LRM Packaging

National Labor Relations Board - Board Decisions

Sep 16, 1992

308 N.L.R.B. 829 (N.L.R.B. 1992)

829
308 NLRB No. 117
LRM PACKAGING
1 The General Counsel has excepted to some of the judge’s credi-
bility findings. The Board’s established policy is not to overrule an
administrative law judge’s credibility resolutions unless the clear
preponderance of all the relevant evidence convinces us that they are
incorrect. Standard Dry Wall Products, 91 NLRB 544 (1950), enfd.
188 F.2d 362 (3d Cir. 1951). We have carefully examined the record
and find no basis for reversing the findings.
The General Counsel has excepted to the judge’s failure to find
that the Respondent violated Sec. 8(a)(1) of the Act by granting an
extra holiday to all employees and a week’s vacation for employees
with 1 year of service. We find that this was not alleged as a viola-
tion in the complaint nor in the complaint as amended at the hearing.
Although Respondent’s president, John Natali, testified that the vaca-
tion and holiday were granted, we cannot find on the record in this
case that this matter was fully litigated. Accordingly, we find the
General Counsel’s exception to be without merit.
2 Mariposa Press, 273 NLRB 528, 529 (1984). See also
Thermalloy Corp., 213 NLRB 129, 131 (1974).
3 Cartridge Actuated Devices, 282 NLRB 426, 428 (1986).
LRM Packaging, Inc. and Local 300-S, Production
Service and Sales District Council, H.E.R.E.,
AFL–CIO. Case 22–CA–16415
September 16, 1992
DECISION AND ORDER
BY CHAIRMAN STEPHENS AND MEMBERS
DEVANEY AND OVIATT
On April 12, 1991, Administrative Law Judge D.
Barry Morris issued the attached decision. The General
Counsel filed exceptions and a supporting brief. The
Respondent filed cross-exceptions, a supporting brief,
and a brief in opposition to the General Counsel’s ex-
ceptions.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the decision and the
record in light of the exceptions and briefs and has de-
cided to affirm the judge’s rulings, findings,1 and con-
clusions as modified below and to adopt the rec-
ommended Order as modified.
1. The judge found that the Respondent violated
Section 8(a)(1) of the Act during the preelection period
by promising to give a raise and grant medical benefits
when the Company could afford it. We disagree.
Soon after the Respondent began operations in Sep-
tember 1988, employees began to inquire about medi-
cal benefits. Initially, Respondent’s president, John
Natali, stated that it was a new business and was not
in a position to grant benefits at that time. Both prior
to and during the union organizing campaign, which
began in April 1989, Natali stated that he would give
medical benefits when the Company could afford it. In
December 1988 and in February 1989, he discussed
with his insurance agent the possibility of a medical
plan for LRM. During the preelection campaign, em-
ployees inquired about raises as well as medical bene-
fits, and Natali responded that the Company would
give a raise and grant a medical plan when the Com-
pany could afford it. The Union lost the June 29 elec-
tion and filed objections. In September, while the ob-
jections were still pending, the Respondent gave a
wage raise and implemented medical benefits effective
in October.
The judge found, and we agree, that the Respond-
ent’s grant of medical benefits and a wage raise while
the Union’s objections to the election were pending
was lawful. He determined that the granting of medical
benefits was promised and set into motion months be-
fore the union campaign began, and that the wage in-
crease was consistent with Natali’s practice at his other
two companies. The judge concluded that the granting
of the medical benefits and wage increase at approxi-
mately the time of the Company’s first anniversary
was motivated by the Respondent’s improved financial
condition and was not an attempt to influence the em-
ployees’ freedom of choice.
However, the judge further found that Natali’s state-
ments to employees at preelection meetings, that he
would give them a medical plan and a wage raise
when the Company could afford it, constituted unlaw-
ful conduct. We disagree.
Milagros Lazala, Nieve Luisa Cano, and Julio
Matos, whose testimony the judge credited, denied that
Natali conditioned these benefits on a union defeat.
