Montgomery Ward & Co., Inc.

National Labor Relations Board - Board Decisions

May 25, 1962

137 N.L.R.B. 346 (N.L.R.B. 1962)

346 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
To grant the requested units would seriously fragmentize the com-
munity of interest among all the employees. Furthermore there is no
evidence that the Employer has a truckdriver as such. Instead it
appears that many employees drive a truck for short periods of time,
none for more than 50 percent of the time. Additionally, the two job
classifications with the strongest community of interest would be
placed in different units; namely the cement finisher and the cement
finisher's helper.
Neither the laborers nor the operating engineers constitutes a craft
or departmental unit.' Accordingly, the only appropriate unit would
be an overall unit including all the employees employed by the Em-
ployer, excluding supervisors.
The Employer contends that the petition should be dismissed be-
cause none of the Unions involved herein has geographical jurisdiction
broad enough to embrace the Employer's normal area of operations.
The Board has consistently refused to predicate unit findings upon
the scope of a local's territorial jurisdiction. The Petitioner and In-
tervenors may withdraw from the election upon timely notice to the
Regional Director 4
Accordingly, we find that the following employees of the Employer
constitute a unit appropriate for the purposes of collective bargaining
within the meaning of Section 9(b) of the Act : All employees em-
ployed by Broomall Construction Company in the Pennsylvania
counties of Northampton, Bucks, Montgomery, Chester, Delaware,
Lancaster, Dauphin, Lebanon, Schuylkill, Carbon, Luzerne, Monroe,
Lehigh, Berks, and York; and the county of Burlington in New
Jersey; but excluding watchmen, guards, and supervisors as defined
in the Act.
[Text of Direction of Election omitted from publication.]
MEMBERS RODGERS and FANNING took no part in the consideration
of the above Decision and Direction of Election.
8 Truss-hfart Corporation, et al ., 121 NLRB 1430; Greene Construction Company, et al.,
133 NLRB 152.
' Paxton Wholesale Grocery Company, 123 NLRB 316.
Montgomery Ward & Co., Incorporated and Retail Store Em-
ployees Union Local No. 1099, Retail Store Clerks International
Association , AFL-CIO. Case No. 9-RD1-267. May 25, 1962
SUPPLEMENTAL DECISION AND ORDER
On November 22, 1961, the Board issued a Decision and Direction
of Election 1 in the above-entitled case, finding appropriate a unit of
1 Not Published In NLRB volumes.
137 NLRB No. 26.
MONTGOMERY WARD & CO., INCORPORATED 347
employees at the Employer's Covington, Kentucky, catalog store,
and directing an election therein. In its decision, the Board found
that the Employer's 5-year contract with the Union, executed
August 1, 1958, and effective from June 1, 1958, to June 1, 1963, was
inoperable as a bar to the Employer's petition which was filed during
the third year of that contract. Thereafter, the Union filed a petition
for reconsideration of the Board's decision, asserting that the decision
would unfairly permit an employer to escape its contract obligations.
The Union's International filed a statement in support of the Union's
position. The Employer filed a statement in support of the Board's
decision urging, as the Board had found, that the Board's contract-bar
rules do not preclude the filing of any petition after the expiration of
the 2-year contract-bar period. As additional grounds for holding the
contract no bar, the Employer reiterated the following contentions it
made when the case was first presented to the Board but which were
not passed upon by the Board in the earlier decisions: (a) that the
contract in question was executed by Local 1594 of the Retail Clerks,
and that the Union is not the legal successor to Local 1594; and (b)
that a substantial change in the Employer's operations and in the
character of the unit had occurred since the execution of the contract.
The Board having considered the petition for reconsideration and
the entire record in this case, including all briefs, finds merit in the
Union's contention and hereby grants the petition for reconsideration.'
