Rosco Concrete Pipe Co., Inc.

National Labor Relations Board - Board Decisions

Aug 1, 1975

219 N.L.R.B. 915 (N.L.R.B. 1975)

ROSS SAND CO., INC. 915
Ross Sand Company, Inc. d/b/a Rosco Concrete Pipe
Co., Inc . and Meshack A. Williams. Case 17-
CA-6276-2
August 1, 1975
DECISION AND ORDER
By MEMBERS FANNING, JENKINS, AND PENELLO
On April 3, 1975, Administrative Law Judge James
T. Rasbury issued the attached Decision in this pro-
ceeding. Thereafter, the Respondent filed exceptions
and a supporting brief, and the General Counsel'
filed cross-exceptions and a supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has considered the record and the at-
tached Decision in light of the exceptions and briefs
and has decided to affirm the rulings, findings,2 and
conclusions of the Administrative Law Judge, with
the modifications stated herein, and to adopt his re-
commended Order.
The evidence indicates that Respondent has for a
period of several years granted bonus or profit-shar-
ing payments to its employees twice a year, usually in
July and December. These payments have been
based primarily on the Employer's gross profits dur-
ing a 6-month period preceding the time of payment.
Here the certification of bargaining representative
occurred in April and the Union on June 18 refused
a wage increase offered in lieu of bonus payments as
made in the past. A strike by some of the employees
started the next day. In July, when Respondent cus-
tomarily would have granted its employees a "bo-
nus" payment based upon its profits accrued be-
tween December 1973 and May 1974, Respondent
unilaterally withheld such payment though, as found
by the Administrative Law Judge, it had become part
of the employees' wage expectancy. In our view, re-
fusing to pay previously earned income to affected
employees who have recently chosen a collective-bar-
gaining agent and have struck in support of their de-
mand is "inherently destructive" of employee rights
under the Act,3 absent a legitimate business justifica-
tion for such action. Here Respondent's explanation
for its action is that the parties were negotiating over
the continuation of the "bonus" plan and that it law-
fully withheld payment of the bonus until the criteria
for determining the bonus payment were settled.' We
agree with the finding of the Administrative Law
Judge that Respondent's proffered justification was
specious. We shall, however, expand his finding to
include the employees' strike activity as a further ba-
sis for Respondent's decision to withhold the bonus
payment. In a conversation at the site of picketing in
October 1974 during which striking employee Wil-
liams asked Respondent President E. H. Ross why
strikers were not paid their July bonus, Ross an-
swered that the reason was that his lawyer had ad-
vised him not to do so until the labor dispute was
over. In our view this evidence gives rise to the rea-
sonable inference that the Respondent's conduct in
withholding the bonus payment was in response to
the concerted activity of employees who engaged in
the strike as well as to the earlier selection of a collec-
tive-bargaining representative. We note also that Re-
spondent, in essence, took the position at the hearing
that it would condition the payment of this earned
income on the settlement of the present labor dis-
pute.
In these circumstances, we find that Respondent's
withholding of bonuses from those employed in the
unit as of May 31, 1974, who' had been employed for
at least 6 months, is violative of Section 8(a)(1) and
(3). Accordingly, we shall adopt the Administrative
Law Judge's recommended Order.'
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board adopts as its Order the recommended
Order of the Administrative Law Judge and hereby
orders that Respondent, Ross Sand Company, Inc.
d/b/a Rosco Concrete Pipe Co., Inc., Topeka, Kan-
sas, its officers, agents, successors, and assigns, shall
take the action set forth in the said recommended
Order.
1 The Administrative Law Judge's inadvertent error in sec. IV, A, par. 3,
of his Decision in referring to the employee 's gross earnings rather than the
employer's is, as motioned by the General Counsel , hereby corrected.
As Respondent 's action in withholding the December 1974 bonus pay-
ment is not before us for consideration , we do not adopt the Administrative
Law Judge's finding that such conduct "may be entirely proper."
