and timed to be ready with the expiration
of the Union contracts , all as heretofore found , convinced
me that Respondents ' failure to bargain with Local 802
was not because they, in the exercise of good faith, were
unable to reach agreement with Local 338, but rather was
a purposely adopted plan to avoid bargaining with either
union, and to undermine their status as the bargaining
representative of their respective employee members
working for Respondents , and hence a violation of Section
8(a)(5) of the Act not only as to Local 338 which I have
heretofore found , but as to Local 802 as well. I so find
and conclude.
COUNCIL OF BAGEL AND BIALY BAKERIES
2. The 8(a)(3) allegation as to Local 802
As above stated when dealing with this branch of the
case as to Local 338, I find it unnecessary to decide
whether the failure of Respondents Bagel Mine and
Famous to employ members of Local 802, after
November 1966, constituted a lockout of those employees
in the usual sense of that term: The fact remains that such
refusal to employ was discriminatory because it was based
on the fact of membership in Local 802, tending to
discourage membership therein, and hence violative of
Section 8(a)(3) of the Act. I so find and conclude. In
addition, I have found that on and after February 1, 1967,
all Respondents prevented their employee members of
Local 802 from performing the services required of them.
This conduct I find and conclude constitute a lockout
violative of Section 8(a)(3) and (1) of the Act. Quaker
States Oil Refining Corporation, 121 NLRB 337; the
Great Atlantic & Pacific Tea Company, 145 NLRB 361."
Also, as in the case of Local 338, I find and conclude
that the establishment of the Nanuet plant without notice
to Local 802, with the intent and purpose of undermining
the latter' s bargaining status, constituted a violation of
Section 8(a)(5) of the Act by all Respondents, and a
violation of Section 8(a)(3) of the Act by Kelton.
Upon the foregoing findings of fact and the entire
record in the case, I make the following:
CONCLUSIONS OF LAW
1. Bagel Mine, Famous, Seaview, House of Bagels, and
Kelton Bagel Bakery, are each employers within the
meaning of Section 2(2) of the Act.
2. The aforesaid employers have, with'the assent of
Local 338 and Local 802, 'expressed an unequivocal
intention to be bound in collective bargaining with said
Locals by group action through Council of Bagels and
Bialy Bakers , and thereby established multiemployer
bargaining units.
3. Bagel Mine , Famous, Seaview, House of Bagels and
Kelton are engaged in commerce within the meaning of
Section 2(6) and (7) of the Act.
4. Local 338 and Local 802 are labor organizations
within the meaning of Section 2(5) of the Act.
5. At all times material Local 338 has been the
exclusive bargaining representative of the employees in a
multiemployer bargaining unit , which unit is appropriate
for the purposes of collective bargaining within the
meaning of Section 9(b) of the Act. The unit is:
All bakers and kettlemen , including ovenmen,
henchmen, fourth men and jobbers, in the employ of the
employer members of the Council, exclusive of all other
employees and all supervisors as defined in Section
2(11) of the Act.
6. At all times "material Local 802 has been the
exclusive collective bargaining representative of the
employees in two multiemployer units, which units are
appropriate for the purposes of collective bargaining
within the meaning of Section 9(b) of the Act. Said units
are:
(a) All route drivers, relief route drivers, peddlers,
independent jobbers, agents, distributors, bobtailers and
driver sales clerks, in the employ of employer members
"For the reasons stated in fn . 35, supra, the decisions in American Ship
Building Co., 380 U .S. 300, and Darling and Co . 171 NLRB No. 95, have
no application so far as the Local 802 aspects of the case is concerned.
913
of the Council exclusive of all other employees and all
supervisors as defined in Section 2(11) of the Act.
(b) All stringers, jumpers, helpers and sales clerks in
the employ of the employer members of the Council
exclusive of all other employees and all supervisors as
defined in Section 2(11) of the Act.
