Montgomery Ward & Co., Inc.

National Labor Relations Board - Board Decisions

Feb 26, 1942

39 N.L.R.B. 229 (N.L.R.B. 1942)

In the Matter of MONTGOMERY WARD & CO., INCORPORATED and UNITED
MAIL ORDER, WAREHOUSE AND RETAIL EMPLOYEES UNION, LOCAL
20 (C. I. 0.)
Case No. C4022.Decided February 26, 1942.
Jurisdiction : general merchandising mail-order industry.
Unfair Labor Practices
Collective Bargaining: charges of refusal to bargain collectively, dismissed.
Employer's refusal to accede to union's minimal demands for preferential
shop, seniority, and arbitration held under the circumstances not,to con-
stitute a refusal to bargain collectively.
Employer's effectuation of wage increases without consulting the union
during a period when negotiations with the union were in "suspension"
held under the circumstances not to constitute a refusal to bargain
collectively.
Employer's refusal to divulge details as to its survey of competitive
wage rates when placing its wage proposal before the union held under
the circumstances not to constitute a refusal to bargain collectively.
Practice and Procedure : complaint dismissed.
Mr. Stephen M. Reynolds, for the Board.
Mr. Stuart S. Ball, Mr. Brooks Wynne, and Mr. Frank J. 'Wright,
of Chicago, Ill., for the respondent.
Mr. Francis Heisler, and Mr. Leonard Levy, of Chicago, Ill., for
the Union.
Mr. George Turitz, of counsel to the Board.
DECISION
AND
ORDER
STATEMENT OF THE CASE
Upon an amended charge duly filed on September 22, 1941,1 by
United Mail Order, Warehouse and Retail Employees Union, Local
20 (C. I. 0.), herein called the Union, the-National Labor Relations
Board, herein called the Board, by the Regional Director for the
Thirteenth Region (Chicago, Illinois), issued its complaint, dated
September 23, 1941, against Montgomery Ward & Co., Incorporated,
1 The original charge was filed on May 5, 1941
39 N L R B., No. 41.
229
230 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Chicago, Illinois, herein called the respondent,2 alleging that the re-
spondent had engaged in and was engaging in unfair labor practices
affecting commerce, within the meaning-of Section 8 (1) and (5) and
Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat.
449, herein called the Act. Copies of the complaint'and notice of
hearing thereon, accompanied by 'copies of the amended charge,
were duly served upon the respondent and the Union,
With respect to the unfair labor practices, the complaint alleged,
in'substance, that a majority of, the employees in an appropriate unit
at the respondent's Schwinn Warehouse, Chicago, Illinois, had des-
ignated the Union as their collective bargaining representative at an
election by secret ballot conducted on August 8, 1940, pursuant to a
Direction of Election of the Board issued on July 11, 1940; 3 that at
all times since August 8, 1940, the Union was the exclusive repre-
sentative of all employees in the unit for the purposes of collective
bargaining; 4 and that on various specified dates between September
1940 and April 1941 the Union ' had requested the respondent to
bargain collectively with it as.such representative, but the respond-
ent at all times failed and refused so to do, in that the respondent
failed and refused to bargain With the Union as the exclusive repre-
sentative of all the employees in the appropriate unit or to make
counterproposals to the Union's proposals, granted wage increases to
employees in the appropriate unit during the course of negotiations
with the Union with respect to wages, and failed and refused to make
reasonable efforts to arrive at an agreement with the Union or to
negotiate and bargain with the Union in good faith.
In its answer ' to the complaint, filed on October 4, 1941, the re-
spondent admitted that the Union represented a majority of the re-
spondent's employees in an appropriate unit, but denied that the
respondent had engaged in the unfair labor practices alleged.
