Rheem Maufacturing Co.

National Labor Relations Board - Board Decisions

Aug 16, 1946

70 N.L.R.B. 57 (N.L.R.B. 1946)

In the Matter of RHEE1 L MANUFACTURING COMPANY and UNITED STEEL
WORKERS OF AMERICA, LOCAL 1798, C. 1. 0.
Case No. 00-C-124&-Decided August 16,1946
DECISION
AND
ORDER
On May 29,1945, the Trial Examiner issued his Intermediate Report
in the above-entitled proceeding, finding that the respondent had
engaged in and was engaging in certain unfair labor practices and
recommending that it cease and desist therefrom and take certain
affirmative action, as set forth in the copy of the Intermediate Report
attached hereto. Thereafter, on or about July 10, 1945, the respond-
ent and International Association of Machinists, Lodge 824, herein
called the Machinists, filed exceptions to the Intermediate Report and
supporting briefs. The Board has reviewed the rulings made by the
Trial Examiner at the hearing and finds that no prejudicial error was
committed. The rulings are hereby affirmed.
Pursuant to notice and at the request of the respondent and the
Machinists, the Board heard oral argument on January 15, 1946, in
Washington, D. C., The Machinists appeared and participated in the
argument; no other party appeared. Thereafter on Januray 25, 1946,
upon motion by United Steelworkers of America, Local 1798, C. I. 0.,
herein called the Steelworkers, the Board heard further oral argument
at Washington, D. C. The Steelworkers and the Machinists appeared
and participated in the argument; the respondent did not appear.
The Board has considered the Intermediate Report, the exceptions
and briefs filed by the respondent and the Machinists, the oral argu-
ments, and the entire record in the case,' and hereby adopts the Trial
Examiner's findings, conclusions, and recommendations, with the
exceptions and additions noted below.
I On or about July 10, 1945, the respondent filed with the Board a written motion to
introduce additional evidence consisting of a copy of the Board ' s certification in Matter of
Rheem Manufacturing Company, 56 N. L. R. B . 159, and a copy of the collective bargaining
contract entered into between the respondent and the Machinists on June 16, 1944, the
correctness of which is attested to by the respondent 's attorney , Herbert E . Hall, in his
affidavit attached to the motion. The motion is granted and the material submitted is
hereby made a part of the record herein.
70 N L. R. B., No. 6
57
58 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
1. We agree with the Trial Examiner that under the doctrine
enunciated in the Rutland Court case,2 the respondent's closed-shop
agreement with the Machinists cannot serve as a defense to the dis-
charge of Radisky, Rodrigues, and Wells, and that therefore, by ac-
ceding to the Machinists' demand for the discharge of these three
employees, the respondent violated Section 8 (3) of the Act.
It is undisputed that Radisky, Rodrigues; and Wells actively par-
ticipated in the Steelworkers' organizing campaign at the respondent's
plant and that for this reason the Machinists suspended them from
membership in its organization and demanded their discharge. We
are convinced by the circumstances appearing in the Intermediate Re-
port and by the entire record, and we find, as did the'Trial Examiner,
that the respondent-had knowledge of this fact at the time it dis-
charged the three complainants. Thus, Plant Manager Griffin, who
authorized their discharge, admitted at the hearing that he knew of the
pro-Steelworkers activity of Radisky, Rodrigues, and Wells and that
he "had an idea" as to what Machinists' Representative Nelson meant
when he assigned "conduct unbecoming members" as the reason for
their suspension from membership in the Machinists. It is also sig-
nificant, as pointed out in the Intermediate Report, that representa-
tives of the Machinists visited the plant and had a conversation with
Griffin relative to the suspension and discharge of these employees,
whereas, normally such requests for discharges were made by the
Machinists' financial secretary either over the telephone or by letter.
Moreover, Radisky, whose testimony the Trial Examiner credited in
other respects, credibly testified that on the night of March 15, 1944, or
the following evening he had a telephone conversation with Griffin
about the possibility of securing a position at another of the respond-
ent's plants and that during the course of this conversation, Griffin
said, "You know, you were discharged for CIO activities."
We also agree with the Trial Examiner that the rival-union activity
of the three discharged employees occurred at a time when it was ap-
propriate for them to exercise their right to change their collective bar-
gaining representative and to affiliate with and campaign for the Steel-
workers, or any other union. Our concurrence, however, is predicated
on the following grounds :
The record shows, as detailed in the Intermediate Report, that on or
about August 12, 1943, the respondent and the Machinists orally
agreed-to continue in effect the terms of their 1942 written closed-shop
agreement, which was then about to expire, until they could execute a
new written agreement embodying a. ruling on a disputed issue which
they had theretofore submitted to the National War Labor Board for
determination 8 Accordingly, from August 18, 1943, the expiration
2 Matter of Rutland Court Owners, Die , 44 N. L. R B 58T, 46 N . L. R. B. 1040
3 The contracting parties were in agreement as to all other terms of the new contract
RHEEM MANUFACTURING COMPANY 59
date of their 1942 contract, to March 27, 1944, the respondent and the
Machinists operated under the terms of the 1942 written contract and
followed it in all respects, including enforcement of the closed-shop
provision. Meanwhile, on March 6, 1944, the Steelworkers filed with
the Board a representation petition on behalf of the employees covered
by the Machinists' contract and, in the resultant representation pro-
ceeding, the Board directed an election among such employees, not-
withstanding the existence of the above-mentioned extension agree-
ment.4 In that proceeding, we found that the extension agreement,
which is now asserted in the instant case as a defense to the discharge
of the complainants was not a bar to an immediate determination of
representatives because of its oral nature and indefinite duration. It
therefore follows, and we find, that the respondent's employees were
privileged at all times during the life of said agreement to select a new
bargaining representative. Under the principle established in the
Rutland Court case, the rival union- activity of Radisky, Rodrigues,
and - "Tells was protected against the operation of the closed-shop
agreement.