7 N.L.R. B. v. Great Dane Trailers, Inc, 388 U.S. 26 (1967).
4 Respondent further contends that completion of the yearend auditor's
report necessary for determining the specific bonus amounts was delayed
until August . If true, this would not relieve Respondent of its obligation
upon receipt of the report to pay the bonuses-a part of previously earned
income.
5 The Administrative Law Judge recommended that the affected employ-
ees be paid an amount "normally paid" which by necessity involves the
same subjective considerations utilized by Respondent in the past.
DECISION
STATEMENT OF THE CASE
JAMES T. RASBURY, Administrative Law Judge: This case'
was heard in Topeka, Kansas, on January 28 and 29, 1975.
' The title has been corrected to conform with the evidence given by Mr.
Ross, president of Respondent , and to conform with an amendment, per-
mitted at the hearing.
I
219 NLRB No. 110
916 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The charge was filed by the Charging Party on October 29,
1974,2 and served by registered mail upon the Respondent,
Ross Sand Company, Inc. d/b/a Rosco Concrete Pipe Co.,
Inc. on October 30, alleging violation of Section 8(a)(1)
and (5) of the National Labor Relations Act, as amended
(herein Act). An amended charge was filed on December
16 and was served at the same time the complaint was
issued and served on Respondent on December 17, alleg-
ing Respondent to have been in violation of Section 8(a)(l)
and (3) of the Act since July 15, and continuing thereafter,
in that Respondent has failed and refused to pay accrued
profit-sharing monies for the first semiannual period of
1974 to the Charging Party and other named employees
because said employees have engaged in, and are continu-
ing to engage in, a strike against the Respondent.
Respondent's answer was served on December 27 and de-
nied all allegations of the complaint except that it admitted
service and acknowledged that the Truckdrivers and Help-
ers, Local 696 , International Brotherhood of Teamsters,
Chauffeurs , Warehousemen and Helpers of America (here-
in the Union), is a labor organization within the meaning
of the Act . A written amendment to the complaint was
dated January 22, 1975, and served on Respondent by
mailing on the same date.
The parties were given full opportunity at the hearing to
introduce relevant evidence , examine and cross-examine
witnesses, and to argue orally. Helpful written briefs were
received from the General Counsel and the Respondent.
Upon the entire record , and from my observations of the
demeanor of the witnesses , I hereby make the following:
FINDINGS OF FACT
1. THE ISSUES
1. Is Ross Sand Company, Inc. d/b/a Rosco Concrete
Pipe Co. Inc ., a properly charged and served Respondent
in this matter?
2. Did Respondent maintain an established bonus or
profit-sharing plan?
3. Did the Respondent violate the Act by its failure to
pay the bargaining unit employees the bonus normally
paid in July of each year?
It. JURISDICTION
The amended complaint alleged that the Respondent, a
Kansas corporation , engaged in the production of concrete
pipe at its plant and principal place of business located at
Topeka , Kansas , where it annually sells goods and services
having a value in excess of $50 ,000 directly to firms or
enterprises located outside the State of Kansas.
Respondent's answer denied all allegations of interstate
2 All dates hereinafter will be in the year 1974 unless otherwise indicated.
commerce and jurisdiction of the Board . However, at the
hearing,' Respondent 's counsel stated , "The employer who
sits here today does purchase material valued in excess of
$50,000 outside the state annually and is engaged in inter-
state commerce within the meaning of the Act, but I am
not responding to the complaint on behalf of any Respon-
dent named in the complaint."
Respondent argues that a charge naming the Ross Sand
Company, Inc., has never been filed and thus Respondent
is not a properly charged party. Ross Sand Company, Inc.,
never having been charged , the Respondent argues, the
complaint cannot be amended at the hearing to include a
party that was never properly charged. Moreover, the Re-
spondent argues , inasmuch as the 10(b) period 4 has
passed , it is too late to amend or have a new charge filed
against the Respondent.
I find the Respondent's argument unconvincing and not
in accord with Board law. I am of the opinion that the
Respondent is a properly charged party and is properly
before this Administrative Law Judge of the National La-
bor Relations Board for a determination of this labor dis-
pute on its merits . E. L. Clark, Owner, Jim H.