Pursuant to notice, a hearing was held at Chicago, Illinois, on
October 20 and 21, 1941, before Samuel Edes, the Trial Examiner
duly designated by the Chief Trial Examiner. The Board and the
respondent were represented by counsel, and the Union by a repre-
sentative. The Board, the respondent, and the Union participated-
in the hearing` and all parties were afforded full opportunity to be
heard, to examine and cross-examine witnesses, and to introduce evi-
dence bearing on the issues. During the hearing counsel for the
Board moved to conform the pleadings with the proof. The motion
2The complaint referred to the respondent as Montgomery Raid & Co During the
hearing , the Trial Examiner granted the motion of counsel for the Board to amend the
complaint to refer to the respondent by its correct corporate name , Montgomery Ward
& Co , incorporated
3 25 N L R B 318
4 The Board so certified .on August 26, 1940 26 N. L. R. B 1347.
MONTGOMERY WARD & CO., INCORPORATED 231
was granted . At the conclusion of the hearing the parties presented
oral argument on the record before the Trial Examiner, and on
November 1, 1941, the respondent filed a brief with the Trial
Examiner.
On or about December 5, 1941, the Trial Examiner filed his Inter-
mediate Report, copies of which were duly served upon the parties,
in which he found that the respondent had not engaged in unfair
labor practices as alleged in the complaint and recommended that
the complaint be dismissed . On or about January 5 , 1942, the Union
filed its exceptions to the Intermediate Report, together with a brief,
and on or ' about January 7 , 1942, the respondent requested oral
argument. On January 27, 1942, pursuant to notice , a hearing was
held before the Board at Washington, D. C.; for the purpose of oral
argument. The respondent and the Union were represented by coun-
sel and participated in the hearing . The Board has considered the
brief ' and exceptions to the Intermediate Report and , except as the
exceptions are, consistent with the findings , conclusions , and order
below, 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 , an Illinois corporation having its principal execu-
tive offices in Chicago, Illinois, is engaged in the manufacture,
purchase , sale, and distribution of general merchandise through
mail-order houses and retail stores . The respondent maintains and
operates 9 mail -order houses , 4 factories , and over 600 retail stores
throughout the United States . During the fiscal year ending January
31, 1940, the -respondent purchased merchandise having a total value
of $358,943 ,(530; in the same period its net sales totaled approximately
$463,832,750.
This proceeding is concerned solely with activities of the respondent
in connection with a warehouse maintained and operated by it at
Chicago, Illinois, known as the Schwinn Warehouse. At the Schwinn
Warehouse the respondent receives merchandise from factories and
vendors for distribution to its retail stores and mail-order customers.
The merchandise distributed through the Schwinn Warehouse is
received from more than 1,000 vendors , the majority of whom are
located outside the State of Illinois . The greater part of such mer-
chandise is shipped from the Schwinn Warehouse to points outside
the State of Illinois . In addition to mail -order customers , such ship-
ments are sent to 374 of the respondent 's retail stores located in 23
States.
232 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
IT. THE ORGANIZATION INVOLVED
United Mail Order, Warehouse and Retail Employees Union, Local
20, is a labor organization chartered by United Retail, Wholesale, and
Department Store Employees of America, herein called the United,
which is affiliated with thG- Congress of Industrial Organizations.
The Union admits employees of the respondent to membership.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. Designation of the Union by a majority of the employees
in the appropriate unit.
On August 26, 1940, on the basis of an election held on August 8,
1940, the Board, acting pursuant to Section 9 (c) of the Act, certified
that the Union had been designated and selected by a majority of all
employees of the respondent at its Schwinn Warehouse, Chicago, Illi-
nois, including catalog-office employees and excluding supervisory
employees on its time-card pay roll, cafeteria employees, ledger, and
supervisory pay roll employees, as their representative for the pur-
poses of collective bargaining and,that, pursuant to Section 9 (a)
of the Act, the Union was the exclusive representative of all such
employees for the purposes of collective bargaining.5 The respondent
does not, in this proceeding, contest the Union's status as such repre-
sentative. Accordingly, we find that at all times from August 8,
1940, to and including April 1941, the Union was the exclusive repre-
sentative of all employees in the unit for the purposes of collective
bargaining with the respondent in respect to rates of pay, wages,
hours of employment, and other conditions of employment.
B. The negotiations
On August 20, 1940, Leonard Levy, a representative of the Union
and regional director of the United, addressed- a" letter to the re-
spondent requesting a collective bargaining conference between the
Union and the' respondent. _ The respondent agreed and a series of
meetings was held. -
The first meeting, held on September 16 to 17, 1940, was in the
nature of a preliminary conference. At the outset the Union re-
quested and was accorded recognition as bargaining representative of
the employees in the appropriate unit. Various other' matters were
briefly discussed, including demands by the Union for a closed shop
and a wage increase. Full discussion, however, was deferred to the
5 26 N L R B 1347
MONTGOMERY WARD & CO., INCORPORATED 233
next meeting, at which the union representatives promised to present
a complete list of its demands.
