San Francisco Joint Board Intl. Ladies Garment Wkrs.

National Labor Relations Board - Board Decisions

Jun 25, 1975

218 N.L.R.B. 805 (N.L.R.B. 1975)

SAN FRANCISCO JOINT BOARD INTL. LADIES' GARMENT WKRS. 805
San Francisco Joint Board International Ladies'
Garment Workers' Union, AFL,-CIO and San
Francisco Shirt Works, Inc. Case 20-CP-530
June 25, 1975
DECISION AND ORDER
BY MEMBERS FANNING, JENIONS, AND
PENELLO
On January 8, 1975, Administrative Law Judge
Richard D. Taplitz issued the attached Decision in
this proceeding. Thereafter, the General Counsel
filed exceptions and a supporting brief; the Charging
Party filed exceptions and a supporting brief; 1 and
Respondent filed a brief in support of the Adminis-
trative Law Judge's Decision.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and
briefs and has decided to affirm the rulings, findings,
and conclusions of the Administrative Law Judge
and to adopt his recommended Order.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative ]Law Judge and
hereby orders that the complaint be, and it hereby is,
dismissed in its entirety.
1 The Charging Party has also filed a motion to reopen record to adduce
the testimony of a participant in Respondent Union's picketing of its
premises . In an affidavit accompanying this motion, counsel for the
Charging Party avers that if this individual were permitted to testify she
would state that such picketing had a recognittional objective. Even
assuming that she would so testify, however, such evidence would be
insufficient to affect the results of our decision herein . The Charging Party
offers no evidence, nor even makes a bare claim , that she was Respondent's
agent or was otherwise in a position to make an authoritative statement
concerning Respondent 's activities . Accordingly, the Charging Party's
motion is hereby denied.
DECISION
STATEMENT OF THE CASE
RicHARD D . TAPLrrz, Administrative Law Judge: This
case was tried at San Francisco, California, on November 5
1 All dates are in 1974 unless otherwise specified.
2 An order consolidating cases, consolidated complaint and notice of
hearing issued on July 12, 1974. The complaint was based on the above-
mentioned charge plus a charge involving the same parties in Case 20-CC-
1482 which was filed on May 8 . Case 20-CC-1482 contained allegations
that Respondent engaged in certain secondary activities in violation of Sec.
8(bX4Ki) and (i)(11) of the Act. At the opening of the hearing, Respondent
executed an informal settlement agreement relating to Case 20 -CC-1482.
218 NLRB No. 33
and 6, 1974.1 The charge was filed on June 10 by San
Francisco Shirt Works, Inc., herein called the Company.
The complaint2 issued on July 12 alleging that San
Francisco Joint Board, International Ladies' Garment
Workers' Union, AFL-CIO, herein called the Respondent
or the Union, violated Section 8(b)(7)(C) of the National
Labor Relations Act, as amended.
Issues
The primary issue is whether the Union's picketing of the
Company to secure an agreement that the Company would
contract out work on garments only to garment industry
contractors who had collective-bargaining agreements with
the Union constituted picketing for recognition in violation
of Section 8(b)(7)(C) of the Act.
All parties were given full opportunity to participate, to
introduce relevant evidence, to examine and cross-examine
witnesses, to argue orally, and to file briefs. Briefs, which
have been carefully considered, were filed on behalf of the
General Counsel and the Union.
Upon the entire record of the case and from my
observation of the witnesses and their demeanor, I make
the following:
FINDINGS OF FACT
I. THE BUSINESS OF THE COMPANY
The Company is a California corporation with facilities
located at 1161 Mission Street and 1111 17th Street, San
Francisco, California . It engages in the jobbing or
manufacturing and the wholesale distribution of women's
apparel. During the year immediately preceding issuance
of the complaint the Company had gross sales in excess of
$500,000 and purchased and received at its California
facilities goods valued in excess of $50,000 directly from
suppliers located outside of California. The Company is an
employer engaged in commerce within the meaning of
Section 2(6) and (7) of the Act.
II. THE LABOR ORGANIZATION INVOLVED
The Union is a labor organization within the meaning of
Section 2(5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. Introduction
As is set forth in detail below, the Union picketed the
Company for more than 30 days to secure an agreement
that the Company would not do business with nonunion
garment industry contractors. No petition for an election
was filed. In substance, the complaint, which alleges a
violation of Section 8(bx7)(C) of the Act, seeks to set the
The General Counsel then moved that the settlement agreement be
approved. After hearing full argument from all the parties and after
considering the opposition to the, proposed settlement agreement by the
Charging Party, I severed Case 20-CC-l482 from Case 20-CP-530,
approved the proposed settlement agreement in Case 20 -CC-1482 and
dismissed those allegations of the complaint that alleged that the Union had
engaged in secondary boycott activity in violation of Sec. 8(bx4)(i) and
(ii)(B) of the Act.
