Pennsylvania Gas & Water Co.

National Labor Relations Board - Board Decisions

Aug 18, 1994

314 N.L.R.B. 791 (N.L.R.B. 1994)

791
314 NLRB No. 128
PENNSYLVANIA GAS & WATER CO.
1 On May 2, 1994, Administrative Law Judge Michael O. Miller
issued the attached decision. The Respondent filed exceptions and a
supporting brief. The General Counsel and the Charging Party filed
answering briefs. The National Labor Relations Board has delegated
its authority in this proceeding to a three-member panel.
1 Certain other allegations of the complaint were disposed of at
hearing. 2 All dates hereinafter are 1992 unless otherwise specified.
Pennsylvania Gas and Water Company and Local
2244, International Brotherhood of Electrical
Workers, AFL–CIO. Case 3–CA–17574
August 18, 1994
DECISION AND ORDER
BY CHAIRMAN GOULD AND MEMBERS BROWNING
AND COHEN
The question presented here is whether the judge
correctly found that the Respondent violated Section
8(a)(3) and (1) of the Act by denying a wage increase
to a unit of employees who were scheduled to vote in
a representation election.1 The Board has considered
the decision and record in light of the exceptions and
briefs and has decided to affirm the judge’s rulings,
findings, and conclusions and to adopt the rec-
ommended Order.
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge and
orders that the Respondent, Pennsylvania Gas and
Water Company, Wilkes-Barre, Pennsylvania, its offi-
cers, agents, successors, and assigns, shall take the ac-
tion set forth in the Order.
Robert L. Ellison, Esq., for the General Counsel.
David E. Koff, Esq. and Cynthia Vullo, Esq. (Koff,
Wendolowski, Ferguson & Mangan, P.C.), of Wilkes-
Barre, Pennsylvania, for the Respondent.
Robert D. Mariani, Esq., of Scranton, Pennsylvania, for the
Charging Party.
DECISION
STATEMENT OF THE CASE
MICHAEL O. MILLER, Administrative Law Judge. This
case was tried in Scranton, Pennsylvania, on March 1, 1994,
based on a charge filed by Local 2244, International Brother-
hood of Electrical Workers, AFL–CIO (the Union or Local
2244) on January 8, 1993, as amended, and a complaint
issued by the Regional Director for Region 3 of the National
Labor Relations Board (the Board) on March 23, 1993, as
amended. The complaint alleges that Pennsylvania Gas and
Water Company (Respondent or the Employer) violated Sec-
tion 8(a)(3) and (1) of the National Labor Relations Act (the
Act) by discriminatorily denying a wage increase to certain
of its employees because of their union activity.1 Respond-
ent’s timely filed answer denies the commission of any un-
fair labor practices.
On the entire record, including my observation of the de-
meanor of the witnesses, and after considering the briefs
filed by all parties, I make the following
FINDINGS OF FACT
I. THE EMPLOYER’S BUSINESS AND THE UNION’S LABOR
ORGANIZATION STATUS
The Respondent, a Pennsylvania corporation with an office
in Wilkes-Barre, Pennsylvania, and places of business at
other locations within the Commonwealth of Pennsylvania,
including Edwardsville, Pennsylvania, is a public utility en-
gaged in the sale and distribution of natural gas and water.
During the past 12 months, Respondent, in the course and
conduct of its business operations, received gross revenues in
excess of $250,000 and purchased and received in excess of
$5000 in products, goods, and materials directly from points
located outside the Commonwealth of Pennsylvania. The
complaint alleges, the Respondent admits, and I find and
conclude that it is an employer engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act.
The complaint alleges, Respondent admits, and I find and
conclude that the Union is a labor organization within the
meaning of Section 2(5) of the Act.
II. UNFAIR LABOR PRACTICE
A. Background
Respondent is a public utility, serving a quarter of a mil-
lion customers with natural gas and water in the northeast
and north central portions of Pennsylvania. It is regulated as
to its rates, operating practices, and all matters relating to its
service to the public by the Pennsylvania Public Utilities
Commission (PUC).
Local 2244 has a collective-bargaining relationship with
Respondent, representing about 210 of its approximately 970
employees in two units of distribution, service, and mainte-
nance employees in Respondent’s northern division. A dif-
ferent union represents a third unit of undisclosed size.
