Memphis Furniture Mfg., Co.

National Labor Relations Board - Board Decisions

Jan 14, 1981

254 N.L.R.B. 330 (N.L.R.B. 1981)

DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Memphis Furniture Manufacturing Co. and United
Furniture Workers of America, Local 282. Case
26-CA-8258
January 14, 1981
DECISION AND ORDER
BY CHAIRMAN FANNING AND MEMBERS
JENKINS AND PENELLO
Upon a charge duly filed on February 1, 1980,
by United Furniture Workers of America, Local
282, herein called the Union, and duly served on
Memphis Furniture Manufacturing Co., herein
called Respondent, the General Counsel of the Na-
tional Labor Relations Board, by the Regional Di-
rector for Region 26, issued a complaint and notice
of hearing on April 24, 1980, in Cases 26-CA-8343
and 26-CA-8258, and thereafter severed them
upon the execution of a settlement agreement in
the former case.
The complaint alleged with respect to the latter
case that Respondent violated Section 8(a)(5) and
(1) of the National Labor Relations Act, as amend-
ed, by refusing to pay unit employees a Christmas
bonus in December 1979. Respondent filed a timely
answer to the complaint denying the commission of
any unfair labor practices.
Thereafter, on August 25, 1980, the General
Counsel of the National Labor Relations Board
filed with the Board in Washington, D.C., a stipu-
lation entered into by the parties on August 19 and
20, 1980, wherein they, inter alia, (1) agree that Re-
spondent failed to pay a Christmas bonus in 1979,
(2) waive a hearing before an administrative law
judge, and (3) request that the instant case, Case
26-CA-8258, be transferred directly to the Board
and considered jointly with Case 26-CA-7551,
which involved the same parties, and that the
Board make findings of fact and conclusions of law
and issue a Decision and Order in the instant case.
By an order dated September 29, 1980, the
Board approved the stipulation of the parties,
denied the request that the instant case be consid-
ered jointly with Case 26-CA-7551,1 ordered the
instant proceeding transferred to the Board, and
advised the parties to file briefs with the Board.
Thereafter, the General Counsel filed a Motion for
Summary Judgment 2 and Respondent filed a brief
in opposition thereto.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
I The Board issued its Decision and Order in Case 26-CA-7551 on
September 24. 1980, 252 NLRB No. 25.
2 In view of the parties' request that the Board issue a Decision and
Order on the basis of the stipulated record, we shall treat the Motion for
Summary Judgment as a brief.
254 NLRB No. 39
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
On the basis of the stipulation, the Motion for
Summary Judgment, the brief, and the entire
record, the Board makes the following:
FINDINGS OF FACT
I. THE BUSINESS OF RESPONDENT
Respondent is a Tennessee corporation engaged
in the manufacture of furniture in Memphis, Ten-
nessee. During the 12-month period preceding the
stipulation, Respondent had direct inflow and out-
flow of materials and products valued in excess of
$50,000.
The parties stipulate, and we find, that Respon-
dent is engaged in commerce within the meaning
of Section 2(6) and (7) of the Act, and we find that
it will effectuate the purposes of the Act to assert
jurisdiction herein.
II. THE LABOR ORGANIZATION INVOLVED
The parties stipulate, and we find, that United
Furniture Workers of America, Local 282, is, and
at all material times has been, a labor organization
within the meaning of Section 2(5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. The Stipulated Facts
All production and maintenance employees, local
and over-the-road truckdrivers, and warehouse em-
ployees of Respondent constitute an appropriate
unit for collective-bargaining purposes within the
meaning of Section 9(b) of the Act. Following an
election on or about May 20, 1977, the Board on
September 15, 1977, certified the Union as the col-
lective-bargaining representative of the unit em-
ployees. At all times thereafter, the Union has
been, and is now, the exclusive representative of all
unit employees for the purposes of collective bar-
gaining with respect to rates of pay, wages, hours
of employment, and other terms and conditions of
employment. From March 12, 1978, and continuing
to March 12, 1980, Respondent and the Union
were parties to a collective-bargaining agreement
which provided the terms and conditions of em-
ployment for the unit employees.
