Kling Factories

National Labor Relations Board - Board DecisionsSep 23, 1938

8 N.L.R.B. 1228 (N.L.R.B. 1938)

In the Matter of KLING FACTORIES, AN ASSUMED TITLE USED BY D. D. KLING, A. J. KLING, AND C. E. HELGREN IN THE MANAGEMENT OF CHATAUQUA CABINET Co., BROCKTON FURNITURE Co., HERRICK FUR- NITURE CO., JOHN A. KLING (SUCCESSOR TO CRANDALL PANEL CO.), AND FREWSBURG FURNITURE Co. and LOCALS 12, 13, 14, AND 15 ORGANIZED FURNITURE WORKERS OF JAMESTOWN, N. Y. Case No. R-757.-Decided September 23) 1938 Furniture Manufacturing Industry-Employer: companies functioning through single management group-Investigation of Representatives: controversy con- cerning representation of employees: controversy concerning appropriate unit; strike-Conciliation : efforts at, by U. S. Department of Labor-Unit Appro- priate for Collective Bargaining: wage workers, except clerical and supervisory employees , who are employed by the companies which function through the single management group ; "employer unit" : activities of companies carried on through management group which determines general policies as well as labor policies of all the companies ; labor problems, wages, and working conditions at plants of all companies uniform ; operations of companies as single unit ; history of collective bargaining relations with employer ; joint action by employees of companies; treatment by employer of employees of various companies without distinction-Election Ordered Mr. Peter J. Crotty, for the Board. Mr. Walter L. Miller, of Jamestown, N. Y., for the Companies. Mr. Daniel B. Sliortal, of Buffalo, N. Y., for the Union. Mr. Arnold R. Cutler, of counsel to the Board. DECISION AND DIRECTION OF ELECTION STATEMENT OF THE CASE On April 11, 1938, Organized Furniture Workers,' herein called the Union, Locals 12, 13, 14, and 15, filed with the Regional Director for the Third Region (Buffalo, New York) an amended petition alleging that a question affecting commerce had arisen concerning the representation of employees of Kling Factories, an assumed title used by D. D. Kling, A. J. Kling, and C. E. Helgran in the manage- 1 It appears from the constitution of the Union, Petitioner Exhibit No. 8, that this is the correct name of the Union , although it is otherwise designated in the notice of hearing and other papers. 8 N. L. R. B., No. 152. 1228 DECISIONS AND ORDERS 1229 ment of Chautauqua Cabinet Co., Mayville, New York; Brocton Furniture Co., Brocton, New York; Herrick Furniture Co., Fal- coner, New York; John A. Kling (successor to Crandall Panel Co.), Brocton, New York; and Frewsburg Furniture Co., Frewsburg, New York, herein called the Companies,2 and requesting an investigation and certification of representatives pursuant to Section 9 (c) of the National Labor Relations Act, 49 Stat. 449, herein called the Act. On April 25, 1938, the National Labor Relations Board, herein called the Board, acting pursuant to Section 9 (c) of the Act and Article III, Section 3, of National Labor Relations Board Rules and Regu- lations-Series. 1, as amended, ordered an investigation and author- ized the Regional Director to conduct it and to provide for an appropriate hearing upon due notice. On May 4, 1938, the Regional Director issued a notice of hearing, copies of which were duly served upon the Companies and the Union. Pursuant to the notice, a hearing was held on May 13, 1938, before Wright Clark, the Trial Examiner duly designated by the Board, and continued on May 20, 1938, before Webster Powell, the Trial Examiner duly designated by the Board in place and stead of Wright Clark. The Board, the Companies, and the Union were represented by counsel and participated in the hearing. Full opportunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing on the issues was afforded all parties. During the course of the hearing the Trial Examiners made several rulings on motions and on objections to the admission of evidence. The Board has reviewed these rulings and finds that no prejudicial errors were committed. The rulings are hereby affirmed. On June 10, 1938, oral argument was had before the Board, in Washington, D. C. The respondent was represented by counsel and presented its argument. The Union did not appear. The respondent also filed briefs which the Board has considered. Upon the entire record in the case, the Board makes the following : FINDINGS OF FACT I: THE BUSINESS OF THE COMPANIES Chautauqua Cabinet Co., Brocton Furniture Co., and Herrick Fur- niture Co. are New York corporations engaged in the manufacture and sale of bedroom furniture. Frewsburg Furniture Co. is also a New York corporation and is engaged in the manufacture and sale of dining room furniture. Approximately 60 per cent of the raw ma- 2 It appears that these are the correct names, although they are otherwise designated in the notice of hearing and other papers. 