The next meeting was held on September 24, 1940. `The Union
was represented by Levy, its chief spokesman throughout all the con-
ferences with the respondent; Francis Heisler,'its attorney; Sandra
G. Slotkin, international representative of the United; and a number
of employee-members of the union bargaining committee. The re-
spondent's representatives included John A. Barr, its assistant secre-
tary in charge of labor relations under the direction of Stuart S. Ball,
secretary of the respondent; Sidney Boyden, personnel manager of
the respondent's Chicago mail-order house; and Lawrence Jones,
personnel manager for all the respondent's mail-order operations.
At this meeting Levy presented the following eight demands of the
Union for collective bargaining discussion : a "closed" or "union"
shop,6 seniority, arbitration, the institution of a regular work day,
the 'establishment of a specified policy relating to the reemployment
of workers inducted into military service, the adoption of a grievance
procedure, the elimination of hardships arising out of the operation
of the respondent's vacation policy, and a wage increase of 10 cents'
an hour for all employees.
The greater part of the meeting, which lasted about 3 hours, was
devoted to discussion of the Union's demand for a closed shop. Levy
contended that a closed shop "would reduce the friction between the
management and the employees." Barr replied that the respondent
had considered the proposal but "could not agree to it." The re-
spondent, Barr explained, "felt it was the privilege of each employee
at the Schwinn Warehouse to either join the Union or, not join the
Union, as he personally desired . . .," that since "the law prohib-
ited us from requiring that any employee not join the Union . . .
it was unfair that the company use its economic power as an employer
to force or coerce any employee into the Union . . .," and that
"just as the company did not feel that it should compel its employees
to belong to any particular church or lodge so it did not,feel that
it should compel its employees to belong to any Union." Barr also
argued that the closed shop limits an employer's freedom to choose
his employees. During the discussion Levy requested Barr to offer
"a counter-proposal to our proposal of the union shop," but when
asked by Barr what kind of counterproposal the respondent could
make to a demand for a closed shop, Levy, as he testified, advised
Barr : "I could make a number of proposals if I were the manage-
ment but since I was not the management . . . it was not in my
"These terms , Levy testified , were used interchangeably * "What we asked of manage-
ment was the ruling that all employees of the company be members-of the union or
become members of the union and remain members of the union as a condition of
employment , and that all new employees shall become members of the union."
234 , 'DECISIONS OF, NATIONAL LABOR RELATIONS BOARD
province to make ,a counter-proposal or to be asked what a counter-
proposal would be, that this was, within the province of the manage-
ment and I was asking a counterproposal from them,"
Turning then to the matter of seniority, Levy proposed that "all
hiring and layoffs shall be guided by length of service . . . that
the company's policy . . . . shall be . . . that all employees
with a lesser length of service shall be laid off before employees with
seniority or longer service shall be laid off . . ." According to
Levy, Barr stated that the application of "strict seniority was against
company policy, that there were too many factors involved insofar
as hiring and-layoffs are concerned, besides seniority, that made it
impossible for the management to apply a policy of strict seniority."
The governing factors, Barr explained to the union representatives,
included "seniority, eligibility, efficiency, flexibility, adaptability,
marital status, physical fitness, age . . ." When Barr offered this
formula as a "counter-proposal" to the Union's seniority demand,
Levy characterized it-as "a mess of words which no man could under-
stand," and said that he thought that Barr did not understand it.
Barr replied that the respondent had been applying the policy and
did understand it.