We are now persuaded, for the reasons set forth below, that where,
as here, the incumbent union is the certified bargaining-representative,'
a current contract should constitute a bar to a petition by either of the
contracting parties during the entire term of that contract. Accord-
ingly, we hold that absent a conflicting timely claim by a rival union, a
petition by either of such parties to a contract is timely only when filed
at the proper time with respect to the contract's expiration date. To
that extent, the Board's rule that a contract of unreasonable duration
will not bar a petition timely filed at or near the end of the first 2 years
of its duration 4 will not apply to the employer and the certified union.'
The primary objective of the Board's contract-bar doctrine is the
achievement of a reasonable balance between the frequently conflicting
aims of industrial stability on the one hand and freedom of choice by
'The Union 's request for oral argument is hereby denied as the record , including the
briefs of the parties, adequately present the issues and the positions of the parties.
3 As hereinafter found, Local 1099 is the legal successor of Local 1594, the certified
union. As such, it is entitled to the benefits of the certification.
* Union Carbide and Carbon Corporation v N.L.R.B , 244 F. 2d 672, 673 (C.A. 6) ;
Pacific Coast Association of Pulp and Paper Manufacturers, 121 NLRB 990, 992.
5 The Board has long held that an uncertified union may file a petition during the
existence of its contract which would otherwise bar an election where it seeks the benefits
of certification General Box Company, 82 NLRB 678. However, the Board will not
process a similar petition by a certified union Botany Mills, Inc, 101 NLRB 293. We
have also held that a petition by an employer who has a contract with an uncertified
union is subject to the contract-bar rules Pazan Motor Freight, Inc, 116 NLRB
1568, 1570.
348 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
employees in the selection of their bargaining representatives on the
other hand. By that doctrine, the Board seeks to afford the contract-
ing parties and the employees a reasonable period of stability in their
relationship without interruption and at the same time to afford the
employees the opportunity, at reasonable times, to change or eliminate
their bargaining representative if they wish to do so. The need to
weigh those conflicting aims arises, for example, where the employer
and the designated union exercise their discretion in agreeing to the
term of the contract and, during that term, the employees seek to
change their representative. In such circumstances, the Board's
contract-bar rules provide a 2-year period during which a valid con-
tract of longer duration constitutes a bar to rival representation claims
or to employee action to decertify the incumbent. Consideration of
the basis of this 2-year rule and its intent reveals clearly that the sole
reason for the possible disruption of a contractual relationship is to
give effect to the employees' right to freedom of choice. There is no
other valid rationale for the Board's conducting an election in dis-
regard of the agreement of the parties as to the term thereof or for
the Board to permit the parties to disregard their own agreement
except by mutual consent, as where the contract is not asserted as a bar.
This valid reason does not exist in the circumstances present here.
The parties to the contract are not rival claimants and a petition by
either of them does not indicate possible employee dissatisfaction with
the existing condition. Rather, such possible dissatisfaction or desire
for a change is presented as a reason for conducting an election only
when a timely petition for certification or for decertification is filed by
a rival union or by the employees or someone acting on their behalf and
such petition is supported by at least a 30-percent showing of interest.
As we make no change in our rule that such petitions may be filed
during the term of a contract of unreasonable duration as long as the
filing occurs at the prescribed times, the rights of the employees are
and continue to be fully protected and remain unaffected by our deci-
sion herein.
It is thus clear that, contrary to the view of our dissenting col-
leagues, our determination with respect to an employer's right to file
a petition under the circumstances of this case does not constitute an
encroachment on "the proper exercise of the employees' freedom of
choice." This being so, we cannot interpret our contract-bar rules in
such a way as to permit employers or certified unions 6 to take ad-
vantage of whatever benefits may accrue from the contract with the
knowledge that they have an option to avoid their contractual obliga-
9 To the extent the holding of Botany Mills. Inc , supra, might be subject to a different
interpretation as to the time at which a petition by a certified union may be filed with
respect to its contract , it is hereby modified to accord with our decision herein.
MONTGOMERY WARD & CO., INCORPORATED 349
tions and commitments through the device of a petition to the Board
for an election?