The Machinists, however, contends that the Rutland Court doctrine
is not applicable here because the complainants were members of its
plant-shop committee at the time they campaigned on behalf of the
Steelworkers. The Machinists argue that the complainants there-
fore owed strict allegiance to it and that their rival union activity was
reasonably regarded as a breach of trust for which they properly were
suspended and rendered eligible for discharge under the existent
closed-shop agreement. On the record in this case, at least, we are
not persuaded by the Machinists' argument that it would not effec-
tuate the policies of the Act to apply the Ruthland Court principle to
these employees simply because they happen' previously to have been
elected, by their fellow employees, as shop-committee members for
the contracting union.
2. The Trial Examiner found that by enforcing the oral exten-
sion agreement on and after March 6, 1944, the date the Steelworkers
filed a representation petition, so as to require all employees to join
the Machinists as a condition of employment, the respondent violated
Section 8 (1) of the-Act. We, however, find it unnecessary to pass
on this-issue in view of the fact (a) that the enforcement of this
contract was never alleged to have affected the results of the above-
mentioned election, (b) that the Machinists have 'since been certified
as the bargaining representative at the plant and have concluded a
new bargaining agreement with the respondent, and (c) that the
and, but for the disputed issue , would have concluded a written agreement effective upon
the expiration of the 1942 contract.
Matter of Rheem Manufacturing Company, 56 N L. R. B. 159.
60 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
discharge of Radisky, Rodrigues, and Wells has heretofore been
found discriminatory on other grounds. '
THE REMEDY
Normally in cases in which an employer has unlawfully discrim-
inated against employees by discharging them, in addition to affirma-
tive -relief, we order the employer - to cease and desist from in any
manner infringing upon the rights guaranteed in Section 7 of the
Act. However, in the instant case, the respondent discharged the
three employees in question because it believed in good faith, though
mistakenly, that the terms of its closed-shop agreement with the
Machinists required that the respondent accede to the Machinists'
demand for their dismissal. Under such circumstances and, in view
of the absence of any evidence that danger of the commission of other
unfair labor practices is to be anticipated from the respondent's con-
duct in the past, we shall not enjoin the respondent from the com-
mission of any and all unfair labor practices. Nevertheless, in order
to effectuate the purposes of the Act, we shall order the respondent
to cease and desist from the unfair labor practices found. In addi-
tion, like the Trial Examiner, we shall order the respondent to take
certain affirmative action , including reinstatement of the three dis-
charged employees with back, pay, designed to effectuate the policies
of the Act. Nothing in our Order, hereinafter set forth, shall be
taken to proscribe conduct of the respondent protected by the proviso
to Section 8 (3) of the Act.
ORDER
Upon the entire record in the case, and pursuant to Section 10 (c)
of the National Labor Relations Act, the National - Labor Relations
Board hereby orders that the respondent, Rheem Manufacturing Com-
pany, Richmond , California , and its officers , agents, successors, and
assigns shall :
1. Cease and desist from :
(a) Discouraging membership in United Steelworkers of America,
Local 1798, C. I. 0., or any other labor organization of its employees,
by discharging or refusing to reinstate any of its employees, or by
discriminating iii any other manner in regard to their hire or tenure
of employment , or any term or condition of employment , for engag-
ing in activities directed to the designation of a new bargaining
representative at an appropriate time :
2. Take the following affirmative action, which the Board finds will
effectuate the policies of the Act :
(a) Offer- to Charles E. Radisky, Anterio Rodrigues, and Charles
Wells immediate and full reinstatement to their former or substan-
RHEEM MANUFACTURING COMPANY 61
tially equivalent positions, without prejudice to their seniority and
other rights and privileges; -
(b) Make whole Charles E. Radisky, Anterio Rodrigues, and Charles
Wells for any loss of pay they may have suffered as a result of the re-
spondent's discrimination against them, by payment to each of them
of a sum of money equal to the amount which he normally would have
earned as wages during the period from the date of the discrimina-
tion against him to the date of the respondent's offer of reinstatement,
less his net earnings during that period;
(c) Post at its plant in Richmond, California, copies of the notice
attached hereto marked "Appendix A." Copies of said notice, to be
furnished by the Regional Director for the Twentieth Region, shall,
after being duly signed by the respondent's representative, be posted
by the respondent immediately upon receipt thereof, and maintained
by it for sixty (60) consecutive days thereafter, in conspicuous places,
including places where notices to employees are customarily posted.
Reasonable steps shall be taken by the respondent to insure that said
notices are not altered, defaced, or covered by any other material;
(d) Notify the Regional Director for the Twentieth Region in writ-
ing, within ten (10) days from the date of this Order, what steps the
respondent has taken to comply therewith.
