Hughes Tool Co.

National Labor Relations Board - Board Decisions

Oct 14, 1940

27 N.L.R.B. 836 (N.L.R.B. 1940)

In the Matter of HUGHES TOOL COMPANY and STEEL WORKERS ORGANIZ-
ING COMMITTEE LODGE # 1742 and EMPLOYEES WELFARE ORGANI-
ZATION OF HUGHES TOOL COMPANY, and H. T. C. CLUB OF HUGHES
TOOL COMPANY, PARTIES TO THE CONTRACT
Case No. C-1494.-Decided October 14, 1940
Jurisdiction : tool manufacturing industry.
Unfair Labor Practices
In General.,
Where bylaws of dominated organization indicated duties of set-up men
were of a supervisory nature, doctrine of respondeat superior applied.
Company-Dominated Unions: continued domination of, after effective date of
Act; failure to renounce the support accorded organizations; maintaining the
existence of, through the grant of exclusive recognition, contractual status,
a check-off system, providing a meeting place and acts expressive of hostility
to "outside" organization.
Dasoiimanation: discharge, charges of, dismissed.
Remedial Orders : disestablishment of company-dominated labor organizations
and contracts with said organizations abrogated ; employer ordered to reim-
burse dues checked-off as of effective date of Act.
Evidence.
The fact that an employer bargained with "inside" organization is im-
material where it has interfered with, dominated, or supported the
organization. ,
Testimony by employees that their participation in dominated organiza-
tion was not secured through interference or coercion is entitled to little
or no weight.
Practice and Procedure
Where respondent claimed no surprise or prejudice to its brief and had
fully litigated the issues determined, ruling denying bill of particulars
affirmed.
Mr. L. N. D. Wells, Jr., for the Board.
Andrewvs, Kelly, Jurth d Cammpbell, by Mr. Robert H. Kelley, Mr.
W. M. Streetman, and Mr. T. M. Mobley, of Houston, Tex., for the
respondent.
Mr. H. A. Rasmussen and Mr. C. W. Dickinson, of Houston, Tex.,
for the S. W. O. C.
Baker, Bott, Andrews & Wharton, by Mr. Tom M. Davis, of Hous-
ton, Tex., for the E. W. 0. and the H. T. C.
Mr. Norman M. Neel, of counsel to the Board.
27 N. L R B, No 145.
836
HUGHES -TOOL COMPANY
DECISION
AND
ORDER
STATEMENT OF THE CASE
837
Upon charges and amended charges duly filed by Steel Workers
,Organizing Committee, Lodge No. 1742, herein called the S. W. O. C.,
the National Labor Relations Board, herein called the Board, by the
Regional Director for the Sixteenth Region ( Fort Worth , Texas),
issued its complaint , dated June 8, 1939, against Hughes Tool Com-
pany, Houston, Texas, 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), (2), and
(3) and Section 2 (6) and ( 7) of the National Labor Relations Act,
49 Stat. 449 , herein called the Act. Copies of the complaint , amended
charge, qnd notice of hearing were duly served upon the respondent,
the S. W. O. C., Employees Welfare Organization of Hughes Tool
Company, herein called the E. W. 0., and upon H. T. C. Club of
Hughes Tool Company, herein called the H. T. C.
The complaint, as amended at the hearing , alleged in substance that
(1) the respondent , on or about December 15,'1933, and at all times
thereafter until the issuance of the complaint , encouraged , fostered,
dominated , and interfered with the formation; enlistment of member-
ship in, and administration of the E. W. O. and contributed financial
and other support to it, and as a part of its plan of interference with the
rights guaranteed in Section 7 of the Act , recognized the E. W. O. as
the exclusive bargaining agency for its white hourly employees and
fostered said plan by entering into contracts with the E . W. O. in,
October 1937 and March 1939; (2) the respondent during the month of
-January 1934, and at all times thereafter , encouraged , fostered, domi-
nated, and interfered with the formation, enlistment of membership
in, and administration of the H. T. C., and contributed financial and
other support thereto, and culminated its plan of interference by
recognizing the H . T. C. as the exclusive bargaining agency for colored
emrloyees , entering into. contracts with that organization in October
1937 and March 1939; (3) the respondent, through ,its officers and
agents.made disparaging remarks about the S. W. O. C. and indicated
the respondent's hostility toward the S. W. O. C. and, its leaders and
members; (4) the respondent transferred H. J. Wilpitz, an employee,
from one department to another and reduced his wages , and on or
about March 1, 1939, discharged him and thereafter refused to rein-
state him, because he joined and assisted the S. W. O. C. and engaged
838 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
in concerted activities with other employees of the respondent for the
purpose of collective bargaining and other mutual aid and protection,
thereby discriminating in regard to hire and tenure of employment of
said Wilpitz, and discouraging membership in the S. W. O. C.; and (5)
by the afore-mentioned and other acts, the respondent interfered with,
restrained, and coerced its employees in the exercise of the rights
guaranteed in Section 7 of the Act. -
On June 12, 1939, the respondent filed with the Regional Director
a request for an extension of time for filing its answer, and on June 14,
1939, the Regional Director granted that request and extended the date
to June 19, 1939, and, upon his own motion, extended the date of the
hearing from June 19, 1939, to July 17, 1939.
On' June 17, 1939, the respondent filed its answer, admitting that
it was engaged in interstate commerce within the meaning of the
Act, but denying` that it had engaged in the unfair labor practices
alleged in the complaint, and requesting a bill of particulars with re-
spect to certain portions of the complaint. The E. W. O. and H. T. C.
also filed answers denying the alleged unfair labor practices and alleg-
ing affirmatively that although they were furnished certain facilities by
the respondent until June 1937, such facilities were equally available to
all other organizations.
Pursuant to notice a hearing was held from July 17 to July 26, and
from September 8 to September 14, 1939,1 at Houston, Texas, before
William P. Webb, the Trial Examiner duly designated by the Board.
The Board, the respondent, the E. W. 0., and the H. T. C., were repre-
sented by counsel and the S. W. O. C. by its representative. All par-
ties participated in the hearing and were afforded full opportunity to
be heard, to examine and cross-examine witnesses, and to introduce
evidence bearing on the issues.
At the beginning of the hearing the respondent moved that it be
granted a bill of particulars with respect to certain paragraphs of the
complaint. Ruling on this motion was reserved and upon renewal of
the motion at the conclusion of the Board's case, the motion was denied.'
Counsel for the Board also moved to amend the complaint to conform
to the proof, limiting the amendment to typographical errors and the
1
I The hearing was adjourned from July 26 to September 8, 1939, because of the illness
of S P Brown, vice- president and general manager of the respondent
2 In its brief, the respondent claimed no surprise or prejudice because of the alleged
indefiniteness of the complaint , nor that it was deprived of an opportunity to present
what evidence it wished at the hearing on the matters shown and issues raised by the proof
adduced against it It is plain from the case which the respondent submitted, that it was
apprised by the complaint of the transactions or occurrences involved upon which the
allegations of untair labor practices were based . It is equally evident that the respondent
made what proof it «ished and otherwise fully litigated the issues herein determined The
ruling of the Trial Examiner is hereby affirmed See The M H Ritzwoller Company v.
N. L R B, 114 F (2d) 432 (C. C A. 7), enf'g as modified M atter of M H. Ritzwoller Cone-
pany and Cooper°s International Union of North America, Local No 28, 15 N L R B. 15.
HUGHES TOOL COMPANY 839
misspelling of names and not extending it.to any material allegations.
This motion was granted by the Trial Examiner.
During the course of the hearing , the Trial Examiner made rulings
on other motions and on objections to the admission of evidence. The
Boy, rd has reviewed the rulings of the Trial Examiner and finds that
no projudicial errors were committed . The rulings are hereby affirmed.
On February 12, 1940, ,the Trial Examiner issued his Intermediate
Report, copies of which were duly served on each of the parties to the
hearing. He found that the respondent had engaged in and was en-
gaging in unfair,labor practices affecting commerce , within the mean-
ing of Section 8 (1) and (2) of Section 2 (6) and (7) of the Act.
