Morten-Davis Co.

National Labor Relations Board - Board Decisions

Aug 19, 1942

43 N.L.R.B. 394 (N.L.R.B. 1942)

In the Matter of MORT>;N-DAVIS COMPANY and INTERNATIONAL
LADIES' GARMENT WORIcERS UNION, LOCAL No. 387
Case No. C-2213.-Decided August'19, 1942
Jurisdiction : garment manufacturing industry.
Unfair Labor Practices
Discrinnanation: charges of, dismissed: employee found to have been discharged
not because of his union membership and activity but because of his failure
to cbtain a bond from a Company such as employer required from all of its
permanent employees.
Practice and Procedure : complaint dismissed.
Mr. Ebner P. Davis, for the Board.,
Mr. George 0. Wilson, of Dallas, Tex:, for the respondent.
Mr. Jack Johannes, of Dallas, Tex., for the Union.
Mr: Mozart G. Ratner, of counsel to the Board.
DECISION
AND
ORDER
STATEMENT OF THE CASE
Upon a charge duly filed on December 27, 1941, by Intetnational
'Ladies' Garment Workers Union, Local No. 387,1 herein called the
'Union, the National Labor Relations Board, herein called the Board,
by the Regional Director for the 'Sixteenth Region (Fort Worth,
,Texas), issued its complaint, dated April 28, 1942, against Morten-
Davis Company, Dallas, Texas, herein called the respondent, alleging
that the respondent had engaged in and was engaging in unfair labor
practices affecting commerce, within the meaning of Section 8 (1)
and (3) and Section 2 (6) and (7) of the National Labor Relations
s The caption of the original charge designated the charging union as Inte, national
'Ladies' Garment Workers Union, Local No 387, but was signed "International Ladies'
Garment Workers Union, Local 348 by Jack Johannes, Attorney " The complaint followed
the signature appearing on the original charge and designated the charging union as
International Ladies' Garment Workers Union, Local No 348 At the hearing, on motion
of Board's counsel and with the waiver of any objection by the respondent's counsel, the
complaint was amended to designate the charging union as shown above.
43 N. L R B, No. 68. '
394
MORTEN-DAVIS COMPANY 395
Act, 49 Stat. 449,,herein called the Act. Copies of the complaint to-
gether with notice of hearing thereon were duly served upon the
respondent and the Union.
Concerning the unfair labor practices, the complaint alleged, in
substance, that the respondent on or about December 17, 1941, dis-
charged; Roy Lyall and since that date has refused to reinstate him
to his former position because he joined or assisted the Union or
engaged in other concerted activities.
On or about May 7, 1942, the respondent filed an answer denying
that it had .engaged in the unfair labor practices alleged in the
complaint.
Pursuant to notice, a hearing was held on May 14 and 15, 1942, at
Dallas, Texas, before Howard Myers, the Trial Examiner duly desig-
nated by. the Chief Trial Examiner. The Board, the respondent, and
the Union were represented by counsel and participated in the hearing.
Full' opportunity to be heard, to examine and cross-examine' witnesses,
and to introduce evidence bearing on the issues was afforded all
parties. At the close of the hearing, counsel for the Board moved to
conform the complaint to the proof and counsel for the, respondent
then moved to conform the answer to the proof. Both motions, were
granted. During the course of the hearing, the Trial Examiner made
rulings on numerous other motions and on objections to the admission
of evidence. At the close of the hearing, the parties argued orally
before the Trial Examiner. Counsel for the Union filed a brief with
the Trial Examiner on May 20, 1942. The Board has reviewed the
rulings of the Trial Examiner and finds that no prejudicial errors
were committed. The rulings are hereby affirmed. I .
The Trial Examiner thereafter filed his Intermediate Report, dated
May 29,,1942, copies of which were duly served upon the parties. He
found that the, respondent had engaged in and was engaging in unfair
labor practices affecting commerce, within the meaning of Section 8
(1) and (3) and Section 2 (6) and (7) of the Act, and recommended
that it cease and desist therefrom and take certain affirmative action
deemed necessary to effectuate the policies of the Act. On June 22,
1942, the respondent filed exceptions to the Intermediate Report, and
a brief in support of such exceptions. None of the parties requested
oral argument before the Board.