B. Union Activity
In the fall of 1992,2 Local 2244 organized among a group
of about 18 electricians, equipment maintenance technicians,
utility persons, and auto systems specialists at the water
treatment facility in Respondent’s central division. A peti-
tion, Case 4–RC–17927, seeking a representation election in
this unit, was filed on September 2, 1992. On September 16,
the Union and the Employer entered into a consent election
agreement, scheduling the election for October 2. The elec-
tion was held as scheduled, the Union received a majority of
the valid votes counted and the Certification of Representa-
tive issued on October 14.
C. The September Wage Increase
Periodically, the PUC conducts management audits of the
utilities it regulates. An extensive audit of Respondent’s op-
erations began in April and continued into the fall. Among
792 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
the issues considered were the wages and salaries paid to its
exempt, nonexempt, and union employees. Respondent was
not required, but was strongly encouraged, to accept the rec-
ommendations of the auditors.
On September 2, Harry Dowling, Respondent’s vice presi-
dent for human resources, met with the individual respon-
sible for auditing the wages paid to the nonbargaining unit
employees. She reviewed her findings and recommendations,
suggesting that the compensation paid these employees was
in the range of 20 percent below the market rates paid to
comparable employees. Following this meeting, Dowling met
with Dean Casaday, Respondent’s president and CEO, to dis-
cuss the auditor’s conclusions, with Casaday voicing concern
about the wage discrepancies.
On September 18, Casaday and Pollock, chairman of the
Employer’s compensation committee, met with the individual
responsible for the entire audit. Later that same day or in the
following week, they asked Dowling for his views on the
wages. He opined that the rates were between 5 and 10 per-
cent below those of the market but not as far off as the audi-
tor had concluded. He recommended a raise of 3.5 percent
to be paid to the 520 nonbargaining unit employees, at a cost
of between $450,000 and $500,000.
In this meeting, they discussed whether the raise should be
paid to those employees who were involved in the pending
representation matter. Dowling discussed this with Respond-
ent’s counsel and was advised that counsel ‘‘felt that it
would probably be unlawful if we were to give the increase
to those individuals.’’ On Dowling’s recommendation, they
decided to grant a 3.5-percent increase to all nonbargaining
unit employees ‘‘who are not officers and not involved in the
IBEW organizing effort.’’ The matter was discussed with the
compensation committee on September 22 and the raise was
announced, effective retroactively to September 13, the be-
ginning of the pay period. That decision was ratified by the
board of directors on October 28, 1992.
When the Union learned of the planned raises, its presi-
dent, Daniel Hanley, wrote Paul Henderson, Respondent’s
vice president for operations, requesting that the raise be ap-
plied to the unit employees as well as others. In a meeting
held in response to that letter, Henderson rejected Hanley’s
request, noting that the unit employees received their raises
pursuant to contract. No mention was made of the employees
subject to the petition.
On September 30, 2 days before the election, Casaday
issued a letter to each of the employees in the unit scheduled
to vote. That letter ‘‘present[ed] some information for [their]
consideration so that they can make an informed decision.’’
It discussed some changes in the work activities which had
been implemented and continued:
Another change in the Company, since I returned
about a year ago, is the renewed commitment to our
Company’s employees. As evidence of this, I recently
announced that a 3.5% salary increase was extended to
all non-bargaining employees. Additionally, the Com-
pany’s salary structure will be reviewed to ensure that
we attract and retain good employees. As you know,
these salary changes cannot be promised to you because
the law forbids such promises during elections.
My philosophy has always been that the greatest
asset of our Company is you, our employee. The
changes described are indicative of my commitment to
that philosophy. That is why I do not think you need
a union and I urge you to vote NO! Working together,
I am confident that we can continue the positive
changes within PG&W.
Paul Henderson, Respondent’s vice president of operations,
conceded that the wording of this letter indicated that it was
intended to influence the employees in the election.
Respondent’s practice, prior to this wage increase, had
been to give annual wage increases with one group of non-
bargaining unit employees getting theirs in January and the
remainder in June. The employees involved in the petition
were among those in the June group and they had received
raises at that time. Under their collective-bargaining agree-
ment, the bargaining unit employees received their raises in
August.
Since the Union’s certification in October, the employees
in the new unit have received no raises; Respondent and the
Union have been unable to agree on wages for them.
D. Analysis
The Board law respecting the granting or withholding of
wage increases during a representation campaign is straight-
forward:
An employer is generally required to grant wage in-
creases while a representation petition remains pending
as if the petition had never been filed. Where, however,
the employer’s past practice is haphazard, the employer
may lack objective evidence to substantiate its claim
that the increases it gave are the same as they would
have been in the absence of the petition. Accordingly,
the Board has fashioned a limited exception to the em-
ployer’s general duty to act as if the petition had not
been filed: The employer may withhold the increases
provided it truthfully tells its employees that it has
merely postponed or deferred the increases and that it
has done so only to avoid the appearance that it inter-
fered with the election. The purpose of these pre-
cautions is to avoid placing the onus for the employer’s
decision on the union.