7. By locking out their employee members of Local
338, on or about February 1, 1967, without having given
the notices required by Section 8(d)(3) of the Act, by
unduly delaying bargaining with Local 338 and thereafter
bargaining with Local 338 with the intentions of avoiding
agreement, and by establishing the Nanuet plant for the
purpose of destroying the majority status of Local 338 as
the representative of said employees, Respondents refused
to bargain with Local 338, and interfered with, restrained
and coerced their employee members of Local 338, and
thereby engaged in and are engaging in unfair labor
practices proscribed by Section 8(a)(5) and (1) of the Act.
8. By unduly delaying bargaining with Local 802, for
the purposes of avoiding their obligation to bargain with
said Local, and by establishing the Nanuet plant for the
purpose of destroying the majority status of that Local as
the bargaining representative of the employee members of
Local 802, Respondents refused to bargain with Local
802, and interfered with, restrained, and coerced their
employee members of Local 802, and thereby engaged in,
and are engaging in unfair labor practices proscribed by
Section 8(a)(5) and (1) of the Act.
9. By locking out and/or by refusing to employ
members of Local 338, and Local 802, because of their
membership in said Locals, and thereafter failing to
reinstate them, Respondents discriminated against said
employees in regard to their hire, tenure of employment,
and other terms and conditions of employment, thereby
discouraging membership in said Locals, and interfered
with, restrained and coerced said employees in the exercise
of their right to self-organization, and thereby engaged in,
are engaging in unfair labor practices proscribed by
Section 8(a)(3) and (1) of the Act.
10. By establishing the Nanuet plant with the intent and
purpose of destroying the majority status of Local 338
and Local 802, as above found, and locking out the
employee members of said Locals in furtherance of that
purpose, Respondent Kelton discriminated against said
employees in regard to their hire, tenure of employment,
and other terms and conditions of employment, thereby
discouraging membership in said Locals, and interfered
with, restrained and coerced said employees in the exercise
of their rights guaranteed by Section 7 of the Act, and
thereby engaged in, and is engaging in unfair labor
practices proscribed by Section 8(a)(3) and (1) of the Act.
11. The aforesaid unfair labor practices are unfair labor
practices affecting commerce within the meaning of
Section 2(6) and (7) of the Act.
THE REMEDY
Having found that Respondents violated Section 8(a)(5)
and (1) of the Act by terminating their contract with
Local 338, and locking out the employee members thereof
without giving the notices to the Federal and State
Services as required by Section 8(d)(3) of the Act, I shall
recommend that Respondents other than Kelton, be
required to forthwith give full effect to and in.all respects
continue to comply with their contract with Local 338,
effective as of February 1, 1966, and continue such
compliance until said contract is terminated by mutual
914 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
consent, or in compliance with the provisions of Section
8(d) of the Act.
Having found that Respondents refused to bargain with
Local 338 and Local 802, within the meahing of Section
8(a)(5) and 8(d) of the Act, I shall also recommend that
Respondents other than Kelton, be required, upon request,
to bargain collectively with Local 338 and Local 802, as
the collective-bargaining representative of the employees
represented by them, severally, and if agreement is
reached, reduce the same to a written signed contract.
Having further found that Respondents discriminated
against their employee members of Local 338 and Local
802, I shall recommend that Respondents other than
Kelton, be required to offer immediate, full and
unconditional reinstatement to each employee member of
Local 338 and Local 802 whom they severally locked out
and/or refused to employ, as heretofore found, to their
former or substantially equivalent jobs, and make each of
them whole for any loss of earnings they severally suffered
by paying to each such employee a sum of money equal to
the wages he normally would have earned during the
period beginning with the date of the initial discrimination
against him, and terminating with the date of an
unconditional offer to him of reinstatement , less his net
earnings , if any , during said period , in accordance with
the formula set forth in F. W. Woolworth Company, 90
NLRB 289, with interest at the rate of 6 percent per
annum , as provided in Isis Plumbing & Heating Co., 138
NLRB 716.