The Board has considered the exceptions and briefs filed by the re-
spondent and finds that the exceptions, insofar as they are consistent
with the findings of fact, conclusions of law, and order set forth below,
are meritorious.
396 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Upon the entire record in the case, the Board makes the following :
FINDINGS OF FACT,
I. THE BUSINESS OF THE RESPONDENT
The respondent, a Texas corporation with its principal office and
place of business at Dallas, Texas, is engaged in the manufacture,
sale, and distribution of ladies' ready-to-wear -garments. During
1941, the respondent purchased cloth, the principal raw material used
in manufacture of its finished product, valued in excess of $335,000,
of which amount 95 percent was purchased outside the State of Texas
and shipped to its place of business at Dallas, Texas. The value of the
finished products sold by, the respondent during the same year
amounted to approximately $700,000, of which amounts 75 percent
was sold, shipped, and delivered to points outside the State of Texas.
The respondent admits that it is engaged in commerce within .the
meaning of the Act.
. II. THE ORGANIZATION INVOLVED
International Ladies' Garment Workers Union, Local No. 387, is
a labor organization affiliated with the American Federation of Labor,
admitting to membership employees of the respondent.
III. THE ALLEGED UNFAIR LABOR PRACTICES
Roy Lyall 2 was first employed by the respondent in the spring or
summer of 1934 as an elevator operator. , About 7 or 8 months later
he was transferred to the cutting room where he worked as a spreader
and then as a cutter. In January or February 1935, while working
as an elevator operator and known to the respondent as Bradshaw,
,he was asked by Ruth Johnson, the respondent's secretary, book-
keeper, and cashier, to fill out an application for a surety company
bond.3 Lyall indicated to Johnson that it was useless for him to fill
out the application because he knew that the National Surety Corpo-
ration would not bond him. Johnson thereupon notified John B.
Donovan, the respondent's president, who asked Lyall for an expla-
nation. Donovan testified, "I told him [Lyall] that the reason I was
. 2 When Lyall was about 5 years old his father died and shortly thereafter his mother
married a ' man named Bradshaw. From the time of his mother ' s remarriage until 1938,
when he was about 29 years of age , Lyall was known as Roy Bradshaw . Since 1938 he
has been known as Roy Lyall
I At this time the respondent had,a "schedule" or master bond of the National' Surety
Corpoiatiog covering certain of its employees. Persons in the position of Lyall were
bonded as,a matter of course. Each February the respondent would submit to the surety
company the names of the persons it wished to include in the bond for the coming year,
together with their respective positions and the amount of coverage it wanted for the
individuals named.
1
MORTEN-DAVIS COMPANY .397
asking that is he would have to do something about it if he continued
' on there [with the respondent] a definite period." Lyall explained
to Donovan that in 1932, while working for the Postal Telegraph
and Cable Company in Houston, Texas, under the name of Bradshaw,
he was charged with a shortage in his accounts and that the National
Surety Corporation or its predecessor, the National Surety Company,
which was his surety, was obligated to reimburse the telegraph com-
pany for the loss.4 Donovan then told Lyall that he would give him
an opportunity to try to clear the matter up. Lyall agreed to do so
and filled out the application. On February 20, 1935, Johnson wrote
the surety company as follows :
Upon renewal of Fidelity Bond Schedule covering various em-
ployees, we have included Roy Bradshaw, who has been in our
employ for about a year. -
He advises us that he is unable to make application to you for
bond right at this time. Is there any particularly good reason
why you could not accept his application for bond? Any infor-
mation you can give us will be appreciated and held in the strict-
est confidence. '
The surety company answered, by letter dated February 23, that it had
previously bonded a Roy Bradshaw of Houston, Texas, and had been
obliged to pay a claim of $67 and inquired for Lyall's home address.,
Thereafter, the surety company, on or about March 25, notified the
respondent that it had elected to cancel the bond as to Lyall and that
after April 26, 1935, Lyall would not be covered by the bond. In June
1936, Lyall was laid off because of lack of work.
In September 1940, he was, rehired by Plant Superintendent John,
Jennings under whom he had worked during his first employment
with the respondent.5 Lyall told Jennings that he had"resumed the
name of Lyall; thereafter he was so carried on the respondent's books.