806 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
perimeters of the Board's decision in Joint Board of Coat,
Suit and Allied Garment Workers' Unions, ILGWU, AFL-
CIO (Hazantown, Inc.), 212 NLRB 735 (1974). In that case,
the Board found that a union did not violate Section
8(bx7)(C) where it picketed a jobber in the garment
industry to force the Company to agree to use union
contractors. The Board held that the picketing was
"protected by the garment industry proviso contained in
Section 8(e), and [was ] not in any way prohibited under
Section 8(b)(7)." The General Counsel argues that the
present case is not within the reach of the Hazantown
decision . In substance, General Counsel contends that the
Hazantown situation involves a pure jobber, while in the
instant case the Company in addition to jobbing has some
employees who do production work and who are eligible
for membership in the Union.
B. The Nature of the Company's Operations
The Company went into business in 1970. At that time
there was only one employee, a bookkeeper. Gradually it
expanded its business until by May 8, 1974 (the date upon
which the allegedly illegal picketing began), approximately
65 persons were employed. At that time, the Company's
facilities were located at 1161 Mission Street, San Francis-
co (the Mission Street plant) and a new facility was under
construction at 1111 17th Street, San Francisco (the 17th
Street plant). The Company transferred its operations to
the new facility during the end of June or beginning of
July.3
On May 8, the Company employed people in the
following categories: there were 4 or 5 designers or
assistant designers who conceived the styles of garments
and made sketches of them; there were 4 patternmakers
who made cardboard cutouts for the pieces that would
make the garment; there were 5 cutters who cut material
into the pieces needed for the garment and who labeled the
pieces so that the contractor would know what was to be
sewed together; there were 4 sewing machine operators
who worked primarily on sewing and pressing garments for
use by the salesmen as samples, who on occasions repaired
garments made by contractors and who on some occasions
worked on production garments (garments that are used
for sale rather than for samples); there were 4 or 5
production coordinators who saw to it that there was
enough fabric and trim and who acted as liaison with the
sewing contractors; there were 3 piece goods distributors
who pulled the yardage material from stock for the cutting
department; there were 1 or 2 trimmers who saw to it that
the right labels, buttons, and the like were coordinated with
the cut goods so that the contractor had the right items to
sew; there were 15 to 18 in the shipping department; and
there were about 20 in sales, clerical, and executive
classifications.
As of the date of the hearing, the Company employed six
sewing machine operators, five people in the design
a One of the divisions of the Company is called San Francisco Tea Party,
Inc. San Francisco Shirt Works, Inc., and San Francisco Tea Party, Inc.,
have substantially the same officers , directors, and stockholders . Earl M.
Turow, the president of San Francisco Shirt Works, Inc., is responsible for
the labor relations decisions of both. He directs the day-to-day operations
and establishes the wage rates and benefits of both. San Francisco Shirt
department, five patternmakers, seven cutters, and one
bundler. An additional employee had been added in the
piece goods department and a few more in the accounting
office.
Respondent's typical operation is as follows: A fabric is
selected and the designer designs the shirt or other
garment. A pattern is made and a samplemaker makes a
sample garment. If a decision is made to produce that
garment, a marker is made for the cutting of the material
and the parts of the garment are cut. Trimmings, such as
buttons, labels, and bows, are bundled with the pieces of
the garment and they are all delivered to a contractor who
sews the completed garment. The garment is then pressed
and returned to the Company where it is put into stock or
shipped to various customers.
The Company's employees are not represented by any
union nor are the employees of any of the contractors used
by the Company'4
The contractors used by the Company are independent
contractors. They are not owned or , controlled by the
Company. The goods and materials worked on by the
contractors are owned by the Company. These contractors
are sometimes referred to as contract shops.
Before May 8, 1974, about-50 percent of the cutting work
was done by outside contractors and 50 percent by the
Company. Since that time, the cutting department has
been enlarged in size and at the time of the hearing the
Company did 100 percent of the cutting.
Though the Company employs six employees who sew
and press, these employees are not able even to produce
enough samples for the salesmen to use. Some of the
sample work is contracted out by the Company. The
Company intends to hire three or four new employees for
sewing when new equipment that has been ordered is
delivered, but even with the prospective employees and two
other employees who sometimes fill in as sewers, the
production of the Company's employees is extremely
limited. Respondent's president, Earl M. Turow, conceded
that more than 90 percent of the sewing and pressing work
is done by outside contractors. He averred that company
employees do 5 percent or more of the sewing and pressing.
Even that estimate, however, appears to be exaggerated.
