David Buttrick Co.

National Labor Relations Board - Board DecisionsSep 23, 1965

154 N.L.R.B. 1468 (N.L.R.B. 1965)

1468 DECISIONS OF NATIONAL LABOR RELATIONS BOARD David Buttriek Company and Milk Wagon Driver and Creamery Workers Union , 'Local No . 380, affiliated with International Brotherhood of Teamsters , Chauffeurs, Warehousemen' and Helpers of America. Case No. 1-CA-4816. September 23, 1965 DECISION AND ORDER On May 25, 1965, Trial Examiner Eugene F. Frey issued his Deci- sion in the above-entitled proceeding, finding that Respondent had `engaged in and was engaging in certain unfair labor practices and 'recommending that it cease and desist therefrom and take certain affirmative action, as set forth in the attached Trial Examiner's Deci- sion. Thereafter Respondent filed exceptions to the Trial Examiner's Decision and a supporting brief, and the General Counsel and the Charging Party filed briefs in support of the Trial Examiner's Decision. 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 [Members Brown, Fanning, and Zagoria]. 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 exceptions, the briefs of the parties, and the entire record in the case, and hereby adopts the findings, conclusions, and recommendations of the Trial Examiner as herein modified.' ORDER Pursuant to Section 10 (c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby adopts as its Order the Recommended Order of the Trial Examiner, and orders that Respondent, David Buttrick Company, Arlington, Massachu- setts, its officers, agents , successors, and assigns , shall take the action set forth in the Trial Examiner's Recommended Order. 1 We find merit in Respondent 's exception to the Trial Examiner 's ruling that certain evidence was not "newly discovered." Thus, we find that Whiting' s early discussions with respect to the additional $700,000 loan from the Funds and its talks with its em- ployees and their bargaining representative concerning contemplated operational changes were facts not readily available to Respondent at the time of the certification. However, like the Trial Examiner , we find that the entire record, as supplemented by these addi- tional facts, contains insufficient evidence of any definite or substantial connection be- tween the Union and the loans by the Funds to Whiting which allegedly give rise to such a conflict of interest as would disqualify the Union from representing Respondent's employees. DECISION OF TRIAL EXAMINER STATEMENT OF THE CASE The issue in this case is whether Respondent , David Buttrick Company has failed and refused in good faith to bargain with the above-named Union as the exclusive 154 NLRB No. 126. DAVID BUTTRICK COMPANY 1469 representative of its employees in an appropriate unit, in violation of Section 8 (a) t 1) and (5) of the National Labor Relations Act, as amended, 29 U.S.C. Sec. 151, et seq. (herein called the Act). The issue arises on a complaint issued December 29, 1964,1 by General Counsel of the Board through the Regional Director for Region 1, and answer duly filed by Respondent. Pursuant to notice, a hearing on the issue was held before Trial Examiner Eugene F. Frey at Boston, Massachusetts, on March 8, 1965, in which all parties participated fully through counsel. All parties waived oral argument at the close of the testimony, but General Counsel and Respondent have filed written briefs with me. Since the close of the hearing, Respondent has moved on notice to correct the stenographic transcript in certain respects; no object having been raised, the motion is hereby granted, the tran- script is corrected accordingly, and the written motion is marked in evidence as Respondent's Exhibit No. 3. From my observation of witnesses on the stand and on the entire record in the case, I make the following: FINDINGS OF FACT 1. THE BUSINESS OF RESPONDENT Respondent is a Massachusetts corporation with its principal office and place of business in Arlington, Massachusetts, where it is in the business of processing, sales, and distribution of dairy products. In this business Respondent has an annual direct outflow of products, and annual direct inflow of milk and other raw materials, valued in each instance at over $50,000. The Board in Case No. 1-RC-8005 discussed below, has assumed jurisdiction over Respondent. I find that it is an employer engaged in commerce within the meaning of the Act. II. THE LABOR ORGANIZATION INVOLVED The above-named Union is a labor organization within the meaning of Section 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES A. The representation case and background events On August 18, 1964, the Union filed its petition in Case No. 1-RC-8005 seeking certification as bargaining representative of Respondent's