MR. GERARD D. REILLY, concurring specially :
When this matter was argued before us, I was somewhat inclined
to question the theory of the complaint because counsel for the inter-
venor made out a strong case for the view that the collective agreement,
as extended, was not a contract of indefinite duration but should have
been construed as either a contract for an additional year or one that
would terminate when modified by the War Labor Board.
In the representation case,5 however, we reached a contrary result
holding that the agreement was not a bar to a new determination of
representatives. Since this opinion must be regarded as the rule. of
the case it would- appear that a question of representation existed at
the time these employees were discharged. Accordingly, I concur
with some hesitation in the instant decision.
APPENDIX A
NOTICE TO -ALL EMPLOYEES
Pursuant to a Decision and Order of the National Labor Relations
Board, and in order to effectuate the policies of the National Labor
Relations Act, we hereby notify our employees that :
We will not discourage membership in United Steelworkers of
America, Local 1798, C. I. 0., or any other labor organization of
I Matter of Rheem Manufacturing- Co., 56 N . L. R. B. 159.
62 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
our employees, by discharging or refusing to reinstate any of our
employees, or by discriminating in any other manner in regard
to their hire or tenure of employment, or any term or condition
of employment, for engaging in activities directed to the designa-
tion of a new bargaining representative at an appropriate time;
We will offer to the employees named below immediate and full
reinstatement to their former or substantially equivalent posi-
tions without prejudice to any seniority or other rights and privi-
leges previously enjoyed, and make them whole for any loss of
pay suffered as a result of the discrimination.
Charles E. Radisky
Anterio Rodrigues
Charles Wells
RREEM MANUFACTURING COMPANY,
Employer.
By -----------=--------------------------
(Representative ) (Title)
Dated --------------------
NOTE: The above-named employees, if presently serving in the
armed forces of the United States, will be offered full reinstate-
ment upon application in accordance with the Selective Service
Act after discharge from the armed forces.
This notice must remain posted for 60 days from the date hereof,
and must not be altered, defaced, or covered by any other material.
INTERMEDIATE REPORT
Mr. Louis Penfield , for the Board.
Mr. Herbert E. Hall, of San Francisco , Calif ., Mr. Ernest M. Henderson, of
Richmond , Calif., and Mr. Horace C. Brown, of Lafayette , Calif., for the
respondent.
Mr. James F. Galliano, of Oakland , Calif ., and Messrs . Carl H. Berner and
Albert B . Nelson , of Richmond, Calif., for the Machinists.
STATEMENT OF THE CASE
Upon charges filed on March 17, 1944, by United Steelworkers of America,
Local 1798, C. I. 0., herein called the Steelworkers , the National Labor Relations
Board, herein called the Board , by the Regional Director for the Twentieth
Region ( San Francisco , California ), issued its complaint dated April 20, 1944,
against Rheem Manufacturing Company, Richmond , California , 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 Act,
49 Stat. 449, herein called the Act. Copies of the complaint , accompanied by
notice of hearing thereon , were duly served upon the respondent and the Steel-
workers, and also upon International Association of- Machinists , Lodge 824,
herein called the Machinists.
With respect to the unfair labor practices , the complaint alleged: ( 1) that
from about August 19, 1943, the respondent required all new employees to become
RHEEM MANUFACTURING COMPANY 63
members of the Machinists within 30 days after their employment; and (2) that
on or about March 15, 1944, the respondent discharged Charles E Radisky and
Anterio Rodrigues, and on or about March 17, 1944, discharged Charles Wells,
because of their membership in and activities on behalf of the Steelworkers, and
because they had been suspended from membership in the Machinists, thereby
discouraging membership in the Steelworkers and encouraging membership in
the Machinists.
Thereafter the respondent filed its answer, in which it denied the commission
of any unfair labor practices.
Pursuant to notice, a hearing was held at San Francisco, California, on May 11,
12, 13, 1944, before the undersigned, Charles W. Schneider, the Trial Examiner
duly designated by the Chief Trial Examiner. At the beginning of the hearing
the undersigned granted the Machinists' motion to intervene in the proceedings.
The Board, the respondent, and the Machinists were represented by counsel and
participated in the hearing.' The Machinists filed an answer Full opportunity
to be heard, to examine and cross-examine witnesses, and to introduce evidence
bearing on the issues was afforded all parties. o
At the close of the heal ing the undersigned granted, without objection, a motion
by counsel for the Board to conform the pleadings to the proof. The parties
argued orally before the undersigned. On May 27, 1944, the respondent filed a
brief. On June 2, 1944, counsel for the respondent filed a request, in which
counsel for the Board joined, for correction of the transcript of hearing. The
request is hereby approved, and the record is ordered to be corrected in accordance
therewith.
Upon the entire record in the case, and from his observation of the witnesses,
the undersigned makes, in addition to the above, the following:
FINDINGS OF FACT
1. THE BUSINESS OF THE RESPONDENT
Rheem Manufacturing Company is a California corporation , having its principal
office at San Francisco , California, and operating plants and offices in Australia,
and the States of California , Illinois, Louisiana , Maryland, Texas , Oregon, Ala-
bama, and Pennsylvania , and maintaining offices in the State of New York and
the District of Columbia.
The present proceedings involved the plant located at Richmond , California,
where the respondent manufactures depth charge casings, pressure tanks, and
grease pails , and fabricates steel gasoline drums and galvanized items such as
anchors, and bunks. The only raw material used at the Richmond plant is steel.