He recommended that the respondent cease and desist from such unfair
labor practices and take certain affirmative action in order to effectuate
the policies of the Act. He recommended dismissal of the 8 (3)
charges.
Thereafter , the respondent , the E. W. 0., and the H. T. C. duly filed
exceptions to the Intermediate Report. Pursuant to notice to all
parties, a hearing for the purpose of oral , argument was duly held on
April 25, 1940, before the Board, at Washington, D. C., in which the,
respondent participated . Briefs were duly filed with the Board by
the respondent , the E . W. 0., and the H. T. C.
Subsequently the parties entered into a stipulation concerning Re-
sponclent 's Exhibit No. 18 and E . W. O. and H. T. C. Exhibit No. 43
which the Board hereby adopts , and incorporates into the record.
The Board has considered the exceptions and the briefs, and save
as the exceptions are consistent with the findings, conclusions , and order
here;n , finds them to be without merit.
Upon the entire record in the case, the Board makes the, following :
FINDINGS OF FACT
1. THE BUSINESS OF THE RESPONDENT
The respondent is a Delaware corporation licensed to do business
in the State of Texas, having its principal office and place of business
in Houston , Texas. The respondent is engaged in the manufacture,
sale, and distribution of oil well drilling tools at its Houston plant
and it maintains warehouse or service plants in Los Angeles, Cali-
fornia; Oklahoma City, Oklahoma ; and Midland , Texas. It has an
export office in New York City. Steel is the principal raw material
used by the respondent and in, the calendar year 1938 it purchased
from places outside the State of Texas between one=half million and
one million dollars worth of this material . The value of the drilling
tools produced by the respondent in the calendar year 1938 was ap-
proximately $10,000,000, of which more than half were shipped by
840 DECISIONS OF NATIONAL LABOR ' RELATIONS BOARD
rail or truck to points outside the State of Texas, and of this amount
products approximating one million dollars in value, were shipped
in foreign commerce. In 1934 there were approximately 2000 hourly
paid employees in the Houston plant. Between that year'and 1939
there occurred a gradual increase in the number of hourly workers
until, at the latter date, there were approximately 3000 thus employed,
of whom nearly 700 were colored employees.
II. THE ORGANIZATIONS INVOLVED
Steel Workers Organizing Committee, Lodge No. 1742, is a labor
organization affiliated with the Congress of Industrial Organizations,
admitting to membership all hourly paid production and maintenance
employees of the respondent at its Houston plant.
Employees Welfare Organization of Hughes Tool Company is a
labor organization affiliated with the American Association of Inde-
pendent Labor Unions, admitting to membership employees of the
respondent at its Houston plant, both white and colored, excluding
executives, heads of departments, and the board of directors. Fore-
men, assistant foremen, and set-up men may be honorary members
and may vote for officers but may not participate in the conduct of
the business affairs. Colored employees may belong for the purposes
of collective bargaining but must hold separate meetings. -
The H. T. C. Club of Hughes Tool Company is an unaffiliated
labor organization admitting to membership all colored employees
of the respondent at its Houston plant.
III. THE UNFAIR LABOR PRACTICES
A. The E. W. 0.
In 1918 a mutual Welfare Organization was organized among the
respondent's employees after the conclusion of a strike.3 There is no
evidence of the existence of any labor organization at the respondent's
plant between that date and the summer of 1933 when International
Association of Machinists, Blue Eagle Lodge'1303, affiliated with the
American Federation of Labor, herein called the A. F. of L., actively
began to organize among the respondent's employees. In October
or November,, 1933, the A. F. of L. petitioned the National Labor
Board under the National Industrial Recovery Act, herein called the
N. R. A. Board, to be certified as the bargaining agency for the
respondent's employees and an election was, arranged for December
1, 1933.
'
The record does not disclose any details concerning the nature or duration , of this
organization.
HUGHES TOOL COMPANY 841
On November 2, 1933, R. C. Kuldell, president of the respondent,
issued the following notice to the employees : "Any employee threat-
ening or intimidating any other employee either to join or refrain
from joining any union will be discharged.",
Within two weeks before the scheduled December 1 election, a
movement was initiated among the employees for the formation of
an inside organization. The respondent participated in this under-
taking from its inception. On November 14 E. M. Ramsey, a tool
maker, wrote Kuldell outlining, and inviting the respondent's criti-
cism of, a plan to form an inside organization to be known as "Hughes
Welfare Organization." In the course of the letter Ramsey stated
-that an inside union would be much more satisfactory and helpful
than "the one most of the employees seem to want to get into" and
mentioned '"the greatest confidence" which the employees had in
Kuldell, stating that he mentioned it solely "to demonstrate the fact
that anything you suggest or that they know you approve of will
be a success with the majority of.the personnel in the shop." Kuldell
did not reply to this letter. Shortly thereafter, Ramsey talked to-
Kuldell in the latter's office concerning the proposed -plan. Kuldell
told Ramsey that he had received the communication and wanted to
talk to him about it. Kuldell also told Ramsey that "the Company
and I personally had no objection whatsoever to his proceeding along
the lines suggested by him in his letter."
Within a few days after Kuldell had discussed with Ramsey the
plan for an inside organization, the respondent furnished assistance
and support in the formation of the organization and iii the enlist-
ment of employee membership. The respondent permitted Ramsey to
use a company conference room for organization purposes and during
the ensuing weeks permitted Ramsey and a committee of seven other
employees to meet at the plant for the purpose of drafting a consti-
tution and bylaws. Permission for the men to be off work was
obtained from J. H. Rohlf, personnel director of the respondent, and
Ramsey admits that over a period of about two weeks he lost "a
great deal of time" from work.4
On November 21, 1933, Ramsey posted on the plant bulletin boards
a notice, "To All Hourly, Employees," signed by Ramsey and printed
by the respondent on the respondent's stationery, which announced
the tentative bylaws and constitution of the E. W. O. The notice
read in part as follows :
This organization is NOT sponsored by the Hughes Tool Com-
pany, nor any officer of the Company. But I have the assur-
s There is no showing whether or not Ramsey and the committeemen were paid for the
time lost during this peiiod. -
842 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ante of the Company, that it will cooperate with an organization
of this kind in every way humanly possible. As long as all
members and officers elected be strictly Hughes Tool Company
hourly men.
Although Kuldell and Ramsey denied that the respondent had given
the assurance described in the notice, the respondent authorized the
posting of the notice, and did not disassociate' itself from the claim
made therein by the E. W. O.
On November 22 Ramsey posted on the plant bulletin boards the
following notice typed by Helen Bell, personnel stenographer, on
company stationery :
HUGHES TOOL COMPANY
NOTICE To ALL HOURLY EMPLOYEES
Each shift will retire immediately to the dining room after the
whistle blows, Friday November 24, for the discussion and
explanation of the Employees Welfare Association.
Each of the 4 shifts was dismissed from work early on November
24 and meetings were held in the company dining hall, for an hour
or more following such dismissal. Jim Delmar, the respondent's
director of athletics, who was Widely acquainted in the plant because
of his position, introduced Ramsey to each shift group. Ramsey
explained the projected organization, and described the advantages
to be derived from the formation of an independent organization.
Either Ramsey or Delmar told the men at the meetings of the benefits
received by the, employees front the respondent in the form of in-
surance, gasoline at reduced prices, paid vacations,, and an athletic
field. P. F. Kennedy, a machinist, testified that H. G. Hogan, gen-
eral foreman of the plant, told him that the 'men would be expected
to attend the meetings when the whistle blew. C. H. Prescott, a
foreman, testified that he was instructed by Hogan, "to have (his)
men knock off fifteen minutes before quitting time and go to the
dining room to attend a meeting." Although Hogan denies knowl-
edge that the meetings were to be held, it is clear that the shifts were
dismissed early for this purpose and it is reasonable that Hogan, as
general foreman of the plant, should have been instrumental in
bringing about their dismissals. We credit the testimony of Kennedy
and Prescott.