Natali’s statement that he would give medical benefits
and a wage raise to employees at some uncertain fu-
ture time when the Company could afford to do so was
not a promise calculated to affect the employees’ free
choice in the election. Rather, it was ‘‘nothing more
than an expression of the Respondent’s opinion that it
hoped to be in a position at some unspecified time in
the future to offer more to its employees in terms of
wages and working conditions, a statement which is
privileged under Section 8(c) of the Act.’’2 The bene-
fits were neither expressly nor implicitly associated
with rejection of the Union. Further, because the judge
found that the grant of medical benefits was promised
and set into motion before the union campaign, the
statement regarding those benefits was simply a reaffir-
mation of plans announced before the union cam-
paign.3
The cases relied on by the judge in which similar
statements were found unlawful are distinguishable. In
JFB Mfg., 208 NLRB 2 (1973), the respondent had in-
terrogated another employee about employee Gloria
Belonga’s union activities. Thereafter, shortly before
Belonga’s unlawful discharge, a foreman invited her to
his office, advised her that the union organizing cam-
paign was untimely, related a story of his own un-
happy involvement in a union organizing campaign,
and then stated that the Company would someday bet-
ter itself and offer employees more. The Board adopt-
830 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
4 NLRB v. Gissel Packing Co., 395 U.S. 575 (1969).
ed the judge’s finding that the remarks were a promise
of future benefits if Belonga and her colleagues aban-
doned their present union activity, and the remarks
thus violated Section 8(a)(1). In Permanent Label
Corp., 248 NLRB 118, 131 (1980), enfd. 657 F.2d 512
(3d Cir. 1981), cert. denied 455 U.S. 940 (1982), in
which similar statements were found unlawful, the
statements were made within the context of numerous
violations of Section 8(a)(1), (3), (4), and (5), includ-
ing hallmark violations warranting a Gissel4 bargaining
order. Moreover, in two instances the promises were
specifically conditioned on defeat of the union. We
find those cases distinguishable because in both the
promises occurred within a context of numerous other
unfair labor practices and were associated with aban-
donment of union activity or union defeat in the elec-
tion. We find that under the circumstances of this case,
where Natali neither expressly nor implicitly condi-
tioned the grant on the election outcome, and where
the grants themselves were lawful, the statements did
not violate Section 8(a)(1) of the Act.
2. We agree with the judge’s finding that in July
1989, while the Union’s objections to the election were
pending, the Respondent violated Section 8(a)(1) of the
Act by threatening loss of promised benefits because
the Union filed objections to the election. Based on a
composite of credited testimony, the judge found that
at a meeting held soon after the Union filed its objec-
tions, in response to a question by employees as to
when he was going to give them medical benefits and
a raise, Natali responded that because the Union filed
objections, ‘‘I cannot do anything for you now.’’ We
agree with the judge that the Respondent’s conduct,
viewed as a whole, violated Section 8(a)(1) because
John Natali’s response placed on the Union the onus
for withholding of benefits. Gerkin Co., 279 NLRB
1012 (1986). We note that Natali’s statements, made at
an employee meeting shortly after he learned that ob-
jections had been filed, lacked the requisite assurances
that employees would not be penalized whether they
selected the Union and that any postponement of an-
ticipated benefits was temporary and solely to avoid
the appearance that he was attempting to interfere with
the outcome of the election. See Atlantic Forest Prod-
ucts, 282 NLRB 855, 858 (1987).
Further, we note that the credited testimony estab-
lished that prior to the election Natali had repeatedly
said he would give a raise and medical benefits when
the Company could afford it. Natali’s statement after
the election, that he could not do anything because the
Union filed objections, is a departure from his earlier
rationale and a campaign tactic which places on the
Union the onus for the withholding of benefits. Find-
ing a violation in these circumstances does not con-
front the Respondent with a ‘‘Hobson’s choice.’’ It
simply precludes the Respondent from having it both
ways—immunity for both granting and withholding
benefits and blaming the Union for the latter.
AMENDED CONCLUSIONS OF LAW
Substitute the following for Conclusion of Law 3.
‘‘3. By threatening plant closure if the employees
chose to be represented by the Union, and by threaten-
ing loss of promised benefits because the Union filed
objections to the election, the Respondent has engaged
in unfair labor practices within the meaning of Section
8(a)(1) of the Act.’’
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge as
modified below and orders that the Respondent, LRM
Packaging, Inc., South Hackensack, New Jersey, its of-
ficers, agents, successors, and shall take the action set
forth in the Order as modified.
1. Substitute the following for paragraph 1(a).
‘‘(a) Threatening its employees with plant closure if
they choose to be represented by the Union, and
threatening its employees with loss of promised bene-
fits if the Union files objections to an election.’’
2. Substitute the attached notice for that of the ad-
ministrative law judge.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we
violated the National Labor Relations Act and has or-
dered us to post and abide by this notice.