1230 NATIONAL LABOR RELATIONS BOARD serials purchased by each of these corporations are shipped to it from points outside the State of New York and approximately 50 to 76.6 per cent of the finished products of each of these corporations are shipped to points outside the State of New York. At the hearing it was stipulated by and between counsel for each of the parties that all four corporations are engaged in interstate commerce. A. J. Kling, D. D. Kling, and C. E. Helgran are respectively presi- dent, secretary, and treasurer of all four corporations. D. D. Kling is also vice president of all four corporations, except the Brocton Furniture Co., of which H. H. Craig is the vice president. J. A. Kling (successor to Crandall Panel Co.) is an estate admin- istered by A. J. Kling and D. D. Kling, the executors of the estate. It , is engaged in the manufacture of built-up panels. The raw materials which it uses are glue, hardware, sandpaper, miscellaneous core stock, various kinds of veneer, hard maple, drawer bottoms, and tape. For the period from January 1, 1937, to April 30, 1938, the value of such raw materials was $219,302, more than 50 per cent of which represents purchases from points outside the State of New York. All the finished products of the estate are sold to the above corporations and absorbed by them as part of their finished products. The plants of each of the Companies are all in Chautauqua County, New York. Immediately prior to December 29, 1937, the five com- panies together employed approximately 429 persons. II. THE ORGANIZATION INVOLVED Organized Furniture Workers is a labor organization admitting to membership all wage workers employed in the furniture industry except clerical and supervisory employees. Local 12 of the Union admits to membership wage workers of the Frewsburg Furniture Co.; Local 13, wage workers of the Herrick Furniture Co.; Local 14, wage workers of the Brocton Furniture Co. and John A. Kling (successor to Crandall Panel Co.), both of which companies are located at Brocton; and Local 15, wage workers of the Chautauqua Cabinet Co. The four locals of the Union are herein collectively called the Locals. III. THE MANAGEMENT OF THE COMPANIES All the companies involved in this case are known in the industry as "Kling Factories." Although each of the companies is a separate and distinct legal entity, all of them are managed, under the name "Kling Factories," from a single general office at Mayville, New York, by a management group consisting of the three common officers of the Companies, namely A. J. Kling, D. D. Kling, and C. E. Helgran. "Kling Factories" is not an incorporated entity and does not own any shares in the various companies. DECISIONS AND ORDERS 1231 At the general office, the management group employs a single clerical staff, including a general auditor, a cashier, and stenographers for all the Companies. In the operation of the various plants, there are at least three supervisory employees who are superintendents of certain departments for two or more of the companies. On occasion maintenance and production employees have been transferred from one of the companies to another. Separate sets of books are maintained for each of the companies, and each of them makes its separate purchases and sales, and files its separate tax statements and labor reports. However, all purchases and sales clear through the management group at the general office. Forms for communications of every kind, including stationery, bills, and checks, are forwarded from the general office under the name "Kling Factories," with the identity of the individual companies also indicated. This name also appears on the trucks of the Companies, the individual companies being identified in smaller print. The general policies as well as the labor policies of all the Com- panies are determined by the management group. All advertising is done under the name of "Kling Factories," and the salesmen, who sell for all the Companies, represent themselves as coming from "Kling Factories." The Companies maintain that this arrangement is merely for econ- omy and efficiency. Whatever the purpose, it is clear that the five Companies, under the name of "Kling Factories," through a single management group, do work closely together as a single unit, practi- cally in every phase and branch of their business, closely resembling an informal association. IV. HISTORY OF COLLECTIVE BARGAINING AND THE QUESTION CONCERNING REPRESENTATION The Union was first organized about January 1, 1937. The Locals were established shortly thereafter. Each of the locals has its own officers and executive board and holds meetings apart from the other locals. About July 6, 1937, a combined committee of the representatives of the Locals, acting for all the employees of all the Companies, sent two communications to the management group regarding wages, hours, seniority rights, and collective bargaining for these employees. The first communication was addressed to "Kling Factories," and was signed by "the representatives of all Kling's workers"; the sec- ond, to "Kling Furniture Company," and was signed by the "Execu- tive Committee, Organized Furniture Workers." Thereupon the Companies posted copies of a notice on the bulletin boards at their plants, agreeing to collective bargaining and seniority rights but denying the other demands. This notice, which was uniform in all 1232 NATIONAL LABOR RELATIONS BOARD the plants, was addressed "To our employees," and was signed by all three members of the management group under the name of "Kling Factories." On July 12, 1937, representatives of each local met with the man- agement group at the general office at Mayville, for the purpose of