Gas Machinery Co.

National Labor Relations Board - Board Decisions

Nov 26, 1975

221 N.L.R.B. 862 (N.L.R.B. 1975)

862 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Gas Machinery Company and Association of Employ-
ees. Case 8-CA-8955
November 26, 1975
DECISION AND ORDER
BY CHAIRMAN MURPHY, AND MEMBERS
FANNING AND JENKINS
On June 26, 1975, Administrative Law Judge
Benjamin K. Blackburn issued the attached Decision
in this proceeding. Thereafter, Respondent filed
exceptions and a supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and brief
and has decided to affirm the rulings, findings, and
conclusions of the Administrative Law Judge and to
adopt his recommended Order.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge and
hereby orders that 'Respondent Gas Machinery
Company, Strongsville, Ohio, its officers, agents,
successors, and assigns, shall take the action set forth
in said recommended Order.
DECISION
STATEMENT OF THE CASE
BENJAMIN K. BLACKBURN, Administrative Law Judge:
The charge was filed on February 18, 1975. The complaint
was issued on March '27. The hearing was held in
Cleveland, Ohio, on May 7. The issue litigated was whether
Respondent violated Section 8(a)(5) and (1) of the
National Labor Relations Act, as amended, by withhold-
ing customary Christmas bonuses in 1974 without first
bargaining with the Charging Party. For the reasons set
forth below, I find that it did.
Upon the entire record, and after due consideration of
briefs, I make the following:
FINDINGS OF FACT
IL THE "UNFAIR LABOR PRACTICE
A. Facts
There is no dispute about the facts in this case.
Respondent paid Christmas bonuses each year from 1967
through 1973 to its production and maintenance employ-
ees, represented since 1971 by the Charging Party. The
amount which each employee received was determined by
management on a subjective basis. Only on rare occasions
did; an individual fail to receive anything. No formula was
followed. The official who dispensed the bonus (in recent
years, William Marquardt, Respondent's president) simply
tried, initially, to give each employee- a gift of an
appropriate size and then to increase it slightly each
subsequent year. In 1973, 48 employees received bonuses
ranging from- a high of $275 to a low of $25. Respondent
has always considered the bonuses as voluntary gifts and
not a part of its wage structure. An employee manual
which it issued in May 1973 contains no mention of a
Christmas bonus. It does mention annual Christmas
baskets and an annual Christmas party for employees.
The bonus has never been covered in any of the series of
collective-bargaining agreements which have been in
existence between Respondent and the Charging Party, nor
has any of them contained a maintenance-of-past practices
clause or a zipper clause. There- have never been any
negotiations` about the bonus in the dealings between
Respondent and the Charging Party which have led up to
these contracts. It has been mentioned only once in the
course of negotiations about `other matters. That occurred
in the spring of 1974 during negotiations which resulted in
a 1-year contract effective as of April 1, 1974. In order to
help it, sell the contract to the employees, the Charging
Party's bargaining committee asked Respondent to prepare
a chart which would show in detail how much employees
were receiving from Respondent. Respondent did so. The
chart was headed "Gas Machinery Co. Wage & Fringe
Benefits." Across the top were listed various "average"
wages. Down the left side were listed 10 different fringe
benefits. Opposite each fringe benefit under the "average
wage" of $4.26 an hour was listed the average number of
cents per hour, which Respondent had paid for that item
over the years. Opposite "hospitalization," for example,
was entered ".35." Christmas bonus was shown as a 6-cent-
an-hour fringe benefit; Christmas basket as 2 cents. The 10
items listed, totaled fringe benefits worth $1.15 an hour.
The Charging Party's three-man shop committee meets
each month with an official of Respondent. The committee
submits written questions. Management answers them. The
Christmas bonus never came up at any of these meetings
until November 20, 1974, when the committee met with
Donald Fernald, Respondent's general manager of opera-
tions. On that occasion, the committee asked:
1. JURISDICTION
Respondent, an Ohio corporation, is engaged at Strongs-
ville, Ohio, in the manufacture of industrial gas generators
and furnaces. It annually ships products valued in excess of
$50,000 directly to customers located outside the State of
Ohio.