The Company produces about four lines of product a year
with 80 to 90 samples in a line. For each garment 42
samples are made. Thus, there are between 13,440 and
15,120 units for samples to be shown by salesmen. Each
sewing machine operator working for the Company can
make between 3 and 7 garments in an 8-hour period, and
the employees each average 27 or 28 a week. If all six of the
Company's sewing machine operators worked on nothing
but samples all 52 weeks of the year they could produce
only 8,400 to 8,700 of the 13,000 to 15,000 samples needed
per year. As of May 8 there were only four sewing machine
operators so if that number is used the output would be
one-third less. As far as production garments are con-
cerned (ones which are destined for sale), the Company
Works, Inc., and San Francisco Tea Party, Inc., are jointly referred to
herein as the Company.
4 Until early April 1974, one contractor, Triumph Curing Center, did
pressing for the Company. Triumph's employees were unionized. Triumph
had a contract with the Union. The Union began picketing Triumph on
March 29, 1974, and a new agreement has not been reached.
SAN FRANCISCO JOINT BOARD INTL. LADIES' GARMENT WKRS. 807
sells about 3 million units annually. Though Turow
testified that on occasions when there was an ad deadline
and 20 or 30 dozen shirts were needed, they were made by
the Company's employees, in relation to the 3 million
production units, such work performed by the Company is
de minimis. This is so even if as claimed by Turow a sewing
machine operator can produce twice as many production
garments as sample garments . In his testimony Turow
referred to his sample department when asked about the
number of Respondent's sewing machine operators. It is
apparent that Respondent doesn't have the employee
complement nor the facilities to make a meaningful dent in
the sewing and pressing work on the 3 million garments it
sells a year.
C. The Union's Demand and the Picketing
On May 8, 1974, the Company received a letter signed by
Mattie J. Jackson, the business manager of the Union,5
which read as follows:
Dear Mr. Turow:
Please note that the undersigned Union neither claims
nor purports to represent any of the employees
employed by San Francisco Shirt Works and San
Francisco Tea Party. Nor does it claim any interest at
this time of the representation of your employees.
It is our understanding that San Francisco Shirt Works
and San Francisco Tea Party is engaged in the
manufacture and sale of Ladies' Apparel by means
what is commonly known as the Jobber, Contractor
system of production.
The purpose of this letter is to advise you that we
intend to picket. The sole purpose of inducing the
company to enter into an Agreement with the under-
signed Union, whereby the company will manufacture
such products by means of such Contractors as have
collective bargaining agreements with the Union.
The Union, of course, is available at any time to discuss
with the company the negations of any such contract-
ing. You may call us at 982-3645.
Should our understanding of the nature of the
company and its method of operations be wrong,
5 The complaint alleges, the answer admits, and I find that Jackson is an
agent of the Union within the meaning of Sec . 2(13) of the Act.
9 The Union began picketing the Company on or about April 1, 1974,
and had before that date picketed Triumph Cuing Center, Inc., a contract
shop that did pressing for the Company. During the hearing , counsel for the
Charging Party argued that a violation of Sec . 8(b)(7)(C) should be found
on the theory that the Union picketed the Company to force Triumph to
recognize the Union . However, such a violation was not alleged in the
complaint nor was it fully litigated. In any event , Triumph had previously
recognized the Union as the collective-bargaining agent of its employees.
Triumph had a recently expired contract with the Union and the Union was
picketing for a new agreement . Sec. 8(bX7) limits picketing for the initial
acceptance of a union as a bargaining representative and therefore is not
applicable to the situation present here . Warehouse Employees Union Local
No. 370, IBT (WitakerPaper Co.), 149 NLRB 731(1964).
9 The Union makes no contention that it was engaging in publicity
please advise us and we shall immediately review our
position.
The picketing which is alleged in the complaint to be
violative of Section 8(bX7)(C) of the Act began on the
same day, May 8,6 when the Union picketed the Mission
Street plant with signs reading:
"Picket"
San Francisco Shirt Works
Use Non Union Contractors
S. F. Joint Board of ILGWU
On May 8, the Union also picketed at the 17th Street
plant, which was under construction. The signs read:
Triumph Curing Co. Contracts with San Francisco
Shirt Works!
Triumph Curing Co. UNFAIR S. F. Joint Board of
ILGWU.