On December 11, 1979, Respondent's counsel,
Ted M. Yeiser, sent to Union President Willie
Rudd a letter referring to article XV, the Christ-
mas bonus provision of the collective-bargaining
agreement, 3 stating that production and economic
:' It provides as follows: "The Company shall continue its present dis-
cretionary policy concerning the granting of gratuitous Christmas bo-
rnuses.
330
MEMPHIS FURNITURE MANUFACTURING CO.
Christmas bonus for 1979, and suggesting a meeting
to discuss the matter. Yeiser and Rudd and other
representatives of Respondent and the Union met
on January 2, 1980, at which time Respondent de-
scribed its business problems and offered a reduced
bonus of $15 to employees with more than I but
less than 5 years of service and $30 to those with
longer service. The Union took the position that
Respondent should adhere to the formula it fol-
lowed in the past; namely, 20 and 40 hours of pay
respectively for the two classes of employees.
On January 3, the membership of the Union
voted to reject Respondent's offer; and Respondent
was so informed on the following day. Thereafter,
Respondent, without the consent of the Union,
failed to pay any Christmas bonus for 1979 to unit
employees.
B. Contentions of the Parties
The General Counsel contends that the instant
case is governed by the recent Decision involving
the same parties and issue 4 wherein the Board held
that Respondent violated Section 8(a)(5) and (1) of
the Act by failing to comply with its promise to
continue, for the life of its 2-year contract with the
Union, payment of the Christmas bonus in the same
manner as in preceding years.
Respondent argues as follows in requesting dis-
missal of the complaint herein:
The language of article XV of the collective-bar-
gaining agreement provides that Christmas bonuses
are discretionary and gratuitous. It is settled law
that such gratuities are not mandatory subjects of
bargaining. As the parties freely agreed that Christ-
mas bonuses are discretionary and gratuitous, the
1979 Christmas bonus is outside the scope of mat-
ters which are mandatory subjects for collective
bargaining.
The clear language of the Christmas bonus arti-
cle is buttressed by article I, "Purposes and Scope
of Agreement," 5 which constitutes a clear and un-
4 Memphis Furniture Manufacturing Co.. supra.
Art. I provides:
Section 1. The purpose of this Agreement is to record the full
terms agreed upon by the Company and Union on all matters subject
to collective bargaining.
Section 2 . .. [T]he parties acknowledge that during the negoti-
ations which have resulted in this Agreement, each party had the un-
limited right and opportunity to make demands and proposals, and
that the understandings and agreements arrived at by the parties
after the exercise of that right and opportunity are set forth in this
Agreement. Therefore, the Company and the Union, for the life of
this Agreement. each voluntarily and unqualifiedly waive the right
and each agrees that the other shall not be obligated to bargain col-
lectively with respect to any subject or matter referred to or covered
by this Agreement, or with respect to any subject or matter not spe-
cifically referred to or covered in this Agreement, even though such
subject or matters may not have been within the knowledge or con-
templation of either or both of the parties at the time they negotiated
and signed this Agreement.
mistakable waiver of the Union's right to bargain
over the 1979 Christmas bonus.6
Even if it is assumed, arguendo, that the Christ-
mas bonus is a mandatory subject for bargaining,
Respondent did not violate Section 8(a)(5) and (1)
of the Act because it did in fact bargain in good
faith with the Union regarding that subject on Jan-
uary 2, 1980. Although Respondent initially pro-
posed that it pay no Christmas bonus for 1979, it
did offer to compromise by paying less than the
usual amount. However, the offer was unequivocal-
ly rejected by the Union, which did not request
any further negotiations or give any indication that
it would accept an amount smaller than that pro-
vided by the formula used by Respondent in the
years up to and including 1977. 7
C. Discussion and Conclusions
We agree with the General Counsel that the in-
stant case is governed by the recent Decision8
wherein the Board deemed the language of the
Christmas bonus provision of the contract unclear
but resolved the ambiguity therein by holding, in
light of the negotiations concerning said provision
as well as the history of Respondent's regular
bonus payments before and after the negotiations,
that Respondent orally agreed to continue to pay
the bonus for the life of the contract on the basis of
the same formula as in the past. Respondent was
therefore ordered to give retroactive effect to the
Christmas bonus provision pursuant to said formu-
la.