During the year 1943 the respondent purchased and transported steel valued at
$7,395,146.83 . Of this amount , $7,035,147.83 worth was transported to the Rich-
mond plant from points outside the State of California . During the same period
the respondent sold and transported products valued at approximately ten million
dollars. Of this amount, $1,065 ,000 worth was sold and transported from the
Richmond plant to points outside the State of California . Ninety-five percent of
the respondent 's production is under contract with the Army and Navy for mili-
tary use wherever it may be required.
II. THE ORGANIZATIONS INVOLVED
United Steelworkers of America, Local 1798, is a labor organization affiliated
with the Congress of Industrial Organizations, admitting to membership employees
of the respondent.
I The Steelworkers did not appear.
64 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
International Association of Machinists, Lodge 824, is a labor organization
affiliated with the American Federation of Labor, admitting to membership
employees of the respondent.
III. THE UNFAIR LABOR PRACTICES'
1. The agreements with the Machinists
On May 27, 1937, upon petition of Amalgamated Association of Iron, Steel and
Tin Workers, a consent election was held, under the -supervision -othe Board's
Regional Director, among the respondent's employees at the Richmond plant.
This election was won by the Machinists.
On August 9, 1937, the respondent entered into a written collective bargaining
contract with the Machinists. By successive written agreements, contractual re-
altions were thereafter continuously maintained. Up to 1942, none of these
agreements required membership in the Machinists as a condition of employment.
However, on August 18, 1942 the parties entered into a new contract containing
the following clause :
... If the employer obtains help from sources other than the Union
such help shall first register with the Union and become members of the
Union in accordance with the Union Constitution within a period of thirty
(30) days from the date of hiring .. .
There is no contention that the Machinists was not the representative of the
employees at the time the above agreement was made, or that the unit was not
appropriate. This clause was interpreted by the respondent and the Machinists
not only to require new employees to become members of the Machinists within
30 -days, but also to require members to maintain their membership in that
organization. The contract further provided that it should remain in effect
for one year, and also from year to year thereafter unless either party gave
notice in writing, at least 30 days prior to the expiration date, of a desire to
change or revise it. On June 30, 1943, the respondent gave notice in writing of
its desire to revise the agreement for the succeeding year.
Pursuant to the above notice, representatives of the respondent and the
Machinists met and negotiated on August 12, 1943, and several times thereafter.
From the beginning of the negotiations the parties were in substantial agree-
ment as to the terms of the new contract, with the exception of one item, namely,
whether or not a stock bonus plan should be discontinued. This dispute they
referred to the War Labor Board for disposition. Inability to agree on this
matter prevented agreement on wage scales. It seems fairly clear that, but for
this dispute, the parties would have concluded a new agreement and resumed
written contractual relations. At the August 12 meeting they agreed that any
agreements arrived at, if approved by the War Labor Board, would be retro-
active to August 18, 1943. In addition they entered into an unwritten- under-
standing to continue to operate under the terms of the August 18, 19422, contract
until a new agreement could be executed.' At a meeting on August 24, Plant
Manager Griffin instructed Personnel Director Henderson to "live under the
2 The following findings are based pn admitted facts, or credible testimony which, unless
otherwise indicated hereinafter, was substantially uncontradicted.
s There is some confusion in the testimony as to whether this understanding was arrived
at at the August 12 meeting or earlier . The undersigned finds that it more probably
occurred at the August 12 meeting.
1
RHEEM MANUFACTURING COMPANY 65
terms of the [August 18, 1942] agreement ... until such time as a new contract
[is] concluded."
From August 18, 1943 to March 27, 1944, the respondent and the Machinists
operated under the terms of the 1942-43 agreement and followed it in all respects,
including the requirement that new employees obtain membership in the
Machinists after 30 days, and that old employees maintain their membership.
When new employees were hired they were given a booklet containing plant
rules and a copy of the-1942-43 agreement, and were told that the agreement
was in effect.
On March 6, 1944, the War Labor Board handed down its decision disposing
of the stock bonus dispute.'
2. The designation of the Steelworkers
Since about 1939 the Machinists' Shop Committee in the plant had consisted of
employees Charles E. Radisky, Anterio Rodrigues, and Charles Wells.`
In the late summer or early fall of 1943, some of the respondent's employees
became dissatisfied with the efforts of,the Machinists as bargaining agent, and
requested the Shop Committee to secure affiliation with the C. I. O. There is
no evidence that any of this dissatisfaction came to the attention of the respondent.
On February 3, 1944, following a series of such requests, Rodrigues and Radisky
conferred with George Gray and Delaney Gallus, business agent and president,
respectively, of the Steelworkers, concerning affiliation with that organization.
Gray and Gallus would apparently make no commitment and the matter conse-
quently lay dormant for the next month.
However, on Saturday noon, March 4,-pursuant to a request by Rodrigues-
Gray, Gallus, and Harry Rench (also an officer of the Steelworkers), met
Rodrigues, Radisky, Wells, and several other employees at the plant gates. Gray
gave Rodrigues application cards for membership in the Steelworkers and said
that lie would be hack on the following Monday to see the results. On the same
afternoon Radisky asked permission from General Foreman Johnson for
Rodrigues to distribute the cards in the plant. Johnson referred Radisky to
Plant Manager Griffin, who gave the permission. Rodrigues then distributed the
cards on the afternoon of March 4, during working hours. By 3: 30 p. m. he had
secured the signatures of some 75 employees' On the same afternoon Rodrigues
secured permission from Foreman Kelsch to take off Monday morning, March 6,
in order to secure other signatures. Rodrigues told Kelsch his purpose in
being off.