employees in a unit con- sisting of all retail drivers and route foremen at Respondent's Arlington, Massachu- setts, plant, excluding bulk drivers, assistant shippers, processing employees, all other employees, and supervisors as defined in the Act. Respondent admits, and I find, that this unit is still appropriate for purposes of collective bargaining within the meaning of Section 9(b) of the Act. At a hearing in that case on September 17 and 21, 1964, Respondent adduced evidence on the question of the Union's dis- qualification to participate in that proceeding because its affiliate organization (herein called the Teamsters) held a mortgage on real and personal property of Whiting Milk Company (herein called Whiting), a competitor of Respondent whose employees are also represented by the Union, under which it could also exercise controls over the operations of Whiting' s business , all as security for a multimillion dollar loan to Whiting. On October 7, 1965, the Regional Director for Region I issued his Deci- sion and Direction of Election, in which he overruled this contention. On October 15, 1965, the Board denied Respondent's petition for review of that decision. At the direction of the Regional Director, a secret-ballot election was held on October 29, 1964, in which a majority of eligible employees voted for the Union, and on November 27, 1964, the Regional Director certified the Union as the statutory bar- gaining agent of employees in the unit. On December 1, 1964, the Union formally requested that Respondent bargain with it as such agent, and on December 8, 1964, Respondent formally declined the request, on the ground that the certification was invalid because of its alleged disqualification for reasons presented in the representa- tion case, and so that it could secure judicial review of the Regional Director' s rejec= tion of this contention. B. The conflict of interest issue In its answer to the complaint, Respondent raised the same affirmative defense of disqualification of the Union because of a conflict of interest. On January 25, 1965, General Counsel moved for judgment on the pleadings herein, which was denied by a Trial Examiner on February 12, 1965, on the ground that the affirmative defense I The complaint issued after a charge was duly filed by the above Union on December 2, 1964. 1470 DECISIONS OF NATIONAL LABOR RELATIONS BOARD presented genuine issues of fact and law which warranted a hearing thereon. At the hearing I permitted Respondent to adduce, over objection, alleged newly discovered evidence bearing on the debtor-creditor relationship between Whiting and Interna- tional Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America (herein called the Teamsters). The sole issues are (1) whether this evidence is in fact newly discovered, and (2) if so, whether it so changes the picture of the relationship aforesaid insofar as it relates to the Union, as to warrant a decision on the conflict-of-interest issue different from that reached by the Regional Director. For this purpose, I must examine the testimony taken before the Regional Director to determine its nature and scope and then consider whether the evidence adduced before me changes the picture of the relationship aforesaid as disclosed to the Regional Director 2 sufficiently to require a finding that as of November 27 and December 1, 1964, the Union, either directly or indirectly through the Teamsters, was in fact involved in a financial relationship with Respondent's competitor, Whiting, which disqualified it from acting as a bargaining agent of employees in the unit .3 The record in the representation case shows, in pertinent part, that: The Union for many years has represented employees of numerous employers in the dairy industry in the Greater Boston metropolitan area. One of these employers is Whiting, a direct competitor of Respondent with a work force of about 600 employees which dwarfs Respondent's payroll of about 30; the Whiting unit also comprised about two-fifths of the total membership of the Union. When Whiting was reorga- nized due to financial difficulties in 1963, it could not secure needed working capital from normal financial sources, hence it made contact through the intervention of officials of the Union with President James R. Hoffa of the Teamsters and a trustee of Central States, Southeast, and Southwest Areas Pensions Funds (herein called the Funds) .4 After negotiations with Hoffa and other fund officials, Whiting, in 1963, procured a $4 million loan from the Funds, which was evidenced by prom- issory notes and secured by mortgages on its real and much personal property, including the goodwill and other assets of the Whiting business, as well as by col- lateral transfers