On the following day, May 9, the picket signs were
changed to conform to those being used at the Mission
Street plant. The Union continued picketing until July 5,
1974.7
On May 20, 1974, Company President Turow called
Union Business Manager Jackson on the telephone. Turow
told Jackson that the Company was not doing business
with Triumph as the union letter had indicated. Jackson
replied that the letter had nothing to do with Triumph and
suggested that he reread it. Jackson told Turow the letter
was written because the Union understood that the
Company was a jobber and the Union wanted to induce
him to negotiate a jobber contract. Turow replied that he
had no interest in such a contract.8
The Union never gave a copy of the proposed jobber
contract to the Company, nor, except for the May 20, 1974,
telephone conversation, did the Company respond to the
Union's May 8, 1974, letter. Jackson has never negotiated a
jobber contract with any employer and doesn't know
whether any such contract has been entered into with a
California employer. She received a sample copy of a
jobber contract from the Union's New York office, but
that was to be used as a model for negotiations with
picketing within the second proviso of Sec . 8(b)(7)(C) of the Act. In
addition, Respondent admitted that, as a result of the picketing , vehicles
were turned back and people did not cross the picket line. Pickets spoke to
truckdrivers and some of the drivers refused to make deliveries.
a This finding is based on the credited testimony of Jackson. Turow
testified that he asked Jackson why the Company was being picketed and
she referred him to the union letter . He also testified that he told Jackson
that if the Union showed good faith by withdrawing the pickets for 2 weeks,
he would analyze the situation and the availability of contractors and would
discuss it with the Union . According to Turow, Jackson said that she wasn't
in a position to give him an answer but that she would call back. Turow
averred that he never heard from her again . I credit Jackson's version of the
conversation as set forth above . Her contention that Turow brought up the
issue of Triumph was supported by the fact that the Company had written
the Union on May 14 , 1974, advising the Union that it had ceased doing
business with Triumph and requesting an immediate removal of the pickets.
808 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
whatever changes were needed to reflect west coast
conditions.9
The Union's constitution states that its jurisdiction
includes all workers employed in the United States and
elsewhere "by firms engaged in the production and
distribution of women's and children's apparel and related
products and accessories and including work or processes
used by such firms." The Union has contracts with
employers in the San Francisco area, such as Tami-Lee
Mae and Lilli Ann Corp. The bargaining unit in those
contracts covers production and maintenance employees
and includes among others: cutters, operators, pressers,
samplemakers, fmishers, drivers, shipping and receiving
department employees, and floor employees. Designers
and patternmakers are excluded from the unit.
D. Analysis and Conclusions
The evidence set forth above establishes that the object
of the Union's picketing was, as is stated in its May 8, 1974,
letter, to induce the Company "to enter into an Agreement
with the ... Union whereby the company will manufac-
ture such products (ladies' apparel) by means of such
Contractors as have collective bargaining agreements with
the Union." In effect, the Union was seeking an agreement
which would limit the right of the employer to do business
with other employers. Such "hot cargo" agreements are
normally subject to scrutiny under Section 8(e) (which
relates to hot cargo agreements) or Section 8(b)(4)(B)
(which relates, among other things to secondary boycotts)
of the Act. However, those sections of the Act have no
application to the instant case because the Company and
the other employers who would be affected by the Union's
demand stand in the relation of jobber, manufacturer,
contractor, or subcontractor who perform parts of an
integrated process of production in the garment industry.
The second proviso of Section 8(e) of the Act wholly
exempts such employers from the coverage of Section 8(e)
and 8(b)(4)(B).10
The complaint alleges that the Union's picketing, which
continued for more than 30 days without a petition for an
election being filed, was unlawful because its object was to
force the Company to recognize or bargain with the Union
as the representative ofthe Company's employees.11
The Union did picket for more than 30 days without the
filing of a petition for an election. The Union was not
currently certified as a representative of the Company's
employees and none of the 8(b)(7) provisos which limit the
applicability of that section are applicable to the instant
situation. The key to whether or not a violation exists is
whether it can be found that the picketing had a
recognitional or bargaining objective.12
The General Counsel relies on two Board decisions for
the proposition that picketing for an agreement that would
limit an employer's right to do business with nonunion
contractors can be construed as recognition picketing. In
Dallas Buildings and Construction Trades Council (Dallas
County Construction Employers' Association, Inc.), 164
NLRB 938 (1967), enfd. 396 F.2d 677 (C.A.D.C., 1968), the
Board considered a situation where a union picketed
construction industry employers for a subcontractor
clause . That case involved an interpretation of Section
8(b)(7)(A) of the Act which proscribes recognitional or
organizational picketing by a union when the employer has
lawfully recognized a different union as the employees'
collective-bargaining representative. The "hot cargo"
limitations set forth in Section 8(e) of the Act do not apply
in such a case because of the first proviso to that section
which exempts agreements in the construction industry
relating to the contracting of onsite construction.13
The construction industry proviso is much more narrow-
ly drawn than the garment industry proviso. The construc-
tion industry proviso permits certain "hot cargo" agree-
ments which would otherwise be unlawful under Section
9 The model contract (Union Exh. 4) is a complex 40-page document,
which by its terms is not applicable to workers employed by the employer
on his own premises or in his inside shop, whether the same is located on his
premises or elsewhere . The model agreement provides that the employer will
contract out work on garments only to shops which are under contract with
the Union. It also provides that the employer will make payments to the
Union's benefit funds on behalf of the contractors ' employees and that the
employer will have a role in the settling of piece rates paid by the
contractor . Under the circumstances present here, there is no way to know
which of the many clauses in the model would have been demanded by the
Union and which would not. The issue never got that far and the only
demand made by the Union to the Company is contained in the May 8,
19745 letter in which the Union seeks to induce "the company to enter into
an Agreement with the undersigned Union, whereby the company will
manufacture such products by means of such Contractors as have collective
bargaining agreements with the Union."