Pierce, Lessee of the Ashville- Whitney Nursing Home, 188
NLRB 235 (1971), enforcement denied on other grounds
468 F.2d 459 (C.A. 5, 1972). There, the Court said, "Re-
spondent Pierce argues that no charge against him was
filed with the Board or served on him within the 6-month
limitaton period prescribed by Section 10(b) of the Act, 29
U.S.C. Sec . 160(b). . . . Pierce 's contentions are unsound
because . . . they proceed from the mistaken assumption
that one who possesses crucial information may conceal
the information and then successfully capitalize on his own
misleading behavior ." In the instant case , the initial charge,
naming Rosco Concrete Pipe Co. as the Employer, was
served at the principal address of Respondent and named
Ross as the employer-representative to contact . The return
receipt was signed by W. P. Hurrel, secretary of the Re-
spondent . Moreover, it seems clear that the congressional
intent of that portion of the Act relating to the filing of a
charge has been complied with fully. Neither the Board nor
its agent initiated the charge . An individual filed the charge
and the investigation, resulting in the issuance of a com-
plaint, followed. The Respondent was fully apprised as to
who was charged with the alleged misconduct. Moreover,
in February the Union, which now represents the employ-
ees, filed an election petition in Case 17-RC-7419 , wherein
the Rosco Pipe Co. was named as employer and E. H.
Ross as the employer representative to contact, which re-
sulted in the Union being certified as the appropriate col-
lective-bargaining unit for "All full-time and regular part-
time production and maintenance employees , truckdrivers,
and working lead men employed at Rosco Concrete Pipe
3 Transcript at pages 6 and 36
4The relevant portion of Section l0(b) of the Act reads as follows:
Whenever it is charged that any person has engaged in or as engaging
in any such unfair labor practice , the Board . . . shall have power to
issue and cause to be served upon such person a complaint. . . Pro-
vided. That no complaint shall issue based upon any unfair labor prac-
tice occurring more than six months prior to the filing of the charge
with the Board and the service of a copy thereof upon the person
against whom such charge is made. ..
ROSS SAND CO., INC.
Co., Inc., at 501 East Gordon, Topeka, Kansas, but EX-
CLUDING office clerical employees, professional employ-
ees, salesmen , guards, and supervisors within the meaning
of the Act." Under all the circumstances of this case, I hold
that the charge sufficiently identified the employer and Re-
spondent as properly before this court; and it may legally
be tried on the merits of the allegations of the complaint.
III. THE LABOR ORGANIZATION
The Respondent admits, and I herewith find , the Truck-
drivers and Helpers, Local 696, affiliated with the Interna-
tional Brotherhood of Teamsters , Chauffeurs, Warehouse-
men and Helpers of America , is, and at all times material
herein has been , a labor organization within the meaning
of Section 2(5) of the Act.
IV. THE ALLEGED UNFAIR LABOR PRACTICES
A. The Evidence
In April the Union was certified as the appropriate bar-
gaining unit for: All full-time and regular part-time pro-
duction and maintenance employees, truckdrivers, and
working leadmen employed at Rosco Concrete Pipe Co.,
Inc., at 501 East Gordon, Topeka, Kansas, but EXCLUDING
office clerical employees, professional employees , sales-
men, guards, and supervisors within the meaning of the
Act. Thereafter negotiations for a collective-bargaining
agreement were conducted between representatives of Re-
spondent and the certified bargaining representative. Mr.
E. H. Ross, president and general manager of the Respon-
dent, testified that he instructed his negotiator to offer the
Union a 10-cent an hour wage increase in lieu of profit
sharing or bonuses payments that may have been made in
the past. That offer was refused by the Union. The last
negotiating session was held on June 18, and on June 19 a
number of the employees in the bargaining unit went out
on strike. There were some employees who did not join the
striking employees and have continued to work.
Meshack A. Williams testified that he first went to work
for the Respondent in June 1965 and received his first bo-
nus or profit-sharing check in December 1965. Thereafter,
he continued to receive bonus or profit-sharing checks on
or about the second week in July and the second week in
December through December 1973. Williams testified that
the amounts varied, that he generally received a larger sum
in the July bonus and that sometimes the checks indicated
that they were profit-sharing monies and at other times
that they were bonus moneys. (See G.C. Exhs. 5, 6, and 7.)
