General Motors Corp.

National Labor Relations Board - Board Decisions

Dec 19, 1944

59 N.L.R.B. 1143 (N.L.R.B. 1944)

In the Matter of GENERAL MOTORS CORPORATION and FEDERATION OF
ARCHITECTS, ENGINEERS, CHEMISTS AND TECHNICIANS, CHAPTER 31,
C. I. O.
Case No. O-C--5385.-Decided December 19, 1944
DECISION
AND
ORDER
Upon complaint issued pursuant to charges duly filed by Feder-
ation of Architects , Engineers , Chemists and Technicians , Chapter
31, C. I . 0., herein called the Union , against General Motors Corpora-
tion, Linden, New Jersey , herein called the respondent , a hearing was
held before a Trial Examiner at New York City on various dates be-
tween March-30 and April 26,1944, in which the Board , the respondent,
and the Union participated by then' representatives . The Board has
reviewed the rulings of the Trial Examiner made on motions and on
objections to the admission of evidence and finds that no prejudicial
error was committed . The rulings are hereby affirmed.
On July 7, 1944, the Trial Examiner issued his Intermediate Report,
a copy of which is attached hereto, finding that the respondent had
engaged in and was engaging in violations of Section 8 (1), (3), and
(5) of the Act . Exceptions to the Intermediate Report and a brief
to support the exceptions were thereafter filed by the respondent.
Oral argument was held before the Board at Washington , D. C., on
November 30 , 1944. The respondent and the Union were represented
and participated in the oral argument . Upon consideration of the
entire record , we hereby adopt the findings, conclusions , and recom-
mendations of the Trial Examiner , with the additions noted below.
The respondent contends that it was under no duty to bargain col-
lectively with the Union at the meeting held on December 27, 1943,
because the Union failed to present written evidence of the authority
of its representatives to bargain on its behalf . We do not agree. At
the outset of the December 27 meeting, Thomas R. Sullivan , interna-
tional representative of the Union, an individual with whom the re-
spondent had previously been in touch, requested that the employee
members of the Union's bargaining committee be summoned from
work . The request was granted and such employees were called in.
Thereupon , the respondent asked that the Union furnish written evi-
59 N. L . R. B., No 205. - 1143
1144 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
dente of the authority of Sullivan and of the committee to bargain in
behalf of the Union. According to the minutes of the meeting, Sulli-
van "replied that such a letter would be forthcoming and requested
that Management forward a similar letter listing the persons author-
ized to represent Management during the negotiations." The re-
spondent agreed to furnish such credentials.' Sullivan. then stated
that the respondent's proposed transfer of employees in the bargaining
unit from salary classification to an hourly rate basis of pay was
improper, unilateral in character, and 'discriminatory, and requested
that the transfer be deferred pending negotiation of the matter with
the Union. To this, R. E. Waldo, personnel director of the respond-
ent's Eastern Aircraft Division, replied, in substance, that it was the
respondent's established policy to transfer salaried employees who had
designated a collective bargaining representative to hourly rate classi-
fication, and that determination of such a policy rested exclusively
with management and was not a proper subject matter for collective
bargaining. The discussion then turned to various other collective
bargaining matters; positions on both sides were stated; and agree-
ment was reached on at least one issue, the establishment of bulletin
boards for the use of the Union.2 In view of these facts and the
respondent's conduct, we are of the opinion that the respondent had
no bona fide doubt as to the authority of the Union's representatives
and that the authority of the Union's representatives had been suf=
ficiently established to place the respondent under a-duty to bargain
with the Union at the December 27 meeting. Moreover, assuming
arguendo, that the respondent had a genuine doubt as to the authority
of the bargaining committee, the burden of challenging the authority
of the Union's representatives rested with the respondent who, in any
event, could have protected its position by terminating the meeting-
pending production of credentials. This the respondent did not do .3
We accordingly find no merit in the respondent's contention.'
I Other than this, the record does not disclose what , if anything, the respondent 's repre-
sentatives stated in response to the Union 's undertaking to produce the requested creden-
tials in due course Under the circumstances , we find that the respondent acquiesced in
the Union 's proposal and consented to proceed with collective bargaining without waiting
for the production of credentials Shortly thereafter , during the first week in January
1944 , the Union submitted the requested credentials to the respondent.
2 Other matters discussed at the meeting of December 27 included vacation pay, separa-
tion allowance , participation by the Union in preparation of replacement schedules for
employees subject to the Selective Service Act , establishment of an employee -suggestion
plan, establishment of a labor -management committee , and check -off and maintenance-of-
membership provisions.
3 We are not persuaded by the respondent 's argument that the discussion , which ensued
at the December 27 meeting after the matter of credentials had been disposed of, was
countenanced and participated in by the respondent solely as a matter of social amenity.
Under the circumstances , we find that , aside from the respondent's refusal to treat the mat-
ter of transfer as a proper subject of collective bargaining, the respondent engaged in
collective bargaining regarding terms and conditions of employment with the Union at
the December 27 meeting
GENERAL MOTORS CORPORATION " 1145
On January 1, 1944, the respondent effected the transfer of the em-
ployees in the bargaining unit to the hourly pay roll, despite the
Union's pending protest and request for negotiation of the matter.
On January 3, 1944, the Union filed the present charge, alleging that
the respondent had engaged in violations of Section 8 (1), (3), and
(5) of the Act.'
As a result of the unilateral action taken by the respondent in trans-
fer of the employees in the bargaining unit from salary to hourly rate
pay base classification, the employees were deprived of certain bene-
fits which they had previously enjoyed as salaried employees, as more
fully set forth in the Intermediate Report. The respondent contends
that such action on its part does not violate Section 8 (3) of the Act
since it made the transfer for business reasons and inasmuch as it had
no motive to discourage union membership. We do not agree. Only
the employees in the bargaining unit who had selected a collective
bargaining representative were transferred from salary to hourly rate
classification; other salaried employees, not part of the bargaining
unit, were permitted to retain their salary classification. Admittedly
the transfer was made because the employees in the bargaining unit
had designated the Union as their representative; absent the designa-
tion, no such transfer would have been made. Under the circum-
stances, we find that the respondent effected the transfer with an intent
to discriminate in regard to terms and conditions of employment,
thereby discouraging membership in the Union ; in any event, we find
that the transfer was of such a character as to have a natural tendency
to discourage union membership. By such conduct, the respondent
discriminated in regard to the terms and conditions of employment of
the employees in the bargaining unit, thereby discouraging member-
ship in the Union, in violation of Section 8 (3) of the Act. We further
find that, by the transfer of the employees in the bargaining unit from
salary to hourly rate classification, the respondent interfered with,
restrained, and coerced its employees in the exercise of the rights guar-
anteed in Section 7 of the Act, thereby violating Section 8 (1) of the
Act.