Following the meeting of November 24, Ramsey had the name of
the E. W. O. placed on the election ballot to be used the following
5 The name , originally contemplated as "Employees Welfare Association ," was later
changed to "Employees Welfare Organization."
HUGHES TOOL COMPANY 843
week, although the E. W. O. was not yet forinally organized. The
representative-of the N. R. A. Board consented to each of the inter-
ested parties making a written statement before the election. Ac-
cordingly, Kuldell published and distributed throughout the plant
-immediately prior to the election two statements which were in-
tended to and did convey plainly to the employees that the respondent
desired then to select the inside organization. In one, entitled "To
the Employees of the Hughes Tool Company," the respondent in-
formed the employees that Howard Hughes, Sr., its founder, had
established the "American Plan or open shop type of management";
that the mutual welfare association in 1918 had elected representatives
to meet with Hughes to "iron out with him, those uncertainties which
remained after the strike" ; that Kuldell could only follow his ex-
ample and continue the principles of management which Hughes
had initiated; that it would cost $58,000 yearly to support the outside
union, whereas a cooperative group within the plant could exist for
one tenth that sum; and that
Whether justified or not, the fact is none the less real that
there exists in the minds and hearts of your foremen, super-
intendent, manager and general manager, an antipathy to the
professional organizer and representative. No law and no vote
on your part can remove human emotions, or change them.
These emotions are deep seated and are the result of fifteen years
of growth. For you now to select to represent you, in all those
personal matters, which will come up for discussion, persons
who are, by their official position out of favor with your own
foremen, and all the management officials, but not only that,
they have added personal insult in their only official publicatioii,
the Labor Messenger, thereby completely barring them from any
consideration of gentlemanly courtesy to which they might have
otherwise been entitled, as individuals . .
The representatives of the outside union understand that the
attitude they have taken of antagonism and public insult leaves
them open only the avenue of legal procedure, and they shall
be accorded every right to which the law entitles them but they
would not,.I am sure, expect any courtesy beyond that point.
In the second statement, entitled "A Farm Parable," Kuldell made
another pointed plea for direct dealing between the management and
its employees rather than through outside intermediaries.
The election was held as scheduled on December 1, 1933. Out of a
total of 1657 votes the E. W. O. received 1026 and the A. F. of L. 602.
Organization of the E. W. O. was completed on Sunday, December
'844 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
10, when the first meeting e was held in a room on company property
attended by approximately 700 employees. Application blanks were
passed out and signed,' the 'constitution and bylaws presented by
Ramsey and the other committeemen were adopted as rafted, and
officers were elected.8 The applications signed included an authoriza=
tion by each applicant for the deduction of dues and deductions for-
payments on loans made by the E. W. 0., from his pay check. The
E. W. O. requested that the respondent begin deducting the dues of
its members, advising that it had check-off authorizations and submit-
ting a list of those so authorizing, and the deduction of dues of E. W. O.
members by the respondent was begun as of December 15, 1933.°
The N. R. A. Board subsequently invalidated the election held on
December 1, 1933, and conducted another election in April 1934. Of
a total of 1614 persons eligible and 1303 voting, 788 voted for the A. F.
of L., and 515 for the E. W. O. Thereafter, the respondent refused to
.recognize either the A. F. of L. or the E. W. O. as the sole agency for
collective bargaining or to enter into written agreements with either
of them. Both organizations continued to function in the plant and'
to represent their own members.
The respondent printed without expense to the E. W. O. its mem-
bership application and check-off authorization forms and also, in
booklet form, the constitution and bylaws of the E. W. O. The re-
spondent also donated to the E. W. O. office space (a desk in the front,
part of the respondent's personnel office), a meeting place in the ship-
ping department, printing, materials, and supplies, The E. W. O. paid
$1.00 to a janitor for his services in cleaning the hall after each meet-
ing. Ramsey testified and we find that since 1933 it has been the
respondent's practice to pay its men for time spent in committee
meetings.
The constitution and bylaws of the E. W. 0., revised as of January
15, 1934, contain the following "guarantees" by the respondent : officers
and committeemen off work "in the interest of the Organization" would
° The minutes of this meeting disclosed that a vote of thanks was given the respondent
for a party held the night before, but there are no further details
7 The record does not disclose how many employees signed applications on this occasion.
8 A G Banks , against whom Ramsey was a candidate , was elected president of the
organization. Ramsey became a member of the advisory council which , for the first year,
was composed of the members of the original organizing committee who were not elected,
to office -
° Besides deducting dues of E W. 0 members , the respondent later made deductions for
loan repayments , for medical fees, and hospitalization for E. W. 0 members , deductions
for H T . C. dues and uniforms ; deductions of fees for badges , tool checks etc., for all
employees, and safety shoes for those who desired them , deductions from the pay checks of
members of the Hughes Tool Company Employees Federal Credit Union covering payments
on stocks , fees, loans, etc ; deductions from pay checks of members of the Hughes Tool Com-
pany Employees Voluntary Burial Association , and S W. O. C . hospitalization insurance
begun in March 1939.
HUGHES TOOL COMPANY 845
be paid by the management; the cost of the recreation department
would be borne by the management ; the cost of the Group, Insurance
Policy "given,to all members of this Organization," should be borne
by the respondent, the policy to be issued through the organization;
the respondent would furnish office space, equipment, printing of all
paper, auditorium and equipment for meetings, lighting, heating, alid
janitor service. The instrument, also provided that "This plan may
be amended or terminated by mutual consent of Employees and
Management."
Supervisory employees are eligible for and have accepted member-
ship in the E. W. 0.10 Prior to 1936 the only restriction upon their
eligibility to hold office was a provision in the constitution and bylaws
prohibiting service on grievance committees.11
On January 18, 1934, A. J. Keith, vice president of the E. W. 0.,
wrote Kuldell as follows :
We still have a few in the shop that are causing trouble, but we
think that if we get the cooperation of the-Company that we
desire, and believe that we will, we can have everybody working
in harmony, with a desire to help the Company.get out the produc-
tion whereby they can make a profit, and make it so that the
Company could do by their men as they have done in the past.,
Believing that these purposes could be more easily accomplished
if you would make us a talk at your earliest convenience, we are
writing this letter to you, asking you to make such a talk on any
subject of your own choosing.
On January 23-five days later-Kuldell posted a memorandum in
which he stated-in part :
... and if certain individuals cannot adjust themselves to the
new order of things, and whole heartedly support the rules of the
majority, there is no alternative left but to ask those persons to
find some other place of employment more suitable to their per-
sonal needs . .
Please understand you are perfectly free to join any organiza-
tion you may choose; you are not required to join any organization
if you do not so choose, but actual interference with the affairs of
10 The following supervisory employees testified at the hearing that they were members
of the E . W. 0 : Hy Hogan, general foreman ; R. L Handy, instructor in the welding
department , W. C. Fleming, foundry foreman ; E. C. Parker, assistant foreman of Shop 4 ;
C. A Vaught, maintenance foreman ; S H. Sloan, foreman of Department 600; W. E.
Jones, foreman of Department 200; C. H. Cox, set-up men in Department 200; R. G.
Naul , safety department ; C. A. Stearns, production checker.
"By a revision effective January 4, 1936, it- was provided that monthly paid employees
and those holding positions of a supervisory nature should be honorary members only and
should enjoy all benefits , but should not have any voice or vote in routine business, and
might be excluded from meetings at the discretion of the president of the organization
846 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
other employees, is ample ground for dismissal. When such re-
quest for dismissal comes from fellow employees, it relieves the
management of any responsibility for continuing such undesirable
persons in the employ of the company.