We find no merit in our colleagues' position that this decision is in
conflict with that portion of Section 9(c) (2) Which provides that "In
determining Whether or not a question of representation affecting
commerce exists, the same regulations and rules of decision shall apply
irrespective of the identity of the persons filing the petition or the
kind of relief sought ...." It is manifest from the legislative his-
tory that this provision was enacted for the sole purpose of requiring
that the Board give equal treatment to affiliated and independent
labor organizations." There is no support whatsoever for the inter-
pretation of that language as requiring that the Board treat all peti-
tioners identically regardless of the facts of each situation. On the
contrary, the contract-bar doctrine itself requires, and the Board
frequently has, made distinctions among filing parties based on the
circumstances of the particular case.' The courts have long recog-
nized that the contract-bar doctrine is a creation of the Board 10 and
that it may, in the Board's discretion, be applied or Waived as the facts
7 We have not in the past permitted a party to avoid its valid commitments or cpn-
tractual obligations in other respects through the use of the Board s processes and vie
see no warrant for concluding that a different rule should be applied to petitions by the
contracting parties See, e g., Spielberg Manufacturing Company, 112 NLRB 1050 (arbi-
tration awards) , Speidel Corporation, 120 NLRB 733 (waiver of bUrgaining rights con-
cerning a given subject) : The Cessna Aircraft Company, 123 NLRB 855, and Briggs
Indiana Corporation, 63 NLRB 1270 (agreement by union not to seek to represent certain
categories of employees during the contract term) ; Sinclair Refining Company, 132
NLRB 1660 (contract terns considered in determining employer's obligation to supply
information).
9 Conference Report No. 510 on H.R. 3020 at p. 48, Legislative History of the Labor
Management Relations Act, 1947, vol I, p. 552; Senate Report No 105 on S 1126 at
p 25, Legislative History of the Labor Management Relations Act, 1947, vol I p 431
6 For example, the General Box case, supra, which the dissenting opinion cites with
approval and which our dissenting colleagues have themselves applied in innumerable
cases, itself makes a distinction in the application of the contract-bar rules in permitting
an uncertified union to petition at a time when the existing contract would bar a rival
claim, although neither an employer (Pazan Motor Freight, Inc., supra) nor a certified
union (Botany Mills, Inc., supra) could do so. Other instances of different treatment
accorded on the basis of the existing conditions are too numerous for an exhaustive list-
ing Some examples are: (1) The holding that aff employer who has recognized an un-
certified union may, near the end of an existing contract, file a General Box type petition
although the employer continues to recognize and bargain with the incumbent union,
whereas in the usual situation the petition would be dismissed on the ground that no
question of representation exists under such circumstances. J. P. O'Neil, at al., d/b/a
J. P. O'Neil Lumber Company, 94 NLRB 1299, 1301; Schye & Sullivan, at al, 115 NLRB
1427; American Lawn Mower Co., 108 NLRB 1589 Compare United States Gypsum Com-
pany, 117 NLRB 1677, with United States Gypsum Company, 116 NLRB 1771 (2) The
holding that the Board will process a petition filed after a new contract is signed where a
union had previously requested recognition but refrained from filing a timely petition in
reliance on the employer's statements or other conduct, although the same contract would
be a bar if the claimant had merely requested recognition prior to its execution but had
delayed filing the petition with the Board. Greenpoint Sleep Ps oducts, 128 NLRB 548;
Deluxe Metal Furniture Company, 121 NLRB 995, 998-999.
10 See, e.g., Kearney & Trecker Corp. v. N.L R B , 210 F. 2d 852 (C.A. 7), cert denied
348 U.S. 824.
350 ' DECISIONS OF, NATIONAL LABOR RELATIONS BOARD
of a given case demand in the interest of stability and fairness in col-
lective bargaining."
In view of the above, we hereby reverse the decision of November 22,
1961, that the petition herein was timely filed because filed during the
third year of a 5-year contract.