Whether the respondent's conduct be viewed as a violation of Section
8 (1) or of Section 8 (3) of the Act, it is nevertheless necessary, in
order to effectuate the purposes of the Act, that the respondent return
the employees in the bargaining unit to salary classification and thus
restore the terms and conditions of employment of such employees in
effect on December 31, 1943, and make each such employee whole for
any loss of pay, or other loss, if any, which he has incurred as a result
4 The Trial Examiner found that the charge was filed on December 31, 1943. The charge
itself, however , states that it was filed with the Board on January 3, 1944 , although it
was subscribed and sworn to before a notary public on December 31, 1943, and we so find
above.
1146 DECISIONS OF NATIONAL . LABOR RELATIONS BOARD
of the respondent 's discrimination against him during the period from
January 1, 1944, to the date that •the respondent restores the employees
to salary status.
ORDER
Upon the entire record in the case, and pursuant to Section 10 (c)
of the National Labor Relations , Act, the National Labor Relations
Board hereby orders that the respondent , General Motors Corporation,
Linden , New Jersey , and its officers , agents, successors , and assigns,
shall:
1. Cease and desist from :
(a) Dicouraging - membership in Federation of Architects, Engi-
neers, Chemists and Technicians , Chapter 31 , affiliated with the Con-
gress of Industrial Organizations , or any other labor organization of
its employees, by discriminating in regard to the hire or tenure of
their employment , or -any term or condition of employment;
(b) Refusing to bargain collectively with Federation of Architects,
Engineers, Chemists and Technicians , Chapter 31 , affiliated with the
Congress of Industrial Organizations , as the exclusive collective bar-
gaining representative of the respondent 's employees in the appro-
priate unit , with respect to rates •of pay, method of pay, wages, hours
of employment , and other terms and conditions of employment;
(c) In any other manner interfering with, restraining, or coercing
its employees in the exercise of the right to self-organization , to form
labor organizations , to join or assist Federation of Architects, Engi-
neers, Chemists and Technicians , Chapter 31, affiliated with the Con-
gress of Industrial Organizations , or any other labor organization,
to bargain collectively through representatives of their own choosing,
and to engage in concerted activities, for the purpose of collective bar-
gaining or other mutual aid or protection , as guaranteed in Section 7
of the Act.
2. Take the following affirmative action, which the Board finds will
effectuate the policies of the Act :
(a) Restore salary classification and the terms and conditions of
employment , including all rights , privileges, and benefits in effect on
or about December 31, 1943, to all employees in the Product Engineer-
ing Department of the respondent 's Linden, New Jersey, plant , within
the appropriate bargaining unit;
' (b) Make whole- all employees in the appropriate unit who were,
transferred from salary to hourly pay classification on or about, Jan-
uary 1, 1944 , for any loss of pay , or other loss , if any , ( such as, but
not limited to, insurance benefits; payment for absent time, holidays;
and vacations ; and separation and retirement pay) which each of them
sustained as a result of the transfer to hourly pay classifiction during
GENERAL MOTORS CORPORATION 1147'
the period from Janury 1, 1944, to the date that the respondent restores
them to salary status;
(c) -Upon request, bargain collectively with Federation of Archi-
tects, Engineers, Chemists and Technicians, Chapter 31, affiliated with
the Congress of Industrial Organizations, as the exclusive collective
bargaining representative of the employees in the appropirate unit,
with respect to rates of pay, method of pay, wages, hours of employ-
ment, and other terms and conditions of employment;
(d) Post'immediately in conspicuous places throughout its plant at
Linden, New Jersey, and maintain for a period of at least sixty (60)
consecutive days from the date of posting, notices to its employees
stating: (1) that the respondent will not engage in the conduct from
which it is ordered to cease and desist in paragraphs 1 (a), (b), and
(c) of this Order; (2) that it will take the affirmative action set forth
in paragraphs 2 (a), (b), and (c) of this Order; and (3) that the
respondent's employees are free to -become and remain members of
Federation of Architects, Engineers, Chemists andTechnicians, Chap-
ter 31, affiliated with the Congress of Industrial Organizations, or any
other labor organization, and that the respondent will not discrimi-
nate against any employee because of membership in or activity on
behalf of such organization :
(e) Notify the Regional Director for the Second Region in writing,
within ten (10) days from the date of this Order, what steps the re-
spondent has taken to comply herewith.
MR. GERARD D. REILLY took no part in the consideration of the above
Decision and Order.
INTERMEDIATE REPORT
Messrs David H. Werther and James C. Paradise, for the Board.
John Thomas Smith by Mr. Kevin McInerney, of New York City, for the
respondent.
Leider, Witt and Canzmer , by Mr. Abiaham Levin, and Mr . Thomas R. Sullivan
and Mr. Martin M Cooper, of New York City, for the Union.
STATEMENT OF THE CASE
Upon charges duly filed by Federation of Architects, Engineers, Chemists and
Technicians , Chapter 31 , C. I. 0., herein called the Union, the National Labor
Relations Board, herein called the Board , by the Regional Director for the Second i
Region ( New York, New York ), issued its complaint dated March 6, 1944, against
General Motors Corporation , Linden, New Jersey , herein called the respondent,
alleging , that the respondent had engaged in and was engaging in unfair labor
practices affecting commerce within the meaning of Section 8 ( 1), (3) and (5),
and Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat. 449,
herein called the Act. Copies of the complaint , accompanied by notice of hearing,
were duly served upon the respondent and the Union.