of the controlling stock interests in the corporation. The loan documents required Whiting to give the Funds semiannual reports of its financial and general business status, and to advise it of any substantial change in its business or operations which might tend to impair the security for the loans. The same documents also gave the Funds and their trustees, in event of default in payments on the loan, broad powers to assume and exercise control over the operations of Whiting in order to protect their investments. Respondent also proved in the representation case, and relied heavily on, the internal relationship between the Union and the Teamsters, and the control of Teamsters officials over activities and affairs of the Union, as shown by the Teamsters and union constitutions and bylaws, as amended through 1961. Its argument there, as here, was based largely upon a judicial analysis of that relationship in I.B.T. V. U.S , 275 F. 2d 610 (C.A. 4) cert. denied 362 U.S. 975, an administrative analysis by the US. Department of Labor in August 1961, and Board Decisions in Oregon Teamsters' Security Plan Office, supra, and General Teamsters, Local 249, etc. supra. Its main argument on these documents was that: Hoffa, as an influential trustee of the Funds and president of the Teamsters, controls the union trustees of the Funds (who were also officials of the Teamsters subject to his control) and through the powers given him by the Teamsters constitution, he also controls the Union and all other locals affiliated with the Teamsters. Hence, as fiduciary of the Funds his main interest is to advance and protect the business of Whiting in order to protect the Fund's investment in that corporation; he can do this through his control of the local union in its dealings with Whiting, and in this respect his interests directly conflict with those of the members of the Union who are employed by other employ- 2 Pittsburgh Plate Glass Company v. N.L.R.B., 313 U.S. 146, 161; N L.R B. v. Trancoa Chemical Corp., 303 F. 2d 456, footnote 6 (C A 1). °The Board has set forth the basic principles in Bausch & Lomb Optical Company, 108 NLRB 1555. 1559, 1561, 1562; Oregon Teamsters' Security Plan Office, et al., 119 NLRB 207, 211; Seafarers International Union of North America, Great Lakes District, AFL- CIO, 138 NLRB 1142 1151, 1152, General Teamsters, Chauffeurs, Warehousemen and Helpers of America, Local 249 , etc., 139 NLRB 605. 'These are large pension funds set up as a result of collective bargaining between the Teamsters and various employers and employer associations, which are built up by con- tributions from the employers. The Funds are administered by 16 trustees, -8 chosen by the Teamsters and 8 by the employers. DAVID BUTTRICK COMPANY 1471 ers like Respondent . In addition , the right of the Funds (and thus Hoffa and the Teamsters ) to take over the operation of Whiting 's business and run it, in event of default on its mortgage payments, would put the Teamsters and the Union in direct competition with Respondent as an employer . Ergo, the Union cannot possibly qualify as an unbiased representative of Respondent 's employees where their inter- ests might conflict with those of Whiting employees which it also represents , or with the interests of Whiting itself which are potentially the same as those of the Funds and the Teamsters . All of these facts and arguments were considered and rejected by the Regional Director and the Board. The only new facts adduced by Respondent in this case are: In July 1964, Whiting formally applied to the Funds for an additional loan of $700 ,000 with which to expand its business into the sale and distribution of refrigerated food products; the new funds to be used for construction of a new plant and purchase of machinery therefor. After extended discussions and negotiations in September and October 1964 , directly with trustees of the Funds , including Hoffa, the loan was finally granted in January 1965 , with the basic evidence of debt and security documents executed by Whiting containing the same terms and conditions and placing the same obligations and other requirements on it, as the documents supporting the original loan; the new mortgage and pledges of personal property added to the existing collateral security the new construction and all chattels and machinery therein, which at completion were valued at about $ 1,500,000 . There is no proof that any agent of the Union participated in the discussions or took part in the consideration of the application, negotiations thereon , or the final decision to grant the additional loan. In Sep- tember 1964 , Whiting had discussions with the Union about reducing the workweek of its retail delivery employees from 