The largest gross sum which Williams ever received was
$1,000. Williams testified that all employees who had been
with Respondent for 6 months or longer received some
bonus check during the 9 years of his employment with the
Company. Williams testified that in October 1974, he had
occasion to talk to Mr. Ross as Ross was leaving the plant
in his car. On that occasion, Mr. Williams asked why Ross
had not given the employees who were on strike their bo-
nus. Mr. Ross replied that his lawyer had advised him not
to do so until the labor dispute was over.
Mr. Castleberry testified that he had been employed by
917
the Respondent about 4-1/2 years; that he had been hired
by Mr. Ross; and at the time he was hired that Ross told
him a bonus was paid twice a year. According to Castleber-
ry, Ross informed him that the amount of the bonus was
based on the number of years that an employee had been
with the Company and the employee's gross earnings.
Castleberry testified that he had received a bonus each July
and December since his initial employment. Castleberry
testified that his July bonus was generally a little larger
than the December bonus.
Leroy E. Deneault testified that he had been employed
by the Respondent at various times over the past 5-1/2
years but that he had gone out on strike and was currently
employed by the City Water Pollution Department. De-
neault testified that at the time he was hired, Mr. Ross
explained to him that the employees received two bonus
payments each year, one in July and one in December. The
witness testified that his largest bonus was in July 1973 in
the amount of $450 and that his December bonus had been
$250.
Mr. Ross testified that the bonuses or profit-sharing
moneys distributed to the employees was a matter entirely
discretionary with him; there was no precise formula and
nothing had ever been set down in writing. His only ac-
knowledged criteria for determining who would receive bo-
nuses was one of whom he "wished to make happy." The
testimony clearly established that the Respondent's fiscal
year ended on May 31, and Ross testified that he made the
decision about the amount of profit-sharing payments that
were to be paid in July before the audit was made at the
close of the fiscal year-sometime in May, June, or April.
Analysis and Conclusion
I am convinced from my analysis of all the testimony
that twice a year Respondent paid a profit-sharing or bo-
nus check to each employee that had been employed by
Respondent for a period of 6 months or longer. The
amount of the check was generally determined by the
employee's basic rate of pay, length of service, and the
profitability of the Company during the prior 6-month pe-
riod. The testimony fails to establish, however, any precise
formula for calculating the amount of the bonus and based
on the testimony it can only be stated that the amount was
at the discretion and sole determination of E. H. Ross. It is
equally true, however, that new employees were informed
that it was the customary practice of the Company to pay
a bonus twice each year and that with rare exceptions5
employees expected to receive an additional payment in or
about December and July of each year which was a part of
their regular wages.
The Respondent urged that its bonuses were discretion-
ary gifts. However, it is clear that while "gifts" as such are
not terms and conditions of employment and thus are not
mandatory subjects for collective bargaining, a payment to
employees may become such an integral part of the em-
ployees' wage structure that an employer may not make
changes in such payment without prior notice and discus-
5 Conceivably part-time or summertime student employees and those em-
ployees with less than 6 months ' service were the only exceptions.
918 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
sion with the union . As the Court held in N.L.R.B. v.
Harrah's Club, 403 F.2d 865 , 874 (C.A. 9, 1968) (quoting
from N.L.R.B. v. Wonder State Mfg. Co., 344 F .2d 210, 213
(C.A. 8, 1965));
The rule is that gifts per se-payments which do not
constitute compensation for services-are not terms
and conditions of employment , and an employer can
make or decline to make such payments as he pleases,
but if the gifts or bonuses are so tied to the remunera-
tion which employees receive for their work that they
were in fact a part of it, they are in reality wages and
within the statute.
Section 8(d) of the Act defines the' subjects about which an
employer must bargain as the "wages , hours, and other
terms and conditions of employment.... " This phrase
has been broadly construed and has been recognized to
"include all emoluments of value or other benefits accruing
to employees out of their relationship with their employer."