With respect to the unfair labor practices , the complaint alleged in substance
that: ( 1) on or about January 1, 1944, because certain of its employees had desig-
1148 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
nated the Union as their bargaining representative, the respondent transferred
those employees from a salaried to an hourly status, and thereby deprived them
of certain rights, privileges and benefits to which they had theretofore been en-
titled; (2) that the said change in status was made unilaterally and without
prior consultation or collective bargaining with the Union, as the collective
bargaining representative of the said employees; (3) that on or about December
27, 1943, and on or about January 29, 1944, and thereafter, the respondent refused
to bargain collectively with the Union with respect to compensating the said
employees on a salaried basis; (4) that by the foregoing acts the respondent com-
mitted unfair labor practices within the meaning of Section 8 (1), (3), and (5) of
the Act.
On March 16, 1944, the respondent filed its answer admitting that the em-
ployees involved had been changed from a salaried to an hourly basis, but denying
the commission of any unfair labor practices. -
Pursuant to notice, hearings were held at New York, New York, on various
dates between-March 30 and April 26, 1944, before the undersigned, Charles
W. Schneider, the Trial Examiner duly designated by the Chief Trial Examiner.
The Board, the respondent, and the Union were represented by counsel and
participated in the bearing. Full opportunity to be heard, to examine and
cross-examine witnesses, and to introduce evidence bearing on the issues was
afforded all parties. -
At the close of the hearing the undersigned granted, without objection, a
motion by counsel for the Board to conform the pleadings to the proof. At
the same time, counsel for the respondent moved to dismiss the complaint. The
undersigned reserved ruling on that motion. It is hereby denied. All parties
waived oral argument before the undersigned. On June 9, 1944, the respondent
filed a brief. -
On June 10, 1944, the parties filed a written stipulation for correction of the
record. The stipulation is hereby approved, and the record is ordered to be
corrected in accordance therewith.
Upon the entire record in the case, and from his observation of the witnesses,
the undersigned'makes, in addition to the above, the following: -
FINDINGS OF FACT
1. THE BUSINESS OF THE RESPONDENT
General Motors Corporation is a Delaware corporation having its principal
office and place of business in New York, New York, and operating a plant at
Linden, New Jersey, where it is engaged in the manufacture, sale, and distribu-
tion of aircraft and related products. The Linden plant is one of 5 plants in
the Eastern Aircraft Division of the Corporation.
During 1943 the respondent received at the Linden plant raw matefials valued
at more than $1,000,000.00, of which approximately 70 percent was secured from
sources in States other than New Jersey. During the same period the respondent
manufactured at the Linden plant products valued in excess of $2,000,000.00,
of which more than 75 percent was shipped to States other than New Jersey.
The respondent concedes that it is engaged in commerce within the meaning
of the Act.
II. THE ORGANIZATION INVOLVED
Federation of Architects, Engineers , Chemists and Technicians, Chapter 31,
is a labor organization. affiliated with the Congress of Industrial Organizations,
and admitting to membership employees of the respondent.
GENERAL MOTORS CORPORATION 1149
III. THE UNFAIR LABOR PRACTICES
1. The appropriate unit
Substantially in accordance with the allegations in the complaint and the ad-
missions in the answer, the undersigned finds that all engineers and technicians
of the Product Engineering Department at the respondent's Linden, New Jersey,
.plant, exclusive of clerical, secretarial, maintenance and specification employees,
all supervisory employees in the rank of group leader and above, and all other
supervisory employees with authority to hire, promote, discharge, discipline, or
otherwise effect changes in the status of employees, or effectively recommend such
action,' constitute, and at all times material herein constituted, a unit appropriate
for the purposes -of collective bargaining within the meaning of Section 9 (b)
of the Act.
2 The Union's majority
On December 8, 1943, a consent election was held among the employees in the
aforesaid appropriate unit, under the supervision of the Regional Director for
the Second Region. In this election a majority of the employees in the unit
selected the Union as their representative for the purposes of collective bargaining.
The undersigned therefore finds that by virtue of Section 9 (a) of the Act,
at all times since December 8, 1943, the Union has been the exclusive representa-
tive of all employees in the aforesaid appropriate unit, for the purposes of col-
lective bargaining in respect to rates of pay, wages, hours of employment, and
other conditions of employment.
3. The change in status
At the time of the above-described election, the employees in the appropriate
unit were employed on a salaried basis. However, about December 18, 1943,
after the results of the election had been certified by the Regional Director, R. E.
Waldo, Personnel Director of the respondent's Eastern Aircraft Division, in-
structed Algie B. Hendrix, Personnel Department head at the Linden plant, to
prepare to transfer the employees in the appropriate unit to an hourly basis.
On either December 21 or 22, without any notice to the Union, Waldo instructed
Hendrix to make the transfer on January 1, 1944. On December 22, the following
Memorandum was issued to supervisors in the Product Engineering Department :
We have just been notified by the Personnel Department that it is the
responsibility of each supervisor to notify employees under his jurisdiction,
who are in the bargaining unit represented by FAECT, that they are being
transferred to the hourly pay roll as of January 1, 1944.
If asked for a reason, the supervisor should explain that it is the policy
of the General Motors Corporation to pay all employees represented by
unions on an hourly basis, so that they will be subject to the same rules and
regulations and entitled to the same benefits and privileges. -
Any questions regarding their rate of pay, vacation benefits, group insur-
ance, privileges, etc., should be referred to the Employment Department,
who will provide explanations.
A member of the Employment Department will contact the employees in-
volved between now and January 1, 1944.
The employees were then interviewed in groups by representatives of the
respondent's employment department, informed of the instructions in the above
' None of the employees in the unit below the rank,of group leader are supervisory within
the meaning of the above definition.
1150 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
memorandum and of the changes in working conditions which the transfer would
involve, and invited to ask any questions 2
No notice was given by the respondent to the Union of the intention to effect
the above transfer.
During the afternoon of December 22, one of the employees telephoned Thomas
R Sullivan, International representative of the Union, and informed him of the
respondent's action. On the following day, Sullivan sent Hendrix a letter,'re-
questing a meeting and stating, in part, as follows :
It has just come to my attention that the Company has notified all personnel
in Product Engineering that as of January 1st, they are to have a different
status because they have chosen the Union to represent them.
We wish to point out that this unilateral action on the part of the company
is definitely improper.