WE WILL NOT threaten our employees with plant
closure if they choose to be represented by a union and
WE WILL NOT threaten employees with loss of prom-
ised benefits if a union files objections to an election.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce you in the exercise of the
rights guaranteed you by Section 7 of the Act.
LRM PACKAGING, INC.
Olivia Garcia Boullt, Esq., for the General Counsel.
Neal D. Haber, Esq. (Moss & Boris), of New York, New
York, for the Respondent.
DECISION
STATEMENT OF THE CASE
D. BARRY MORRIS, Administrative Law Judge. This case
was heard before me in Newark, New Jersey, during 17 days
of hearing beginning December 5, 1989, and ending June 21,
831LRM PACKAGING
1 All dates refer to 1989 unless otherwise specified.
2 At the hearing a new par. 8 was added to the complaint alleging
that Respondent granted wage increases in September 1989 and
granted medical benefits in October 1989. In view of my rec-
ommended Order dated February 5, 1991, pars. 9–14 of the com-
plaint have been dismissed.
1990. On a charge filed on July 5, 1989,1 a complaint was
issued on August 31 alleging that LRM Packaging, Inc. (Re-
spondent) violated Section 8(a)(1) and (5) of the National
Labor Relations Act, as amended (the Act). Respondent filed
an answer denying the commission of the alleged unfair
labor practices. On November 27 the Regional Director
issued an order directing that this proceeding be consolidated
with Case 22–RC–10135. On December 10, 1990, the Gen-
eral Counsel filed a motion to approve the Charging Party’s
withdrawal of that portion of the charge which seeks a bar-
gaining order, to dismiss that portion of the complaint seek-
ing a bargaining order and to sever and remand the represen-
tation case. On February 5, 1991, I granted the General
Counsel’s motion.2
The parties were given full opportunity to participate,
produce evidence, examine and cross-examine witnesses,
argue orally, and file briefs. Briefs were filed by the General
Counsel and by the Respondent on October 31 and Novem-
ber 2, 1990, respectively.
On the entire record of the case, including my observation
of the demeanor of the witnesses, I make the following
FINDINGS OF FACT
I. JURISDICTION
Respondent, a corporation with an office and place of
business in South Hackensack, New Jersey, has been en-
gaged in the nonretail packaging of products. Respondent ad-
mits that it meets the requisite jurisdictional standards and
admits, and I so find, that it is an employer engaged in com-
merce, within the meaning of Section 2(2), (6), and (7) of
the Act. In addition, it has been admitted, and I find that
Local 300-S, Production Service and Sales District Council,
H.E.R.E., AFL–CIO (the Union) is a labor organization with-
in the meaning of Section 2(5) of the Act.
II. THE ALLEGED UNFAIR LABOR PRACTICES
A. The Issues
The issues are:
1. Did Respondent create the impression among its em-
ployees that their union activities were under surveillance in
violation of Section 8(a)(1) of the Act?
2. Did Respondent threaten its employees with plant clo-
sure if they chose to be represented by the Union in violation
of Section 8(a)(1) of the Act?
3. Did Respondent promise its employees benefits and
threaten its employees with loss of promised benefits in vio-
lation of Section 8(a)(1) of the Act?
4. Did Respondent grant wage increases and medical and
life insurance benefits to its employees in violation of the
Act?
B. The Facts
1. Background
LRM commenced business in September 1988. In Decem-
ber 1988 it relocated to its present facility. In April 1989 the
Union commenced an organizing drive at Respondent’s facil-
ity and on May 1 it filed with the Board a petition seeking
certification as representative of Respondent’s production and
maintenance employees. Pursuant to a stipulated election
agreement executed by the parties an election by secret ballot
was conducted on June 29. On July 3 the Union filed objec-
tions to conduct affecting the results of the election. On No-
vember 27 the Regional Director issued his second report on
objections and consolidated the representation case with this
proceeding. As noted above, Case 22–RC–10135 has been
severed from this proceeding and remanded to the Regional
Director.
2. Impression of surveillance
The complaint alleges that on June 16, John Natali, the
president of LRM, created the impression among Respond-
ent’s employees that their union activities were under sur-
veillance. Norma Aguilar had played a key role in the union
organizing effort. She had been outspoken during the first
meeting held by Respondent to discuss the organizing activ-
ity. She testified that approximately 2 weeks before the elec-
tion, Natali told her that ‘‘somebody had told him that I had
brought in the union.’’ In support of this allegation General
Counsel, in its brief, cites the above-quoted testimony of
Aguilar and Natali’s testimony that prior to the election he
‘‘knew some employees who favored the union.’’