collective bargaining. These negotiations proved unsuccessful. As a result, the employees of all the Companies went out on strike on July 15. About July 25, 1937, and on several occasions thereafter, the man- agement group met with a Commissioner of Conciliation from the United States Department of Labor, in an endeavor to settle the strike. On each of these occasions the discussion related to all the Kling Factories. About July 29, 1937, and at various times there- after, the management group met with the combined committee of the representatives of the various locals for the purpose of reaching some agreement. At these meetings, the combined committee of the Locals acted in behalf of all the employees of all the Companies and the management group negotiated with it on that basis. The discus- sions related to all the Companies and not to any individual one. On August 19, 1937, while the strike was still in effect, the Com- panies sent a printed communication to their employees suggesting a basis upon which they would be willing to open their plants. This communication was addressed "To Our Employees," and was signed by all the members of the management group under the name "Kling Factories." The strike, however, continued. About August 31, 1937, the combined committee of the Locals, the .president of the Union, and the management group agreed upon a strike settlement. The settlement agreement was typed upon sta- tionery containing the name "Kling Factories," with a' list of the various companies in small type, was addressed "To Our Em- ployees," stated the terms of the settlement without reference to any individual company, and was signed by the management group under the name "Kling Factories." Copies of this agreement were then cir- culated among the employees of all the Companies through the com- bined committee of the Locals. On September 1, 1937, the employees of all the Companies, pursuant to this agreement, returned to work. In January 1938, the representatives of the Union conferred with the management group regarding certain grievances at the Chautau- qua Cabinet Co. In February and March the Locals, through an officer of the Union, carried on further negotiations with the same management group regarding other grievances. At the conference between the representatives of the Union and the management group during February and March 1938, the Locals maintained that the management group should continue to bargain DECISIONS AND ORDERS 1233 collectively with the combined committee of the Locals. The Com- panies, through the management group, maintained that each of the companies should deal separately with its respective local. It ap- pears that on that issue the Companies and the Locals reached an impasse. We find that a question has arisen concerning the representation of employees. V. THE EFFECT OF THE QUESTION CONCERNING REPRESENTATION UPON COMMERCE We find that the question concerning representation which has arisen, occurring in connection with the operations of the Companies described in Section I above, has a close, intimate, and substantial relation to trade, traffic, and commerce among the several States, and tends to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. VI. THE APPROPRIATE UNIT The Companies and the Locals present conflicting claims regarding the unit or units appropriate for the purposes of collective bargaining. The Locals contend that all the wage workers of all the Companies constitute an appropriate unit. On the other hand, the Companies contend that the wage workers of each of the Companies constitute an appropriate unit. Thus the issue raised here is whether a single unit composed of all the wage workers of all five Companies is ap- propriate or whether five units composed of the wage workers of each of the five Companies are appropriate. The labor problems, wages, and working conditions at the plants of all the Companies are uni- form. The history of the collective bargaining indicates that both the management group as well as-the employees of the Companies recognized this uniformity. The strike settlement agreement as well as almost all the negotiations and communications prior thereto, re- ferred to all the employees of the Companies at the various plants without reference to any individual company. During this period, with few exceptions, the Locals acted through, and the Companies treated with, the combined committee representing the wage workers of all the Companies. The close association of the Companies, their operation through a single management group, the formulation of all labor and.other policies by such management group, the similarity in labor problems, wages, and working conditions at all the plants, and the history of collective bargaining strongly support the claim of the Union that a unit including all the wage workers employed at the Companies, 1234 NATIONAL LABOR RELATIONS BOARD excluding clerical and supervisory employees, is the one that will in- sure to the employees the full benefit of their right to self-organiza- tion and to collective bargaining, and will otherwise effectuate the policies of the Act.3 The Companies point out that the differences in the geographical location of the plants of the various companies is a factor militating against a single