As you know, the purpose of our pending negotiations is to reach an agree-
ment covering all of the matters mentioned in the memo addressed to "All
Product Engineering Supervision" under date of December 22, 1943.
We urge that no change in status of the employees concerned take place
pending outcome of our negotiations. Specifically, we request that the memo
of December 22nd, copy of which is attached, be recalled.
On December 24, Sullivan also telephoned Hendrix and reiterated that the
respondent's action was improper. During this conversation a meeting between
the Union and the respondent was arranged for December 27.3
Representatives of the respondent and the Union then met on December'27.
The respondent's representatives were Waldo, Hendrix, W. F. Burke, E. C.
Ackerman, V. M. Schneider, and M. M. Muterspaugh ; the Union's Sullivan and
the negotiating committee, consisting of employees Young, Wilde, Sheehan,
Sussman, and Gordon. Sullivan told the respondent's representatives that the
proposed transfer was improper, unilateral, and discriminatory, and requested
that its execution be deferred pending negotiation with the Union. According to
the testimony of Sullivan, Young, Wilde, Sheehan, and Sussman, Waldo replied,
in substance, that the transfer to an hourly basis of salaried employees who had
designated a bargaining representative, was a, matter of company policy solely
within the discretion of management, and not a subject for negotiation. Waldo,
who testified for the respondent, denied that he had said that the respondent
would not negotiate the proposed transfer. However, he testified ". . . Instated
that in my opinion the things that we were to bargain on were wages, hours
of work and conditions of employment ; that how we calculated or figured arriving
at their method of pay was not in my opinion a subject of negotiation." Hendrix
testified generally that the respondent has at all times been "willing to nego-
tiate . . . the method of pay,'; and has, "never refused to bargain with the,
Union on this item or any other item." Burke, Ackerman, Schneider, Muter-
spaugh, and Gordon did not testify. The undersigned credits the testimony of
Sullivan, Young, Wilde, Sheehan, and Sussman.'
2 The effect of the transfer on the employees' conditions of employment is discussed at a
later point in this report. -
8 There is no substantial dispute concerning the above findings.
* In further support of this finding, there is credible testimony by Wilde and Young to the
effect that they understood Waldo to say that the policy had been established by higher
officials of the respondent in Detroit, and was "out of their hands." Although Waldo
denied having made such a statement, it is significant that after Waldo's reply to Sulli-
van's request' for negotiation, Sullivan stated that he would take up the matter with the
respondent's Detroit officials. Absent a declination to negotiate the issue, there would have
been no occasion for Sullivan to appeal to Detroit.
GENERAL MOTORS CORPORATION , 1151
The respondent's representatives indicated their immediate readiness to nego-
tiate a wage agreement on an hourly basis. However, the Union declined to
discuss the wage question on such a basis Some tentative discussibn then fol-
lowed concerning other subjects to be covered in a collective bargaining contract.
At the conclusion of the meeting the Union agreed to submit a proposed agree-
ment, and arrangements were made to meet again during the month of January.
On December 31, 1943, the Union filed the present charge, in which it alleged
that the proposed transfer was discriminatory, that the respondent's action was
unilateral in character, and that at the December 27 meeting the respondent had
refused to bargain with the Union concerning the transfer.
On January 1, 1944, without any further meetings or discussions between the
parties, the respondent effected the transfer of the employees in the unit from
the salaried to an hourly rate of pay.
On January 18. 1944, another meeting was held between representatives of the
respondent and the Union. Sullivan requested at this meeting that the transfer
be rescinded and the employees restored to the salaried pay roll. Waldo declined.
Sullivan then asked that the matter be negotiated. According to Waldo, his
answer to the latter request, in substance, was to outline, "the reasons why it
was quite desirable to change the method of pay " At this meeting, the parties
also discussed a draft of a proposed agreement which had been submitted by the
Union, covering conditions of employment' other than wages and the method of
pay. Tentative agreement was reached respecting certain of the items in the
Union's proposal
However, the Union thereafter broke off negotiations.
On April 8, 1944, during the course of the present hearing, at the request of the
respondent, representatives of the parties again met. The respondent's repre-
sentatives again offered to negotiate an agreement on an hourly basis, and ex-
plained their reasons for the transfer a The Union representatives again re-
quested that the employees be restored to the salaried status. The request was
refused. At this meeting, for the first time during the negotiations, the respond-
ent's representatives made reference to an agreement made in 1941, whereby the
respondent assertedly acquired the right to change the status of the employees
here involved. This alleged agreement is discussed at a later point in the report.
Another meeting was held on April 19. The Union reiterated its request for
restoration of the salaried status, and the request was again refused.
4 The effect of the change in status
As a result of the transfer to the hourly pay roll, the employees in the appro-
priate unit lost certain benefits or contingent privileges which they had en-
joyed as salaried personnel These items the respondent describes as "revocable
benefits " They were non-contractual in nature, and the respondent reserved
the right to "change, suspend or cancel all or any part of them as circumstances
may require." The particular benefits, or privileges, which were lost by the
employees as a result of the transfer are as follows:
Separation Pay: In general, salaried employees with more than one year's
service who are separated involuntarily for non-disciplinary reasons, are eligible
for a separation allowance of from 50% to 600% of their average monthly salary,
the percentage depending upon the length of service. There is no comparable
provision for hourly employees.
6 The reasons advanced by the respondent are discussed at a later point in this report.
618653-45-vol 59-74
1152 , DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Group Insurance: Both hourly and salaried employees may participate in group
insurance plans covering life, sickness and accident, hospitalization, and sur-
gical insurance . Hospitalization'-and surgical coverage is substantially similar
for both groups of employees. Salaried employees are eligible for from $200000
to $20,000.00 in life insurance, the amount of the coverage being determined by
the employee's salary.' Sicknesfi and accident compensation eligibility for sal-
aried employees increases, comparably, in accordance with the salary bracket,
frow a minimum of $14 00 per week to a maximum of $38 50 per week.' These
sickness and accident benefits are payable to salaried employees for from 13 to
24 weeks, according to the employee's length of service. Premium cost is in
proportion to the coverage extended
However, the group insurance plan for hourly employees provides a maximum
of $2000.00 life coverage, and 13 weeks of sickness and accident benefits of $14.00
per week. Some of the employees in the appropriate unit carried as much as
$10,000 life, and comparable sickness and accident, insurance prior to January 1,
1944. As a result of the transfer, their insurance was involuntarily reduced to
the coverage permitted hourly employees"
Retirement Plan: Salaried employees between-the ages of 40 and 55 and earning
over $250.00 per month are eligible to participate in a retirement plan, in which
the respondent shares the cost by contriliuting, along with the employees. There
is no similar program for hourly employees. A number of the employees in the
unit who had participated in the plan prior to January 1, 1944, were removed
from its operation by the transfer, and their contributions refunded with accrued
interest.