7 to 6 days and eliminating some jobs, in order to make its operations more efficient and improve its ability to compete with other dairies, including Respondent . The Union took no position either way on the pro- posal , and raised no objection to Whiting 's discussion of the changes with its ,employees . Whiting talked with them directly, with no agent of the Union present, late in 1964 and in January 1965, and apparently made some of the changes without protest from the Union . In making these changes , Whiting made no report thereon to the Funds under the terms of its mortgage and other security documents given to the Funds as aforesaid , although Whiting officials admit that if it wanted to elim- inate routes or change or curtail its business materially , it would be obligated to notify the Funds under these documents . Up to 1964, Whiting had bargained with the Union as part of a multiemployer association . The last multiemployer contract expired March 31, 1965, but at the time of the hearing Whiting had abandoned multiemployer negotiations and was preparing to negotiate a new contract individually -with the Union. Since Whiting 's early discussions about the $700,000 loan and talks with the Union about changes in working conditions occurred after the representation hearing but before the Union 's certification and demand for bargaining , I do not consider these facts to be newly discovered evidence since they could have been presented to the Board in the representation case before the certification . Even if I considered them as new and independent facts, they would still appear insufficient to establish a conflict of interest of the Union sufficient to disqualify it from acting as bargaining agent after November 27, 1964, particularly since there is no proof ( other than the Board had already considered ) that before that date the Union had participated in any way in the negotiations for the additional loan; and a mere preliminary discussion between Whiting and the Union about proposed changes of working conditions , during which the Union did not commit itself , does not of itself prove , or reasonably tend on any theory to indicate , betrayal by the Union of its members employed by Respondent in order to advance the business interests of Whiting , the personal interests of its employees , or the investment interests of the Funds. Coming to the events of 1965, I am likewise unable to conclude that the actual grant of the additional $700,00 loan by the Funds, or Whiting 's unilateral talks with -employees about changes in working conditions , with apparent acquiescence of the Union, are sufficient to show a definite and substantial tieup between the Union and Whiting which would disqualify it from bargaining with Respondent . First, there is the same lack of proof of participation by the Union in the negotiation and grant of the loan , so that Respondent is relegated to the same arguments of inferential tieuo between Teamsters , the Funds , and the Union which were rejected by the Board. The increase of the original loan from $4 million to $4 ,700,000 shows only that the Fund's interest as an investor in Whiting 's business progress may have increased about 15 percent in direct ratio to the rise in its investment , but without a change of 1472 DECISIONS OF NATIONAL LABOR RELATIONS BOARD potential control upon default to actual or imminent control it is mere speculation to say that the Union's interest in protecting Whiting to the detriment of Respond- ent's employees had increased significantly beyond that already shown to the Board in the facts relating to the original loan. The fact that the Union apparently per- mitted the unilateral discussion of changes in working conditions, including possible elimination of some jobs, is an unusual circumstance which raises a suspicion that it might have been deliberately abdicating its statutory duty to bargain for protection of its members at Whiting, from some ulterior motive, but without more elucidation of the position of the Union on this subject in the September talks and later, it is, again mere speculation to say that it was permitting these changes without protest in order to urotect the security of the Fund's investment, and thereby deliberately enhancing Whiting's business prospects to the detriment of Respondent and its employees. Lacking any proof that in this period Teamsters officials or Fund trus- tees were cognizant of these facts, or entered into the discussions between Whiting and the Union. it is also no more than speculation to say that either President Hoffa of the Teamsters, or the Teamsters, or the Funds acting as his creatures or as inde- pendent entities, had any more power or motivating interest to