With respect to arbitration, the Union proposed that "in the event
of any disagreements between the management and the Union that
could not be settled between the management and the Union, . . .
such disagreements be presented to an impartial chairman or to an
impartial , arbitrator or to some group of people that would be
selected by the Union and the management, to decide and agree to
select an impartial person to decide these disagreements." The re-
spondent refused this demand, explaining, through Barr, that "the
company would not allow . . . the rights and privileges of man-
agement to pass into the hands of people who were strange to both
the management and the employees . . ., that it was the pre-
rogative of the company to determine policy and to say whether or
not the employees or the management has acted in a proper way;
that to allow . . . arbitration . . . would be taking away
from the management a prerogative . . which the company
would not relinquish . . " i
On the subject of the work day, the Union pointed to the fact
that the employees were required to work at uncertain hours, and
demanded that the respondent- institute "a regular working day"
commencing at 8 a. in. and ending at 4: 50 p. m. This demand,
according to Levy, was rejected with the explanation that such an
arrangement "would be disadvantageous to the company" in view
of the irregular "manner in which orders came into the Schwinn
Warehouse ..."
MONTGOMERY WARD & CO., INCORPORATED 235
,The demand of the Union with respect to employees inducted into
military service was that upon discharge from such service they "be
returned to their jobs without loss of seniority . . . and at the rate
of pay established at the time of . . . reinstatement . .." To this
Barr replied that the respondent "would reemploy, without loss of
status, employees who had been . . . in the country's service pro-
viding conditions had not so changed in the meantime as to make it
. .. impossible or grossly inequitable to do so . . -." The respond-
ent, however, would not commit itself beyond what the law required;
Barr advised Levy that "the provisions for reemployment that were
contained in the Selective Service Act and related Acts was a fair
arrangement and that the wording of the statutes fairly represented
what our policy would-be in that regard."
With respect to the Union's proposal that "a grievance committee'
and channels for the solution of grievances" be established there was
no substantial controversy. Barr, according to Levy, stated that the
management "would welcome the establishment of such a committee"
and that it believed the parties "could work out grievances in the
Schwinn- Warehouse to the satisfaction of the Union and the
management."
With respect to vacations, the Union, according to Levy, took
exception to the respondent's established practice whereby employees
became eligible for vacations on the anniversary date of their em-
ployment and were permitted to take their vacations at any time
during the 12-month period following the anniversary date. Levy
testified that he advised the respondent's representatives that in many
cases this worked a "hardship" on employees, since they "might have
to wait eighteen or nineteen . . . or sometimes twenty months before
[they] could have any vacation . . . in the summer months or in
the usual vacation periods." The union representatives, however,
proposed no alternative for the respondent's policy, and Barr advised
them that the respondent intended to adhere to its existing policy.7
The demand of the Union for a wage increase of 10 cents per hour
for all employees was discussed briefly at this meeting. The manage-
ment representatives stated that it was the respondent's policy to
' According to Barr, the basis for the Union's objection respecting the vacation policy
was that the employees were compelled to take vacations at unseasonable times of the
year when, Barr testified, Levy was told that the employees were free to take their
vacations at any time during the year following the anniversary date of employment,
no further objection was voiced. The sole provision in the proposed contract submitted
by the Union to the respondent on October 11 or 12, 1940, was that "Vacations . . now
enjoyed by the employees shall be maintained by the Employer " Levy also protested that
in particular cases unfair exceptions were made in the application of the respondent's
vacation policy. At the hearing Levy admitted that individual grievances with respect to
vacations were taken up by the Union with the management and that "some" of the
cases were adjusted. -
236 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
pay wages at least as high as those paid by its competitors and that
the respondent was undertaking a survey of the wage rates of its
competitors. Accordingly, the Union was requested and agreed to
defer discussion of wages until the survey was completed.
Further meetings between the Union and management representa-
tives were held on, September 26, October 3, 9, and 30, 1940, and
April 23, 1941. During the meetings held on September 26 and
October 3, 1940, the Union renewed and urged the respondent to
accept its demands. The respondent refused, again detailing the
reasons for its objections to various of the proposals. Nor was the
Union any more successful in prevailing upon the respondent at
the meeting held on October 9, 1940. In addition to those who at-
tended the previous meetings, Samuel Wolchok, president of the
United, appeared and spoke on behalf of the Union. In order, as
Levy testified, "to establish- how closely we can come together in
bargaining collectively," Wolchok suggested that the Union might
accept the respondent's -seniority policy, if the respondent, in turn,
would agree "to arbitrate any differences . . . arising out of the
application of this policy." The respondent would not agree, re-
peating that it was opposed to arbitration and stating that "negotia-
tion was ... a more sound means of working out ... problems ..' .;
that any problem that was solved by negotiation was more satis-
factorily settled than problems that were settled by arbitration."