Payment for Absent Time: Salaried employees may for certain prescribed
periods be paid for time absent for work, such as for illness , late reporting, or
leaving work early. Such payments are in the discretion of the employee 's super-
visor, who determines whether the reason for the absence is satisfactory. There
is no comparable policy with respect to hourly paid employees. Prior to ,Jan-
nary 1, 1944, employees in the unit were paid for such absences. Thereafter they
were not.'
Vacations With Pay: During 1943, salaried employees with 6 months service,
and hourly employees with from 1 to 5 years service, were eligible for 1 week's
vacation with pay. However, salaried employees with more than one year's serv-
ice were eligible for 2 weeks paid vacation. According to the testimony of
Hendrix, the salaried vacations are non-cumulative, and are not granted where
the employee cannot be spared from his work In the Ritter case, the salaried
employee does not receive pay in lieu of vacation. However, the majority of
the salaried employees received paid vacations in 1943.
Holidays: Both hourly and salaried employees received Christmas Day off in
1943. Salaried employees were paid for the day ; hourly employees were not"
"Thus, a salaried employee earning less than $125 00 monthly is eligible for $2000.00
of life insurance ; whereas one earning over, $350 00 is eligible for the maximum of
$20,000.00. Those with intermediate salaries are eligible for proportionate coverage.
P However , salaried employees earning in excess of $350 00 per month are not eligible
for sickness and accident , hospitalization , and surgical insurance , under the above plan.
8 There is a differential in relative cost as the amount of life insurance increases. Thus,
the premium on a $2000 00 policy is $.40 per month per thousand ; on a $20,000 .00 policy
it is $.50.
9 occasionally , in extraordinary circumstances , such as employee rallies, extreme weather,
and similar occurrences , hourly paid employees have been paid for late reporting. There
is no general policy in that regard, however.
10 While, according to Hendrix , the vacation and holiday policy for 1944 had not yet been
established at the time of the hearing , the 1943 policy is indicative of the general differences
in the treatment of salaried and hourly employees.
GENERAL MOTORS CORPORATION 1153
5 The respondent's contentions, and conclusions as to unfair labor practices.
The respondent admitted having transferred the employees from the salaried
to the hourly status, but denied that in so doing it had committed any unfair
labor practices. The respondent's principal contentions may be stated as follows :
(1) that the transfer is not a subject on which the respondent was required to
bargain with the Union; (2) that the transfer did not result in the loss of any
substantial benefits; (3) that the respondent in fact bargained with the Union
concerning the transfer ; and (4) that the respondent's purpose was non-discrimi-
natory, and that the transfer was necessary, (a) to facilitate the negotiation of
a satisfactory collective agreement, and (b) to avoid disruption of the respond-
ent's established personnel procedure and to avoid possible unfair labor practice
charges These contentions will be discussed seriatum.
The respondent asserts that the method of paying employees is a matter solely
within the discretion of management, and outside the prescribed area of collective
bargaining ; that whether employees should be on a salaried or an hourly basis
is such a subject ; and, therefore, as a matter of law, the respondent was not
required to bargain with the Union concerning the transfer. This syllogism, how-
ever, understates the issue. What is involved here is more than the academic
query whether compensation shall be computed by one method of calculation or
by another. For one thing, the contention leaves out of account certain factors
inherent in the status itself, such as prestige and standing; factors untranslatable
in terms of pecuniary advantage. Moreover, in this case, there were attributes
of the salaried status susceptible of measurement in terms of tangible gain.
Therefore, whether or not the employees should have been on a salaried or an
hourly basis, and whether or not they should have retained the benefits of the
salaried status, were questions vitally affecting their conditions of employment.
The Act required the respondent to bargain with the Union, as the exclusive
representative of the employees in the appropriate unit, with respect to rates of ,
pay, wages, hours of employment, and other conditions of employment. The
undersigned therefore finds that the transfer was a subject on which the respond-
ent was required to bargain collectively with the Union.
Compliance with the law required that before the transfer was executed, it be
negotiated with the bargaining representative. But the respondent proceeded
to effect it without notice to the Union. Instead, the employees were merely
informed individually that the change would be effected. However pure the
respondent's motives may have been, this unilateral action clearly constituted a
by-passing of the collective bargaining representative and a resort to individual
action.
In justification of the unilateral character of the transfer, the respondent con-
tends, intro- alia, that in 1941 it had entered into an agreement with the Federation
of Architects; Engineers , Chemists, and Technicians, which provided that any
salaried group employed by the respondent which thereafter designated that
labor organization as a bargaining representative, could be transferred by the
respondent to an hourly pay roll. The undersigned finds that the evidence does
not support the assertion that such an agreement was made."
it on November 12, 1941, the respondent and Locals 201 and 202 of the Society of De-
signing Engineers , affiliated with the Federation of Architects, Engineers , Chemists, and
Technicians, entered into a collective bargaining agreement , covering certain employees in
4 of the respondent' s plants in the State of Michigan . This contract appears to contem-
plate an hourly status for the employees involved . It contains the following provision:
In case the Federation of Architects, Engineers , Chemists and Technicians shall
be certified as the bargaining representatives for any additional bargaining units,
0
1 154 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Moreover, even if such an agreement existed, it would, in the opinion of the
undersigned, contravene the purposes and the policies of the Act. The authority
of a labor organization to bind employees by agreements with employers does
not come into existence until the organization has been designated by the em-
ployees as their bargaining representatives. Until such time as it represents
the employees, the organization has no authority to contract on their behalf.