unit for the employees of all the Companies. All the plants of the Companies are in the same county within a radius of only 20 miles. The history of collective bargaining, even though short, shows that collective bargaining can be carried on effectively on the basis of the larger unit. The Companies further point out that, as the owners and stockholders of all the Companies are not identical, the activities of any one of the companies should not be involved in the labor hazards of the others. The owners and stock- holders have acquiesced in the operation of the Companies, including the conduct of their labor relations, as a single unit through a single management group,4 as a consequence of which the employees of the Companies have found that effective collective bargaining with such an employer unit requires them also to organize and act as a single unit. The Companies finally contend that although the man- agement arrangement is purely a voluntary one which can be altered at'the will of any of the Companies, the unit proposed by the Union is "unalterable and binding forever." This is not so. Changed con- ditions may necessitate the determination of a different unit. We find that all the wage workers of the Companies, excluding clerical and supervisory employees, constitute a unit appropriate for the purposes of collective bargaining and that said unit will insure to employees of the Companies the full benefit of their right to self-organization and to collective bargaining and otherwise effec- tuate the policies of the Act. VII. THE DETERMINATION OF REPRESENTATIVES At the hearing oral testimony was introduced showing that the Locals represent a majority of the employees in the appropriate unit. However, no other evidence was introduced to substantiate the Locals' claim to represent a majority and the Locals have requested an election. We find that the question which has arisen concerning the repre- sentation of employees of the Companies can best be resolved by 8 See Matter of Shipowners ' Association of the Pacific Coast, et at. and International Longshoremen's and Warehousemen's Union, District No. 1, 7 N L. R B. 1002. `More recently a stockholder in one of the companies has brought an action to withdraw such company from the management group. DECISIONS AND ORDERS 1235 the holding of an election by secret ballot. In accordance with our usual practice, we find that the employees eligible to vote in the election shall be those within the appropriate unit who were em- ployed during the pay-roll period immediately preceding April 11, 1938, the date of the filing of the amended petition, excluding those employees who have since quit or been discharged for cause. Upon the basis of the above findings of fact and upon the entire record in the case, the Board makes the following : CONCLUSIONS or LAW 1. A question affecting commerce has arisen concerning the repre- sentation of employees of Chautauqua Cabinet Co., Mayville, New York; Brocton Furniture Co., Brocton, New York; Herrick Furni- ture Co., Falconer, New York; John A. Kling (successor to Crandall Panel Co.), Brocton, New York; and Frewsburg Furniture Co., Frewsburg, New York, within the meaning of Section 9 (c) and Section 2 (6) and (7), of the National Labor Relations Act. 2. All the wage workers of Chautauqua Cabinet Co., Brocton Furniture Co., Herrick Furniture Co., John A. Kling (successor to Crandall Panel Co.), and Frewsburg Furniture Co., excluding cleri- cal and supervisory employees, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9 (b) of the National Labor Relations Act. DIRECTION OF ELECTION By virtue of and pursuant to the power vested in the National Labor Relations Board by Section 9 (c) of the National Labor Relations Act, 49 Stat. 449, and pursuant to Article III, Section 8, of National Labor Relations Board Rules and Regulations-Series 1, as amended, it is hereby DIRECTED that, as part of the investigation authorized - by the Board to ascertain representatives for the purposes of collective bargaining with Chautauqua Cabinet Co., Mayville, New York; Brocton Furniture Co., Brocton, New York; Herrick Furniture Co., Falconer, New York; John A. Kling (successor to Crandall Panel Co.), Brocton, New York; and Frewsburg Furniture Co., Frews- burg, New York, an election by secret ballot shall be conducted with- in fifteen (15) days from the date of this Direction, under the direction and supervision of the Regional Director for the Third Region, acting in this matter as agent for the National Labor Rela- tions Board and subject to Article III, Section 9, of said Rules and Regulations, among all the wage workers employed by Chautauqua 117213-39-vol. 8--79 1236 NATIONAL LABOR RELATIONS BOARD Cabinet Co., Brocton Furniture Co., Herrick Furniture Co., John A. Kling (successor to Crandall Panel Co.), and Frewsburg Furni- ture Co. during the pay-roll period immediately preceding April 11, 1938, excluding clerical and supervisory employees, and excluding those employees who have since quit or been discharged for cause, to determine whether or not they desire to be represented by Organized Furniture Workers, for the purposes of collective bargaining. MR. DONALD WAKEFIELD SMITH took no part in the consideration of the above Decision and Direction of Election.