During the negotiations last April, the committee was
given a list which showed how much our benefits cost
the company on an hourly basis. The Xmas bonus was
listed at 6 [cents per] hour which represents a[n]
average bonus of $124.80. Will we be getting any as was
the implication last April?
221 NLRB No. 129
GAS MACHINERY COMPANY 863
Respondent 's answer was:
There will definitely be a Christmas basket and party
on December 24th., However, because of our profit
position the company has not decided as of this date
what will be done with Christmas bonuses. A decision
will be made regarding this after Thanksgiving.
There was no further discussion of the matter between
Respondent and the Charging Party prior to December 11,
1974, when, Fernald announced to assembled employees
that Respondent was not going ; to pay a 1974 Christmas
bonus for economic reasons. (Respondent 's business was
down substantially from the previous year). Fernald told
the shop committeemen just before the meeting that the
Christmas bonus was the subject of the meeting but not
what Respondent 's decision was. On December 12, the
committee met with Fernald and asked Respondent to
reconsider .- The committee, or its individual members,
made the same request on some three subsequent days.
Respondent simply reiterated on each of these occasions its
decision not to pay a Christmas bonus in 1974. The subject
did not come up, however, at the shop committee's
monthly meeting with management on December 18, 1974.
The Christmas party was held as scheduled on December
24, 1974, and baskets were distributed as usual . However,
no bonus was paid, either to shop or to office employees.
On January 3, 1975, the shop committee filed a, written
grievance. It read:
During the contract negotiations between the com-
pany and the Association of Employees in April of
1974 the company did make a chart on Gas Machinery
blueprint paper which was titled "Gas Machinery Co.
Wages and Benefits." This chart showed the average
hourly wage at that time and the hourly cost to the
company of the shop employee's benefits existing at
that time.
Included was the Christmas Bonus of $ .06 per hour.
This chart was used by the company as a lever to
convince the shop employee 's [sic] to accept a contract
proposal offered by the company. The proposal was
accepted.
The company ' has given an unilateral Christmas
bonus for at least 10 years prior to 1974.
Due to these facts we feel that the shop employee's
[sic ] are entitled " to a bonus based on, .06 an hour per
shop employee.
Respondent replied on January 13, 1975, over Fernald's
signature, thus:
In response to the grievance filed January 3, 1975,
regarding Christmas bonuses , the Committee claims
that the Company used a company prepared chart
showing benefits as a lever to, convince the shop to
settle on -a contract proposal.
It is true that the Company did prepare a chart
showing the historical costs of the previous years
averaged. These costs included not only the Christmas
bonus but also holidays , pensions, Christmas basket,
cost of living, etc. All these items were shown as a
historical basis, and not as of the contract date or the
contract settlement.
Secondly, the chart was not prepared until the Shop
Committee requested that we prepare it so that they,
the Shop Committee , could present it to the employees.
At no time did the company or its representatives
interpret or present this graph to the employees.
Therefore, the Company feels that the shop is not
entitled to a Christmas bonus under the provisions of
your grievance , and that the Christmas bonus is exactly
that, a bonus, and that it is up to the discretion of the
Management whether a bonus will be given 'or not
given . This holds true in the past and in the future.
Negotiations in early 1975 culminated in a 2-year
contract to replace the 1-year contract which was in effect
from April 1974 through March 1975. Once again, there
were no negotiations over or even mention of the
Christmas bonus and the contract does not contain a
bonus clause, a maintenance-of-past practices clause, or a
zipper clause.
B. Analysis and Conclusions
1. Is Respondent's bonus wages?
Respondent's argument on the merits is two-pronged.
First, it contends that the Christmas bonus paid by
Respondent from 1967 through 1973 has not become part
of, its wage structure . It relies principally on N.L.R.B. v.
Wonder State Manufacturing Company, 344 F.2d 210, 213
(C.A. 8, 1965), where the court said:
The rule is that gifts per se -payments which do not
constitute compensation for services-are_ not terms
and conditions of employment , and an employer can
make or decline to make such payments as he pleases,
but if the gifts or bonuses are so tied to the
remuneration which employees received for their work
that they were in fact a part of it , they are in . reality
wages and within the statute. This is a question of fact
and, if the Board's finding to that effect is supported by
substantial evidence, the finding must be accepted on
review. N.L.R.B. v. Niles-Bement -Pond 199 F.2d 713
(2Cir. 1952); N.L.R.B. v. Electric Steam Radiator
Corporation, 321 F.2d 733 (6 Cir. 1963); N.L.R.B. v.