Other Union demands were also discussed at the meeting, but no
agreement was reached. During the course of the discussion, Wol-
chok asked Barr "whether or not the company would-sign a contract
with the union and enter into an'agreement with the union." Barr
replied : "we will sign anything on which we will agree." When
further asked by Levy to state the matters as to which the parties
could agree, Barr advised the conferees : "We have discussed these
questions with you openly and honestly and you know our position
on all of the questions which we have discussed ; and on any of
those questions which .. . we are in agreement on, we are prepared
to enter into a contract with the union." The meeting terminated
after Wolchok advised Barr that the Union would submit a written
contract to the respondent as the basis for further negotiations. The
Union submitted a proposed contract on October 11 or 12.
At the following meeting, held on October 30, 1940, each item
in the proposed contract was discussed. As a substitute for the
Union's prior demand for a closed shop, the contract provided that
the respondent would discharge any employee presently a member
in the event such employee was expelled or suspended from mem-
bership for violation of the agreement or of the Union's constitu-
MONTGOMERY WARD & CO., INCORPORATED 237
tion or bylaws s Barr told Levy that this proposal "would not be
acceptable to the company for the same reasons . . . advanced in op-
position to the closed shop . . ." The union' representatives then
asked Barr for a written "counterproposal" on this point. Barr
replied that it was "the careful thinking and judgment of the
management ... - that the Schwinn Warehouse should be operated
as an open shop; . . . I would assume that writing out of a sentence
saying that the Schwinn Warehouse would be operated on an open
shop basis would not be what [the Union] was asking for because, as
I understood the general practice in trade agreements, . . . it was
... to say nothing . . . rather than stating that it was an open shop
specifically."
With reference to hours, the contract, embodying substantially
the prior demand of the Union, provided for a regular work day
beginning at 8 a. in. and ending at 4: 50 p. in., with time and a half
to be paid for services performed at other hours. The respondent
would not agree to pay overtime on the basis of a stipulated work
day; it proposed to pay overtime only for work performed in excess
,of a 40-hour week. 1 The testimony is in conflict as to the respondent's
position regarding the establishment of a regular work day. Ac-
cording to Levy, Barr" rejected the Union's proposal, despite the
fact that thereafter the respondent did establish a, regular 8 a. in.
to 4: 50 work day in some of the warehouse departments. Barr,
however, testified that he told the Union "there was no substantial
disagreement between us with regard to hours . . ., that the Union's
demand . . . was practically all right with the company, except
that the beginning and quitting time probably could not be made
effective in all departments." In view of the position taken by
Wolchok, in a letter addressed to Ball, secretary of the respondent,
shortly after the October 30 meeting, that apart from ""the issues in
connection with a preferential shop and seniority . . . other factors
can be ironed out with very little controversy," we find, as did the
Trial Examiner, that, to the extent that resolution of this conflict
is required, Barr's version is to be credited.9
8 The union's representative termed this a "preferential shop " Although not so
provided in the contract, Levy stated at the hearing that he understood the "preferential
shop" demand to include the provision that "in the event of layoffs non-union members
will be laid off first."
9
The fact that the respondent did establish a regular work day in some departments
shortly after the October 30 meeting, is not significant, since this was effected in response
to the Union's request at a grievance meeting with the respondent's Schwinn warehouse
superintendent, Peters. In one of the pamphlets issued to its members, the Union
announced that among the "changes . . . brought about by our Union" was the fact
that, "for the first time in Schwinn, hours have been regulated . . " In another such
pamphlet, the Union advised its members that as a result of its presentation of the matter
to the respondent , the management "had agi eed . . . to have a regular starting and
stopping time on the receiving dock."
238 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The other-provisions in the contract, dealiiig with seniority, arbi-
tration, vacations, grievance procedure, wages, and employees in-
ducted into military service, also embodied substantially the de-
mands theretofore made by the Union." As to vacations and griev-
ance procedure the parties were in substantial accord. On seniority
and arbitration, however, the parties again could find no common
ground. These points were fully discussed, but, as had been true
at the earlier meetings, the respondent would not yield as to
either and the Union would accept the respondent's seniority
formula only if its demand for arbitration was accepted.