control the policies and actions of the Union toward Whiting to the detriment of Respondent and its. workers, than they had under the facts previously presented to the Board 5 Finally, the circumstance that Whiting has for the first time in 1965 elected to engage in individual bargaining with the Union, instead of continuing in multiemployer bar- gaining with Respondent, without more, is not enough to warrant an inference that this was done deliberately, with the approval or at the request.of Hoffa, Teamsters, or the Funds, to enable the Union to deal individually with Whiting in order to pro- tect its business, to the detriment of Respondent or other competitors. Considering all the new facts and circumstances, singly and collectively, I must. conclude and find that they are not sufficient to support or establish Respondent's affirmative defense of disqualification of the Union, to the extent necessary fo rebut the prima facie case of refusal to bargain made out by General Counsel. I therefore conclude and find that Respondent has failed and refused since December 8, 1964, in good faith to bargain collectively with the Union as the statutory representative of its employees in the appropriate unit found above, in violation of Section 8(a)(5) and (1) of the Act. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The acts of Respondent described in section III, above, occurring in connection with its operations described in section 1, above, have a close, intimate, and substan- tial relation to trade, traffic, and commerce among the sevei al States, and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce, V. THE REMEDY Having found that Respondent has engaged in and is engaging in certain unfair labor practices, I shall recommend that it cease and desist therefrom, and take cer- tain affirmative action designed to effectuate the purposes of the Act. Upon the foregoing findings of fact, and the entire record in this case, including the record in the representation proceeding, I make the following: CONCLUSIONS OF LAW 1. Milk Wagon Driver and Creamery Workers Union, Local No. 380, affiliated with International Brotherhood of Teamsters, Chauffeurs , Warehousemen and Help- ers of America, is a labor organization within the meaning of Section 2 ( 5) of the Act. 2. David Buttrick Company is an employer engaged in commerce within the mean- ing of Section 2(6) and (7) of the Act. 3. By refusing , and continuing to refuse , to bargain collectively with the above Union as the certified representative of its employees in the appropriate unit found above, Respondent did engage in and is engaging in unfair labor practices within c Respondent does not point out any proof In the representation record, and I find none In the record made before me, that either Hoffa, the Funds, or the Teamsters have made any suggestions or offered advice to Whiting about the normal conduct of Its busi- ness , following any semiannual reports made by Whiting to the Funds since the grant of the original or additional loans. DAVID BUTTRICK COMPANY 1473 the meaning of Section 8(a)(5) of the Act, and also did interfere with, restrain, and coerce, and is interfering with, restraining, and coercing, its employees in the exercise of the rights guaranteed in Section 7 of the Act, and thereby did engage in and is engaging in unfair labor practices affecting commerce within the meaning of Sec- tions 8(a)(1) and (5) and 2(6) and (7) of the Act. RECOMMENDED ORDER On the foregoing findings of fact and conclusions of law and the entire record in this case, and pursuant to Section 10(c) of the National Labor Relations Act, as amended, I hereby recommend that Respondent, David Buttrick Company, its offi- cers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Refusing to bargain collectively in good faith concerning rates of pay, wages, hours of employment, and other conditions of employment, with Milk Driver and Creamery Workers Union, Local No. 380, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, as the exclusive representative of its employees in the following appropriate unit: All retail drivers and route foremen at Respondent's Arlington, Massachusetts, plant, excluding bulk drivers, assistant shippers, processing employees, all other employees, and supervisors as defined in the Act. (b) Interfering with the efforts of the above-named labor organization to negoti- ate for or represent the employees in the said appropriate unit as their exclusive bar- gaining agent. 2. Take the following affirmative action which I find will effectuate the policies of the Act. (a) Upon request, bargain collectively with the above-named labor organization as the exclusive representative of all employees in the above-described appropriate unit, and, if -an understanding is reached, embody such understanding in a signed agreement. (b) Post at its plant in Arlington, Massachusetts, copies of the attached notice marked "Appendix." 