As indicated above, Respondent contends that
article I of the contract constitutes a waiver of the
Union's right to bargain concerning the continu-
ation of the Christmas bonus, and that, in any
event, Respondent was under no obligation to pay
the 1979 bonus because it did in early 1980 bargain
in good faith with the Union, which refused to
accept its compromise proposal. The cases cited by
Respondent in support of its argument are inappo-
site as they, unlike the instant proceeding, do not
involve a contract which contains a Christmas
bonus provision. As the Board has already con-
cluded that said provision requires Respondent to
pay its traditional Christmas bonus for the life of
the 2-year contract, Respondent's contentions as to
I Respondent cites Radioear Corporation, 199 NLRB 1161 (1972), and
214 NLRB 362 (1974), and Bancroft-. Whitney Ca. Inc., 214 NLRB 57
(1974). for the proposition that a similar "zipper" clause constituted a
waiver of the union's right to bargain concerning the continuation of the
Christmas bonus.
I Respondent cites Century Electric Motor Company. 192 NLRB 1941
(1971), wherein it was held that the employer had bargained in good faith
to impasse on the subject of a Christmas bonus and was therefore free to
withhold it.
n Memphis Furniture Manufacturing Co.. supru.
331
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
its good-faith bargaining and waiver are inapplica-
ble to the situation herein because the Union in its
dealings with Respondent properly continued to
rely on the Christmas bonus provision of the con-
tract by insisting on compliance therewith.
In view of the foregoing, we find that Respon-
dent violated Section 8(a)(5) and (1) of the Act by
failing and refusing to pay its unit employees the
1979 Christmas bonus in accordance with the for-
mula which it followed prior to 1978.
IV. THE EFFECT OF THE UNFAIR LABOR
PRACTICES UPON COMMERCE
The activities of Respondent set forth in section
III, above, occurring in connection with its oper-
ations described in section I, above, have a close,
intimate, and substantial relationship to trade, traf-
fic, and commerce among the several States and
tend to lead to labor disputes burdening and ob-
structing commerce and the free flow of com-
merce.
V. THE REMEDY
Having found that Respondent has engaged in
unfair labor practices, we shall order that it cease
and desist therefrom and take certain affirmative
action designed to effectuate the policies of the
Act.
Having found that Respondent unlawfully failed
and refused to pay Christmas bonuses to employees
for 1979 as required by the collective-bargaining
agreement then in effect, we shall order it to honor
and give retroactive effect to the terms and condi-
tions of the collective-bargaining agreement relat-
ing to Christmas bonuses and make its employees
whole for losses suffered by reason of its failure to
honor and apply the provisions of the agreement,
with interest to be computed in the manner set
forth in Florida Steel Company, 231 NLRB 651
(1977). 9
CONCLUSIONS OF LAW
1. Memphis Furniture Manufacturing Co. is an
employer engaged in commerce within the mean-
ing of Section 2(2), (6), and (7) of the Act.
2. United Furniture Workers of America, Local
282, is a labor organization within the meaning of
Section 2(5) of the Act.
3. All production and maintenance employees,
local and over-the-road truckdrivers, and ware-
house employees of Memphis Furniture Manufac-
turing Co., but excluding all office clerical and pro-
fessional employees, salesmen, watchmen, guards
and supervisors as defined in the Act, constitute a
9 See, generally, Isis Plumbing d Heating Co., 138 NLRB 716 (1962).
unit appropriate for the purposes of collective bar-
gaining within the meaning of Section 9(b) of the
Act.
4. Since September 15, 1977, the above-named
labor organization has been, and is now, the certi-
fied and exclusive representative of all employees
in the aforesaid appropriate unit for the purposes of
collective bargaining within the meaning of Section
9(a) of the Act.