On February 6, 1934, A. G. Banks, president of the E. W. 0. sent
copies of its constitution and bylaws to Kuldell and requested that
Kuldell and M. E. Boehm, plant superintendent, sign them. On Feb-
ruary 9, 1934, Kuldell replied, stating inter alia:
.. . in my opinion you have done a very fine piece of work for
the length of time you have been working in this organization. I
see no criticism I can offer at the present time, and assure you
the management and no officer of the Hughes Tool Company is
in a position to approve or disprove your constitution and by-laws,
but all of us stand ready to assist you in anyway we can but the
organization must remain entirely independent of control or
approval of the management.
Upon written request by you at any time we shall be glad to
answer any question you may-put to us, but your constitution and
by-laws must be approved by your own organization. It is not
the purpose of the management to interfere in any way with the
operation of the organization, but we stand ready,to give such
advice or assistance as may be asked for.
On January 25, 1935, E. M. Ramsey, then vice president of the
E. W. 0., wrote Kuldell as follows :
Inclosed you will find a month by month financial statement for
the year 1934, so that you might see what the Organization, of
which you and the Management are directly responsible for the
existence of, has been doing and is doing for the welfare of the
employees of Hughes Tool Company.
We hope we will be able to continue doing as much, and even
more for the employees in the coming year as we have in the past.
Trusting that we might have the continued cooperation of the
Management, we remain . . .1'
On November 29, 1935, Ramsey wrote Kuldell requesting advice
concerning the applicability to the E. W. O. of a law requiring the
licensing of organizations doing an insurance business. Ramsey
stated, inter alia:
As you know, without the benefits carried for its members, other
'than that of arbitration between the Management and employees,
this Organization 'cannot remain in existence.
12 Kuldell denied that he or the management were directly responsible for the existence
of the E W. 0 Ramsey testified that this letter resulted from his desire to do everything
he could to show the management his appreciation for its attitude toward the organization.
HUGHES TOOL COMPANY 847
Trusting this will be given your serious consideration and look-
ing toward you for material assistance for the sake of our Organi
nation, as well as your opinion in regard to what action you think
would be advisable to forestall the dissolving of this Organization
and the possibility of complying with this law, so that we may
continue to operate, we remain . . .
Kuldell referred this letter to C. S. Johnson, the respondent's treasurer.
On November 30, 1935, James Kilday, member of the law firm retained
by the respondent, wrote Kuldel] :
This has reference to the letter written by the Employees' Wel-
fare Organization in regard to a recent opinion by the District
Judge, W. F. Robertson.
Not long ago, I consulted the Actuary in the Insurance 'Depart-'
about the probable necessity for the Employees' Welfare
Organization's complying with the statute . . . I reached the
conclusion that it was well to leave the matter as it was then, and
is now, until advised-to the contrary by General McCraw.
Following receipt of this letter Kuldell made a notation on it to
Johnson and Ramsey :
We suggest you take no action whatever unless and until the
state makes the first move. It probably will never disturb you.
R. C. K.
Thus the respondent afforded the E. W. O. the benefit of legal
advice from attorneys employed by the respondent.
On redirect examination by counsel for the Board, Kuldell, ad-
mitted that prior to 1938 the E. W. O. had "gone into the hole" on
several picnics, two or three, and that the respondent had made up
the difference between the cost and amount received from the sale
of tickets. He admitted that the E. W. O. committee had requested
in 1936 that the respondent make up a $262 deficit and the respondent,
complied. On recross examination, when counsel suggested that it
was a plant-wide picnic, Kuldell said that inasmuch as the committee
was composed of active E. W. O. members, the actual result was that
few except members attended. Thus the respondent contributed finan-
cial support to these E. W. O. enterprises.
In 1936 Word Clark, an hourly worker in the forge shop and a
grievance committee man for the E. W. 0., complained to Kuldell
about certain treatment he had received, and asked for a general raise.
Clark testified that the following morning J. W. Stewart, general
foreman of the forge shop, told him, "I don't approve of some of the
grievances you have taken over there"; that about a week later Stewart
approached him and inquired what Clark was trying to do, "trying
848 DECISIONS OF NATIONAL LABOR RELATIONS BOARD '
to organize the boys against me?"; that he replied, "Well, the Welfare,
that is no union, nothing but a fake"; and that Stewart said, "Well,
that's all we're going to have here." Stewart denied making these
statements. In view of the fact that the statements are consistent
with the respondent's hositlity toward outside labor organizations
as otherwise expressed during this period, and with the respondent's
other support of the E. W: 0., we credit the testimony of Clark and
we find, in accord with the finding of the Trial Examiner, that the
conversations occurred substantially as recounted by Clark. Clark
testified further without contradiction, and we find, that in 1937 after
he had withdrawn from the E. W. O. and joined the A. ' F. of L., he
was unable to get promotion in the forge shop and that Stewart
told him, "You brought all this on yourself through organizing ac-
tivity." Thereafter, Clark transferred to the foundry, where, accord-
ing to his testimony, the following subsequently occurred :
I .asked him [W. L. Fleming, foundry foreman] for a week's
vacation, and he . . . said : "What do you want a week's vacation
now for?" I told him I wanted to tlo a little organizing work.
He said : "What do you want to organize for?" "Well," I said,
"I need to do some organizing; the boys here want a union." He
said, "Well they don't need no union here. We have the Welfare.
That is got good benefits. That is all we are going to have or
recognize." I told him the Welfare was illegal, it would be a
violation. He said he did not think so, that they would take
care of that.
Fleming testified that this testimony was "false"; that Clark asked
for a vacation in order to organize, and that Fleming replied that
Clark could take a vacation for this purpose if he had one "coming."
In addition to the consistency of the statement attributed to Fleming
with the respondent's favorable attitude toward the E. W. O. and its
contrasting attitude toward outside unions, Fleming had been a mem-
ber of the E. W. "O. since its inception. In accord with the finding of
the Trial Examiner, we credit the testimony of Clark and find that
Fleming in substance, made the statements hereinabove set forth.
Late in January 1937 the E. W. 0., while doing its ordinary bank-
ing business at the South Texas Commercial National Bank, applied
to the First National Bank in Houston, one of the banks with which
the respondent did business, for a one-thousand dollar loan. John
T. Scott, chairman of the board of directors of the bank and a friend
of Kuldell, asked Kuldell concerning the desirability of making the
loan. Kuldell told Scott that the E. W. O. was "all right," that the
bank would be safe in making a thousand dollar loan, and that he,
Kuldell, would personally see that the E. W. O. paid it. On January
HUGHES TOOL COMPANY - 849
27 the First National Bank granted the loan, and an unsecured de-
mand note was executed by the E. W. O. Shortly thereafter the
E. W. O. sought to have the loan increased to $3,000. Upon Kuldell's
recommendation that an increase of $1,000 would be sufficient, the
bank increased the loan by this amount. In 1938 and in 1939 the bank
dealt with the E. W. O. on its previous record of payment and no
question was asked of anyone about it.
Irvin Tuck, a machine operator testified that a month or two after
he began working for the respondent in February 1937, C. F. Stein-
man, his set-up man,13 asked him while he was working at his machine;
if he would be interested in joining the E. W. O. explaining that
it was an organization for sick benefits and the like. Later Steinman
told Tuck that outsiders did not have anything to do with it and that
he would 'like to see Tuck in it. Steinman admitted that he had
solicited Tuck's membership.
About May 1, 1937, there was distributed in the respondent' s time-
keeper's office a publication of the American Iron and Steel Institute
entitled "The Men Who Make Steel," advocating collective "coopera-
tion" instead of collective bargaining. It was necessary for the em-
ployees to pass through this office in order to enter the shop. The
timekeeper on the third shift told Kennedy, an employee, to take only
one copy as there was a limited number for distribution at that time.
The respondent neither denied, nor explained the distribution of this
publication. In view of this, on these facts we find that the respond-
ent was responsible for its distribution.
On May 16, 1937, the S. W. O. C. received its charter. The record
does not disclose whether it had begun its organizational campaign
prior to this time.