Citizens Hotel Company, 326, F.2d 501 (5 Cir. 1964);
'N.L.R.B. v. United States Air Conditioning Corporation,
336 F.2d 275 (6 Cir. 1964); N.L.R.B. v. Toffenetti
Restaurant Company, 311 F.2d 219 (2 Cir. 1962);
N.L.R.B. v. Wheeling Pipe Line, 229 F.2d 391 (8 Cir.
1956).
After reviewing the evidence which had caused the Board,
at 147 NLRB 179 (1964), to conclude that the wages rule
had been met , the court further said:
Thus, from the uncontroverted evidence, the follow-
ing facts plainly appear : (1) there was no consistency or
regularity in awarding the bonuses-rather they were
made intermittently , i.e., in three of the five years
immediately prior to 1962 ; (2) there was no uniformity
in or basis for the amount of the bonus; (3) the bonuses
were not tied to the remuneration received by -the
864, DECISIONS OF NATIONAL LABOR RELATIONS BOARD
employees; (4) whether a bonus was paid and the
amount thereof depended on the financial condition
and ability of respondent.
Here, Respondent has no quarrel with the 'first point.
Rather, it relies on the fact that the decision to give a bonus
to or withhold it from any particular employee is based on
subjective considerations only and does not take into
account- his earnings, rate of pay, hours worked, or
seniority to argue that failure to measure up to the second,
third, and fourth points precludes a wages'finding here.
Thus, the first issue is whether the stringent rule laid down
in Wonder is the law applicable to this case. I conclude, on
the basis of two post-Wonder decisions by the Board, that it
is, not.
In Henry Vogt Machine Co., 190 NLRB 122 (1971), a
panel majority consisting of Chairman Miller and Member
Fanning said:
The. Trial Examiner found, and we agree, that a
bonus based on regular compensation and length of
service, and paid uniformly and with sufficient regulari-
ty to become part of wages, is a mandatory bargaining
subject. However, we disagree with his finding that this
Respondent failed to fulfill its statutory bargaining
obligation when it failed to pay its employees a
Christmas bonus in 1969.
Beginning in 1925, the Respondent gave all its
employees a Christmas gift or bonus which varied in
form and amount and included a gold piece and life,
insurance. Nothing was given between 1930 and 1937.
From 1938 to 1941, $5. In 1942, the year the Union was
recognized, war stamps or bonds were given. Between
1943 and 1964, each employee received amounts which
varied from $10 to $25. In 1965, each employee with
more than 1 year's service received an amount equal to
40 hours' pay; those with from 6 to 12 months' service,
20 hours' pay; and those with less than 6 months, $25.
Nothing was paid in 1966. In 1967 and 1968, all
employees received amounts based on the 1965
formula.` In 1969, again, nothing was given.
the record shows that the Union for years has made
little, if any, attempt to bargain about the bonus. The
Union remained silent when the Respondent failed to
pay a bonus, in 1966. In 1967, when advised of
Respondent's intent to resume bonus payments on the
basis of the 1965 payments, the Union contented itself
with raising no objections, and sought no contractual
commitments with respect to the bonus.
The above facts show that the bonus payment was
intermittent and not uniform in amount or basis over
the years. It is also evident that from 1942, when the
Union was recognized, until 1969, the Union voiced no
objection to the payment, nonpayment, or change in
the bonus; nor did the Union make any request to
bargain about the bonus issue. Thus by 1969 it is clear
that the payment of abonus had come to be considered
a discretionary matter, -as to which bargaining was not
the custom or practice. [Citing Wonder.]
Member Brown, dissenting, said:
I am persuaded that the Trial Examiner's view of this
case is reasonable and accurate. To characterize as
"intermittent," as the majority does, a bonuspaid every
year for 30 years since 1938 except for`the 2-years 1966
and 1969 seems to me to misstate the facts. And' to
describe as "not uniform ' in amount or basis" the
payment for '21 years (between 1943 and 1964) of
amounts between $10 and $25, and in 1965, 1967, and
1968 of amounts based on length of service (40 hours'
pay after 1-year's service, 20 `hours' pay after 6-12
months' work, and $25 with less than 6 months' service)
seems tome to misconstrue the record.