On March 6, Rodrigues spent the morning securing additional authorizations
from employees in the plant, and by noon had a total of 182 signatures. He then
turned the cards over to Gray.'
On that afternoon the Steelworkers informed the respondent, by telegram, that
a majority of the respondent's employees had designated the Steelworkers as
their collective bargaining representative, and requested negotiation of an agree-
4 The decision of the War Labor Board was that the discontinuance of the stock bonus
did not require the Board's approval.
5In the, spring of 1943 Wells resigned from the committee because of illness. He
resumed his position on the committee in February 1944.
' The respondent employed approximately 325 employees.
I Wells distributed a few of the cards and secured some signatures. Radisky took no
part in the distribution. Rodrigues and Wells signed application cards in the Steelworkers
on March 4; Radisky on March 6.
,66 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ment. Contemporaneously, the Steelworkers filed with the Board a petition for
investigation and certification of representatives
3. The discharge of Radisky, Rod! 1gaes, and 1Fells
On the morning of March 15, 1944, while he was at work, Radisky received a
phone call from his wife to the effect that he had received a telegram from H W.
Brown, International President of the Machinists, suspending him from member-
ship for dual union activities Radisky immediately sought ont Rodirigues They
attempted to_ telephone Rodrigues' home, to ascertain whether Rodrigues had
received a similar telegram Although employees had theretofore customarily
been permitted to make phone calls from the plant, on this occasion the switch-
board operator, upon learning Radisky's identity, refused him a line. Later in
the morning, Radisky informed Wells and Plant Manager Griffin of his suspension.
Shortly after noon on that day General Foreman Johnson- told Radisky and
Rodrigues to get their tools and go to the office ; and further told them that they
were discharged. Wells, upon hearing of this, became ill, packed his tools and
left the plant. Radisky and Rodrigues then went to Plant Manager Griffin's
office where Griffin told them, in the presence of Personnel Director Henderson,
and Carl Berner and Al Nelson , business agents of the Machinists , that they
were not members in good standing in the Machinists , and were therefore dis-
charged. On the following day Wells was notified at his home that he was
discharged for the same reason,
At the time of their discharges, all three employees had in fact been suspended
from the Machinists because of their activity on behalf of the Steelworkers, and
requests for their discharge had been made by the Machinists. Their dues in
the Machinists were fully paid up at the time of the discharges.
Although the respondent asserts that it had no knowledge , at the time of the
discharges, of the reason for the suspensions, the undersigned finds that 'the
respondent knew that the three employees had been suspended from the Ma-
chinists because of their activities on behalf of the Steelworkers.'
About March 27, 1944, the Machinists requested the discharge of 15 to 28
other employees because they were not members in good standing. The re-
spondent declined to effect the discharges. Since that date, membership in the
Machinists has not been required as a condition of employment.
s On May 3 , 1944 , the Board found that a question concerning representation existed and
directed an election . Matter of Rheem Manufacturing Company, 56 N. L R. B. 159
e While Griffin testified that Berner and Nelson did not inform him of the reason for the
suspensions when they requested the discharges , the undersigned infers and finds that
Griffin was aware of the reason Thus , ( 1) Griffin knew of the men's activities on behalf
of the Steelworkers ; ( 2) the plant switchboard operator refused to let Radisky call Rod-
rigues' home on the morning of the discharge ; ( 3) Radisky Informed Griffin that morning
of his suspension . Although Griffin denied that Radisky told him the reason for the sus-
pension , the undersigned infers that Radisky did ; ( 4) Berner and Nelson came to Griffin's
office about 11 : 40 a. in. on March 15, and were closeted with him until 12 :30 before Rad-
isky and Rodrigues were called in ; (5) Henderson testified that he was called to Griffin's
office "as a witness" to the discharges ; ( 6) Griffin did not urge the men to compose their
differences with the Machinists , although he customarily urged other employees to do so
when the Machinists requested discharges , ( 7) the procedure used in requesting the
discharges was highly unusual. Normally , requests for discharge were made by the
Machinists ' financial secretary , either by phone or by letter. In this case , Berner and
,Nelson came to the plant . From these, and all the other surrounding circumstances, the
,undersigned finds it implausible that the respondent could have been ignorant of the reason
for the suspensions . A realistic appraisal of human conduct requires the conclusion that
the respondent would not , at a time when it was in urgent need of skilled help, have dis-
charged old and valuable employees who were leaders in the union , without inquiry.
Moreover , Griffin ultimately testified that he had an idea " as to the reason for the sus-,
pensions.
RHEEM MANUFACTURING COMPANY
4. Concluding findings
67
The issues raised by the pleadings are: (1) whether the respondent violated
Section 8 (1) of the Act by requiring new employees, after August 19, 1943, to
become members of the Machinists within 30 days after their employment ; and
(2) whether the'respondent violated Section 8 (3) of the Act by discharging
Radisky, Rodrigues, and Wells because they were not members in good standing
of the Machinists.