Natali credibly testified that at a meeting held with the
employees on April 21 a ‘‘couple’’ of employees said that
Norma Aguilar would ‘‘speak for them.’’ Natali further testi-
fied that on June 9 he had a discussion with Aguilar in
which she said:
that people had accused her of bringing the union there,
and I said, well I don’t know that you did it. Oh, she
says, people have said that I was the one that brought
the union here. And she says, did I do anything wrong?
I says no, you were well within your rights. You
haven’t done anything wrong.
Natali denied that he told Aguilar that he knew that she
brought in the Union. I find that the General Counsel has not
shown by a preponderance of the evidence that Natali told
Aguilar that he knew that she had brought in the Union.
In support of the allegation, in its brief, the General Coun-
sel cites two cases, Sierra Hospital Foundation, 274 NLRB
427 (1985), and Arrow Automotive Industries, 256 NLRB
1027 (1981). I believe that neither case supports finding a
violation in this proceeding. In Sierra Hospital Foundation,
the director of nursing told union activist Cory that she knew
that ‘‘nurses Phillips, Green, Haskins and Stone were in-
volved in the organizing campaign’’ (274 NLRB at 427).
The Board stated ‘‘we agree with the Judge’s assessment that
such statements, showing such specific knowledge of em-
ployee organizing activities, suggest that the Respondent was
engaged in surveillance.’’ In Arrow Automotive Industries,
the supervisor asked an employee if she knew that there had
been a union meeting the previous evening. On asking how
832 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
he knew, he replied ‘‘there was a lot of things he knew
which she did not know. He said he could even tell her ev-
erybody that was there’’ (256 NLRB at 1029). In the instant
proceeding Natali admitted that he knew some of the em-
ployees who favored the Union. He did not specify their
names. I believe that this proceeding is distinguishable from
Sierra Hospital Foundation where the supervisor was very
specific in mentioning the names of the people involved in
the organizing and from Arrow Automotive Industries where
the supervisor said that he knew ‘‘everybody’’ that was at
the union meeting. I believe that the General Counsel has not
sustained his burden of showing that Respondent created the
impression among its employees that their union activities
were under surveillance and, accordingly, the allegation is
dismissed.
3. Threat of plant closure
The complaint alleges that at several meetings it held with
all of its employees during the period between April 15 and
June 28, Respondent threatened its employees with plant clo-
sure if they chose to be represented by the Union. Ana Colon
testified that at the first meeting of employees held by Re-
spondent, Natali stated ‘‘that if the union came in he would
not have with which to give the promised benefits. And then
he would have to close the company.’’ Similarly, Aniana
Crespo testified that at a meeting in April where all the em-
ployees were present Natali stated that ‘‘all he would have
left to do would be to talk to the union, and if it came down
to it he would have to close down.’’ Aguilar stated that at
one of the meetings with employees Natali said that ‘‘if he
actually negotiated with the union, that he would be forced
to close the company, because he had no money in order to
pay all the expenses that the union was asking for.’’ Julio
Matos, an employee, denied that Natali said he would close
the plant. Similarly, Nieve Cano, another employee, denied
that Natali said he would close the plant.
When Natali was asked whether he stated to employees
that he would close the Company he denied that he made
that statement. He testified, however, that the employees
‘‘had a feeling that that’s the way it would work. That if I
had no money to meet the union demands, that I automati-
cally would have to shut down. Where they got that notion
I don’t know, but I never said it.’’ Natali was then asked
whether he said anything about the possibility of closing the
plant at a meeting with employees on June 26. He testified:
The only time that was alluded to was when we
talked about strikes. And what was said was that in a
very long protracted strike possibly a company would
have to shut down if the strike was too long and there
was an undue burden on the company . . . . It was al-
ways a possibility. That’s as much as was said about
plant closing.
Armand Saavedra, secretary-treasurer of Respondent, also
testified that on June 26 Natali spoke to the employees about
what it would mean to have a strike. He credibly testified
that Natali told the employees that ‘‘if there’s a union there’s
always a probability of a strike.’’ When asked whether Natali
used the word ‘‘possibility’’ or ‘‘probability,’’ Saavedra was
very certain that the word used by Natali was ‘‘probability.’’