I can only view, the conclusions as being designed' to
fit the language of the court in N.L.R.B.- v. Wonder
State Manufacturing Company, on which the majority
rationale relies. Comparison of the facts of that case'
with those here is especially revealing. For 'there the
bonus was described as "made intermittently, i:e., in
three of the five years immediately prior to 1962" with
none paid in 1962,3 and the' court distinguished cases
cited by it on the ground "the bonuses were of regular
and long duration (10 to 19 years) and'in most' instances
the bonus was tied into seniority" 4 (emphasis supplied).
3 344 F 2d at -214. The nonpayment, in 1962 was in issue. The
recitation of the facts in that case shows the company began operation
in 1950 and the'bonus had been paid only in 1955, 1956, 1959, 1960,_
and 1961
4 Ibid It is thus apparent that the court was' not indicating that it
deemed it mandatory that a bonus be tied to seniority In any event, it
may be significant that the bonus in the instant case during the period
beginning 1965 was in fact based on length of service, with the
Respondent.
More recently, Mello Pistoresi & Son, Inc. (S & D
Trucking Co.,' Inc.), 203 NLRB 905 (1973), involved a
situation where a bonus was discontinued in the context of
bargaining with a newly certified union for a'first contract.
A Board majority consisting of Members Jenkins and
Penello said:
The Administrative- Law Judge found, and we agree,
that as Respondent withheld payment of the 1971
Christmas bonus for legitimate business reasons,-i.e., to
offer the largest possible wage increase, such conduct
did not violate Section 8(a)(3) of the Act. However, the
Administrative Law Judge further found that inasmuch
as the employees -had received bonuses in 1969 and
1970 solely because of the employer-employee relation-
ship, the bonuses should be regarded as wages or terms
and conditions of employment and constituted a
bargainable matter. Nevertheless, he found the unilat-
eral failure to pay the bonus did not violate Section
8(a)(5) of the Act. We find merit in the Union's
exceptions to the dismissal of this portion of the
complaint,
As found by the Administrative ,Law Judge, the
bonuses constituted a bargainable 'matter. It is undis-
puted that Respondent made a final-decision not to pay
the bonuses without affording the Union an oppor-
tunity to bargain with respect thereto at a time when
the Union was the certified collective-bargaining
representative, for the employees whose terms and
conditions of employment were affected by Respon-
GAS MACHINERY COMPANY 865
dent's decision. Under such circumstances, Respondent
was under a statutory duty to bargain about its decision
to discontinue the Christmas bonus. As it is clear that
Respondent did not inform the Union that it was
considering not paying the 1971 bonus, and that
Respondent notified the Union only after the decision
had already been made, this unilateral action which
resulted in changes in the wages and terms of
employment of employees, even though not taken in
bad faith, nevertheless violated Respondent's statutory
obligation.' In reaching this result, we are mindful of
the fact that Respondent's payment of the bonus
extended over only a 2-year period. We have held,
however, that a 3 year payment of bonuses is sufficient
to make the matter bargainable.2 We do not deem the
period of time herein as substantially different from the
period involving that case. Accordingly, we find that
the Respondent, by unilaterally discontinuing the
payment of Christmas bonuses to its employees in
1971, violated Section 8(a)(5) and (1) of the Act.
not been of "regular and long duration." The court
summarized the holdings of previous cases as follows: 9
In the cases cited, supra, the bonuses were of
regular and long duration (10 to 19 years) and in
most instances the bonus was tied into seniority.
Because of these and other circumstances not
present here, the Board and courts had little
difficulty in deciding that the bonuses were in fact
wages or remuneration within, the statute.
In view of the foregoing, I agree with the Adminis-
trative Law Judge that the Christmas bonus had not
become part of the employees' remuneration and
therefore Respondent was not required to bargain with
the Union concerning its discontinuance. Accordingly,
I dissent from the majority decision.
8 It escapes me how the compliance officer in the Regional Office
can be expected to compute the amounts that would have been paid
and the identity of recipients. Any such determination must be based
on sheer speculation
9 N LR B v Wonder State Manufacturing Co, 344 F 2d 210, 214
(C.A 8)
i See, e .g , N L. R B. v. Benne Katz d/b/a Williamsburg Steel
Products Co, 369 U.S. 736; Gravenslund Operating Company d/b/a
Washington Hardware and Furniture Co., 168 NLRB 513.