No question is raised respecting the majority status of the Machinists in August
1943. That status was not challenged until March 1944. The bargaining unit
was appropriate.10 The undersigned therefore finds that on August 18, 1943, the
Machinists was the representative of the employees, qualified to contract on their
behalf, and competent to conclude an agreement requiring membership in the
Machinists as a condition of employment. Moreover, it did so. The conduct of
the parties clearly evinces a mutual agreement to continue to operate under the
terms of the 1942 contract until their dispute was disposed of by the War Labor
Board, and a new agreement executed. Although the 1942 contract did not
explicitly provide for the maintenance of membership by Machinists' members, the
parties so intended and interpreted it, and the validity of such construction is
not disputed by the Board. The contract is therefore to be considered as if it
expressly so provided." Since, by virtue of the unrevoked notice of termination
given by the respondent on June 30, 1943, the 1942 agreement expired on August
18, 1943, the arrangement to continue to operate under its terms constituted a
new and oral agreement.
The Board has repeatedly held that an employer may not condition employment
upon membership in a particular labor organization, unless the imposition of
the requirement is permissible under the proviso to Section 8 (3) of the Act32
This proviso is as follows :
Provided, That nothing in this Act, . . . or in any other statute of the
United States, shall preclude an employer from making an agreement with a
labor organization (not established, maintained, or assisted by action defined
in this Act as an unfair labor practice) to require, as a condition of employ-
ment, membership therein, if such labor organization is the representative
of the employees as provided in Section 9 (a), in the appropriate collective
bargaining unit covered by such agreement when made.
The first question to be determined, therefore, is whether this oral agreement
is such an agreement as is referred to in Section 8 (3).
The express purpose of the Act is to insure employees the right of self-organiza-
tion and a free choice of bargaining representatives. Since the proviso consti-
tutes a limitation upon that general purpose, it is not to be broadly construed.13
Oral collective bargaining agreements are to be discouraged. True stability
in labor -relations cannot be achieved unless the mutual undertakings of em-
ployers and labor organizations are evidenced by something more substantial
than a meeting of the minds. In the absence of a signed memorial incorporating
the items of agreement, serious question may arise over the terms of, or even
the fact of, understanding. Such considerations have resulted in the establish-
ment of the principle that, where a question concerning representation other-
wise exists , the Board will direct an election, despite the existence of an oral
10 The unit was substantially the one found appropriate by the Board in the representa-
tion proceedings referred to in footnote 8, supra.
"'Matter of General Furniture Manufacturing Co., 26 N. L. R. B. 74, 79-80. -
12 Matter of Ansley Radio Corporation, 18 N. L. R B 1028, 1051 -
Matter of Rutland Court Owners , Inc., 46 N. L. R. B. 1040.
712344-47-vol. 70-6
68 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
collective bargaining agreement. Thus, in the case of Eicor, Inc.,' the Board
said :
This Board often refuses to conduct representation investigations where
there are in existence valid contracts which evidence that stability'of labor
relations has been attained. But experience has indicated that true stabil-
ity of labor relations is not attained until collective agreements have been
reduced to writing and signed. The crucial importance of the signing of
agreements in the history of the collective bargaining process was recognized
by the Supreme Court in the Hetnz case. In the light of this history, the
signing of collective agreements cannot be regarded as a mere formality.
We are therefore of the opinion that a collective bargaining agreement
which has not been reduced to writing and signed does not constitute a bar to
a determination of representatives.
Where a question of representation thus exists under Sectiou 9 of the Act,
principles of statutory accommodation would appear to require that oral agree-
ments be accorded equal non-recognition under Section 8.
In the instant case, however, no question concerning representation arose
until March 1944. If the respondent was guilty of unfair labor practices prior
to that time, it must be upon the assumption that the August 1943 oral agree-
ment was invalid per se. The undersigned is of the opinion that, under the
peculiar circumstances presented, it was not. Thus, labor relations in this
plant had been stabilized for years and evidenced by written and signed agree-
ments. The representative status of the Machinists at the time of the making
of the oral agreement is unquestioned. The old contract stood as a memorial
of the substantive conditions of agreement, and the employees were informed
that it was in full force and effect. But for the bonus dispute, the 1942 contract
would undoubtedly have been succeeded by another signed agreement. But for
the referral to the War Labor Board, the parties would normally have worked
out their own solution to the impasse, possibly by bargaining it out peaceably,
possibly by resort to economic force with resultant interruption to war produc-
tion. Upon these considerations, the undersigned is of the opinion that it was
not an unfair labor practice for the respondent, tinder the extraordinary cir-
cumstances here presented, to agree orally to continue the old agreement, and
to enforce it, so long as no question concerning representation existed."
However, on March 6, 1944, a question concerning representation arose."
Moreover, on March 6 the War Labor Board issued its decision in the bonus dis-
pute. The termination of the extension agreement was therefore imminent. In
the case of Rutland Court Owners, Inc 17 the Board held that near the termina-
tion date of a closed-shop agreement, employees are free to designate a new
collective bargaining representative for the subsequent contract year. In that
case, the employer, 2% weeks before the end of a contract year, upon demand of
the contracting union, discharged employees for the reason that they had desig-
" 46 N. L. R. B. 1035.
This is not to say that every oral contract is protected by the proviso to Section 8
(3) of the Act . Reasonable limitations upon the use and forut. of the closed -shop device
may exist if necessary to prevent abuse. Wallace Corporation v. N. L. It. B., 323 U. S. 248;
Matter of Monsieur Henry Wines , et al., 44 N. L. It. B. 1310 ; Matter of Rutland Court
Owners, Inc, 46 N. L. It. B. 1040.