N.L.R.B. v. Detroit Resilient Floor Decorators Local 2265,
317 F.2d 269, 270 (C.A. 6, 1963) 6 In the instant case, there
can be no doubt that the bonus was a part of the employ-
ees'wages and they were so advised at the time of hiring.
In addition to the Respondent' s argument that the bo-
nus payments were so tenuous and discretionary as to be
totally outside the realm of compensation, Respondent ar-
gues that once the negotiations began, the bonus payments
became a subject for negotiations and could not properly
be paid until the negotiations had reached a satisfactory
conclusion. This argument fails to stand up, however, un-
der any kind of scrutiny. Clearly the record establishes that
payments were made on a regular basis and paid in De-
cember, and the second period was December through
May 31, the end of Respondent' s fiscal year, generally paid
in July. The working period (December 1973 through May
31, 1974) for which the July 1974 payment would normally
have been made had substantially passed before any nego-
tiations on a labor agreement had occurred. Conceivably,
it may be entirely proper to withhold payment of the De-
cember 1974 bonus until such time as some agreement has
been reached with the Union because this subject matter
had become a part of the negotiations, it is completely
wrong for Respondent to withhold the payments which
would normally have been paid covering a period of time
prior to the union negotiations. I have been aided in reach-
ing these conclusions largely because Ross' testimony was
lacking in candor; it was evasive and tended to confuse
and obfuscate the facts. It was apparent that Ross was a
successful and intelligent businessman. I have great diffi-
culty in believing his testimony was anything other than
contrived. The testimony supports, and I herewith con-
clude as a reasonable inference, that Respondent's only
6See also N.L.R.B. v. Niles-Bement-Pond Company, 199 F.2d 713, 714
(C.A. 2, 1952); General Telephone Company of Florida v. N L.R.B., 337 F.2d
452, 454 (C.A. 5, 1964); N.L.R.B v. Electric Steam Radiator Corp, 321 F.2d
733, 735-737 (C.A. 6,1%3); Stark Ceramics, Inc. v. N.LR.B., 375 F.2d 202,
205-206 (C.A. 6, 1%7); N.L.R.B. v. Progress Bulletin Publishing Co., 443
F.2d 1369 (C.A. 9, 1971); Beacon Journal Publishing Co. v. N.L.R.B., 401
F.2d 366, 367 (C.A. 6, 1%8). While these cases deal with failure to bargain
violations , where the bonus has already been earned and is withheld, it is
violative of Section 8(a)(3) of the Act.
reason for withholding the July 1974 bonus payment was
because of the concerted action of a majority of the em-
ployees in the bargaining unit selecting a union as their
collective-bargaining representative. Such conduct is viola-
tive of Section 8(a)(1) and (3) of the Act because it not only
tends to interfere with the Section 7 rights of the employees
but is a form of discrimination with regard to the condi-
tions of employment tending to discourage membership in
a labor organization.7
V. THE EFFECT OF THE UNFAIR LABOR PRACTICE UPON COMMERCE
The activities of the Respondent as set forth in section
IV, above, occurring in connection with its operations de-
scribed in section II, above, have a close, intimate, and
substantial relationship 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.
THE REMEDY
Having found that Respondent has engaged in unfair
labor practices, I shall recommend that it cease and desist
therefrom and that it take certain affirmative action de-
signed to effectuate the policies of the Act. Interest at the
rate of 6 percent per annum beginning August 1, 1974,
shall be added to any sum determined to be due and owing
each of the employees employed in the bargaining unit as
of May 31, 1974, and interim earnings need not be offset
against said sums because it has been found that these bo-
nus payments were rendered for past services performed.
Isis Plumbing & Heating Co., 138 NLRB 716 (1962).
On the basis of the foregoing findings of fact, and upon
the entire record in the case, I make the following:
CONCLUSIONS OF LAW
1. The Ross Sand Company, Inc. d/b/a Rosco Concrete
Pipe Co., Inc., is engaged in commerce within the meaning
of Section 2(6) and (7) of the Act.
2. The Union, Truckdrivers and Helpers, Local 696, af-
filiated with the International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of America, is,
and at all times material herein has been, a labor organiza-
tion within the meaning of Section 2(5) of the Act.