Johnson testified that she first learned "several months" after Lyall's
rehiring that he was the same person who had previously worked for
the respondent under the name of Bradshaw. Since the bond list
was revised each February, Jennings asked Lyall, in January' or Feb-
ruary 1941, to fill out an application form to be submitted to the Na-
tional Surety Corporation. Lyall, replied that he did not think be
would be able to "pass a bond," but at Jennings' request he executed
the form and returned it the following day. On May 11, 1941, the
respondent requested the surety company to include Lyall under that
name in its master bond. This the surety company did. Some days
+ Lyall - testified without contradiction and we find, as did the, Tiial Examiner, that,
the- shortage was not due to any fault of his. Neither the surety company nor the tele-
graph company proceeded against him by either civil or criminal action
3 After working as a cutter for about 6 weeks he became a marker in the cutting room
and held that position until his discharge.
398• DECISIONS OF NATIONAL LABOR RELATIONS BOARD
later Johnson notified the surety company by telephone of Lyall's
identity.° -
On or about June 6 the Union received its charter.. Lyall was not
a charter member and there is no evidence that he was active in union
affairs before the charter was issued. He joined the Union 3 weeks
after it was chartered, at which time some of the other cutters em-
ployed by the respondent had already become members. Lyall ad-
mitted that he did not begin to wear his union button in the plant
until a few weeks after he had joined the Union, and the record shows
that all the other cutters who were union members began to wear their
buttons in the plant at approximately the same time.
On July 17 the surety company notified the respondent that it had
elected to terminate its liability under the bond as to Lyall and- that
pursuant to the terms -of the bond it was giving the respondent 35
days' notice of that intention. Johnson testified that upon' receiving
this communication she spoke to Donovan, who remarked that Lyall
would have to do something about it. Donovan testified that he there-
upon spoke to Jennings and,
asked him if he knew that Roy Lyall could not make bond and
he said he did not, and I also asked him if he knew if he was the
same as Roy Bradshaw that worked for us before and he said
that, he did know; and I said, "'Nell," I said'. do you need him
now at this time ?" He said, "Yes, I do." I said, "We don't want
to do anything to hurt the boy but he will have to do something
about getting his bond fixed up." So I told him or Miss Johnson
to speak to him [Lyall] and see what he could do about it. I
don't know which one I spoke to, probably both.?
On July 24, the respondent wrote the surety company asking it
to' reconsider its action, stating that since it was the respondent's
policy not to retain in its employ anyone "on whom [the respondent]
could not secure fidelity insurance" it wished "to do nothing that
would hurt" Lyall. With respect to this letter, the respondent
received no reply from the surety company until November 18, 1941.
In August 1941 the respondent, after repeated solicitations by the
9 On July 7 , the surety company's Dallas office wrote a letter to its home office in New
York in which it said , among other things :
We are now advised that the Assured suspects Roy Lyall to be one and the same
as Roy Bradshaw, Change notice #4, 'March 25, 1935, File #105005, cancelled
Bradshaw 's coverage under this schedule on account of unsatisfactory investi-
gation
will you please immediately compare Roy Lyall with Roy Bradshaw 's applica-
tion and if there is any possible basis for filing cancellation notice, please imme-
diately send it to us
This letter is the only evidence of the date of Johnson's call
7 The record does not indicate , however , whether or not' either Jennings or Johnson
discussed the matter with Lyall at that time.
MORTEN-DAVIS COMPANY 399
surety company, decided to substitute 'a blanket bond covering all of
its employees for the schedule bond which had been in force until that
time.
On November 14, 1941, Don Ellinger, the manager of the Dallas and
Fort Worth locals of the International Ladies' Garment Workers
Union,,called upon Donovan pursuant to an appointment' At this
meeting, according to Donovan's testimony, the following occurred :
* * * Well, before they came in * * * Don Ellinger came
in to see me and said lie wanted to talk to me, and I asked him
him what he, wanted to talk to me about. He said he wanted.to
talk to me about the cutters. I said, "What about the cutters?"
He said, "The boys want a raise." I, said, "Mr. Ellinger, I would
be glad to discuss it with the boys themselves, but I have nothing
to discuss with you. In fact, I don't recognize you as a bargain-
ing agent." * * * I reminded him of the fact that the Board
had, just ruled 8 that be was not, or the union which he repre-
sented was not a bargaining agent, and I told him also, I said,
"The boys are here. I will be glad to talk to them individually
because a matter of salary is a question of status of an employee.