10 The second proviso of Sec. 8(e) reads:
Provided further, That for the purposes of this subsection (e) and
Section 8(b)(4XB) the terms "any employer," any person engaged in
commerce or in industry affecting commerce," and "any person" when
used in relation to the terms "any other producer, processor, or
manufacturer," any other employer," or "any other person" shall not
include persons in the relation of a jobber , manufacturer , contractor, or
subcontractor working on the goods or premises of the jobber or
manufacturer or performing parts of an integrated process of
production in the apparel and clothing industry: Provided further, that
nothing in this Act shall prohibit the enforcement of any Agreement
which is within the foregoing exception.
11 Sec. 8(b)(7)(C) of the Act states that it is an unfair labor practice for a
union:
(7) to picket or cause to be picketed, or threaten to picket or cause to be
picketed, any employer where an object thereof is forcing or requiring
an employer to recognize or bargain with a labor organization as the
representative of his employees, or forcing or requiring the employees
of an employer to accept or select such labor organization as their
collective bargaining representative , unless such labor organization is
currently certified as the representative of such employees:
w
(C) Where such picketing has been conducted without a petition under
Section 9(c) being filed within a reasonable period of time not to exceed
thirty days from the commencement of such picketing...
12 There is no evidence that the Union was seeking to organize the
Company's employees.
The complaint alleges that the picketing was intended to force the
Company to recognize and bargain with the Union as the collective-
bargaining representative of the Company's employees. The complaint does
not allege nor is there any evidence that an object of the picketing was to
force any of the Company 's nonunion contractors to recognize the Union as
the representative of those nonunion contractors' employees.
13 The first proviso to Sec. 8(e) reads:
Provided, That nothing in this subsection (e) shall apply to an
agreement between a labor organization and an employer in the
construction industry relating to the contracting or subcontracting of
work to be done at the site of the construction, alteration , painting, or
repair of a building, structure or other work.. .
SAN FRANCISCO JOINT BOARD INTL. LADIES' GARMENT WKRS. 809
8(e), The garment industry proviso goes much further in
permitting conduct that would otherwi§e be unlawful either
under Section 8(e) or 8(b)(4)(B).
In the Dallas case the employees of the employers from
whom the contractor clause was sought were represented
by collective-bargaining representatives. Some of those
representatives had unsuccessfully sought the contractor
clause and after bargaining had executed collective-bar-
gaining contracts that did not contain such a clause.
Thereafter, a different labor organization began picketing
for the contractor clause . The Board found that the
subcontracting proposal would signif=icantly affect the
employees of the picketed employers and could mean the
difference between an employee's working or not working.
The incumbent unions had already bargained on the
contractor issue and the Board found that the picketing
union. was intruding on the exclusive bargaining rights of
the incumbent unions. The Board held:
.. , the employers are entitled to the protection of
Section 8(b)(7)(A) against actions which tend to erode
or even destroy their right to operate, unimpeded by
outsiders' threats and picketing, under the collective-
bargaining terms lawfully negotiated with their employ-
ees' representatives.
The second case relied on by the General Counsel is
Building and Construction Trades Council of Philadelphia
and Vicinity (Samuel E. Long, Inc.), 201 NLRB 321 (1973),
enfd. without published opinion 485 F.2d 680 (C.A. 3,
1973). In that case, a union picketed a nonunion construc-
tion industry employer for a contract that would limit the
employer's right to subcontract to nonunion employers.
The contract would have applied to work that the
employer might , have done with his own employees or
through subcontracts . The Administrative Law Judge
found a violation of Section 8(b)(7)(C) of the Act after
concluding that the Dallas case was controlling. The Board
adopted the Administrative Law Judge's Decision but
added a specific finding that an object of the picketing was
to organize the employer 's employees 14
Counsel for the Union argues that the cases cited by the
General Counsel are inapposite and that the controlling
law is set forth in Joint Board of Coat, Suit and Allied
Garment Workers ' Unions, ILGWU, AFL-CIO
(Hazantown, Inc.), 212 NLRB 735 (1974). Hazantown was
a jobber in the apparel industry. It employed approximate-
14 The Board relied on an admission of a union agent that the picketing
had an organizationa l object.