2 See Wonder State Manufacturing Company, 147 NLRB 179,
enforcement denied 344 F.2d 210 (CA 8) With all due respect to the
Eight Circuit Court of Appeals, we-do not abandon our, well-
established policy of not adhering to the views of courts of appeals
which are contrary to our own until the issue had been decided by the
Supreme Court of the United States.
Member Kennedy , dissenting in part, said:
The Board has found a Christmas bonus to be part
of the wage structure rather than a gift only where it
has been continued over a period of time sufficient to
justify the expectation on the part of employees that
they would receive the bonus as part of "wages." As
stated by the court in N.LR.B. v. Niles-Bement-Pond
Company, 199 ,F.2d 713, 714 (C.A. 2):
Where, as here , the so-called gifts [Christmas
bonuses ] have been made over a substantial
period of time and in amount have been based on
the respective wages earned by the recipients, the
Board was free to treat them as bonuses not
economically different from other special kinds of
remuneration like pensions , retirement plans or
group insurance , to name but a few, which have
been held within the scope of the statutory
bargaining requirement.
I have been able to find no case, and the majority
decision cites no case, where either the Board or the
courts have held that a Christmas bonus paid in only 2
years and in accordance with no perceptible objective
formula has been held to have been incorporated in the
wage structure and thereby become a bargainable
matter.8 The closest case which I have unearthed is
Wonder State Manufacturing Company, 147 NLRB 179,
where the Board found that a Christmas bonus which
had been paid for at least 3 preceding years had
become bargainable and the employer had violated
Section 8(a)(5) by unilaterally discontinuing it. Howev-
er, the court refused to enforce this part of the Board's
order holding that the bonuses were gifts since they had
The court's fourth point in Wonder-respondent's
financial condition and ability-is expressly eliminated by
the Board's holding in Pistoresi that the employer's
legitimate business reasons and absence of bad faith are
immaterial. Even Member Kennedy is in apparent agree-
ment here, for his dissent makes no mention of ability to
pay or good faith. His footnote 8 is concerned only with
the difficulty of determining the amount the employer will
be required to pay under' the majority's Order that the
employees be made whole for the bonus they were denied
(an issue considered here in the section entitled "The
Remedy" below).
As to the court's second and third points-the absence of
some objective standard such as a percentage of wages
uniformly applied for determining what each employee
would have gotten as a bonus-the Board in both Vogt and
Pistoresi decided the question solely on the basis of the
regularity with which the bonus had been paid. The fact
that the dissent in each case specifically discussed the
majority's holding in terms of the court's opinion in
Wonder makes it clear that the majority was not overlook-
ing the additional factors. In Pistoresi, of course, the
majority's express disagreement with the court only
strengthens the conclusion that the Board does not agree
with the court's stringent standard. Rather, in the Board's
view, regularity of payment is alone enough to take a
Christmas bonus out of the gift category and make it part
of an employer's wage structure. Two years were sufficient
in Pistoresi. It follows that 7 years are more than sufficient
here.
2. Has the Charging Party waived its right to
bargain about Respondent's bonus?
Closely linked to the question of whether Respondent's
Christmas bonus is part of its wage structure is the question
of whether the Charging Party has treated it in such a
manner over the years that the Charging Party has
effectively waived its right to bargain In this regard,
Respondent argues that the Charging Party has treated the
866 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
bonus as lying within Respondent's sole discretion. It
points to the fact- that the Charging Party has never
attempted to bargain over the' bonus, either during contract
negotiations or at other times. It points also to the fact that
questions posed to officials have been queries about
whether the Company was going to be able to pay a bonus
at all rather than requests for information about money
employees felt they had coming to them as a matter of
right. This argument overlooks the fact that the first time
after 1967 that,a question arose about whether employees
were going to get a bonus the Charging Party acted on a
claim of right.- Ever since the events which led up to this
case began at the shop committee-management meeting on
November 20, 1974, the Charging Party has asserted that
the Christmas bonus was a part of wages and riot a gift
discretionary with Respondent. If, as Respondent claims,
the Charging Party has waived its right to bargain about
the bonus by recognizing its discretionary nature, there
would have been no written grievance on January 3, 1975,
and the formal charge which underlies this case would
never have been filed.