5. By refusing since December 1979, and at all
times thereafter, to bargain collectively with the
above-named labor organization as the exclusive
bargaining representative of the employees of Re-
spondent in the appropriate unit, specifically by re-
pudiation of the Christmas bonus due the unit em-
ployees pursuant to its collective-bargaining agree-
ment with the Union, Respondent has unilaterally
and without the consent of the Union, modified the
contract in mid-term in derogation of Respondent's
bargaining obligation under Section 8(d) of the
Act, thereby engaging in unfair labor practices af-
fecting commerce within the meaning of Section
8(a)(5) of the Act.
6. By the acts described in section III, above,
Respondent has refused to bargain with the Union
and has interfered with, restrained, and coerced its
employees in the exercise of the rights guaranteed
them in Section 7 of the Act, and thereby has en-
gaged in and is engaging in unfair labor practices
within the meaning of Section 8(a)(1) of the Act.
7. The aforesaid unfair labor practices are unfair
labor practices affecting commerce within the
meaning of Section 2(6) and (7) of the Act.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board hereby orders that the Respondent,
Memphis Furniture Manufacturing Co., Memphis,
Tennessee, its officers, agents, successors, and as-
signs, shall:
1. Cease and desist from:
(a) Unilaterally and without the consent of the
Union failing and refusing to pay Christmas bo-
nuses due employees under any collective-bargain-
ing contract between Respondent and the Union or
othewise unilaterally modifying the provisions of
any such contract during its term.
(b) In any like or related manner interfering
with, restraining, or coercing employees in the ex-
ercise of the rights guaranteed them in Section 7 of
the Act.
2. Take the following affirmative action which
the Board finds will effectuate the policies of the
Act:
332
MEMPHIS FURNITURE MANUFACTURING CO.
(a) Honor and give retroactive effect, from De-
cember 1979, to the terms and conditions of its
March 12, 1978, collective-bargaining contract
with the Union relating to Christmas bonuses, and
make its employees whole for the losses incurred
by them as a result of Respondent's failure to
honor and apply the provisions of the contract in
the manner set forth in the section of this Decision
entitled "The Remedy."
(b) Preserve and, upon request, make available to
the Board and its agents, for examination and copy-
ing, all payroll records, social security payment re-
cords, timecards, personnel records and reports,
and all other records necessary to analyze the
amount of backpay and other redress due under the
terms of this Order.
(c) Post at its Memphis, Tennessee, place of busi-
ness copies of the attached notice marked "Appen-
dix." 1 0 Copies of said notice, on forms provided by
the Regional Director for Region 26, after being
duly signed by Respondent's authroized representa-
tive, shall be posted by Respondent immediately
upon receipt thereof, and be maintained by it for 60
consecutive days thereafter, in conspicuous places,
including all places where notices to employees are
customarily posted. Reasonable steps shall be taken
by Respondent to insure that said notices are not
altered, defaced, or covered by any other material.
'O In the event that this Order is enforced by a Judgment of a United
States Court of Appeals, the words in the notice reading "Posted by
Order of Judgment of the United States Court of Appeals Enforcing an
Order of the National Labor Relations Board."
(d) Notify the Regional Director for Region 26,
in writing, within 20 days from the date of this
Order, what steps the Respondent has taken to
comply herewith.
APPENDIX
No-rTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILI. NOT unilaterally and without the
consent of United Furniture Workers of Amer-
ica, Local 282, fail and refuse to pay Christmas
bonuses due you under any collective-bargain-
ing agreement between us and the Union or
otherwise unilaterally modify the provisions of
any such contract during its term.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce you in the
exercise of your rights under Section 7 of the
National Labor Relations Act, as amended.
WE WILL honor and give retroactive effect
to the terms and conditions of our March 12,
1978, contract with the Union as it relates to
Christmas bonuses, and WE WILL pay each of
you the amounts you lost since December
1979 with interest on the amounts due, because
we did not pay the Christmas bonuses due
under the contract.
MEMPHIS FURNITURE MANUFACTUR-
ING Co.
333