is The Board described this contract as follows:
This contract between the Union and the jobber, who is described
therein as "the employer," requires the jobber to deal only with those
contractors designated and approved in advance by the Union, and
expressly states that it is not applicable to the employees of the jobber
on his premises "or in his inside shop whether the same is located on his
premises or elsewhere ." The jobber contract also provides for the fixing
of piece rates by the Union and the jobber and requires the jobber to
pay the contractor an amount sufficient to cover compensation for the
contractors' employees, which is fired in a contract between the Union
and the contractor, [footnote omitted] plus a reasonable amount to
cover overhead and services in.order to ensure against diversion of the
moneys paid for compensation; makes the jobber liable, to a limited
extent, for defaults by the contractors in paying compensation to the
contractors' employees; requires a jobber to provide and pay the full
ly four employees who designed and made clothing
patterns and sample garments and approximately three
shipping and office clerical employees. The raw materials
used in making the garments were shipped on Hazantown's
order to various contractors who actually fabricated the
garments. The contractors employed traditional garment
industry employees such as cutters, sewing machine
operators, stitchers, and pressers. The completed garments
were shipped by the contractors back to Hazantown who
distributed them to its retail customers. Neither the
employees of Hazantown nor its contractors were repre-
sented by any labor organization. The Hazantown case
arose when the Joint Board of Coat, Suit and Allied
Garment Workers' Unions, ILGWU, AFL-CIO, picketed
Hazantown to obtain a "jobbers contract" that would have
prevented Hazantown from doing business with nonunion
contractors.15 Hazantown's employees did not and could
not perform any of the work performed by Hazantown's
contractors. Hazantown's premises were not equipped to
perform such work and its employees were not the type of
employees who usually performed fabricating work. In
addition, the union in Hazantown confined its membership
to employees such as cutters , sewers, and machine
operators who perform actual production work. That
union did not admit to membership those kinds of
employees employed by Hazantown such as designers,
patternmakers, markers, and sample hands.
Prior to the Board litigation in Hazantown, an NLRB
Regional Director obtained a temporary injunction from a
District Court under Section 10(1) of the Act to restrain the
union's picketing.16 On appeal, the Second Circuit Court of
Appeals reversed the District Court and dismissed the
petition for the injunction:.',7 That court discussed at length
the history of the garment industry, the legislative history
of the Act, and the meaning of the garment industry
proviso in Section 8(e) of the Act. The court pointed out
that, in the past,' garment industry manufacturers had
changed the nature of their operations to avoid direct
dealings with employees by use of the jobber contractor
arrangement; that the intense competition between con-
tractors resulted in reduced labor costs which depressed
wages and led to substandard labor conditions; that
unionization of one contractor was ineffective if the jobber
could turn to nonunion competitor contractors; and that
the weapon developed by the union to meet this was to
require the jobber to agree to deal only with unionized
contractors. The court went on to trace the legislative
cost of disability benefits to the contractors' employees; requires the
jobber to make contributions to the Union's various trust funds from
which the contractors' employees receive semiannual bonuses and
health and welfare, retirement, and unemployment benefits; authorizes
a union representative to visit the jobber's premises to take up
complaints and to examine its books and records to determine whether
the jobber is complying with the terms of the contract, and binds the
jobber to arbitrate disputes with the union. In addition, the jobber's
contract contains language providing that in a labor dispute, the jobber
and the contractor have "a close unity of interests with each other" and
"are not neutrals with respect to each other but are jointly engaged in
an integrated production effort."
16 Joint Board of Coat, Suit and Allied Garment Workers Unions, ILGWU,
AFL-CIO [Hazentown, Inc J, 367 F.Supp. 486 (D.C.N.Y., 1973).
17 Danielson v. Joint Board ILGWU [Hazantown, Inc.], 494 F.2d 1230
(C.A. 2, 1974).
810 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
history of the Act, which indicated that the Act was not
intended to outlaw such union tactics in the garment
industry. The court then discussed the scope of the
garment industry proviso set forth in Section 8(e) and
compared it with the more limited proviso applicable to the
construction industry. After- discussing the Dallas and
other cases, the court concluded:
While (Hazantown's) employees were entitled to
bargain to prohibit or limit the amount of subcontract-
ing [citation omitted] nothing in the jobber's agreement
would prevent this. Although the agreement would
restrict their future freedom to bargain about the terms
of subcontracts, e.g., by insisting that Hazantown
should not use union subcontractors since this might
increase costs to such a degree as to force a curtailment
of Hazantown's "manufacturing" operations, this is so
wholly theoretical as to stretch the words "forcing or
requiring an employer to recognize or bargain with a
labor organization as the representative of his employ-
ees" beyond the breaking point.