In view of our reversal of the finding in the earlier decision, it now
becomes necessary to consider the Employer's aforementioned addi-
tional claims that the contract is no bar because (a) the Union is not
the legal successor to Local 1594, which executed the contract, and (b)
that there has been a substantial supervening change in the Employer's
operations and the bargaining unit since the execution of the contract.
As to (a), Local 1594 of the Retail Clerks, which executed the con-
tract, was certified by the Board on May 31, 1955, following an election
in Case No. 9-RC-2486, conducted pursuant to a stipulation for certi-
fication upon consent election. It later merged with Locals 981, 1099,
and 1109 of the Retail Clerks, all in the Greater Cincinnati area, the
,surviving local being known as Local 1099. Prior to the merger, the
affairs of the individual locals were being managed by a single group
of the International's representatives, and the same group continued
this function following the merger. The Employer continued to
check off dues to Local 1099 for some 9 to 10 months following the
merger. In these circumstances, and in view of the lack of evident
significant change in the union membership, officers, or administrators
of the local, or in its day-to-day relationships with the Employer, and
the apparent understanding of both the Employer and the Union that
the consolidated group intended to function as a continuation of the
constituent unions, we find, contrary to the Employer, that Local 1109
is the successor to Local 1594, within the meaning of the Act.12
As to (b), the record shows that the contract in question was exe-
cuted on August 1, 1958 and covered the Employer's Covington, Ken-
tucky, retail store employees. On Saturday, December 17, 1960, the
Employer terminated this retail store operation, and on the following
Monday, reopened at the same location as a catalog store, retaining 14
of its former complement of 52 employees, which it later reduced to its
current complement of 8 employees. Hours, benefits, and other condi-
tions of employment have remained substantially unchanged. The
changeover from the retail store, which had a catalog department, to
the catalog store operation required no more than 2 months of em-
ployee instruction. While there are differences between the two types
11 For example , in Kearney & Trecker Corp v N L.R B , supra, the court set aside 101
NLRB 1577 on other grounds but enforced that decision insofar as it is relevant to the
instant case , in National Biscuit Division (National Biscuit Co ) v Boyd Leedom, 265
F 2d 101 (CAD C ), cert denied 359 U S. 1011 , the Board 's schism rule was held to be
within the allowable limits of the Board 's discretion and not prohibited by Section
9(c) (2) Accord, N L R B. v. Grace Company, 184 F. 2d 126 (C A 8) ; N L. R.B. v. Libbey-
Owens-Ford Glass Company, et at., 241 F. 2d 831 (CA. 4).
12 Union Carbide & Carbon Corp v. N.L.R.B , supra
MONTGOMERY WARD & CO., INCORPORATED 351
of operation, these differences appear primarily to concern the Em-
ployer's administration, rather than its labor relations. Labor rela-
tions have remained centralized under a single manager in Chicago,
Illinois, who plays a primary role in bargaining and contract negotia-
tion in behalf of the stores.13 In these circumstances, we find that there
has not been a sufficiently substantial change in either the Employer's
operations or the character of the bargaining unit to remove the con-
tract as a bar.
Accordingly, we find that the contract is a bar to the instant petition,
and we shall therefore order that the petition be dismissed, and shall
amend the certification to conform herewith.i4
[The Board set aside the Board's Decision and Direction of Election
of November 22, 1961, dismissed the petition, and amended the certi-
fication in Case No. 9-RC-2486 by substituting therein, as the repre-
sentative of the employees, Retail Store Employees Union Local No.
1099, Retail Clerks International Association, AFL-CIO, for Retail
Clerks International Association, Local 1594, A.F.L.]
MEMBERS RoDGERS and LEEDOM, dissenting :
We disagree with our colleagues' decision, which reverses, on recon-
sideration, a Board finding that the contract was no bar to the Em-
ployer's petition.