Each employee is on an entirely different status. Some of them
have been here a long time and some are entitled to a raise,
and some are not. I will be glad to talk to each one of them
separately and individually" * * * 9
Towards the end of this meeting the five cutters, all of whom were
members of the Union, appeared at the entrance to Donovan's private
office. Both Ellinger and Donovan then went over to the men and
Ellinger told them that Donovan refused to discuss the question of
a wage increase with him, but that Donovan would discuss the mat-
ter with the men individually, if they so desired. Thereupon, Lyall
told the other men to wait outside and he went into Donovan's pri-
vate office.
According to Donovan's testimony, which is in substantial accord
with Lyall's version of what took place at this meeting, he said to
Lyall, after the latter had told him that the cutters wanted a raise :
* * * "Well, Roy, the first thing that you have to do before
we could give you a raise would be to clear up your bond."
I said, "If you were entitled to it raise I wouldn't want to give
"On November 10, 1941, the Board issued a decision in a representation proceeding in-
volving the Union and the respondent , dismissing the Union 's petition on the ground that
the unit consisting only of cutters, contended for therein by the Union ,'was inappropriate
for the purpose of collective bargaining. Matter of Morten-Davis Company, doing business
under the trade name of Donovan Manufacturing Company and International Ladies'
Garment TForkers Union, Local A `o . 387, 36 N . L R B 804.
° Elhnger testified substantially to the same effect. -
400 DECISIONS OF NATIONAL LABOR -RELATIONS BOARD
you a raise until you could clear that up because we might have
to let you go if you were not able-to make the bond." I said,
"Has Mr. Jennings said anything to you about the bond,", and
I think he said, "No." I said, "Well, I want you to clear this
bond up. I want you to get this cleared up, and then after that
I will discuss it with Mr. Jennings, and if possible we will give
you a raise." He said, "How long will you give me to get this
bond fixed up ?" And I said, "Any reasonable length of time."
And, he said, "Well," - - - I said, "I would suggest that you go
up and see the bonding company and see what you can do,about
He further testified that he told Lyall that "it wouldn't be neces-
sary Roy, for you, or any of the other boys to bring any outsider
in to discuss matters with" him, because he was "always willing and
ready to talk to any of you boys at any time." Lyall testified that he
was going to tell Donovan that he had joined the Union but that he
did not get a chance to do so.,
At the time of this conference Donovan had not yet received the
reply from the surety company to his letter of July 24 and therefore
had no' reason to believe that Lyall' could not make a satisfactory
'adjustment with the surety' company. However, in its letter of
November 18, the surety company informed the respondent that it
would not rescind its cancelation notice of July 17. -
Shortly after his talk with Donovan on November 14, and pur-
suant to Donovan's suggestion that he stfaighten out the matter of
the bond, Lyall,went to the Dallas office of the surety company: ' He
testified that he was told, and that he immediately thereafter in-
formed Donovan, that the surety company "could adjust the matter
if it was satisfactory with" the respondent. On December 3, Dono-
van wrote the surety company as follows :
Mr. Roy Lyall, who is employed in our organization, was ad-
vised by me that it'would be necessary for me to drop him from
our employ unless he was able to make bond. On his request, I
told him I would give him a reasonable time to get the bond.
But he now advises me that he talked to you and that you told
him you could'adjust the'matter if it was satisfactory with me.
I do not understand this statement if you made it. -
As I understand the case, the responsibility is yours and -not
ours, to determine whether or not you will bond this employee.
If you are, willing to bond him as you do other employees, then
I would like for you to,do it, and do it immediately. If you are
not willing'to,, bond' him; as you do other ,employees, advise me,
immediately, but please do not put the responsibility for your
MORTEN-DAVIS COMPANY • 401
favorable or unfavorable decision on us. Whether you do or
do not issue the bond to him is your responsibility, and not ours.
It is my intention to keep this employee so long as his work con-
tinues to be satisfactory, if he gets the bond. On the other hand,
I will release him if he is unable to get the bond.