The fact that the Christmas bonus has never been on the
table during contract negotiations in 1972, 1973, 1974,,and
1975 has no significance. As the Board pointed out most
recently in Keller-Crescent Company, a Division of Mosler,
217 NLRB No. 100 (1975), in a different context, "[A]
statutory right . . . exists unfettered and undiminished in
the absence of some explicit language contained in the
contract unmistakably waiving or in some manner limiting
it, or language, warranting resort to consideration of
collateral evidence of contractual intent, which evidence
clearly and unequivocally establishes that the union
understood and intended said language to waive or limit
the statutory right, despite the lack of the reduction of this
intent into clear and express language in the contract.
There can be no statutory right more fundamental than the
right to bargain about wages. The fact that Respondent
and the Charging Party never discussed the bonus as an
aspect of wages during their contract negotiations and
never put any language, either clear or ambiguous, about it
into their contracts precludes any finding of waiver on
contractual grounds. A maintenance-of-past-practices
clause, even though the bonus may never have entered the
negotiators' heads, would be conclusive evidence of no
waiver, but there is no such clause, in any of the contracts.
By the same token, the absence of a zipper clause precludes
any finding that the Charging Party intended by its silence
during negotiations to waive its right to bargain about the
bonus.
3. Has Respondent fulfilled its obligation to
bargain about the Christmas 1974 bonus?
The other prong of Respondent's argument on the merits
is the contention that it has met any obligation it may have
to bargain with the Charging Party by direct communica-
tion with the Charging ` Party and its membership both
prior to and subsequent to its decision not to pay the bonus
in 1974. It asserts, and I agree; that "the record establishes
that the Company was ready and willing to discuss the
issue with the Union before, during, and after the decision
that a bonus could not be paid due to financial considera-
tions. . . . At no time did the Company ever state to the
Union that the bonus was `discontinued' or eliminated-
only that it would not be paid, in 1974." It relies on General
Manager Fernald's statement to the shop committee on
November 20, 1974, that no decision had yet been made
and his informing individual members of the committee on
December 11, 1974, that he was about to ' announce the
decision to assembled employees as evidence that negotia-
tions were had before the decision was made. However, the
main thrust of its argument relies on the Charging Party's
efforts to get Respondent to reconsider on December 12,
1974, and thereafter, culminating in the written grievance
and Respondent's response thereto on January 13, 1975,
plus the fact that, if not canceled, the bonus would not
actually have been paid until the party on Christmas Eve.
An uncommumcated readiness and willingness to discuss
a mandatory subject of bargaining is not enough to meet
the obligation to bargain imposed by, the Act, especially
when, as here, the other side has brought the subject up.
The idea of eliminating the bonus for 1974 ceased to be a
proposal and 'became a fait accompli when Respondent
made up its mind. The record does not reveal precisely
when, that was. It occurred sometime` after', Fernald spoke
with the committee on November 20 and before he spoke
with the first committee member prior to the announce-
ment on December 11. Whenever the decision was made, it
is obvious that nothing transpired between Respondent
and the Charging Party on or before December 11 which
rose to the level of the sort of negotiations contemplated by
the Act, for Fernald's answer to the committee's question
gave the Charging Party' no opportunity to present its
views. Equally obviously, nothing that happened after
December 11 meets the statutory standard, for Respon-
dent's responses to the Charging' Party's repeated requests
that it reconsider i gave the Charging Party no opportunity
to try, even though fruitlessly, to undo the fait accompli.
The fact that the Charging Party asked Respondent to
reconsider and was rebuffed after Decembei 11 and before
Christmas Eve has no significance whatsoever, for it is
clear that Respondent's decision, once announced, was
irrevocable. This facet of Respondent's defense must fail
because there are no facts to support- its assertion that it
"was ready and willing to discuss the issue with the Union
... during . . . the decision."
Respondent has cited this portion of the court's opinion
in N.L.R.B. v. Citizens Hotel Company, d/b/a Hotel Texas,
326 F.2d 501, 505 (C.A. 5, 1964), in support of its
argument:
The union has no absolute veto power under the Act.