In the Board proceedings in Hazantown, the Administra-
tive Law Judge who heard the case found that the union
violated Section 8(b)(7)(C) of the Act. The Board disagreed
and dismissed the complaint in its entirety. The Board
specifically found that the picketing was not recognitional
or organizational in that the union was not seeking to
represent or organize Hazantown's own employees or the
employees of Hazantown's nonunion contractors. The
Board held that the picketing by the Union, which was to
force Hazantown to agree to use only contractors whose
employees were already represented by the Union, was
consistent with the intent of the garment industry proviso.
The Board rejected the General Counsel's theory that
jobbers and contractors were joint employers or unitary
employers for the purpose of Section 8(b)(7). In discussing
the legislative history of the garment industry proviso the
Board said:
Unquestionably, Congress intended a broad exemption
of garment industry unions from some of the strictures
of the Act because of special problems which they had
encountered while organizing employees in their
industry. The story has often been told of how clothing
manufacturers, in order to avoid unionization, had
closed their inside shops and contracted with various
outside contractors to perform the actual production
work. These contractors avoided unionization by
operating moveable shops which could be closed
quickly and reopened at a new location with a new
employee complement.
To cope with this type of activity by garment
industry manufacturers and contractors, Congress
specifically authorized garment industry unions to
engage in otherwise prohibited conduct for the purpose
of forcing jobbers to execute agreements requiring
them to use only union contractors. Thus, in 1949,
Senator Taft assured his colleagues that the provisions
of Section 8(b)(4) of the Act were not intended to apply
to situations in which "the Union may attempt to
persuade the jobber's workers not to design or to cut
goods to be manufactured in the shops of the nonunion
contractors," 10 substantially the identical situation
presented in the instant case. This interpretation was
accepted by representatives Landrum and Grifl'm in
1959 when Congress was considering the Landrum-
Griffin Bill's expansion of Section 8(b)(4) and the
enactment of Section 8(e).11 However, as if to strength-
en these assurances, Congress also enacted the garment
industry proviso which on its face exempts unions in
that industry from the provisions of Section 8(b)(4XB)
and 8(e) and therefore gives the unions a free hand to
engage in secondary picketing to obtain agreements not
to do business with nonunion employers. The enact-
ment of the proviso was intended to permit unions to
continue "present unionization practices throughout
the integrated production process in the garment
industry without being hampered by the Landrum
Griffin Act" 12 and to ensure that "garment unions can
continue to make arrangements with jobbers not to
contract out work to subcontractors using nonunion
labor." 13
10 95 Cong. Rec. 8709 (June 30, 1949).
11 105 Cong. Rec. 14508-09 (August 13, 1959) repented in II Leg. Hest.
at 1680-81.
12 105 Cong. Rec. 16428 (September 3, 1959) reprinted in II Leg . Hest. at
1446.
13 105. Cong. Rec. 16652 (September 4, 1959) repented in II Leg. Hist. at
1737.
The Board concluded that the picketing did not have a
recognitional or organizational objective but:
Rather, the purpose of the Respondent's picketing was
to force Hazantown to agree to use contractors who
had recognized and bargained with the Respondent as
the representative of their employees, an object which
we find to be protected by the garment industry proviso
contained in Section 8(e), and not in any way
prohibited by Section 8(b)(7).
Unlike the instant case, there was a specific finding in
Hazantown that the union did not admit to membership the
type of employees employed by Hazantown, that the
Hazantown employees were not in classifications who
usually performed fabricating work, and that Hazantown
was not equipped to perform such work. The Board noted
that those factors distinguished Hazantown from Long and
the Dallas. The Board also noted that in Long an
organizational object had been established by admissions
from a union agent. It is difficult to determine, however,
how much reliance the Board placed on these distinctions.
The emphasis placed by the Board on the legislative history
of the garment industry proviso indicates that the special
considerations applicable to the garment industry and the
consequent language of the garment industry proviso were
the key elements in the decision. The construction industry
cases could therefore be distinguished on other grounds.
The Board was, however, concerned in Hazantown with
whether the picketing had a proscribed object because of
the long range effect on working conditions of Hazan-
town's own employees that would have resulted from a
jobber contract. The Board pointed out that such a
SAN FRANCISCO JOINT BOARD INTL. LADIES' GARMENT WKRS.
contract might restrict to some extent the future right of
Hazantown employees to bargain about subcontracting,
but also noted that the Hazantown employees could still
bargain about prohibiting or limiting the amount of
subcontracting. It was also noted that any conclusions
concerning the impact on the employees was wholly
speculative because Hazantown's employees did and could
not perform the work done by contractors; that Hazan-
town was not equipped to do fabricating work; and that
the proposed contract did not apply to any inside shop that
might be established by Hazantown.
It is axiomatic that a statute must be read as a whole and
that one section of a statute should not be lightly construed
as nullifying another section. After analyzing the legislative
history and the statutory language, the Board in Hazan-
town in effect concluded that Section 8(b)(7) should not be
read in such a way as to emasculate the garment industry
proviso of Section 8(e). The basic principles of law set forth
in Hazantown are equally applicable to the instant case.