At the October 30 meeting, for the first time, the Union's wage
proposal received full consideration." The respondent announced
that its survey of competitive wage rates had been completed, and
that, in view of the facts revealed by the survey, the respondent was
prepared to grant wage increases to three categories' of employees,
namely, the order fillers, whose wages would be raised from 40 cents
per hour to a sliding scale of 40 to 47 cents per hour, and the checkers
and the parcel-post packers, whose rates would be raised from 45
cents per hour to a sliding scale of 50 to 56 cents per hour. Ap-
proximately 125 of the 200 workers then employed would be affected
by the proposed increase. The respondent's representatives dis-
closed the names of the concerns covered by the survey, but refused
to divulge the wage rates in effect at all the concerns on the ground
that some of the figures had been given to the respondent in con-
fidence. They stated, further,- that they were unable to give the
Union the names of the employees affected by the proposed increase
and the amount of the increase each would receive 12 Barr stated
that the respondent would be willing to receive and consider any
further information the Union might have respecting competitive
wage rates for the classifications involved, but that the respondent
desired to put the stated increases in effect immediately. Wolchok
agreed that the increases should not be held up pending the negotia-
tion of a final'agreement on all the subjects under discussion, and
the new rates were put into effect on November 1, 1940.13
i° Such differences as appeared were minor in character Thus, in regard to vacations,
the contract provided only for the maintenance of the existing practice At an earlier
meeting the Union had recognized that its demand for strict seniority could not be applied
to all employees : the contract accordingly made provision for the exception of specified
categories of workers
"Levy testified that the wage question was considered at the October 9 meeting, but
the notes of Broian, one of the iespondent's attorneys, which are probably more reliable
In this regard, place the discussion at the October 30 meeting
ii Fui ther, according to Levy, Barr adx iced the Union that lie did not know whether
the respondent would disclose the total pay-roll increase reflected by the proposed raises.
Barr testified that the Union was told that such figures had not been computed, but that this
would be done and the figures furnished if the Union so desired . We credit the testimony
of Barr on this point, as did the Trial Examiner.
11 In a leaflet distributed to the employees on about November 16, 1940, the Union
announced : "Montgomery ward has increased wages in the Schw inn warehouse as a
MO'NTGOME'RY WARD & CO., INCORP rORATE':D 239
The Union took as its final position that it would "never sign a
contract which does not contain either a provision for a closed shop
or a provision for arbitration," 14 and the October 30 meeting proved
unproductive of an agreement. That night Wolchok and other rep-
resentatives of-the Union met with Ball, secretary of the respondent.
Little was accomplished. On Wolchok's suggestion, the October 30
meeting was adjourned without arrangements for a future meeting
having been made. On November 4, in a letter addressed to Ball,
Wolchok, after stating that Ball had been "entirely frank and honest
in [his] expressions and opinions," stated :
I should like to inquire at this time whether you have a
favorable reply to, the issues which we left with you, in connec-
tion with a preferential shop and seniority. This is of particular
importance. Other factors can be ironed out with very little
controversy. -
Ball replied :
We have reviewed Mr. Barr's report and have approved the posi-
tion which Mr. Barr took in the course of his discussions with
you. Certainly, however, the door is open to you for further
discussions at any time you may desire. All you will have to
do is to advise Mr. Barr. of your wishes.
No further meeting looking toward the consummation of a col-
lective bargaining agreement was had between the parties until
'April 23, 1941. Prior thereto, however, a grievance procedure was
initiated and meetings were held at regular intervals between union
and management representatives with respect to various grievances
relating to bonuses, wage rates paid to individuals, favoritism, the
dismissal of employees, lighting facilities, and the like. Many of
the matters so handled were successfully adjusted. In a broadside to
its members the Union, referring to its grievance meeting with the
respondent on December 10, announced : "SCIIWINN UNIT PRESENTS
19 GRIEVANCES-COMPANY CORRECTS 18." '
At the meeting held on April 23, 1941, negotiations for a contract
were resumed . However, the preferential shop, seniority, and arbi-
tration issues again arose as barriers to an agreement-1,5 Except with
result of our negotiations . " and in a leaflet distributed about December 13, it was
stated that "the Union negotiated wage increases for a majority of the Schwinn workers."