Nor do negotiations necessarily have to exhaust
themselves to'the point of the so-called impasse. But
there must be discussion prior to the time the change is
initiated. An employer must at least inform the union
of its proposed actions under circumstances which
afford a reasonable opportunity for counter arguments
or proposals. Here, of course, there was no such
discussion. The Employer was wilting to talk. It
apparently tried to find out what the Union had in
mind. But the! fact is that at no time after the moment
the law required the Employer to bargain did it ever
GAS MACHINERY COMPANY
advise the Union of what it proposed to do this
Christmas-i.e., pay no bonus.
Respondent's point, of course, is that the court commented
on the employer's willingness to talk. It would distinguish
this case from the result in Citizens Hotel Company on the
ground that here there were discussions.- But that argument
misconstrues the nature of the "discussions" which were
held here. When the law of what constitutes bargaining
within the meaning of the Act, so succinctly stated by the
court in Citizens Hotel Company, is applied, the only
possible finding is that Respondent did not inform the
Charging Party of its proposed action prior to the time it
decided not to pay the 1974 Christmas bonus under
circumstances which afforded a reasonable opportunity for
counterarguments or proposals. "[T]he fact is that at no
time after the moment the law required [Respondent] to
bargain did it ever advise the [Charging Party] of what it
proposed to do this Christmas-i.e., pay no bonus "
(Emphasis supplied.) Since I have already found that
Respondent's Christmas bonus was part of its wage
structure, it follows that Respondent's failure to afford the
Charging Party a reasonable opportunity to negotiate
before the decision was final constitutes 'a violation of
Section 8(a)(5) and (1) of the Act.
Upon the 'foregoing findings of fact, and upon the entire
record in this case, I make the following
CONCLUSIONS OF LAW
1. Gas Machinery Company is an employer engaged in
commerce within the meaning of Section 2(6) and (7) of the
Act.
2. Association of Employees is a labor organization
within the meaning of Section 2(5) of the Act.
3. Association of Employees is the sole and exclusive
bargaining representative of Respondent's employees in
the following appropriate unit:
All hourly-paid production and maintenance em-
ployees at Respondent's Strongsville, Ohio, plant, but
excluding all office employees, clerical employees,
temporary employees, and professional employees,
guards and supervisors as defined in the Act.
4. By unilaterally withholding the 1974 Christmas
bonus without affording Association of Employees an
opportunity to bargain with respect thereto, Respondent
has violated Section 8(a)(5) and (1) of the Act.
5. The aforesaid unfair labor practice is an unfair labor
practice affecting commerce within the meaning of Section
2(6) and (7) of the Act.
THE REMEDY
Respondent also contends that, in any event, it should
not be ordered to make its employees whole for the 1974
Christmas bonus they have lost on the ground that such a
remedy would be unjust. It relies, in this regard, on
N.L R.B. v. Citizens Hotel Company, supra, and Beacon
1 In the event no exceptions are filed as provided by Sec 102.46 of the
Rules and Regulations of the National Labor Relations Board, the findings,
conclusions, and recommended Order herein shall, as provided in Sec
867
Journal Publishing Company v. N L. R. B., 401 F.2d 366
(C.A 6, 1968), where the courts denied enforcement of the
restitution portion of the Board's Orders; N L R. B v. John
Zink Company, 83 LRRM 3045 (C.A. 10, 1973), where the
court enforced in part and denied enforcement in part in
an unpublished decision, and N.L.R.B. v. Nello Pistoresi &
Son, Inc (S & D Trucking Co., Inc), 500 F.2d 399 (C.A. 9,
1974), where the court denied enforcement of any part of
the Board's Order.