In May 1937 Kuldell conferred with the officers of the E. W. O. in
regard to changes in the relationship between the respondent and the
E. W. O. made necessary by the decisions of the Supreme Court of
the United States sustaining the constitutionality of the Act 14 There-
after, the respondent conferred with its attorneys in respect to this
matter, and then began to charge the E. W. O. rent for office space
and cost prices for printing and stationery and other supplies. It
continued, however, to donate the use of a hall for E. W. O. meeting
purposes and a room for E. W. O. committee meetings.
11 Tuck testified that the position of set -up man roughly corresponds to that of strawboss.
The foreman gave orders to the set-up men, and they in turn would tell the men what
to do with their machines The constitution and bylaws of the E. W. O. revised as of
January 15 , 1934, Article IV, Section 2, reads as follows : "No member whose work in the
plant is of a supervisory nature, such as set-up men and Class D Foremen, shall be eligible
to serve on any grievance committee." We are of the opinion that under the doctrine of
respondeat superior the respondent must assume responsibility for the action of set-up
men. See Matter of Virginia Electric Power Company and Transport Workers of America,
20 N. L. R B, 911, and cases therein cited
14 N. L. R. B. v. Jones & Laughlin Steel Corp , 301 U. S. 1, and related decisions.
323428-42-vol. 27-55
850 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
On. July 7, 1937, in reply to a request of the E. W. O. for exclusive
bargaining rights, Kuldell wrote Ramsey that exclusive recognition
could not be thus accorded, but could only be granted to a composite
group consisting of the E. W. 0., H. T. C. and A. F. of L.15 Although
prior to this time Kuldell had conferred with a committee of
S. W. O. C. members the S. W. O. C. was excluded by Kuldell from
the proposed arrangement.
On July 23 the respondent abandoned its position of July 7, and
wrote the H. T. C. and E. W. O. according them exclusive bargain-
ing rights for colored and white employees respectively.- In a memo-
randum to shop employees on August 2, Kuldell announced the ex-
clusive recognition of the E. W. O. and H. T. C. and stated further
that other groups could still discuss problems affecting their own
membership or their organization, and : -
We believe the experience of the past three years indicates
that this plan will work to the satisfaction of the greater majority
of the employees and the Company. On its success in the future
will depend its continuity. The management, asks your continued
cooperation and assures you of its best efforts in your behalf.
Kuldell explained that he meant that this was a radical departure
from previous company policy and that the continuance of the recog-
nition would depend upon the receipt, of cooperation similar to that
received during the past 3 years.i7
After negotiations which continued for over a month an agreement
between the respondent on the one hand and the E. W. O. and
H. T. C. on the other was concluded and published by the respondent
in pamphlet form on October 1, 1937. In its final form it incor-
porated the respondent's past policies throughout the preceding 3
years except for provisions regarding seniority, arbitration, and
production rate.18
11 Kuldell testified that prior to his letter of July 7, the E. W O. had requested exclusive
bargaining rights and that thereafter the E. W. O. continued its insistence that it be so
recognized.
16 The respondent relied upon representations of these two organizations as to the
number of authorizations for check-off, for proof of majority.
14 Kuldell stated that he withheld exclusive recognition from any organization as long as
possible in order to avoid partiality through advantages over other organizations accruing
to any organization so recognized He explained that the respondent departed from the
policy within a month after his letter of July 7, 1937, to the E. W. O. because " I was forced
to it by the circumstances and the law ." We are not persuaded by that explanation because
first, the Act had been in effect since July 5, 1935, and had been held valid by the Supreme
Court on April 12,• 1937, and secondly , Kuldell's notice of August 2 made continued exclu-
sive recognition contingent upon its "success" despite the requirements of the Act. We
are satisfied and find upon all the facts, including the respondent 's subsequent acts herein-
after discussed , that the respondent granted the E W. O. and, H. T. C. exclusive recogni-
tion at this juncture in order to counteract the S. W . O. C. campaign.
?e Seniority , previously on a departmental basis, was made plant -wide. -
HUGHES TOOL COMPANY 851
In December 1938 it was found that wage rate negotiations for
quarterly adjustment of wages provided for in the October 1, 1937,
agreement were impracticable and it was decided to enter into a
year's contract. After nearly 3 months of negotiations during which
time the employees were reclassified and minimum and maximum
wage rate limits set, the respondent entered into a contract with
the E. W. O. and H. T. C. on March 1, 1939, for the duration of 1
year. These two organizations were recognized as the exclusive
bargaining agencies and there was express recognition of the open
shop.
B. The H. T. C.
The H. T. C. was first organized as a charitable organization at,
the respondent's plant in 1926.
In a letter dated January 15, 1934, to C. S. Johnson, treasurer
of respondent, Kuldell - suggested that since the E. W. O. repre-
sented "practically all of the white hourly men," that organization
could handle the insurance (previously handled by the company)
directly with the insurance company.19 He remarked further:'
In order to make available to all employees, the same bene-
fits formerly obtained I suggest that you get in touch with Mr.
Rohlf, and suggest to our colored employees that they too or-
ganize a welfare organization, patterned somewhat along the
white men's association, and that when such association has been
formed, that duly elected officers take office, and the insurance
policies now in force on colored employees may be handled the
same way . . .
The conversion of the H. T. C. from a welfare to a labor organiza-
tion occurred in March 1934, after Kuldell had suggested its forma-
tion in his letter to Johnson. Richard Guess, its several-times
president, met with 9 or 11 other colored employees at the home of
Philip Page. As a result of that meeting, Guess was selected as a
temporary chairman, and the committee, using E., W. O. bylaws
as a pattern, drew up a constitution and bylaws which Guess pre-
sented to Kuldell in person for approval. At the hearing, Guess
quoted Kuldell as having said at that time :
That sounds pretty good. I don't see how you can do that,
but I wouldn't sign anything. I can't sign anything as execu-
tive of the Hughes Tool Company. If I can help you,_I will
help- you carry out your plan, but -I - wouldn't sign anything.
29 This plan was never effectuated
852 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Thereafter Guess presented the constitution and bylaws to some
200 colored employees at a meeting in the company dining hall on
a Sunday in the first week of April 1934. Permission to use the
dining hall was obtained by Guess from the respondent, and also
permission to post notices of that meeting on the respondent's
bulletin boards. Some 190 applications, printed by the respondent
without expense to the H. T. C., were signed at that meeting.
The constitution and bylaws of the H. T. C. were later printed
by the respondent without charge to the H. T. C. Article IV read
as follows :
Section 1. The company will agree to furnish a place for
meeting twice per month, and the printing of all stationery
at lowest possible cost.
Section 2. Any member of the H. T. C. Club who makes a
• claim against this club, which claim is proven to be false, will
be reported to the management of the Hughes Tool Company
for such disciplinary action as they (the Management) may
ImpoSe.20
Kuldell testified that he had approved Section 1 above quoted prior
to the time when the respondent printed the pamphlet for the
H. T. C.
The H. T. C. held two meetings a month in the respondent's ship-
ping department during 1934 and, after it became well organized,
only one regular meeting a month and extra ones when necessary.
The regular meeting day was Sunday. For the use of the hall the
H. T. C. paid a small janitor fee on those occasions when it served
beer. During the early years of its reorganization, the H. T. C.
did not maintain an office on the respondent's premises. The re-
spondent first furnished the H. T. C. office space in January 1937,
but did not charge rent for it until June 1937 at which time it began
to charge the H. T. C. $6.00 a month.
The H. T. C. asked the respondent, and the respondent began,
to deduct H. T. C. members' dues from their wages in May 1934.
Richard Guess, president of the H. T. C., testified as follows con-
cerning the inception of this check-off : ,
Q. Before this meeting of April 4, 1934, had you contacted
the company or arranged to deduct the dues from the men's
pay checks if they authorized the company to deduct the dues?