Therefore , in the opinion of the undersigned , no valid agreement existed in
December, 1943, permitting the respondent to effect unilateral changes in the con-_
ditions of employment of the employees here involved. It is equally clear that
the respondent was not proceeding under a mistake of fact, reasonable or other-
wise, as to whether the Union had waived the right to object to the transfer.
When Sullivan learned of the proposed action, he immediately protested. Al-
though it was thus put on notice of the Union's position, the respondent never-
theless proceeded to put the transfer into effect It was not until April, 1944,
that the respondent's representatives made reference to the Detroit agreement as a
reason for the respondent's action.
The respondent also contended that, because of the non-contractual and revocable
character of the benefits of salaried employees, and because the granting of the
benefits may be withheld in the individual case at the discretion of management,
the employees in the unit were not deprived of anything of value by reason of
their transfer to the hourly pay roll. The undersigned finds no merit in this
contention. It is apparent that the transfer deprived employees of advantages of
real and tangible value Thus, for example, they actually lost valuable insur-
ance protection and payment for absent time, both of which they had enjoyed
prior to the transfer, and both of which they ceased to enjoy thereafter. More-
over, the fact that some of the benefits, such as retirement pay and separation
allowance, may never have vested to the, point of immediate claim and enjoy-
ment, is immaterial. By the transfer all the employees in the unit were deprived
of a present expectancy of future enjoyment of those benefits. The undersigned
finds these various losses to have been substantial and material.n However,
although the transfer thus effected a material and substantial change in the con-
ditions of employment, the invalidity of the respondent's conduct does not neces-
sarily turn upon that conclusion. The importance of status itself, apart from
the question of economic gain or loss, has already been alluded to. Moreover, it
the matter of including such units under the terms of this Agreement shall be nego-
tiated ( emphasis supplied) between the Personnel Staff of the Corporation and the
International Union officers of the Union , it being understood that in considering
including any additional bargaining units under this Agreement due consideration
shall be given to any-local wage classifications , rates, understandings or practices as
may exist.
This paragraph clearly contemplates negotiation of the question of inclusion of additional
bargaining units
1' The respondent also argues that the employees received certain gains as a result of
the transfer , and that any losses were thereby offset . Thus, ( 1) they became eligible, as
hourly employees, for leave of absence at the end of 6 months service , instead of one year,
as salaried ; ( 2) they became eligible for lower amounts of life insurance , where the rela-
tive cost is lower , ( 3) by the conversion their wages were actually increased , due to the
fact that the hourly rate was arrived at by dividing the monthly salary by 177 33, and
the hourly rate set at the next highest even cent; (4) they may now elect tw take pay
in lieu of vacations ; ( 5) they may now' receive daily overtime ; and .(6 ) higher paid
employees became eligible for sickness and-accident , hospitalization, and surgical insurance.
Since the issue is whether the employees were deprived of any benefits by the transfer,
these facts are not material But, in any event, the undersigned does not consider the
losses to have been compensated by the gains. -
GENERAL MOTORS CORPORATION 1155
is conceded that one of the reasons for the transfer was the-fact that the em-
ployees had designated a bargaining representative"
The undersigned is of the opinion that such a circumstance is not a proper
factor to be considered by an employer in the establishment or revision of work-
ing conditions and terms of employment . Unilateral changes in employment
status made by an employer based on the exercise of the right to act collectively,
are repugnant to the basic purposes of the Act , are per se at variance with the
interdiction in Section 8 (3) against discrimination in regard to hire, tenure,
and conditions of employment , and an inevitable deterrent to, and interference
with , the exercise of the right to self-organization guaranteed in Section 7.
The respondent contended that at the December 27 and subsequent meetings,
it bargained with the Union respecting the transfer The undersigned has
found, however , that at the December 27 meeting , the respondent declined to
negotiate with the Union regarding the transfer . Moreover, it is clear from
the testimony of Waldo, that whatever discussion occurred at that meeting
respecting the transfer , it was not collective bargaining in good ,faith. Thus,
Waldo ultimately testified that actually no collective bargaining occurred at
the December 27 meeting . The reason asserted by Waldo was that Sullivan
did not present proper credentials , and that the entire subject of collective
bargaining was therefore in abeyance pending the receipt of written evidence,
from the international Union, of Sullivan 's authority to negotiate an agreement.
Sullivan agreed to secure such a letter, which was subsequently received by
the respondent on January 6, 1944 The testimony and the minutes of the
December 27 meeting indicate that the parties discussed other subjects of col-
lective bargaining with the view of reaching agreement thereon. The under-
signed is therefore not persuaded that the respondent 's representatives enter-
tained any genuine, good-faith , doubt as to the authority of Sullivan.
However, even if such doubt did exist , the respondent proceeded to execute the
transfer , as it had announced , without giving the Union an opportunity to
comply with the respondent 's demand, and thus foreclosed the possibility of
further negotiation The undersigned therefore finds that the respondent's
conduct was not in good faith.
The purpose of the transfer , according to the respondent was (1 ) to facilitate
the negotiation of a satisfactory wage agreement with the Union , and to enable
the respondent to grant certain anticipation union demands ; and (2 ) to prevent
disruption of the respondent 's salaried personned procedure , and to avoid charges
of discrimination in the administration of benefits to salaried employees"
Considerable testimony was adduced by the respondent in support of these
assertions . Had the respondent actually negotiated the transfer , such arguments
would be relevant in determining whether the respondent 's reasons were asserted
in good faith, but they have no relevancy when asserted in justification of a
refusal to negotiate. The legality of the ultimate objective is equally immaterial
where, as here, the issue is the legality of the means employed . Furthermore, it
is not to be assumed that the union representatives would have been impervious
to reasonable argument had the respondent negotiated on the issues. As a mat-
is Thus Waldo testified "If they had continued to deal with the corporation on an indi-
vidual basis , as individual employees , they would have continued on a salary . When they
chose to deal with the corporation on a collective basis, then they were put on a basis
where we could deal with them logically as a collective group , and on the same basis as
we deal with all other people who are on a collective basis "
"That is, to avoid charges that supervisors , in exercising their discretion as to the
granting of payment for absent time , et cetera , were being less or more lenient with union
members than with non - members
1156 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ter of fact, throughout the various conferences between the parties, the union
representatives indicated their willingness to consider an agreement on an hourly
basis. They merely insisted that the transfer be negotiated . Moreover , while
not unmindful of the respondent 's administrative problems, the undersigned finds
no substantial evidence'that the negotiation of an agreement on a salaried basis
would not have been possible, or that it would have disrupted the respondent's
procedure with respect to salaried personnel "
But even: if the respondent's administrative quandary be conceded, its method
of resolving the dilemma goes to the very heart of the Act. The justification
should have been addressed in the first instance to the bargaining agent of. the
employees, to the end that a just solution be reached in the light of mutual
understanding of the facts and reciprocal appreciation of the inherent problem.