The concerns which caused Member Kennedy to include
footnote 8 in his dissent in Nello Pistoresi & Son, 203
NLRB 905, are applicable here where the record contains
no formula from which the size of the 1974 Christmas
bonus, but for Respondent's unfair labor practice, could be
computed. However, since the Board has recently passed
on the question of remedy both in that case and in John
Zink Company, 196 NLRB 942 (1972), in situations closely
analogous to this one, expressly holding that restitution is
required in order "to prevent the wrongdoer from enjoying
the fruits of his unfair labor practice and gaining undue
advantage at the bargaining table," and since I am as much
bound by Board precedent with respect to remedy as I am
with respect to the substantive law of whether a Christmas
bonus is wages, I have no choice. I will, therefore.
recommend, in addition to the cease-and-desist, bargain-
upon-request, and post-a-notice remedy provisions cus-
tomary where Section 8(a)(5) has been violated, that
Respondent be ordered to make its employees whole. As
the Board said in its Prstoresr decision, supra, it is "not
required at this stage of the proceeding to decide the
detailed formula to be used in determining the amounts of
compensation due to the employees; the formula to be
used in fixing the amount of compensation can be
determined by agreement of the parties or, if necessary, in
a backpay proceeding."
Upon the basis of the foregoing findings of fact,
conclusions of law, and the entire record in this proceed-
ing, and pursuant to Section 10(c) of the Act, I hereby issue
the following recommended:
ORDER'
Respondent Gas Machinery Company, its officers,
agents, successors, and assigns, shall:
I. Cease and desist from:
(a) Refusing to bargain collectively with Association of
Employees with respect to Christmas bonuses or any other
term or condition of employment by unilaterally withhold-
ing bonus payments or effectuating changes in any other
terms or conditions of employment of its employees in the
appropriate unit represented by Association of Employees.
(b) In any like or related manner interfering with,
restraining, or coercing employees in the exercise of rights
guaranteed in Section 7 of the Act.
2. Take the following affirmative action necessary to
effectuate the policies of the Act:
(a) Upon request, bargain collectively in good faith with
Association of Employees as exclusive collective-bargain-
102 48 of the Rules and Regulations, be adopted by the Board and become
its findings, conclusions, and order, and all objections thereto shall be
deemed waived for all purposes
868 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Ing representative of all its employees in the appropriate
unit.
(b) Make whole the employees in the appropriate unit for
any monetary losses they may have suffered by reason of
Respondent's unilateral withholding of the 1974 Christmas
bonuses, in the manner set forth above in the section
entitled "The Remedy."
(c) Preserve and, upon request; make available to the
Board or its agents, for examination and copying, all
payroll records, social security payment records, timecards,
personnel records and reports, and all other records
necessary to analyze the amount of backpay due under the
terms of this recommended Order.
(d) Post at its plant in Strongsville, Ohio, copies of the
attached notice marked "Appendix." 2 Copies of said
notice, on forms provided by the Regional Director for
Region 8, after being duly signed by Respondent's
authorized representative, shall be posted by it immediate-
ly upon receipt thereof, and be maintained by it for 60
consecutive days thereafter, in conspicuous places, includ-
ing 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.
(e) Notify the Regional Director for Region 8, in writing,
within 20 days from the date of this Order, what steps the
Respondent has taken to comply herewith.
2 In the event that this Order is enforced by a Judgment of a United
States Court of Appeals, the words in the notice reading "Posted by Order
of the National Labor Relations Board" shall read "Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board "
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board having found, after a
hearing, that we violated Federal law by unilaterally
withholding the 1974 Christmas bonuses, we hereby notify
you that:
The National Labor Relations Act gives all employees
these rights:
To engage in self-organization
To form, join, or help unions
To bargain collectively through a representa-
tive of their own choosing
To act together for collective bargaining or
other aid or protection
To refrain from any or all of these things.
WE WILL NOT fail or refuse to bargain collectively in
good faith with Association of Employees as the
exclusive collective-bargaining representative of our
employees in the appropriate, unit concerning Christ-
mas bonuses and other terms and conditions of
employment by unilaterally withholding Christmas
bonuses without adequate notice and opportunity to
bargain with respect thereto bemg,afforded Association
of Employees.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce you in the exercise of the above
rights.
WE WILL, upon request, bargain collectively in good
faith with Association of Employees as exclusive
collective-bargaining representative of all our employ-
ees in the appropriate unit which is:
All hourly-paid production and maintenance
employees at-our .Strongsville, Ohio, plant, but
excluding all office employees, clerical employ-
ees, temporary employees, and professional em-
ployees, guards and supervisors as defined in the
Act.
WE WILL make whole the employees in the appropri-
ate unit for any monetary losses they may have suffered
by reason of our unilateral withholding of the 1974
Christmas bonuses.
GAS MACHINERY COMPANY