'+ At the time of the hearing , Levy testified , the Union had but one contract with an
employer which did not provide for a closed or preferential shop; that contract , however,
contained both seniority and arbitration provisions
'L Wages were also discussed at this time . Between November 1, 1940, and April 23,
1941, the respondent had initiated various wage increases in addition to those announced
at the previous October 30 meeting Barr admitted that the Union had not been consulted
in this matter , but explained that wages had been increased because of the rise in com-
petitive wage scales and that the Union had not been consulted because it had "made
no request upon the company to ... negotiate wages subsequent to November 1st, 1940."
448105-42-vol. 39-17
240 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
respect to grievance questions, no further meetings were held between
the parties.
C. Concluding findings
In the circumstances here disclosed the respondent cannot be said
to have violated its statutory duty to bargain collectively with the
Union. At the first meeting with the Union's representatives the
respondent accorded the Union recognition as exclusive bargaining
agent of the employees. Thereafter the respondent, whenever re-
quested, inet with the Union and allowed it full opportunity to
present its demands and its reasons in support thereof, and at all
times it fully explained its own position as to each of the Union's
proposals. The respondent indicated, further, the terms upon which
it would enter into a collective bargaining agreement and declared
its willingness to reduce to writing any agreement reached.
The duty imposed by the Act is not limited to the recognition of
the representatives of the employees, to the mere meeting and dis-
cussion of terms with them, or to the formal expression of a willing-'
ness to enter into contractual arrangements. The Board and the
courts on frequent occasion have indicated that the difference between
the semblance and the substance of collective bargaining may be
tested by the extent to which the parties evidence a sincere purpose
to explore the total situation and find a basis for agreement.16 The
employer must in a very real sense undertake to discover with the
Union such common ground as may exist between the parties. On
the other hand, satisfaction of the statutory obligation does not
require an employer to capitulate to the demands addressed to him 17
The record in this case does not, in our opinion, disclose a failure
by the respondent to meet its affirmative responsibility to find a
mutual basis of understanding. As a result, at least in part, of the
Union's demand for a wage increase, the management undertook a
survey of competitive rates of pay, and, when this was completed,
presented to the Union its proposal on the subject. The respondent's
wage proposal was thereafter put into effect only upon consultation
16 See , for example , Matter of S L. Allen it Company, Inc. and Federal Labor Union
Local No 18526 , 1 N. L R B , 714, 728; Matter of Singer Manufacturing Co and United
Electrical, Radio it Machine Workers of America, 24 N L R B 444 , enf'd as mod
Singer Manufacturing Co v. National Labor Relations Board , 119 F (2d) 131 (C C A 7)
cent den , 313 U S. 595; National Labor Relations Board v Reed it Prince Mfg Co , 118
F (2d) 874 (C C. A. 1), cert den , 313 U S 595; National Labor Relations Board v
George P Pilling it Son Co ., 119 F ( 2d) 32 (C. C. A. 3) ; Globe Cotton Mills v. National
Labor Relations Board, 103 F (2d) 91 (C. C. A. 5) ; National Labor Relations Board v
The Boss Mfg . Co, 107 F. ( 2d) 574 (C C A 7) ; Wilson it Co v . National Labor Relations
Board, 115 F ( 2d) 759 (C. C A. 8).
" Art Metal Construction Co. v. National Labor Relations Board. 110 F. (2d) 148
(C C A. 2) ; National Labor Relations Board v. Highland Paik Mfg Co , 110 F (2d) 632
(C
(C.
C. A. 4) ; National Labor Relations Board v. F, xpress Publishing Co, 111 F
C. A 5), mod. in other respects , 312 U. S. 426,
( 2d) 588
MOMPGOVIE'RY WARD, & CO., INCORPORATED 241
and agreement with the Union, which thereafter announced to its
membership that the wage increases were the "result of our negotia-
tions." The fact that in placing its proposal before the Union the
respondent refused to divulge details as to the competitive rates shown
by the survey is not significant in the circumstances of this case.