It is clear from the reaction of the Union's bargaining committee, as reflected
by the minutes of the various meetings , that the gravamen of their complaint,
probably overshadowing any specific grievance arising out of the change, was that
in initiating it, the respondent had left the employee's representative completely
out of account. The respondent's precipitate action, its reluctance to negotiate
the transfer, and its persistence, after the Union had requested reconsideration.
in executing the plan, unquestionably contributed heavily to the impasse which
the parties subsequently reached, and to what the respondent refers to as the
Union's "uncooperative" attitude 16 The respondent left the Union no choice.
Faced with a fait accompli, it had to choose between- the extremes of submitting
to the unilateral action, or of demanding its nullification The respondent's at-
titude permitted no middle course.
As to the contention that the transfer was necessary to avoid unfair labor
practice charges, it is sufficient answer that an employer may not commit unfair
labor practices in order to avoid possible unfair labor practice charges.17
The undersigned therefore finds that, because the employees in the appropriate
unit had designated the Union as their bargaining representative, the respondent
transferred them from the salaried to the hourly status, thereby changing the
terms and conditions of their employment and depriving them of rights, privileges,
or benefits which they had theretofore enjoyed ; and that the respondent there-
after refused to restore the employees to the salaried status. It is further found
that this transfer was effected by the respondent unilaterally and without con-
sultation with the Union, as- the employees' bargaining representative ; and that
by the foregoing conduct and by refusing to negotiate in good faith with the
Union concerning the transfer, the respondent refused to bargain collectively
with the Union concerning the transfer.
It is further found that by the above-described conduct the respondent dis-
criminated in regard to the hire and tenure of employment of its employees,
discouraged membership in the Union, and interfered with, restrained, and
coerced its employees in the exercise of the rights guaranteed in Section 7 of
the Act.
15 Thus Waldo conceded that it would be "quite possible" to negotiate an agreement on a
salaried basis , but asserted that it would be "impracticable "
10 Thus, Waldo testified, the Union refused to listen to the respondent's explanations as to
the reasons for the transfer, constantly reiterated its "ultimatum " that the employees be
restored to the salaried status before the wage question be discussed , filed charges , and broke
off negotiations.
17 The respondent Also contended that the Union did not bargain in good faith. Without
conceding the materiality of such an assertion, or its foundation in fact, it may be stated
that the Union 's conduct was not a contributing factor in the respondent ' s determination to
effect the transfer . The undersigned therefore finds the contention to be without merit.
GENERAL MOTORS CORPORATION
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
1157
The activities of the respondent set forth in Section III, above, occurring in
connection with the operations of the respondent described in Section I, above,
have a close, intimate, and substantial relation to trade, traffic, and- commerce
among the several States, and tend to lead to labor disputes burdening and
obstructing commerce and the free flow of commerce.
V. THE REMEDY
Having found that the respondent has engaged in unfair labor practices, the
undersigned will recommend that it cease and desist therefrom and take certain
affirmative action designed to effectuate the policies of the Act.
It has been found that by transferring the employees in the appropriate unit
from a salaried to an hourly status, thus depriving them of certain rights, priv-
ileges, or benefits, the respondent discriminated in regard to their hire and
tenure of employment, refused to bargain collectively with the Union, and
interfered with, restrained, and coerced its employees. In order to remedy
effectively the effects of such unfair labor practices, it is necessary that the
status quo be restored The undersigned will therefore recommend that the
respondent return to the salaried pay roll all employees in the appropriate unit,
and, in addition, that it restore all the terms and conditions of employment of
such employees, including rights, privileges, or benefits, in effect on December
31, 1943 It will be further recommended that the respondent make whole each
of the employees in the appropriate unit who was transferred to the hourly play
roll on January 1, 1944, for any losses of pay, or any other losses, if any, (such
as insurance, payment for absent time, holidays, vacations, separation pay, retire-
ment pay, etc.) which he incurred, as a result of the respondent's discrimination
against him, during the period from January 1, 1944, to the date the.respondent
restores the employees to the salaried status
The undersigned will also recommend that the respondent, upon request,
bargain collectively with the Union."
Upon the basis of the foregoing findings of fact, and upon the entire record in
the case, the undersigned makes the following:
CONCLUSIONS OF LAW
1. Federation of Architects, Engineers, Chemists and Technicians, Chapter 31,
affiliated with the Congress of Industrial Organizations, is a labor organization
within the meaning of Section 2 (5) of the Act
2. All engineers and technicians of the Product Engineering Department at
the respondent's Linden, New Jersey, plant, exclusive of clerical, secretarial,
maintenance and specification employees, all supervisory employees of the rank
of group leader and above, and all other supervisory employees with authority
'$ The respondent also contended that there is a jurisdictional dispute between the
Union and the United Automobile, Aircraft, and Agricultural Implement Workers of
America, also affiliated with the Congress of Industrial Organizations, with respect to
jurisdiction over the employees in the appropriate unit, and that the case is therefore
moot. A motion of the respondent, made at the beginning of the hearing, to dismiss the
complaint on this ground, was denied. While the record indicates that there have been
negotiations between the two organizations with respect to the transfer of jurisdiction to
the U. A. W., there has been no surrender of jurisdiction. The Union has continued to
represent the employees throughout these proceedings. No other labor organization ap-
peared at the hearing to contest the Union's authority. The undersigned therefore finds
that the case is not moot, and that the respondent's unfair labor practices can be
effectively remedied only by an order directing the respondent to bargain with the Union.