Although some of the witnesses testified that Natali actu-
ally said that he would close the plant, after considering all
the testimony, I find that he did not actually make that state-
ment. I find that he told the employees that if the Union
were voted in, negotiations would ensue and there was the
‘‘probability’’ that there would be a strike. In that event,
there was the possibility that the Company would go out of
business.
In NLRB v. Gissel Packing Co., 395 U.S. 575, 618 (1969),
the Supreme Court articulated standards to determine wheth-
er statements of possible effects of unionization are permis-
sible. The Court stated (at 618):
An employer is free to communicate to his employees
any of his general views about unionism or any of his
specific views about a particular union, so long as the
communications do not contain a ‘‘threat of reprisal or
force or promise of benefit.’’ He may even make a pre-
diction as to the precise effects he believes unionization
will have on his company. In such a case, however, the
prediction must be carefully phrased on the basis of ob-
jective fact to convey an employer’s belief as to de-
monstrably probable consequences beyond his control
. . . .
In Marathon LeTourneau Co., 208 NLRB 213, 222
(1974), statements similar to those made by Natali were held
to be ‘‘thinly veiled threats of plant closure if the Union won
the election, violative of Section 8(a)(1) of the Act.’’ In
Turner Shoe Co., 249 NLRB 144, 146 (1980), the Board
held that there was ‘‘no demonstrable record evidence to
support the Employer’s message that . . . unionization would
lead to strikes, plant closure, job loss, and other unidentified
disasters.’’
I find that the record does not contain any basis of objec-
tive fact to show that if the Union were to win the election
there would ‘‘probably’’ be a strike which may then force
Respondent to close. It is entirely understandable that wit-
nesses such as Colon, Crespo, and Aguilar obtained the im-
pression that Natali said he would be forced to close the
Company. As was stated in Georgetown Dress Corp., 201
NLRB 102, 116 (1973):
It is only simple justice that a person who seeks advan-
tage from his elected use of the murky waters of double
entendre should be held accountable therefor at the
level of his audience rather than that of sophisticated
tribunals, law professors, scholars of the niceties of
labor law, or ‘‘grammarians.’’
I therefore conclude that Natali, by making the statement
that if the Union won there would probably be a strike which
could possibly cause the Company to close, threatened plant
closure, in violation of Section 8(a)(1) of the Act.
4. Assistance with transportation costs
The complaint alleges that during several meetings it held
with its employees Respondent promised its employees as-
sistance with transportation costs if they rejected the Union.
Cano testified that at a meeting with employees which took
place prior to the election one of the employees mentioned
transportation costs. Cano credibly testified that Natali said
that he ‘‘couldn’t provide the transportation costs, because he
couldn’t promise anything to anybody.’’ Natali testified that
several employees asked for help in transportation costs. He
833LRM PACKAGING
3 Numerous witnesses testified that no meeting was held the day
before the election. Natali and his attorney both credibly testified
that Natali was advised repeatedly not to schedule a meeting withing
24 hours of the election. An attorney’s advice may be taken into ac-
count in assessing the factors to be considered in determining credi-
bility resolutions. See King Trucking Co., 259 NLRB 725, 728
(1981); Gossen Co., 254 NLRB 339, 350 (1981), enfd. in part and
denied in part on other grounds 719 F.2d 1354 (7th Cir. 1983). I
find that Respondent did not hold a meeting with its employees on
June 28.
4 Robert Moss, Respondent’s attorney, credibly testified that he ad-
vised Natali to ‘‘tell employees that nothing has changed regarding
his ability to do anything.’’ In this regard, see cases cited above in
fn. 3.
credibly testified that he replied that ‘‘we couldn’t give them
an answer at that time. That I’d look into it and . . . I would
get back to them.’’ I find that the General Counsel has not
shown that Respondent promised its employees assistance
with transportation costs. Accordingly, the allegation is dis-
missed.
5. Promise of benefits
The complaint alleges that at several meetings it held with
its employees prior to the election Respondent promised its
employees wage increases and medical and life insurance
benefits if they rejected the Union. Colon testified that on
June 28, the day before the election, Natali told the employ-
ees that ‘‘if the union did not come in’’ he would give them
benefits.3 Crespo testified that Natali stated at that meeting
that ‘‘if the house won they would increase our salary and
give us an insurance plan.’’ Aguilar testified that at one of
the meetings Natali told the employees to ‘‘give him two
weeks to give us the benefits, if the union was no longer out-
side.’’ On cross-examination, Aguilar conceded that Natali
said that ‘‘with a union or without a union’’ if he couldn’t
afford the cost of benefits he couldn’t provide them.