3. Respondent was properly charged and advised of the
alleged violations of the Act consistent with the statutory
provisions of the Act and other constitutional provisions
designed to afford Respondent due process of law.
4. Since on or about July 15, 1974, Respondent has
failed and refused to make bonus payments to employees
in the bargaining unit represented by the Union for the
working period from December 1973 through May 1974,
because said employees have engaged in, and are continu-
ing to engage in, concerted activity protected by Section 7
of the Act, and Respondent has thereby engaged in unfair
labor practices in violation of Section 8(a)(1) and (3) of the
Act.
7 Cf. Valley Oil Co. Inc., 210 NLRB No. 74 (1974).
ROSS SAND CO., INC.
Upon the basis of the above findings of fact and conclu-
sions of law and upon the entire record in the case , I here-
by issue the following recommended:
ORDERS
Respondent, Ross Sand Company, Inc. d/b/a Rosco
Concrete Pipe Co., Inc ., its officers , agents, successors, and
assigns , shall:
1. Cease and desist from:
(a) Refusing to pay employees their profit-sharing or
bonus moneys earned for the period from December 1973
through May 1974.
(b) Interfering with , restraining, or coercing employees
in the exercise of their rights as guaranteed in Section 7 of
the Act.
2. Take the following affirmative action designed to ef-
fectuate the policies of the Act:
(a) Pay to all employees who were on Respondent's pay-
roll and working within the bargaining unit on May 31,
1974, who had been employed for at least 6 months by
Respondent, the bonus or profit-sharing moneys in an
amount normally paid to said employees, with interest to
accrue at the rate of 6 percent per annum from August 1,
1974, until said sums are paid.
(b) Make available to the Board or its agents payroll
and other records necessary to aid in the computation ,of
said bonus payments.
(c) Post at its office and principal place of business in
Topeka, Kansas , copies of the attached notice marked
"Appendix." 9 Copies of said notice, on forms provided by
the Regional Director for Region 17, shall , after being duly
signed by a representative of the Respondent Company, be
posted immediately upon receipt thereof , and be main-
tained by it for a period of 60 consecutive days thereafter,
in conspicuous places, including all places where notices to
employees are customarily displayed. Reasonable steps
shall be taken by Respondent Company to insure that said
notices are not altered, defaced, or covered by any other
material.
(d) Notify the Regional Director for Region 17, in writ-
ing, within 20 days from the date of this Order, what steps
Respondent Company has taken to comply herewith.
8 In the event no exceptions are filed as provided by Sec. 102.46 of the
Rules and Regulations of the National Labor Relations Board , the findings,
conclusions, and recommended Order herein shall, as provided in Sec.
102.48 of the Rules and Regulations , be adopted by the Board and become
its findings , conclusions , and Order, and all objections thereto shall be
deemed waived for all purposes.
919
9 In the event that the Board's Order is enforced by a Judgmentof 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."
APPENDIX
NOTICE To EMPLOYEES
POSTED - BY ORDER OF THE
NATIONAL LABOR-RELATIONS BOARD
An Agency of the United States Government
After affording all sides an opportunity to present evidence
and state their positions, the National Labor Relations
Board has found that we have violated the National Labor
Relations Act, and has ordered us to post this notice.
The Act gives employees the following rights:
To engage in self-organization
To form, join, or assist unions
To bargain collectively through representatives of
their own choosing
To engage in activities together for the purpose of
collective-bargaining or other mutual aid or protec-
tion
To refrain from the exercise of any such activities.
WE WILL NOT interfere with, restrain, or coerce our
employees or applicants in the exercise of the rights
guaranteed to them in Section 7 of the National Labor
Relations Act.
WE WILL pay to all employees within the collective-
bargaining unit represented by the Teamsters Union,
Local 696, the bonus or profit-sharing moneys with
interest which was earned by them for the period of
work from December 1973 through May 1974 and
which would have been paid on or about the end of
July 1974 but for our discriminatory conduct in failing
and refusing to make such payments.
Ross SAND COMPANY , INC. D/B/A Rosco CONCRETE
PIPE CO. INC. - -