The factual situation in the instant case differs from
Hazantown in that the Union does admit to membership
employees in some of the classifications employed by the
Company; in that some production work is done by the
Company's employees; and in that the Company is
equipped to perform some of that work. However, none of
these factual distinctions warrant a different conclusion
from that reached in Hazantown. The Union's jurisdiction
and the fact that it admits to membership certain
classifications of employees are less important than what it
actually does in a specific case. The amount of production
work performed by the Company's employees is, as is set
forth above, de minimis. The Company sells approximately
3 million units annually and the Company's sewing
machine operators cannot produce even the samples
needed by the salesmen. In Hazantowa, the company
employed four employees who designed and made clothing
patterns and sample garments as well as three shipping and
office clerical employees. In the instant case, the Company
operated on a much larger scale but as in Hazantown its
employees performed only a limited function with regard
to the creation of the garment. The fabricating, production,
or actual sewing machine work was performed almost
entirely through a contractor system. As in Hazantown, the
effect of the jobber contract on the job security or wages of
the Company's employees is wholly speculative. Also, as in
Hazantown, the 'great mass of the work performed by the
contractors was not of the same kind as the work
performed by the Company's employees.
The jobber contract would not be an undue limitation on
the Company's employees' right to bargain about subcon-
tracting. The Company's employees'were unrepresented. If
they were in the future to engage in collective bargaining
with the Company, the jobber contract would not prevent
bargaining about the prohibition or limitation of the
amount of contracting. Thus, the employees would be
entitled to bargain about protecting their own work. The
only impact of the jobber contract might be to restrict the
employees' future freedom to insist that the Company
should not use union contractors. However, as the Second
Circuit Court of Appeals held in Danielson v. Joint Board
ILGHWU (Hazantow); Inc.), supra, such a theoretical'
18 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,
1conclusions , and recommended Order herein shall, as provided in Sec.
102.48 of the Rules and Regulations , be adopted by the Board and become
811
approach stretches the "recognition or bargaining" con-
cepts of Section 8(bX7) beyond the breaking point.
In conclusion I find that, as in Hazantown, the Union's
picketing was to force the Company to agree to use
contractors who had recognized and bargained with the
Union as the representative of their employees, that such
an object was protected by the garment industry proviso
contained in Section 8(e), and that such picketing was not
in any way prohibited under Section 8(b)(7).
Though this finding is based in part on the factual
similarity with Hazantown and particularly the fact that the
great bulk of the Company's fabricating work was done by
contractors, I believe that the same result is required on
broader grounds. The garment industry proviso permits
conduct that would otherwise be prohibited which relates
to jobbers, manufacturers, and contractors performing
parts of an integrated process of production in the garment
industry. In Hazantown, the Board read Section 8(bX7) in
such a way as to avoid unduly limiting that proviso. In my
opinion, the logic behind the Hazantown decision requires
the conclusion that a union can picket for a jobber contract
when an employer uses the contract system even where
that employer also performs a substantial fabricating
function with his own employees. The mere fact that an
employer does fabricating work in his own shop with his
own employees does not limit a union's right, under the
garment industry proviso of Section 8(e), to seek to limit
whatever contract work is done to contractors having
collective-bargaining agreements with the union. The
critical factor to be evaluated in each case is whether the
jobber contract is keyed solely to regulating the jobber,
manufacturer, contractor relation or whether it is being
used unlawfully as a subterfuge to obtain recognition from
the company as the representative of the company's
employees. Situations may arise where the impact of a
jobber contract on the company's own employees is so
immediate and substantial as to warrant the conclusion
that the union, in fact, has a recognitional object. Such is
not the situation in the instant case. A hypothetical or
conjectural impact on the employees of the company is not
a sufficient reason for limiting the scope of the garment
industry proviso or for the fording of a recognitional or
organizational object.
In sum, I ford that the General Counsel has not proved
by a preponderance of the credible evidence that the
Union picketed for an object proscribed in Section
8(b)(7)(C) of the Act. I shall therefore recommend that the
complaint be dismissed in its entirety.
CONCLUSIONS OF LAW
1. The Company is an employer engaged in commerce
within the meaning of Section 2(6) and (7) of the Act.
2. The Union is a labor organization within the
meaning of Section 2(5) of the Act.
3. The Union has not engaged in the unfair labor
practices alleged in the complaint.
Upon the foregoing findings of fact, conclusions of law,
and the entire record, and pursuant to Section 10(c) of the
Act, I hereby issue the following recommended:
ORDER'S
The complaint is dismissed in its entirety.
its findings, conclusions, and Order, and all objections thereto shall be
deemed waived for all purposes.