H.S.M. Machine Works, 284 NLRB 1482, 1484 (1987) (cita-
tions omitted). See also Borman’s, Inc., 296 NLRB 245
(1989), and Martin Industries, 290 NLRB 857, 859 (1988).
Respondent, however, contends that, under Veteran’s
Thrift Stores, 272 NLRB 572 (1984), American Mirror Co.,
269 NLRB 1091 (1984), and Great Atlantic & Pacific Tea
Co., 192 NLRB 645 (1971), it was precluded from granting,
and privileged to withhold, wage increases which were un-
precedented and unplanned from a unit in which there was
a pending organizational campaign.
Respondent’s reliance on the foregoing cases is misplaced
as the September wage increase could not be properly char-
acterized as unprecedented and unplanned. The controlling
authority here is Associated Milk Producers, 255 NLRB 750
(1981), cited with approval in Martin Industries, supra. In
that case, the employer had a practice, very similar to Re-
spondent’s, of granting a single annual across-the-board wage
increase in about June of every year. It did so in June 1979.
In September of that year, however, it learned that changes
793PENNSYLVANIA GAS & WATER CO.
3 Unlike the instant case, however, that employer granted the raise
to the employees after the election, albeit prospectively only rather
than retroactively as it had for its other employees.
4 The judge also pointed out that neither an employer’s good-faith
belief that a pending organizational campaign or election precluded
the grant of such a wage increase nor the possibility of being
charged with unsustainable allegations of wrongdoing justified with-
holding of an increase which normally would have been paid to the
affected employees.
5 The Union urges an additional 8(a)(1) finding based on the Em-
ployer’s actions in placing the onus for the withholding of the raise
on the Union. This was not alleged in the complaint by the General
Counsel and I am precluded from making such a finding.
6 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and rec-
ommended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed
waived for all purposes.
in applicable Federal wage guidelines permitted it to grant its
employees an additional 8-percent increase. That increase
was granted to all of its employees except those who were
involved in an organizational campaign and for whom a rep-
resentation petition was pending, effective in October. As
here, the raise was withheld on the advice of counsel.3
The administrative law judge noted that ‘‘[w]here the in-
crease withheld from employees is a normal one so that a
normal course of action is altered because of employees’
union activities, the employer violates Section 8(a)(1) and (3)
of the Act,’’ citing Russell Stover Candies, 221 NLRB 441
(1975), and Gates Rubber Co., 182 NLRB 95 (1970). He
stated that the October raise ‘‘had aspects of both regularity
and irregularity’’ and that a raise in October was unprece-
dented and unexpected. However, further observing that ‘‘the
increase had been decided upon by higher officials free from
any consideration of the union campaign,’’ that it was given
to all of that employer’s employees save those involved in
the petition, and that those employees traditionally received
increases at the same time as other divisional employees, he
found the withholding of that raise to be discriminatory. He
stated:
Where, as here, a systemwide increase is put in ef-
fect in a manner free from union considerations, the
withholding of that increase at a . . . unit undergoing
union organization is not necessary to avoid risking un-
lawful interference . . . . This is so because the sys-
temwide application does what a regular pattern of
wage increases does in other circumstances—provides
the evidence necessary to demonstrate that the increase
was given free from union . . . considerations.
The Board has considered systemwide changes in
wages and benefits as ‘‘normal’’ or free from improper
considerations without inquiry as to their historical pat-
terns and has found the withholding of such an increase
at a single facility during preelection campaigning to be
violative of Section 8(a)(1) and (3) of the Act. Russell
Stover Candies, supra.
Associated Milk Producers, supra at 755.4 The Board ex-
pressly affirmed the judge’s rationale.
The systemwide raise given by Respondent, based on the
suggestion and at the urging of its regulatory authority, is the
equivalent of the raise granted in Associated Milk Producers
and of raises which follow historical patterns. Respondent
was not privileged to withhold it, notwithstanding the advice
of its counsel. Withholding that raise violated Section 8(a)(3)
and (1) of the Act.
I would further note, moreover, that the timing of the raise
to all except the employees subject to the petition, taken to-
gether with the timing and wording of Respondent’s Sep-
tember 30 letter to those unit employees, indicates an intent
to manipulate those benefits so as to influence the election.