16 See footnote 8, supra. Thus , on March 4 and 6 a substantial number of the employees
designated the Steelworkers . On March 6 , the Steelworkers notified the respondent of its
claim to represent a majority of the employees and filed a petition for investigation and
certification of representatives , on which petition the Board subsequently directed an elec-
tion. The Board found that there was no contractual bar to directing an election.
11 46 N. L. R. B. 1040. _
RHEEM MANUFACTURING COMPANY 69
nated another representative for the succeeding contract year.
The Board
said :
employees who attempt to retain their membership in the contracting
union during the life of the contract may not be foreclosed from doing so
for the purpose of justifying their discharge under the contract merely
because they have designated a new representative for future bargaining.
To hold otherwise would mean that an employer and a union official, acting
in concert, could maintain one labor organization in perpetuity as the bar-
gaining representative by the simple device of expelling any employees who
wished to have a different representative when the question of renewal of
the contract arose.
The principle of that case is applicable here. Thus, irrespective of whether or
not they were free to do so theretofore (a question which it is unnecessary to de-
cide), the respondent's employees were free on March 6, 1944, to designate a
new collective bargaining representative and the respondent was not privileged
to discharge them for having done so, or privileged thereafter to require mem-
bership in the Machinists as a condition of employment. It is therefore found
that, by discharging Radisky, Rodrigues, and Wells at a time when they were
free to designate a new bargaining representative, for the reason that they were
no longer members in good standing in the Machinists, and with the knowledge
that they had been involuntarily suspended from the Machinists because of their
activities on behalf of the Steelworkers, the respondent discriminated in the
hire and tenure of their employment, encouraged membership in the Machinists,
and discouraged membership in the Steelworkers. It is further found that, by
that action, and by requiring new employees, after March 6, 1944, to acquire
membership in the Machinists as a condition of employment, the respondent in-
terfered with, restrained, and coerced its employees in the exercise of the rights
guaranteed in Section 7 of the Act's
Iv. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
The activities of the respondent set forth in Section III, above, occurring in con-
nection with the operations of the respondent described in Section I, above, have
a close, intimate , and substantial relation to trade, traffic, and commerce among
the several States, and tend to lead to labor disputes burdening and obstructing
commerce and the free flow of commerce.
V. THE REMEDY
Having found that the respondent has engaged in unfair labor practices, the
undersigned will recommend that it cease and desist therefrom and take certain
affirmative action designed to effectuate the policies of the Act.
It has been found that the respondent has discriminated in regard to the hire
and tenure of employment of Charles E. Radisky, Anterio Rodrigues, and Charles
Wells, thereby discouraging membership in the Steelworkers. The undersigned
will recommend that the respondent offer Radisky, Rodrigues, and Wells, im-
mediate and full reinstatement to their former or substantially equivalent posi-
tions without prejudice to their seniority and other rights and privileges; and
11 It would not be fair to the respondent to say that it discharged Radisky, Rodrigues,
and Wells in order to assist the Machinists to maintain its influence over the employees
The circumstances under which the Steelworkers ' designations were secured indicate the
contrary. However , regardless of its actual motive, the inevitable effect of the respond-
ent's conduct was to discourage membership in the Steelworkers . Good faith , or mistake
of law , are not valid defenses.
70 DECISIONS OF NATIONAL LABOR RELATIONS BOARD.
that the respondent also make them whole for any loss of pay , if any, which they
suffered, as a result of the discrimination against them , by payment to each of
them of a sum of money equal to the amount which he would normally have
earned as wages from the date of the discrimination to the date of the offer of
reinstatement , less his net earnings '° during such period.
Upon the basis of the foregoing findings of fact, and upon the entire record
in the case , the undersigned makes the following :
CONCLUSIONS of LAw
1 United Steelworkers of America, Local 1798, Congress of Industrial Organ-
izations, and International Association of Machinists, Lodge 824, American Feder-
ation of Labor, are labor organizations within the meaning of Section 2 (5)
of the Act.
2. By discriminating in regard to the liire and tenure of employment of Charles'
E. Radisky, Anterio Rodrigues, and Charles Wells, thereby discouraging mem-
bership in ,United Steelworkers of America, Local 1798, Congress of Industrial
Organizations, and encouraging membership in International Association of
Machinists, Lodge 824, American Federation of Labor, the respondent has en-
gaged in, and is engaging in, unfair labor practices within the meaning of Section
8 (3) of the Act: I
3. By interfering with, restraining, and coercing its employees in the exercise
of the rights guaranteed in Section 7 of the Act, the respondent has engaged in,
and is engaging in, unfair labor practices within the meaning of Section 8 (1) of
the Act.
4. The aforesaid unfair labor practices are unfair labor practices affecting
commerce, within the meaning of Section 2 (6) and (7) of the Act.