Milagros Lazala, an employee of LRM, was called as a
witness by Respondent. She credibly testified that at a meet-
ing held with employees in April, Natali said that ‘‘he was
going to give us medical benefits and a raise.’’ She further
testified that Natali said ‘‘he couldn’t give them today but
he would give them.’’ She denied that anything was said
about 2 weeks being a period of time before Natali took any
action with respect to the wage increases or providing an in-
surance plan. She further credibly testified that Natali stated
at a meeting which all employees attended that ‘‘he couldn’t
give the raise because the factory was just beginning but that
eventually he would [give] it to us when the company had
more income.’’ Similarly, Cano credibly testified that at a
meeting of all employees at the time when the Union first
began organizing, Natali stated that ‘‘he was going to give
us the medical benefits . . . when he could afford to do it.’’
She also testified that Natali did not say that if the Union
stays away for 2 weeks he will then give the medical bene-
fits and the wage increase. Likewise, Matos credibly testified
that at a meeting held in April Natali stated that he would
furnish a raise and a medical plan ‘‘whenever he was under
the necessary conditions to afford this.’’
I credit the testimony of Lazala, Cano, and Matos that
Natali told the employees at meetings held prior to the elec-
tion that he would grant them a raise and a medical plan
when the Company could afford it. In JFB Mfg., 208 NLRB
2 fn. 1 (1973), the Board held that a statement to an em-
ployee that the ‘‘company would someday better itself’’ and
would offer the employees ‘‘more’’ constituted a violation of
Section 8(a)(1). Similarly, in Permanent Label Corp., 248
NLRB 118, 131 (1980), enfd. 657 F.2d 512 (3d Cir. 1981),
the Board affirmed the administrative law judges decision,
which stated:
The promise of benefits need not be specific in na-
ture or as to the time of its implementation,and need
not be expressly conditioned on abandonment of union
support. Thus a promise that the Company would some-
day better itself and offer the employees more con-
stituted a promise of future benefits in violation of Sec-
tion 8(a)(1).
I find, therefore, that Natali’s statement to the employees
in the preelection period that Respondent would give a raise
and grant a medical plan when the Company could afford it
is a promise of benefits in violation of Section 8(a)(1) of the
Act.
6. Threatened loss of benefits
The complaint alleges that in July Respondent threatened
its employees with loss of promised benefits unless the
Union dropped the charge filed against Respondent. On June
29 a secret-ballot election was held at which time the Union
lost the election. On July 3 the Union filed objections to con-
duct affecting the results of the election. Colon testified that
after the election Natali told employees that ‘‘he was not
going to give the benefits, because the union had a suit
against him. Until the union [took] that suit away he would
not be able to give any benefits.’’ Crespo testified that at a
meeting which took place about a week after the election,
Natali told the employees ‘‘that he had a letter from the
NLRB that he couldn’t do anything, but that he would go
ahead with everything he had promised.’’ Natali testified that
he had a meeting with employees on July 10 or 11. He testi-
fied that employees asked him ‘‘when are you going to give
us the medical benefits and when are you going to give us
our raise?’’ He replied, ‘‘I cannot do anything for you
now.’’4 Based on the above testimony, I find that at a meet-
ing held soon after the Union filed its objections, in response
to a question by employees when he was going to give the
raise and the medical benefits, Natali responded that because
the Union filed objections ‘‘I cannot do anything for you
now.’’
It is a well-established Board rule that during the
preelection period an employer must grant or withhold bene-
fits ‘‘as he would if a union were not in the picture.’’ Gerkin
Co., 279 NLRB 1012 (1986); Great Atlantic & Pacific Tea
Co., 166 NLRB 27, 29 (1967). The same rule has been ap-
plied after an election, while objections to the election are
pending. Martin Industries, 290 NLRB 857 (1988). In Gerkin
Co., supra, the Board pointed out the rationale for this rule
stating ‘‘the Respondent used the withholding announcement
as a campaign tactic and sought to place the onus on the
union for the withholding of the benefits, a classic violation
of the rule requiring the employer to proceed as if the Union
were not in the picture.’’ By stating ‘‘I cannot do anything
for you now’’ because the Union filed objections to the elec-
834 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
tion, Respondent in effect was placing the onus on the Union
for the withholding of the benefits. I find that this constituted
a violation of Section 8(a)(1) of the Act.