Thus, there appeared to be no urgent requirement that the
raise be granted in September, before the election, or be paid
retroactively. Neither was there a need to emphasize that
raise in the September 30 letter or to imply further salary re-
views for nonbargaining unit employees. Where, as here, an
employer manipulates the granting or withholding of benefits
to gain an advantage in an election, its actions are deemed
discriminatory. Times Wire & Cable Co., 280 NLRB 19, 29
(1986).5
Citing Great Atlantic & Pacific Tea, supra, and H.S.M.
Machine, supra, Respondent asserts that an employer may
postpone the granting of an irregular or haphazard raise ‘‘if
it truthfully tells its employees that it has merely postponed
or deferred the increases [so as to] avoid the appearance that
it has interfered with the election.’’ H.S.M. Machine, supra
at 1484. Suffice it to note that Respondent satisfied neither
of these conditions. The raise was not deferred, it was denied
to the affected employees, and Respondent did not advise the
employees, except in the broadest of terms, as to the pur-
ported reason for its action.
CONCLUSION OF LAW
By discriminatorily withholding a wage increase from the
employees in the collective-bargaining unit which was the
subject of the petition and election in Case 4–RC–17927 the
Respondent has engaged in unfair labor practices affecting
commerce within the meaning of Section 8(a)(3) and (1) and
Section 2(6) and (7) of the Act.
REMEDY
Having found that the Respondent has engaged in certain
unfair labor practices, I find that it must be ordered to cease
and desist and to take certain affirmative action designed to
effectuate the policies of the Act.
Having found that Respondent discriminatorily withheld a
wage increase from certain specified employees in violation
of Section 8(a)(3) and (1) of the Act, I shall order Respond-
ent to grant them the wage increase which was denied them
and make them whole. Respondent shall do so in the manner
set forth in Ogle Protection Service, 183 NLRB 682 (1970),
with interest as prescribed in New Horizons for the Retarded,
283 NLRB 1173 (1987).
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended6
ORDER
The Respondent, Pennsylvania Gas and Water Company,
Wilkes-Barre, Pennsylvania, its officers, agents, successors,
and assigns, shall
1. Cease and desist from
794 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
7 If this Order is enforced by a judgment of a United States court
of appeals, the words in the notice reading ‘‘Posted by Order of the
National Labor Relations Board’’ shall read ‘‘Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order
of the National Labor Relations Board.’’
(a) Withholding wage increases from its employees be-
cause of their union activities.
(b) In any like or related manner interfering with, restrain-
ing, or coercing employees in the exercise of the rights guar-
anteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to ef-
fectuate the policies of the Act.
(a) Grant the employees who are in the bargaining unit
which was the subject of the petition and election in Case
3–RC–17927 the 3.5-percent wage increase which was de-
nied to them because of their union activities.
(b) Make its employees whole for the wage increase it un-
lawfully withheld in the manner set forth in the remedy sec-
tion of this decision.
(c) Preserve and, on request, make available to the Board
or its agents for examination and copying, all payroll records,
social security payment records, timecards, personnel records
and reports, and all other records necessary to analyze the
amount of backpay due under the terms of this Order.
(d) Post at Edwardsville, Pennsylvania, copies of the at-
tached notice marked ‘‘Appendix.’’7 Copies of the notice, on
forms provided by the Regional Director for Region 3, after
being signed by the Respondent’s authorized representative,
shall be posted by the Respondent immediately upon receipt
and maintained for 60 consecutive days in conspicuous
places including all places where notices to employees are
customarily posted. Reasonable steps shall be taken by the
Respondent to ensure that the notices are not altered, de-
faced, or covered by any other material.
(e) Notify the Regional Director in writing within 20 days
from the date of this Order what steps the Respondent has
taken to comply.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we vio-
lated the National Labor Relations Act and has ordered us
to post and abide by this notice.
WE WILL NOT withhold wage increases from our employ-
ees because of their union activities.
WE WILL NOT in any like or related manner interfere with,
restrain, or coerce employees in the exercise of the rights
guaranteed them by Section 7 of the Act.
WE WILL grant the employees who are in the bargaining
unit which was the subject of the petition and election in
Case 3–RC–17927 the 3.5-percent wage increase which was
denied to them because of their union activities.
WE WILL make our employees whole for the wage in-
crease unlawfully withheld, with interest.
PENNSYLVANIA GAS AND WATER COMPANY