0 Section 2 of Article IV of the H . T. C. constitution and bylaws was revised on June 5,
1937 to read as follows : "Any article or section of these bylaws in the future that may
conflict with the laws of the United,States of America will be null and void "
HUGHES TOOL COMPANY 853
A. Well when I sent the by-laws to Mr. Kuldell he said he
couldn't sign it, but he said he would help us with it and he
gave me the knowledge to know that he would. In fact, I
knew he had for the E. W. O.
Q., When you were in Mr. Kul dell's office didn't you just
speak to him about whether or not he would allow dues to be
deducted?
A. No, sir. ' That is encouched in the by-laws.21
Q. I- see.
A. And he approved that, and I took it for granted it was
all right.
Q. So you went and had these authorizations for pay roll deduc-
tions printed. Were those printed by the respondent company?
A. Yes, sir.
Q. Without expense to the H. T. C.?
A. Yes, sir.,
C. The respondent's attitude toward outside organizations
The respondent contends that its attitude in the conduct of its rela-
tionship to competing organizations has been one of strict impartiality,
and that not only has it made available to all organizations every
facility furnished to any one organization, but it has openly declared
its position to be that of a neutral observer. In support of this con-
tention it points to a sequence of events which it asserts evidences its
true attitude.
Kuldell testified that he made it a point to see that the A. F. of L.
was offered the same facilities that the E. W. O. was afforded. Under
the circumstances, we are not satisfied with the effect of such an offer.
It must be remembered that from the beginning Kuldell manifested
a marked "antipathy to the professional organizer and representative"
which shows his attitude to have been the very antithesis of that now
claimed and, as has been seen, the respondent continued to make state-
ments which were plainly expressive of its hostility to any form of
outside organization. We are convinced that no general offer of "equal
facilities," in the absence of an express retraction of the extreme mani-
festations of hostility, could effect a position' of neutrality on the part
of the respondent.
On July 24, 1934, Kuldell wrote Ramsey telling him that the respond-
ent could not participate in payment of E. W. O. picnic expenses
because any money which could be used for any such purposes must
be distributed fairly among all employees regardless of group affili-
21 Section 5 of Article 5 of the bylaws reads : "Each member will pay, $ 1.00 as a joining fee,
and 75¢ per month as dues , which will be deducted from the third pay check of each month
by the company."
1854 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ation.22 -On September 28, 1934,'Kuldell wrote the E. W. O., telling
of an arrangement to deal with the A. F. of L. which would not affect
the work of the E. W. O. except that each employee would have the
choice of dealing through either organization. On January 28, 1935,
Johnson wrote an auditing firm which wished to audit E. W. O. ac-
counts, saying that the respondent was "determined to maintain a
hands-off policy." On March 7, 1935, Kuldell wrote Johnson concern-
ing the publication of a "house organ," stating:
The object of this paper must be strictly informative, and must
not be used by any group, either the management or any group of
the employees, to further its own means, especially at the expense
of any other group. The management has long hesitated (to
allow such a publication) for fear that the employees might think
(it) was being used to influence them in their plans and in their
thinking . . . The paper must also not be used by either group
for collective bargaining, in any way to advance arguments for
or against the other group.
On May 28, 1935, Kuldell posted a memorandum to employees noti-
fying them of the unconstitutionality of the N. I. R. A., stating that
this would make little difference in the relationship between em-
ployees and management since "human relationship should be above
'the law," and further, "we shall continue not to discriminate against
any man, because of any organization to which he may be affiliated."
On April 16, 1937, the respondent published to the employees a
notice which paraphrased the provisions of Section 8, claimed that
the respondent "'has observed these rules since first signing the
N. R. A. Code," and "called" the attention of supervisory employees
to them for "strict and impartial observance." On November 2, 1937,
Kuldell wrote Ramsey in reply to a request for permission to organize
a chapter of the American Legion, stating, "The organization of em-
ployees of any type is strictly a matter of their own concern. The
management may not oppose such organization, nor is it necessary
to secure its permission. So far as we are concerned, you are of
course welcome to do so." ^
Of the expressions of apparent neutrality above set forth, only
the announcement of May 28, 1935 and the notice of April 16, 1937
were posted for the attention of all the employees. In the first notice
the respondent disavowed any intention to discriminate because of
the affiliations of its employees. It did not announce or assure labor
organizations at the respondent's plant of freedom from the respond-
22 Kuldell admitted, however, that prior to 1938 the B. W. O. had "gone into the hole"
on two or three picnics and the respondent had contributed the difference between the cost
and the amount received from the sale of tickets.
HUGHES TOOL COMPANY 855
ent's domination and favoritism. The notice of April 16, 1937, did
not disclaim the respondent's unfair labor practices. On the con-
trary it claimed not to have engaged in unfair labor practices al-
though it had fostered intramural and opposed outside-organizations.
The remaining expressions were either not published at all and there-
fore completely incapable of expurgating the relationship existing
between the respondent and these organizations of the domination
and interference indulged in by the respondent at the outset, or
were addressed to the E. W. O. or to Ramsey personally, and so were
received where they could not constitute a definite and universal
declaration of policy. The respondent at no time posted notices to
its employees disestablishing the E. W. O. and the H. T. C. While
these expressions of the respondent as a whole purported, in general
terms, to assure a freedom from interference and discrimination, they
"neither renounced the Company's unfair labor practices nor prom-
ised their abandonment," and accordingly "fell far short of conveying
`to the employees the knowledge of a guarantee of an unhampered
right in the future to determine their labor affiliations'." 23
Moreover, at subsequent dates the respondent further manifested a
hostile attitude toward outside labor organizations which necessarily
had the effect of negativing any but the most unequivocable represen-
tations of impartiality.
The respondent, through its officers and supervisors, actively sought
to discourage the employees from affiliating with the S. W. O. C.
Irvin Tuck, a machine operator, who joined the S. W. O. C., testified
that while he was working, C. F. Steinman, his set-up man, upon
seeing his S. W. O. C. button, inquired if he had read the pamphlet
"Join the C. I. O. and Help Build a Soviet America" 24 and after
receiving an affirmative reply said, "You ought to be careful about
what you get into out here." Steinman testified that the other man
on Tuck's machine had told him Tuck was "talking C. I. 0." and
that he (Steinman) told Tuck in a friendly way that he should not
talk like that during working hours. He denied, however, that he
told him he ought to be careful what he joined. In view of Stein-
man's membership in the E. W. O. since its inception and the fact
that both the respondent and the E. W. O: were hostile to the
23 N. L. R B. v. Falk Corp, 308 11. S 453 ; Westinghouse Electric & Manufacturing Co. v.
N: L R. B , June 10, 1940, 112 F. (2d) 057 (C C A. 2) ; Kansas City Power if Light Co. 1.
N. L. R B , 111 F (2d) 340 (C. C. A. 8) ; Cf. Magnolia Petroleum Co v. N. L. R B., June
13, 1940, 112 F (2d) 545 (C. C. A. 5) ; and Humble Oil & Refining Co. 1. N. L. R B., June 24,
1940. 113 F (2d) 85 (C. C A 5).
ss This pamphlet was a publication of the Constitutional Educational League Indicting the
C. I. 0 as a communist controlled union. Ramsey had ordered, about the time of the ad-
vent of the S. W. O. C., 1500 or 2000 copies of them for distribution among the employees.
They were paid for with E. W. O. funds.
856 DECISIONS OF NATIONAL LABOR 'RELATIONS BOARD
S. W. 0. C., we credit the testimony of Tuck, and findithat Steinman
made the statements attributed to him.
Tuck testified further that he, Buck Harris, and Joplin, S. W. 0. C.
grievance committee members, conferred with M. E. Boehm, plant
superintendent, shortly after the S. W. 0. C. received its charter.
Tuck quoted Boehm as follows :
... he (Boehm) stated that what we all should do would be
to try to advance our personal interest more, to try to boost
production, and we would get along better that way. He said
each one of us should try to boost production and study how to
make ourselves a better workman rather than taking up labor
matters like that; that we would all get along better to advance
our own personal interest. He said that, after all, that is what
our officers were doing, that they were trying to advance their
personal interest and that they were just in it for the money
that was in it.