By letter dated December 15, the surety company again informed the
respondent that it would not' bond Lyall. On the same date the
surety company wrote Lyall in part as follows:
Besides yourself we understand that Mr. J. B. Donovan, Presi-
lent, The Morten-Davis Company has called upon this office
to intercede for you to see if by your repayment of the above
amount -we would reconsider the question of bonding you. While
we appreciate the interest shown on your behalf by Mr. Dono-
van this is to confirm our previous verbal advice to you, namely,
'that this office has no authority to speak for the corporation on
that subject of bonding or in bonding any certain individual, that
such matters are handled and passed upon exclusively by our
home office underwriters who directed this office- of our corpora-
tion to issue'the cancellation notice last July. In' other words,
if you pay the amount [due] to our corporation- we cannot, as
we do not have such authority, tell you or.' Mr. Donovan that
our corporation will rebond you.
On December 17 Donovan called Lyall to his office and told him
that because the surety company refused to bond him he was discharged.
Lyall then left the plant. On January 5, 1942, Lyall returned to the
plant and handed Donovan a fidelity bond in the sum of $2400 10 writ-
ten by the Lawyers Lloyds of Texas, and told Donovan that if the pro-
visions of the bond were not satisfactory to the respondent, the Lawyers
Lloyds of Texas would write a bond that was satisfactory. On the
following day Donovan returned the bond to Jack Johannes, the
Union's attorney, with a letter wherein he stated that under the, cir-
cumstances the bond was not acceptable to the respondent. The
concluding paragraph of the letter reads as follows :
If he [Lyall] can get the company which bonds our employees, to
reconsider their action and bond him in the same manner that they
do other employees of this company, I would then consider him
for reemployment, whether or not I would reemploy him would,
of course, depend on all of the circumstances surrounding the
situation at- the time he was able to put himself in the 'same
position as other employees of this company.
"The National Surety Colpoiation 's blanket bond was of the same amount.
481039-42-vol. 43-26
402 DECISIONS OF NATIONAL LABOR RELATIONS BOARD'
The Trial Examiner found that Johnson notified the surety com-
pany of Lyall's identity on or before July 7 because she became aware
of Lyall's union activity just prior to that date. However, we ar3
not convinced that Johnson was aware of Lyall's union affiliation when
she called the surety company or that any such knowledge which she
may have had motivated her attempt to ascertain whether or not
the surety company was cognizant of Lyall's identity. The Trial Ex-
aminer further found that Lyall was discharged because of his union
activities during the meeting with Donovan on November 14. How-
ever, the bond question had been pending long before Lyall became a
member of the Union; the respondent had repeatedly requested the
surety company to reconsider its position with respect to Lyall's bond
and did so even after Lyall had joined the Union; and at the meeting
on November 14 Donovan again requested Lyall to take care of the
matter. Although the issue is not entirely free from doubt in view
. of the remarks made by Donovan at the November 14 conference re-
specting representation of the men by "outsiders," we are not con-
vinced that the respondent determined to discharge Lyall because of his
union membership or activity. We are of the opinion and find that
the respondent did not discharge Lyall because of his union activities
or affiliation but rather because he had failed to obtain a bond from
the National Surety Corporation such as the respondent required of
all of its permanent employees. While the respondent's refusal to
accept the bond- which Lyall subsequently offered may have been
unduly harsh, we do find that this constituted a refusal to reinstate
occasioned by Lyall's union membership or activity.
We find that the respondent has not discriminated in regard to the
hire and tenure of employment of Roy Lyall, thereby encouraging
or discouraging membership in a labor organization. Accordingly,
we shall dismiss the complaint.
Upon the basis of the above findings of fact and upon the entire
record in the case, the Board makes the following :
CONCLUSIONS OF LAW
'1. The operations of the respondent occur in commerce, within the
meaning of Section 2 (6) of the Act.
2. International Ladies' Garment Workers Union, Local No. 387,
affiliated with the American Federation of Labor is a labor organiza-
tion, within the meaning of Section 2 (5) of the Act.
3. The respondent has not interfered with, restrained, or coerced
its employees, within the meaning of Section 8 (1) of the Act.
4. The respondent has not discriminated in regard to .the hire and
tenure of employment of Roy Lyall, within the meaning of Section 8
(3) of the Act. I ' ' -
MORTEN yDAVIS COMPANY
ORDER
403
Upon the basis of the foregoing findings of fact and conclusions of
law-and pursuant to Section 10 (c) of the National Labor Relations
Act, the National Labor Relations Board hereby orders that the' com-'
plaint against the respondent, Morten-Davis Company, Dallas, Texas,
be, and'it hereby is, dismissed.
•MR. GERARD D. REILLY took no part in the consideration of the above
Decision and Order. ,