6 Copies of said notice, to be furnished by the Regional Direc- tor for Region 1, shall, after being duly signed by Respondent, be posted by it imme- diately upon receipt thereof, and be maintained by it for 60 consecutive days there- after, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by Respondent to insure that said notices are not altered, defaced, or covered by any other material. (c) Notify the Regional Director for Region 1, in writing, within 20 days from the date of receipt of this Recommended Order what steps the Respondent has taken to comply herewith. 7 0 If this Recommended Order is adopted by the Board, the words "a Decision and Order" shall be substituted for the words "the Recommended Order of a Trial Examiner" In the notice. If the Board's Order is enforced by a decree of a United States Court of Appeals, the words "a Decree of the United States Court of Appeals, Enforcing an Order" shall be substituted for the words "a Decision and Order". If this Recommended Order Is adopted by the Board, this provision shall be modified to read: "Notify said Regional Director, in writing, within 10 days from the date of this Order, what steps the Respondent has taken to comply herewith." APPENDIX NOTICE TO ALL EMPLOYEES Pursuant to the Recommended Order of a Trial Examiner of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Rela- tions Act, as amended, we hereby notify our employees that: WE WILL NOT refuse to bargain collectively with Milk Wagon Driver and Creamery Workers Union, Local No. 380, affiliated with International Brother- hood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, as the exclusive representative of our employees in the bargaining unit described below. WE WILL NOT interfere with the efforts of the above-named union to negotiate for or represent as exclusive bargaining agent our employees in the bargaining unit described below. 20 6-446-6 G-vol 154-94 1474 DECISIONS OF NATIONAL LABOR RELATIONS BOARD WE WILL, upon request , bargain with the above-named union as the exclusive representative of all our employees in the bargaining unit described below with respect to rates of pay, wages, hours of employment, and other conditions of employment, and if an understanding is reached, embody such an understanding in a signed agreement. The bargaining unit is: All retail drivers and route foremen at our Arlington, Massachusetts, plant, excluding bulk drivers, assistant shippers, processing employees, all other employees, and supervisors as defined in the Act. DAVID BUTTRICK COMPANY, Employer. Dated------------------- By------------------------------------------- (Representative) (Title) This notice must remain posted for 60 consecutive days from the date of posting, and must not be altered, defaced, or covered by any other material. If employees have any question concerning this notice or compliance with its pro- visions , they may communicate directly with the Board's Regional Office, Boston Five Cents Savings Bank Building , 24 School Street , Boston, Massachusetts , Telephone No. 523-8100. Sinko Manufacturing and Tool Company and District 50, United Mine Workers of America and Plastic Workers Union Local 18, I.U.D.T.W., AFL-CIO, Party to the Contract Sinko Manufacturing and Tool Company and Eugene Payan. Cases Nos. 13-CA-4433 and 13-CA-4433-2. September 23, 1965 SUPPLEMENTAL DECISION AND AMENDED ORDER On October 28, 1964, the National Labor Relations Board issued its Decision and Order in this proceeding 1 finding that Respondent, :Sinko Manufacturing and Tool Company, had engaged in certain conduct violative of Section 8(a) (1) and (3) of the National Labor Relations Act, as amended. The Board further found that Respond- ent had violated Section 8 (a) (1) and (2) of the Act by certain acts of unlawful assistance to Plastic Workers Union Local 18, I. U. D. T. W., AFL-CIO, including its recognition of Local 18 and execution on August 30, 1961, of a collective-bargaining agreement with Local 18 -which contained a union-security clause. To remedy these violations, the Board, inter alia, directed that Respondent withdraw recognition from Local 18, and that it reimburse all its employees for the moneys ,unlawfully exacted from them since August 30, 1961, under that :union-security agreement. On February 1, 1965, Sinko Division of MSL Industries, Inc.. (herein called Sinko Division), filed with the Board a petition for -modification of the Board's Order, to which the General Counsel filed .an opposition on March 4, 1965. 1149 NLRB 201. .154 NLRB No. 117.