Boehm did not deny the statements attributed to him.25
We find that the statements of Steinman and Boehm were in-
tended to discourage S. W. 0. C. membership and that the employees
might fairly infer that it was not to their interest to remain active
members of the S. W. 0. C.26
In 1937 or 1938 Word Clark, a member of the A. F. of L. had a
conversation with Rohlf, the respondent's personnel manager, in
the latter's office, after Clark had been told by Battle, assistant fore-
man in the foundry, to report to Rohlf's office. Clark testified that
Rohlf told him that the respondent favored the A. F. of L. much
more than the U. I. 0. but that nevertheless Clark, an A. F. of L.
member, must quit organizing altogether on company property.
Rohlf called Clark in again about a week later and confronted Clark
with his knowledge of certain organizing activities conducted by
Clark among the respondent's colored employees. Clark said that
the colored employees needed a union as well as the white men, and
Rohlf told him, "They have got one, the only one that we are going
to recognize." Rohlf admitted telling Clark that the Company did
not permit organizing on company property but categorically denied
u Tuck testified that he assumed Boehm was referring to S W. O . C. national or local
officers when he said the officers were just in it for the money that was in it. The re-
spondent takes exception to the Trial Examiner 's findine in this regard on the ground that
Tuck's testimony , " I-Te said that after all that is what our officers were doing . . ." Is
more properly interpreted as meaning the officers of the respondent . In view of Tuck's
explanation we are of the opinion that his testimony is not susceptible of the interpretation
which the respondent would place upon it.
20 See National Labor Relations Board v. A. S . Abell Company, 97 F. (2d ) 951 (C. C. A. 4)
mod'g and aff 'g Matter o f The A. S. Abell Company and International Prnnting and 'Press-
men's Union, Baltimore Web Pressmen 's Union, No . 31, 5 N. L R B 644.
HUGHES TOOL COMPANY 857
making the other statements attributed to him by Clark. We do not
credit his denial and find, in accordance with the finding of the Trial
Examiner, that he made the statements attributed to him.'
In July 1938 A. V. Hickman, machine operator and president of the
C. I.O., was laid off four days for "loafing." Upon his return, after
discussing his office in the C. I. 0. with Bill Murphy, set-up man, Hick-
man inquired if he was "not on the spot." Murphy replied that he was,
but not with him (Murphy). Hickman asked, "With who, the com-
pany?" and Murphy "shook his head, yes, and walked off."
D. Concluding findings
Upon the record we are satisfied and find that,the respondent es-
tablished and maintained both the E. W. 0. and the H. T. C. and by
its conduct precluded the exercise of any free choice of a bargaining
agent by its employees. In 1933, at a time when the employees were
organizing independently of the respondent, the plan for an inside or-
ganization was submitted to Kuldell who in effect approved it and
gave its sponsors an assurance of the respondent's full support.27
Thereupon, the respondent provided a conference room for organiza-
tion purposes and allowed Ramsey and his committee time off in which
to prepare a constitution and bylaws for the organization. The
respondent permitted the posting of the notice of November 21, 1933,
which outlined the proposed inside organization, and on November 24
it permitted each shift to assemble in the company dining hall during
working hours to enable the organizers to secure employee adherents.
Shortly thereafter, just prior to the election of December 1, 1933, the
respondent through statements published and distributed by Kuldell,
plainly and unequivocally expressed its desire to have its employees
select an inside organization to represent them. After the election
the respondent donated freely its facilities to aid in consummating the
establishment of the E. W. 0. It printed the applications and
authorizations signed by prospective members at the meeting of
December 10, and also the constitution and bylaws of the E. W. 0.,
and furnished the, E. W. 0. office space, meeting places, printing,
materials, and supplies. These and other facilities were "guaranteed"
in the E. W. 0. bylaws. The respondent initiated a system of de-
'27 The E. W. 0 and H. T. C. have had a continuous existence from December 1933 and
April 1934, respectively , to date. Consequently , although the respondent ' s conduct occur-
ring prior to July 5, 1935, the effective date of the Act, does not constitute unfair labor
practices , such conduct determines the significance of the respondent 's acts occurring after
the effective date of the Act, and also the character of the E W. 0 and H T. C National
Labor Relations Board v. Pennsylvania Greyhound Lines, Inc , et at, 303 U . S 261 , rev'g.
98 F. (2d ) 178 (C. C. A. 3 ), and enf'g Matter of Pennsylvania Greyhound Lines, Inc, Grey-
hound Management Company and Local Division No 1063 of the Amalgamated Association
of Street, Electric Railway and Motor Coach Employees of America , 1 N. L. R. B. 1.
858 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ducting dues from E. W. O. members' pay checks, for the purpose of
facilitating the securing of members therein and lending financial
stability to the organization. The organization as established pro-
vided for membership and hence support of the supervisory staff.
The respondent effectively cooperated with the E. W. O. in halting
outside organization by threat of dismissal of any dissident employees.
Finally, the respondent recognized the E. W. O. as the exclusive bar-
gaining representative for white employees, and entered into con-
tracts with that organization thus attempting to perpetuate its ex-
istence.
The reorganization of the H. T. C. into a labor organization
followed shortly after Kuldell's suggestion to Johnson that the colored
employees organize in the same fashion as the white employees and its
organizers adopted the pattern established by the E. W. O. as Kuldell
had,suggested in the letter-to Johnson. The respondent allowed the
H. T. C. to use its dining hall for meetings, furnished the organization
with office space, printing and supplies, and initiated the check,-off
system as provided in the bylaws. Finally, the respondent recognized
the H. T. C. as the exclusive bargaining representative of the respond-
ent's colored employees and entered into contracts with that organiza-
tion thus attempting to perpetuate the existence of the H. T. C.
The E. W. O. and the H. T. C. stand today, as they did before the
effective date of the Act, as obstacles to freedom of organization on
the part of the respondent's employees. Although the respondent in
1937, ceased to donate office space, printing, materials and supplies,
outright contributions for picnics, assistance in securing bank loans,
and legal advice, it has never renounced the support accorded these
organizations and it has maintained their existence through the grant
of exclusive recognition, contractual status, a check-off system, by
providing a meeting place, and by numerous statements and acts by
officials of the respondent plainly expressive of its hostility to any
form of outside organization.
The respondent contends that it engaged in arm's length bargain-
ing with the E. W. O. and the H. T. C. and relies on the fact that
it made concessions to these organizations to support its contention.
The fact that the respondent bargained with the H. T. C. and E. W. O.
and that, they procured benefits for their members is immaterial under
the Act, if the. respondent has in fact interfered with, dominated, or
supported the organizations.28 We are convinced from the record that
such interference, support, and domination has occurred.
Upon this record, testimony by employees that their'participation
in the E. W. O. and H. T. C. was not secured through interference
29 N. L. R . B. v. Newport News Shipbuilding d Dry Dock Co., 308 U. S. 241.
Hu GHES TOOL COMPANY 859,
or coercion and that these were the organizations of their choice is
entitled to little or no weight.29
We find, on the basis of the foregoing evidence, that the respond-
ent has, since July 5, 1935, dominated and interfered with the
administration of the E. W. O. and the H. T. C. and contributed
financial and other support to them. We find that the respondent
insured the exclusion of unions other than the E. W. O. and H. T. C.
from successful organization in its plant through the adoption of the
contracts of October 1, 1937, and March 1, 1939, and that the perform-
ance of such contracts prevented the respondent's employees from
freely expressing the rights guaranteed in Section 7 of the Act. We
find further, that the respondent has interfered with, restrained, and
coerced its employees in the exercise of the rights guaranteed to them
by Section 7 of the Act.
E. The discharge
The complaint alleged that the respondent transferred one H. J.
Wilpitz from one department to another and reduced his wages, and
on or about March 1, f939, discharged him and thereafter refused
to reinstate him because he joined and assisted the S. W. O. C. and
engaged in concerted activities with other employees, thereby dis-
couraging membership in the S. W. O. C.