RECOMMENDATIONS
Upon the basis of the above findings of fact and conclusions of law, the under-
signed recommends that Rheem Manufacturing Company, Richmond, California,
its officers, agents, successors, and assigns shall:
1. Cease and desist from :
(a) Discouraging membership in United Steelworkers of America, Local
1798, Congress of Industrial Organizations, or any other labor organization of
its employees, or encouraging membership in International Association of Machin-
ists, Lodge 824, American Federation of Labor, by discriminating in regard to the
hire and tenure of their employment, or any term or condition of employment;
(b) In any other like or related manner interfering with, restraining, or
coercing its employees in the exercise of the right to self-organization, to form
labor organ izatioiis,, to join or assist United Steelworkers of America, Local 1798,
Congress of Industrial Organizations, or any other labor organization, to bar-
gain collectively through representatives of their own choosing, and to engage
in concerted activities for the purpose of collective bargaining or other mutual
aid or protection as guaranteed in Section 7 of the Act.
2. Take the following affirmative action which the undersigned finds will
effectuate the policies of the Act : -
"By "net earnings" is meant earnings less expenses , such as for transportation, room,
and board, incurred by an employee in connection with obtaining work and working else-
where than for the respondent , which would not have been incurred but for his unlawful
discharge and the consequent necessity of his seeking employment elsewhere. See Matter
of Crossett Lumber Company , $ N. L. R B . 440. Monies received for work performed upon
Federal, State , county, municipal , or other work -relief projects shall be considered as
earnings . See Republic Steel Corporation Y. N. L. R. B., 311 U. S. 7.
I
RHEEM MANUFACTURING COMPANY 71
(a) Offer to Charles E. Radisky, Anterio Rodrigues, and Charles Wells, immedi-
ate and full reinstatement to their former or substantially equivalent positions,
without prejudice to their seniority or other rights and privileges ;
(b) Make whole Charles E. Radisky, Anterio Rodrigues, and Charles Wells for
any loss of pay they may have suffered as a result of the discrimination against
them, by payment to each of them of a sum of money equal to the amount which
he normally would have earned as wages during the period from the date of the
discrimination against him to the date of the respondent ' s offer of reinstatement,
less his net earnings during that period ;
(c) Post at its Richmond, California, plant copies of the notice attached hereto-
and marked "Appendix A." Clopies of said notice, to be furnished by the Regional
Director for the Twentieth Region, shall, after being duly signed by the respond-
ent's representative , be posted by the respondent immediately upon receipt thereof,
and maintained by it for sixty (G0) consecutive days thereafter, in conspicuous
places, including all places where notices to employees are customarily posted.
Reasonable steps shall be taken by the respondent to insure that said notices are
not altered, defaced, or covered by any other material ;
(d) Notify the Regional Director for the Twentieth Region in writing within
ten (10) days from the date of the receipt of this Intermediate Report what
steps the respondent has taken to comply herewith
It is 'further recommended 'that unless on or before ten (10) days from the
receipt of this Intermediate Report, the respondent notifies said Regional Director
in writing that it will comply with the foregoing recommendations , the National
Labor Relations Board issue an order requiring the respondent to take the
action aforesaid.
As provided in Section 33 of Article II of the Rules and Regulations of the
National Labor Relations Board, Series 3, as amended, effective July 12, 1944,
any party or counsel for the Board may within fifteen (15) days from the date
of the entry of the order transferring the case to the Board, pursuant to Section 32
of Article II of said Rules and Regulations, file with the Board, Rochambeau
Building, Washington 25, D. C., an original and four copies of a statement in
writing setting forth such exceptions to the Intermediate Report or to any other
part of the record or proceeding ( including rulings upon all motions or objections)
as he relies upon , together with the original and four copies of a brief in support
thereof. Immediately upon the filing of such statement of exceptions and/or
brief, the party or counsel for the Board filing the same shall serve a copy thereof
upon each of the other parties and shall file a copy with the-Regional Director.
As further provided in said Section 33, should any party desire permission to
argue orally before the Board, request therefor must be made in writing within
ten (10 ) days from the date of the order transferring the case to the Board.
CHARLES W. SCHNEIDER,
Trial Examiner.
Dated May 29, 1945
APPENDIX "A"
NOTICE TO ALL EMPLOYEES
Pursuant to the recommendations of a Trial Examiner of the National Labor
Relations Board, and in order to effectuate the policies of the National Labor
Relations Act, we hereby notify our employees that :
We' will not in any manner interfere with, restrain , or coerce our em-
ployees in the exercise of their right to self-organization, to form labor
organizations , to join or'assist United Steelworkers of America, Local
72 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
1798, Congress of Industrial Organizations or any other labor organization,
to bargain collectively through representatives of their own choosing, and
to engage in concerted activities for the purpose of collective bargaining
or other mutual' aid or protection. -
We will offer to the employees named below immediate and full rein-
statement to their former or substantially equivalent positions without
prejudice to any seniority or other rights and privileges previously en-
joyed, and make them whole for any loss of pay suffered as a result of the
discrimination. -
The employees to be reinstated and made whole are:
Charles E. Radisky
Anterio Rodrigues
Charles Wells i
All our employees are free to become or remain members of the above-named
union or any other labor organization. We will not discriminate in regard' to
hire or tenure of employment or any term or condition of employment against
any employee because of membership in or activity on behalf'of any such labor
organization. `
RHEEM MANUFACTURING COMPANY,
Employer.
-Dated------------------ By --------------------------------------
(Representative ) ( Title)
NoTE :-Any of the above-named employees presently serving in the armed
forces of the United States will be offered full reinstatement upon applica-
tion in accordance with the Selective Service Act after discharge from the
armed forces.
This notice must remain posted for 60 days from the date hereof, and must
not be altered, defaced, or covered by any other material.