There is no indication that such refusal was grounded in a purpose
to defeat the negotiations; the respondent, so far as appears, sin-
cerely believed the requested information to be confidential. More-
over, the Union did not claim that competitive rates were not suffi-
ciently known to it as a result of its own organizational experience
in the industry.
WWTe do not attach importance to the fact that the respondent
effected further wage increases after November 1, 1940, without con-
sulting the ' Union. However significant this might have been in
other circumstances, in this case the increases were put into effect
pursuant to normal management policy and with no purpose of by-
passing the Union. Moreover, as in Matter of Westchester News-
papers, Inc., and Westchester Newspaper Guild, et al.,18 negotiations
were in "suspension" at the time. In these circumstances the re-
spondent was' under no duty to withhold normal action respecting
wages pending consultation with the Union.19 This is especially true
since the wage question at no time appeared as an issue in any way
determinative of the final course of negotiations. Throughout, the
negotiations stood at an impasse for reasons unrelated to any question
of wages. As appears from WVolchok's letter to Ball of November 4,
the parties were in substantial disagreement only as to the issues
arising in connection with the Union's demands for a preferential
shop, seniority, and arbitration. These issues were basic to the
successful negotiation of an agreement. The respondent would not
yield, but-neither would the Union. The respondent was not bound
to ^iccede to these minimal demands, and the record does not show
that in refusing to yield the respondent was motivated by an unlaw-
ful design or insincerity of purpose. On the contrary, that the
respondent stood its ground in good faith and would, where it deemed
it proper, yield to the demands of the Union, is attested by its amen-
ability to the institution of a regular work day, the establishment
of a grievance procedure, and the frequent adjustment of grievances
at regular meetings held' for that purpose with the Union's repre-
sentatives. It appears clear that but for the honestly taken but
irreconcilable positions of the parties 'in regard to the preferential
shop, seniority, and arbitration, the negotiations would have resulted
18 26 N L B. B. 630
"See National Labor Relations Board v. Sands Manufacturing Co., 306 U S- 332, 343,
344.
242 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
.in a mutually satisfactory agreement concerning wages, hours, and
other terms and conditions of employment.20
In view of the foregoing, and upon the entire record herein, we
find that the respondent did not refuse to bargain collectively with the
Union within the meaning of the Act.
Upon the foregoing findings of fact and upon the entire record in
the case, the Board makes the following :
CONCLUSIONS OF LAW
1. United Mail Order, Warehouse and Retail Employees Union,
Local 20 (C." I. 0.), is a labor organization, within the meaning of
Section 2 (5) of the Act. -
2. At all times from August 8, 1940, to April 1941, United Mail
Order, Warehouse and Retail Employees Union, Local 20 (C. I. 0.),
was the exclusive representative of all employees of the respondent at
'its Schwinn Warehouse, Chicago, Illinois, including catalog-office
employees and excluding supervisory employees on its time-card pay
roll, cafeteria employees, ledger, and supervisory pay-roll employees,
for the purposes of collective bargaining within the meaning of
Section 9 (a) of'the Act.
3. The operations of • the respondent at its Schwinn Warehouse,
Chicago, Illinois, occur in commerce, within the meaning of Section
2 (6) of the Act.
4. The respondent at its Schwinn Warehouse, Chicago, Illinois, has
not engaged in unfair labor practices within the meaning of Section
8. (1) or (5) 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 Rela-
tions Act, the National Labor Relations Board hereby orders that
the complaint against Montgomery Ward & Co., Incorporated, Chi-
cago, Illinois, be, and it hereby is, dismissed.
CHAIRMAN MILLIS took no part in the consideration of the above
Decision and Order.
20 The facts disclosed in this case differ in substantial and decisive respects from the
facts in Matter of Montgomery Ward & Company and Warehousemen's Union, Local No
206, et at., 37 N. L R. B. 100, in which the Board found a violation of Suction 8 (1)
and (5 ) of the Act Unlike the situation here, the respondent in that case , the Board
found , refused to agree to embody understandings with the union in'a signed written con-
tract, refused to accord the union exclusive recognition in such contract , refused to discuss
freely and fully the demands of the union or to take any affirmative action looking toward
the- successful consummation of negotiations , and in a variety of other ways evidenced
a want of good faith in negotiations with the union.