7. Wage increases and granting of medical benefits
At the hearing the complaint was amended to allege that
Respondent violated the Act by granting wage increases in
September and by granting medical benefits in October 1989.
The record is clear that wage increases were granted during
the last week of September and a medical plan was instituted
effective October 15.
LRM commenced business in September 1988. During the
first several months of operation, the company maintained a
minimum level of employees and was not profitable. In late
October or early November 1988, an employee, Rosa
Larreta, asked Natali ‘‘when are we going to get Blue Cross
and Blue Shield.’’ Natali responded that it was a new busi-
ness and ‘‘we weren’t in a position to grant medical benefits
at this time.’’ Natali is the owner of another company lo-
cated in close proximity to LRM, called La Rinascente. In
December 1988 while talking with Ron Snider, the insurance
agent for his other company, Natali mentioned to Snider that
‘‘down the road I’m probably going to have to talk to you
about a medical plan for the employees’’ at LRM. In January
or early February, several employees, including Larreta,
again asked Natali for medical benefits. He gave the same
reply that he had given to Larreta earlier. During February
Natali again spoke with Snider and told him ‘‘it look’s like
I’m going to make a go’’ of LRM and ‘‘I’d like to know
what I have to do to find out what it is going to cost me
for a medical plan.’’ Snider told Natali that it would be nec-
essary to get a census sheet filled out for the employees at
LRM so that he would be able to tell him the cost for dif-
ferent medical plans that would be available. In May the cen-
sus forms were distributed to the employees and then re-
turned to the insurance agency. During June Natali was fur-
nished by the insurance agency with the costs of medical
plans with eight different companies. At a meeting held with
the employees on June 26, Natali told the employees ‘‘we
now have what we had been seeking, which is the costs for
the medical plan, and that at the time which we can afford
them, now that we know what they cost, we would imple-
ment them.’’
Natali testified that by September LRM’s ‘‘financial situa-
tion improved to the point where we now felt we could af-
ford the medical plan that we had talked to the employees
about.’’ The Company’s account receivables and incoming
orders had greatly increased and for the month of August
LRM generated about one-third of the total sales generated
during its entire fiscal year. In addition, Natali credibly testi-
fied, which testimony was not controverted, that LRM had
a number of large orders placed with it for work to run
through October and reasonably anticipated obtaining sub-
stantial additional business in the succeeding months. LRM
selected one of the insurance plans suggested by its insurance
agency in its June 9 proposal and implemented that plan on
October 15.
In addition, in September LRM provided a wage increase
to its employees from $4.58 per hour to $4.90 per hour. Sep-
tember marked the first anniversary of LRM’s commence-
ment of operations. Natali explained the reason for giving the
wage increase at the first anniversary, as follows:
I’m involved with two other companies La
Rinascente being one of them . . . and in both busi-
nesses we grant annual increases. And we review on a
yearly basis . . . . So we felt that after one year at
LRM, and with the good financial report that I had for
August and into September, we felt that it was time to
grant a wage increase. Had I not been making money,
neither one of those things would have happened. There
wouldn’t have been any medical benefits, and there
wouldn’t have been a wage increase.
The granting of benefits to employees after an election,
and while objections are pending, can be violative of the Act
if it is an attempt to influence results if a second election is
ordered. Electric Hose Co., 262 NLRB 186, 205 (1982).
However, ‘‘the granting of wage increases and/or benefits
during the pendency of a representation proceeding, includ-
ing the pendency of objections to an election, is not per se
unlawful.’’ Marine World USA, 236 NLRB 89, 90 (1978).
Rather, as the Board stated (ibid.):
The test is whether, based on the circumstances of
each case, the granting of increased wages and benefits
is calculated to impinge upon the employees’ freedom
of choice in an upcoming scheduled election or an elec-
tion which might be directed in the future.
The Board continued (ibid.):
Thus, for example, the Board has found the granting
of new wages and benefits during the pendency of a
representation proceeding to be lawful where an em-
ployer has established that such action was consistent
with past practice, such action had been decided upon
prior to the onset of union activity, or business jus-
tifications prompted the adjustment.
See also Premium Maintenance, 282 NLRB 10 (1986), and
Craft Maid Kitchens, 284 NLRB 1042, 1044–1045 (1987). In
Churchill’s Supermarkets, 285 NLRB 138, 140 (1987), the
Board held that the implementation of a new health care pro-
gram during an election campaign did not violate the Act.