The Board's contract-bar doctrine unqualifiedly declares that a pe-
riod of 2 years, but no longer, is a reasonable time during which em-
ployees must, in the interest of bargaining stability, forgo their
freedom of choice in the selection or rejection of bargaining repre-
sentatives. Following the expiration of the 2-year period, the em-
ployees are entitled to complete freedom of choice in the selection of
representatives. The several types of representation petitions con-
stitute different avenues for bringing this about; no one of these ave-
nues can be closed to employees, as does the majority decision, without
encroaching to that extent on the proper exercise of the employees'
freedom of choice.
The decision of the majority here is basically inconsistent with both
the intent of Board's contract-bar doctrine," and with the mandatory
13 Catalog store employees in the Employer's chain share equally in incentive pay,
whereas retail store employees receive individual incentive pay Both groups receive
basic pay. The administrative differences between the catalog and retail operations in-
clude separate chains of supervisory authority , separate company divisions and ware-
housing, the existence of sales forces in retail stores , and the fact that catalog stores
sell by sample only The differences in employee functions are largely concerned with the
use of different types of forms and accounting procedures.
14 Lloyd A. Fry Roofing Company, et at., 118 NLRB 587. The fact that the Union has
not requested such amendment is immaterial as the Board has the authority to police its
certification by clarification , amendment , or even revocation , on its own motion The
Bell Telephone Company of Pennsylvania , 118 NLRB 371 , 373 The Order herein is not
to be construed as a new certification or an extension of the previously issued certification
15 Contrary to our colleagues ' assertion , there is nothing in the Board ' s contract-bar
doctrine which limits the applicability of the 2 -year rule to "rival" petitions Rather, the
352 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
language of Section 9 (c) (2) of the Act, which reads in part as
follows :
In determining whether or not a question of representation af-
fecting commerce exists, the same regulations and rules of decision
shall apply irrespective of the identity of the persons filing the
petition or the kind of relief sought... .
Clearly, the contract here would not constitute a bar to a petition filed
by a rival union. Indeed, the contract here would not constitute a bar
if this union were uncertified and if it, itself, had filed a representation
petition.16 Thus, in holding that it does bar the Employer's petition
and that for this reason no question concerning representation exists,
our colleagues, contrary to the express provisions of the Act, have
fixed different "rules" for determining the existence of such a ques-
tion, and have made their decision dependent on "the identity of the
persons filing the petition."
For these reasons, we would affirm the Board's earlier decision.
Board has stated unequivocally and without limitation that " any contract having a
fixed term in excess of 2 years shall be treated , for the purposes of contract bar, as a
contract for a fixed term of 2 years. . .' Pacific Coast association of Pulp and Paper
Manufacturers, 121 NLRB 990, 992
16 General Box Company, 82 NLRB 678 ; Natona Mclls , hie, 97 NLRB 11 ; Pazan Motor
Freight, Inc, 116 NLRB 1568
Western States Regional Council No. 3 International Wood-
workers of America , AFL-CIO and International Woodworkers
of America , Local 3-101 , AFL-CIO 1 and Priest Logging, Inc.'
Case No. 19-CC-168. May 25, 1962
DECISION AND ORDER
On January 25, 1962, Trial Examiner Eugene K. Kennedy issued
his Intermediate Report, attached hereto, in the above-entitled pro-
ceeding, finding that the Respondents had not engaged in any unfair
labor practices and recommending that the complaint be dismissed.
Thereafter, Respondent Regional Council and the General Counsel
filed exceptions and supporting briefs.'
The Board' has reviewed the rulings of the Trial Examiner made
at the hearing and finds that no prejudicial error was committed.
The rulings are hereby affirmed. The Board has considered the Inter-
mediate Report, the exceptions and briefs, and the entire record in
1 Hereinafter referred to as the Regional Council and the Local, respectively.
a Hereinafter referred to as Priest.
3 The exceptions of Respondent Regional Council went solely to the failure of the Trial
Examiner to find that it was not properly named as a Respondent
'Pursuant to the provisions of Section 3(b) of the Act, the Board has delegated its
powers in connection with this case to a three-member panel [Members Leedom, Fanning,
and Brown].
137 NLRB No. 31.