1158 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
to hire, promote , discharge , discipline , or otherwise effect changes in the status
of employees , or effectively recommend such action , constitute , and at all times
material herein constituted ; a unit appropriate for the purposes of collective bar-
gaining within the meaning of Section 9 (b) of the Act.
3. By virtue of Section 9 (a) of the Act , Federation of Architects , Engineers,
Chemists and Technicians , Chapter 31 , affiliated with the Congress of Industrial
Organizations, was, on December 8, 1943, and at all times thereafter, and is now,
the exclusive representative of all employees in the aforesaid appropriate unit,
for the purposes of collective bargaining with respect to rates of pay,-wages, hours
of employment , and other conditions of employment.
4. By discriminating in regard to the hire , tenure, and terms and conditions of
employment of the employees in the appropriate unit, thereby discouraging mem-
bership in Federation of Architects , Engineers , Chemists and Technicians, Chap-
ter 31, affiliated with the Congress of Industrial Organizations , the respondent
has engaged in and is engaging in, unfair labor practices within the meaning of
Section 8 ( 3) of the Act.
5. By refusing to bargain collectively with Federation of Architects, Engi-
neers, Chemists and Technicians, Chapter 31 , affiliated with the Congress of In-
dustrial Organizations , the respondent has engaged in, and is engaging in, unfair
labor practices within the meaning of Section 8 (5) of the Act.
6. By interfering with , restraining , and coercing its employees in the exer-
cise of the rights guaranteed in Section 7 of the Act , the respondent has engaged
in, and is engaging in, unfair labor practices within the meaning of Section 8 (1)
of the Act.
7. The aforesaid unfair labor practices are unfair labor practices affecting
commerce , within the meaning of Section 2 ( 6) and ( 7) of the Act.
i
RECOMMENDATIONS
Upon the basis of the above findings of fact and conclusions of law, the under-
signed recommends that General Motors Corporation , its officers , agents, suc-
cessors, and assigns, shall:
1. Cease and desist from :
(a) Discouraging -membership in Federation of Architects, -Engineers, Chemists
and Technicians , Chapter 31 , affiliated with the Congress of Industrial Organiza-
tions, or any other labor organization of its employees, by discriminating in
regard to the hire and tenure of their employment , or any term or condition of
employment ;
(b) Refusing to bargain collectively with Federation of Architects , Engineers,
Chemists and Technicians , Chapter'31 , affiliated with the Congress of Industrial
Organizations, as the exclusive collective bargaining representative of the re-
spondent 's employees in the appropriate unit;
(c) In any other manner interfering with, restraining , or coercing its em-
ployees in the exercise of the right to self-organization, to form labor organ=
izations , to join, or assist Federation of Architects , Engineers , Chemists and
Technicians , Chapter 31 , affiliated with the Congress of Industrial Organizations,
or any other labor organization , to bargain collectively through representatives
of their own choosing , and to engage in concerted activities for the purpose of
collective bargaining , or other mutual aid or protection , as guaranteed in Section
,7 of the Act. -
2. Take the following affirmative action which the undersigned finds will
effectuate the policies of the Act.
GENERAL MOTORS CORPORATION 1159
(a) Restore to the salaried pay roll , and to the terms and conditions of em-
ployment , including all rights , privileges or benefits in effect on December 31,
1943, all employees in the Product Engineering Department of the respondent's
Linden, New Jersey, plant, within the appropriate bargaining unit;
(b) Make whole all employees in the appropriate unit who were transferred
from the salaried to the hourly pay roll on January 1, 1944, for any losses of pay,
or other losses, if any, (such as insurance , payment for absent time, holidays,
vacations , separation and retirement pay, etc .), which they sustained as a result
of the transfer to the hourly pay roll during the period from January 1, 1944, to
the date the respondent restores them to the salaried status;
(c) Upon request , bargain collectively with Federation of Architects , Engineers,
Chemists and Technicians , Chapter 31 , affiliated with the Congress of Industrial
Organizations , as the exclusive collective bargaining representative of the em-
ployees in the appropriate unit ;
(d) Post immediately in conspicuous places throughout its plant at Linden,
New Jersey , and maintain for a period of at least sixty ( 60) consecutive days
from the date of posting , notices to its employees stating: ( 1) that the respondent
will not-engage in the conduct from which it is recommended that it cease and
desist in paragraph 1 (a), (b) and ( c) of these recommendations ; ( 2) that it
will take the affirmative action set forth in paragraph 2 (a), (b), and ( c) of these
recommendations ; and (3 ) that the respondent 's employees are free to become
or remain members of Federation of Architects , Engineers , Chemists and Tech-
nicians , Chapter 31, affiliated with the Congress of Industrial Organizations, and
that the respondent will not discriminate -against any employee because of his
membership in or activity on behalf of that or any other labor organization ;
(e) Notify the Regional Director for the Second Region in writing within ten
(10) days from the date of the receipt of this Intermediate Report what steps the
respondent has taken to comply therewith.
It is further recommended that unless on or before ten (10 ) days from the
receipt of this Intermediate Report the respondent notifies said Regional Director
in writing that it has complied with the foregoing recommendations , the Na-
tional Labor Relations Board issue an order requiring the respondent to take the
action aforesaid.
As provided in Section 33 of Article II of the Rules and Regulations of the
National Labor Relations Board, Series 3, effective November 26, 1943, any party
or counsel for the Board may within fifteen ( 15) days from the date of the entry
of the order transferring the case to the Board , pursuant to Section 32 of Article
II of the said Rules and Regulations , file with the Board, Rochambeau Building,
Washington , D. C., an original and four copies of a statement in writing setting
forth such exceptions to the Intermediate Report or to any other part of the
record or proceeding ( including rulings upon all motions or objections) as he
relies upon , together with the original and four copies of a brief in support thereof.
Immediately upon the filing of such statement of exceptions and/or brief, the
party or counsel for the Board filing the same shall serve a copy thereof upon
each of the other parties and shall file a copy with the Regional Director. As
further provided in said Section 33, should any party desire permission to argue
orally before the Board request therefor must be made in writing to the Board
within ten ( 10) days from the date of the order transferring the case to the
Board.
CHARLES W. SCHNEIDE$,
Trial Examiner.
Dated July .7, 1944.