The Trial Examiner found that the respondent had not discrimi-
nated in regard to the hire and tenure of employment or terms and
conditions of employment. of H. J. Wilpitz. The S. W. O. C. took
no exception to his finding in this regard. We have reviewed the
evidence and agree with the finding of the Trial Examiner. 'We find
that the respondent has not discriminated in regard to the hire and
tenure of employment or any term or condition of employment in
respect to H. J. Wilpitz.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
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.
29 N L. R. B. v. Newport News Shipbuilding & Dry Dock Co., 308 U. S. 241 ; N. L. R. B. v.
Brown Paper Mill Company, Inc ., 108 F. ( 2d) 867 (C. C. A. 5), enf'g. 12 N. L . R. B. 60,
cert. denied 60 S. Ct. 1104 ; N. L. R. B v. Skinner h Kennedy Stationery Co., July 25, 1940
( C. C. A. 8 ), 6 L. R. R . 781, enf'g. 13 N. L. R. B. 1186.
860 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
V. THE REMEDY
Having found that the respondent has engaged in unfair labor
practices, we will order it to cease and desist therefrom and to take
certain affirmative action designed to effectuate the policies of the Act.
We have found that since July 5, 1935, the respondent has domi-
nated and interfered with the administration of the Employees Wel-
fare Organization of Hughes Tool Company, and the H. T. C. Club
of Hughes Tool Company, and contributed financial and other sup-
port to them. In order to effectuate the policies of the Act and free
the employees of the respondent from such support, interference, and
domination, and the effects thereof, which' constitute a continuing
obstacle to the exercise by employees of rights guaranteed them in
the Act, we will order the respondent to withdraw all recognition
from and completely disestablish'the Employees Welfare Organiza-
tion of Hughes Tool Company, and the H. T. C. Club of Hughes
Tool Company as representatives of the respondent's employees for
the purpose of dealing with the respondent concerning grievances,
labor disputes, wages, rates of pay, hours of employment, or condi-
tions of work. Since the agreement of March 1, 1939, between the
respondent on the one hand and the Employees Welfare, Organiza-
tion of Hughes Tool Company and the H. T. C. Club of Hughes Tool
Company on the other, embodies recognition of these two organiza-
tions as such representatives, and represents the fruits of the respond-
ent's unfair labor practices and devices by which to perpetuate their
effects, we will.order the respondent specifically to cease and desist
from giving effect to this or any other agreement with these organiza-
tions or either of them in respect to rates of pay, wages, hours of
employment, or other conditions of work.
We have found that the check-off of dues from members' wages
was accorded the Employees Welfare Organization of,Hughes Tool
Company and the H. T. C. Club of Hughes Tool Company for the
purpose of facilitating the securing of members therein, and of sta-
bilizing the finances of these two organizations. It is apparent that
authorizations for the check-off of dues for organizations dominated
and supported by the respondent were not the voluntary acts, of the
employees signing such authorizations, but 'represented a further
aspect of the employees' compulsion to abandon their rights under the
Act and to support the organizations which, the respondent had
fostered for purposes proscribed by the Act. Under these circum-
stances, in order to restore the status quo and thus effectuate the
,policies of the Act, we will order that the respondent reimburse the
employees for all amounts deducted from their wages as dues for the
HUGHES TOOL COMPANY 861
Employees Welfare Organization of Hughes Tool Company and the
H. T. C. Club of Hughes Tool Company since July 5, 1935.30
We have found that the respondent has interfered with, restrained,
and coerced its employees in the,exercise of the rights guaranteed in
Section 7 of the Act. Not only shall we order the respondent to cease
and desist from engaging in such unfair labor practices, but also, in
order to remedy the situation brought about by the respondent's hav-'
ing engaged in such practices and thus to effectuate the policies of the
Act, we, shall order the respondent to notify its employees at its
Houston plant in specific terms that it will not engage in any of the
aforesaid practices and that it will take the affirmative action indicated
in this Order.,
Upon the basis of the above findings of fact and upon the entire
record in the case, the Board makes the following :
CONCLUSIONS OF LAW
1. Employees Welfare Organization of Hughes Tool Company,
H. T. C. Club of Hughes Tool Company and Steel Workers Organiz-
ing Committee, Lodge No. 1742, are labor organizations within the
meaning of Section, 2 (5) of the Act.
2. By dominating and interfering with the formation,and adminis-
tration of the Employees Welfare Organization of Hughes Tool Com=
pany and H. T. C. Club of Hughes Tool Company, and by contributing
financial and other support to said organizations, the respondent has
engaged in and is engaging in unfair labor practices within the mean-
ing of Section 8 (2) of the Act.
3. By interfering with,' restraining, and coercing its employees in
,the exercise of the rights guaranteed in Section 7 of the Act, the re-
spondent has engaged in and is engaging in unfair labor practices
within the meaning of Section 8 (1) of the Act.
4. The aforesaid unfair labor practices are unfair labor practices
affecting commerce, within the meaning of Section 2 (6) and (7) of
the Act.
5. The respondent has not engaged in unfair labor practices, within
the meaning 'of Section 8 (3) of the Act.
ORDER
- Upon the basis of the foregoing findings of fact and conclusions of
law, 'and pursuant to Section 10 (c) of the National Labor Relations
Act, the National Labor Relations Board hereby orders that the re=
$' See Matter of Heller Brothers Company of Newcomerstownyand International Brother-
hood of Blacksmiths, Drop Forgers and Helpers, 7 N. L. R. B. 646.
862 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
,spondent, Hughes Tool Company, a Delaware corporation, Houston,
Texas,' and its officers, agents, successors, and assigns shall :
1. Cease and desist from : -
(a) In any manner dominating or interfering with the administra-
tion of the Employees Welfare Organization of Hughes Tool Com7
pany and, the H. T. C. Club of Hughes Tool Company, or either of
them, or with the formation or administration of any other labor or-
ganization of its employees, or in any manner contributing support
to the Employees Welfare Organization of Hughes Tool Company and
the H. T. C. Club of Hughes Tool Company, or either of them, or to
any other labor organization of its employees;
(b) Giving effect to or performing any and all contracts or arrange-
ments now existing with Employees Welfare Organization of Hughes
Tool Company and H. T. C. Club of Hughes Tool Company, or either
of them, relating to rates of pay, wages, hours of employment, or other
conditions of employment, or any modification or extension thereof;
(c) In any other manner interfering with, restraining', or coercing
its employees in the exercise of the right to self-organization, to form,
join, or assist labor organizations, to bargain collectively through rep-
xesentatives of their own choosing, and to -engage in concerted activi-
ties for the purposes of collective bargaining pr 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) Withdraw all recognition from Employees Welfare Organiza-
tion of Hughes Tool Company and H. T. C. Club of Hughes Tool
Company; and each of them, as representatives of any of its employees
for the purpose of dealing with the respondent concerning grievances,
labor disputes, wages, rates of pay, hours of employment, or other
conditions of employment, and completely disestablish Employees)
Welfare Organization of Hughes Tool Company and H. T. C. Club
.of Hughess Tool Company and each Of them, as such representatives;
- (b) Reimburse individually, and in full, all of its employees whose
dues were deducted from their wages on behalf of Employees Welfare
Organization of Hughes Tool Company and H. T. C. Club of Hughes
Tool Company, for dues thus deducted since July 5, 1935;
(c) Post immediately and in conspicuous places at its plant, 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 respond-
ent 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 the
respondent will take the affirmative action set forth in paragraphs -2
-(a),and , (b) of this Order;
HUGHES TOOL COMPANY 863
(d) Notify the Regional Director for the Sixteenth Region in writ-
ing within ten (10) days from the date of this Order what steps the
respondent has taken to comply herewith.
IT Is FURTHER ORDERED that the complaint, as amended, in so far as it
alleges that the respondent has engaged in unfair labor practices with-
in the meaning of Section 8 (3) of the Act, be, and it hereby is,
dismissed.