The Board stated (ibid.), ‘‘the Respondent demonstrated that
the improvement in benefits represented the logical working
out of a plan initiated before the advent of a union campaign
. . . .’’
As early as September 1988 Natale told an employee that
he would give medical benefits when the Company could af-
ford it. In December 1988, 4 months prior to the union orga-
nizing campaign, Natali advised his insurance agent of the
possibility of a medical plan for LRM. In February 1989,
Natali again spoke to his insurance agent concerning the
medical plan and was told that census forms would be re-
quired to be completed. This was done during May and the
information concerning alternative medical plans was fur-
nished by the insurance agent to Natali in June. In Septem-
ber, after seeing that the financial situation of the Company
improved, Natali decided to grant medical benefits effective
October 15. With respect to the wage increase, Natali’s prac-
tice at the other two companies he owns is to grant a yearly
wage increase. Seeing that the business had become profit-
able he granted a wage increase at LRM at the first anniver-
sary date of the Company’s being in business. Under such
835LRM PACKAGING
5 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and rec-
ommended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed
waived for all purposes.
6 If this Order is enforced by a judgment of a United States court
of appeals, the words in the notice reading ‘‘Posted by Order of the
National Labor Relations Board’’ shall read ‘‘Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order
of the National Labor Relations Board.’’
circumstances, I believe that the granting of the benefits and
the increased wages was not ‘‘calculated to impinge on the
employees’ freedom of choice in an upcoming scheduled
election or an election which might be directed in the fu-
ture,’’ Marine World USA, supra, 236 NLRB at 90. The
granting of the wage increase was consistent with Natali’s
practice at his other two companies and the granting of the
medical benefits had been set into motion as early as Decem-
ber 1988, 4 months prior to the advent of the Union. When
the results of business operations during the summer of 1989
showed that the Company was profitable, Natali decided to
grant both a wage increase and the medical benefits. Under
these circumstances, I believe that the wage increase and the
granting of medical benefits did not constitute a violation of
the Act. See Marine World USA, ibid. Accordingly, the alle-
gation is dismissed.
CONCLUSIONS OF LAW
1. Respondent is an employer engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act.
2. Local 300-S, Production, Service and Sales District
Council, H.E.R.E., AFL–CIO is a labor organization within
the meaning of Section 2(5) of the Act.
3. By threatening plant closure if the employees chose to
be represented by the Union, by promising wage increases
and medical benefits if the employees rejected the Union,
and by threatening loss of promised benefits because the
Union filed objections to the election, Respondent has en-
gaged in unfair labor practices within the meaning of Section
8(a)(1) of the Act.
4. The aforesaid unfair labor practices constitute unfair
labor practices affecting commerce, within the meaning of
Section 2(6) and (7) of the Act.
5. Respondent did not violate the Act in any other manner
alleged in the complaint.
THE REMEDY
Having found that Respondent has engaged in certain un-
fair labor practices, I find it necessary to order Respondent
to cease and desist therefrom and to take certain affirmative
action designed to effectuate the policies of the Act.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended5
ORDER
The Respondent, LRM Packaging, Inc., South Hackensack,
New Jersey, its officers, agents, successors, and assigns, shall
1. Cease and desist from
(a) Threatening its employees with plant closure if they
choose to be represented by the Union; promising its em-
ployees wage increases and medical benefits if they reject the
Union and threatening its employees with loss of promised
benefits if the Union files objections to an election.
(b) In any like or related manner interfering with, restrain-
ing, or coercing employees in the exercise of the rights guar-
anteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to ef-
fectuate the policies of the Act.
(a) Post at its facility in South Hackensack, New Jersey,
copies of the attached notice marked ‘‘Appendix.’’6 Copies
of the notice, on forms provided by the Regional Director for
Region 22, after being signed by the Respondent’s authorized
representative, shall be posted by the Respondent imme-
diately upon receipt and maintained for 60 consecutive days
in conspicuous places including all places where notices to
employees are customarily posted. Reasonable steps shall be
taken by the Respondent to ensure that the notices are not
altered, defaced, or covered by any other material.
(b) Notify the Regional Director in writing within 20 days
from the date of this Order what steps the Respondent has
taken to comply.
IT IS FURTHER ORDERED that those allegations of the com-
plaint as to which no violations have been found are dis-
missed.