As Kelton Bagel Bakery has not been in operation since
February 1, 1967, and the Nanuet facility is an automated
one, requiring a very limited number of employees, the
ordinary remedy of reinstatement with backpay will not,
as to Kelton's employees, restore the status quo ante.
Hence, "to effectuate the policies of the Act and achieve
the desideratum of responsible collective bargaining"
(Royal Plating Co., 148 NLRB 545, 549), it is necessary
to fashion a remedy that fits the circumstances of the
case. Accordingly, I shall recommend that as to Kelton
Bagel Bakery, the Board order the latter: (1) in the event
that it resumes its operations within the jurisdiction of
Local 338 at a time when the contract with Local 338,
effective February 1, 1966, is in effect as herein
determined, it shall from the date of such resumed
operations, give effect to and fully comply with all
provisions of said contract, until said contract is
terminated by mutual consent or in a manner consistent
with Section 8(d) of the Act, but whether such operations
are resumed before or after such contract ceases to be
effective , as herein provided , it shall , upon request,
bargain collectively with both Local 338 and Local 802 as
the exclusive representative of the employees in the
respective units represented by them, severally, and if an
agreement is reached , to reduce the same to a written,
signed contract ; (2) create a preferential hiring list
containing the names of those employees who were
members of or represented by Local 338 or Local 802,
respectively, and whom it locked out and/or refused to
employ on or about February 1, 1967, and in the event it
resumes operations within the jurisdiction of said Locals,
to offer to those employees immediate reinstatement to
their former or substantially equivalent positions without
prejudice to the seniority and other rights and privileges
which they severally enjoyed, and make each of them
whole for any loss of pay suffered by reason of the
discrimination against him, by paying to him a sum of
money equal to the wages he normally would have earned
during the period beginning February 1, 1967, and
terminating with the date of an unconditional offer of
reinstatement to him , less his net earnings , if any, during
said period, in accordance with the Board's formula set
forth in F. W Woolworth, supra, and Isis Plumbing &
Heating Co., supra; (3) in the event it does not resume
operations as aforesaid, that it make whole each employee
member of Local 338 or 802, locked out and/or refused
employment on about February 1, 1967, for any loss of
pay suffered by reason of the discrimination against them
by paying to each of them a sum of money equal to the
amount he normally would have earned as wages from
February 1, 1967, until such time as each secures, or did
secure , substantially equivalent employment with another
employer , computed in accordance with the Board 's usual
formula set forth in F. W. Woolworth Company, supra,
and Isis Plumbing & Heating Co., supra; and (4) as the
usual posting of notices at its plant is no longer feasible,
nor would it have the desired effect, that it be required to
mail a copy of such notice to each employee whose name
appears on the preferential hiring list above mentioned, as
well as to Local 338 and Local 802. It will further be
recommended that it be required to preserve and make
available to authorized agents of the Board , for inspection
and copying, all payroll records, social security payment
records , timecards , personnel records and reports , and all
other records necessary or useful in computing the amount
of backpay due, or in determining compliance with the
Board's order, and that the Board reserve the right to
modify the backpay and reinstatement provisions of its
order, if made necessary by changed conditions, or to
make such supplements thereto as may hereafter become
necessary to define or clarify their application to specific
circumstances not now apparent . Bonnie Lass Knitting
Mills, Inc., 126 NLRB 1396, 1398-99; Darlington Mfg.
Co., 137 NLRB 231, Board's order enfd. 397 F.2d 760
(C.A. 4). Royal Plating Co., 148 NLRB 545, 548.
In view of the nature and extent of the violations found,
which "strike at the very roots of employees' rights
safeguarded by the Act (Dayton Town and Country
Furniture Shop, Inc., 172 NLRB No. 103), it will be
recommended that Respondents be required to cease and
desist from in any manner interfering with , restraining or
coercing their employees in the exercise of rights
guaranteed them by Section 7 of the Act. N.L.R.B. v.
Entwistle Mfg. Co., 120 F.2d 523 (C.A. 4); California
Lingerie , Inc., 129 NLRB 912, 915.
[Recommended Order omitted from publication.]