Stehli & Co., Inc.

National Labor Relations Board - Board Decisions

Aug 28, 1941

35 N.L.R.B. 44 (N.L.R.B. 1941)

In the Matter of STEHLI & CO., INC. and TEXTILE WORKERS UNION OF
LANCASTER, PENNSYLVANIA AND VICINITY, LOCAL #133, AFFILIATED
WITH THE TEXTILE WORKERS UNION OF AMERICA AND THE C. I. O..and
TEXTILE WORKERS UNIT #1 OF THE NATIONAL LABOR LEAGUE, INC.,
AND NATIONAL LABOR LEAGUE, INC., PARTIES TO THE CONTRACT
Case No. C-1793.-Decided August 28, 1941
Jurisdiction : textile weaving industry.
Unfair Labor Practices
Interference, Restraint, and Coercwon: discriminatory application of contract
"preferential clause" in laying off and rehiring non-members of company-
dominated union.
Company-Dominated Union: formation of by "old and trusted" employees who
had been officers of predecessor union found to be illegally formed in prior
decision ; membership solicitation by representatives of management ; failure
of employer to inform employees that predecessor union was illegal-support :
signing contract with dominated union and checking off dues for it ; affording
job preferences to members of company union.
Remedial Orders : employer ordered to disestablish dominated organization;
abrogation of contract with dominated organization ordered.
Mr. Jack Davis,'for the Board.
Zimmerman, Myers & Kready, by Mr. S. R. Zimmerman and Mr.
B. M. Zimmerman, of Lancaster, Pa., for the respondent.
Mr. W. Curtis Yerger, of Lancaster, Pa., for the Union.
Mr. W. Hensel Brown, of Lancaster, Pa., for the Unit and the
League.
Mary M. Persinger, of counsel to the Board.
DECISION
AND
ORDER
STATEMENT OF THE CASE
Upon charges and amended charges duly filed by Textile Workers
Union of Lancaster, Pennsylvania and Vicinity, Local #133, affiliated
with the Textile Workers Union of America and the C. I. 0., herein
called the Union, the National Labor Relations Board, herein called
the Board, by the Regional Director for the Fourth Region (Phila-
delphia, Pennsylvania), issued its complaint dated October 2, 1940,
against Stehli & Co., Inc., Rossmere, Pennsylvania, herein called the
35 N. L. R. B., No. 12.
44
SfPEHLI & CO., INC.- 45
respondent, alleging that the respondent at its Rossmere, Pennsylvania,
plant had engaged in and was engaging in unfair labor practices af-
fecting commerce, within the meaning of Section 8 (1) and (2) and
Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat.
449, herein called the Act.
With respect to the unfair labor practices, the complaint alleged,
in substance, that the respondent (1) beginning about August 1937,
dominated and interfered with the formation and administration of
Independent Silk Workers Union of Rossmere, a labor organization
herein called the Independent, known since about April 1938 as Textile
Workers Unit #1 of the National Labor League, Inc., herein called
respectively the Unit and the League; (2) since about April 1938,
dominated and interfered with the formation and administration of
the Unit and the League; (3) contributed aid and support to the
said labor organizations; and (4) thereby, and by other acts, interfered
with, restrained, and coerced, and is interfering with, restraining, and
coercing its employees in the exercise of the rights guaranteed in
Section 7 of the Act. Copies of the complaint, accompanied by a
notice of hearing thereon, were duly served upon the respondent, the
Union, the Unit, and the League.
Thereafter the respondent filed its answer, admitting the allegations
of the complaint concerning its incorporation and business, but deny-
ing that it had engaged in or was engaging in the alleged unfair labor
practices, and denying specifically that Unit #1 of the League is a
successor to the Independent or is or was the same organization in
fact or in law. The League and the Unit also filed answers to the
complaint, alleging that the Independent had been dissolved and de-
nying that the respondent had dominated or interfered with the
formation or administration of, or had contributed support to, Unit
#1 or the League.
Pursuant to notice, a hearing was held in Lancaster, Pennsylvania,
from October 24 to November 4, 1940, before E. G. Smith, the Trial
Examiner duly designated by the Chief Trial Examiner. The Board,
the respondent, the Unit, and the League were represented by counsel,
and the Union by a subregional director; all participated in the hear-
ing. Full opportunity to be heard, to examine'and cross-examine wit-
nesses, and to introduce evidence bearing on the issues was afforded
all parties. During the course of the hearing the Trial Examiner
reserved ruling as to several motions to strike testimony, and in his
Intermediate Report denied such motions. At the conclusion of the
hearing, counsel for the Board moved to amend the pleadings to con-
form to the proof with respect to certain minor matters. This motion
was granted by the Trial Examiner without objection. During the
hearing the Trial Examiner made numerous rulings on other motions
46 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
and on objections to the admission of evidence. The Board has re-
viewed the rulings of the Trial Examiner and finds that no preju-
dicial errors were committed. The rulings are hereby affirmed. At
the conclusion of the hearing all parties were afforded an opportunity
to present oral argument to the Trial Examiner and to file briefs with
him. None of the parties availed itself of such opportunity.
On January 25, 1941, the Trial Examiner issued his Intermediate
Report, copies of which were duly served upon the respondent, the
Union, the Unit, and the League, wherein he found that the respondent
had continued its domination of and interference with the Inde-
pendent' by continuing the Independent in existence under the name
of the Unit and the League, and had dominated and interfered with
the formation and administration of the Unit and the League, and
contributed support to these organizations. He recommended that the
respondent cease and desist from its unfair labor practices and take
certain affirmative action to remedy the situation. Exceptions to the
'Intermediate Report and to the record were filed by the respondent
on February 18, 1941, and by the Unit and the League on February
21, 1941. On March 7 and 10, 1941, respectively, the respondent, and
the Unit and the League, filed briefs in support of their exceptions.
On June 3, 1941, pursuant to notice duly served upon all parties a
hearing for the purpose of oral argument was held before the Board
in Washington, D. C. The respondent, and the Unit and the League
were represented by counsel and participated in the hearing. The
Board has considered the exceptions and briefs filed by the respondent,
and by the Unit and the League, and, to the extent that the exceptions
are inconsistent with the findings of fact, conclusions of law, and order
set forth below, finds them to be without merit.
Upon the entire record in the case, the Board makes the following :
FINDINGS OF FACT
I. THE BUSINESS OF THE RESPONDENT
The respondent, Stehli & Co., Inc., is incorporated under the laws
of the State of New York, and is registered to do business in five
other States. All the stock in the corporation is owned by members
of the Stehli family. This family has been engaged in the silk industry
in Switzerland since 1840 and in this country since 1880, at which time
Stehli & Co. A. G., of Zurich, Switzerland, had a selling agent here.
The respondent's first weaving mill in this country was established
in Lancaster, Pennsylvania, in 1898.
IIn an earlier proceeding Involving the respondent the Board , on March 30, 1939,
found, among other things, that the respondent had dominated and interfered with the
formation and administration of the Independent and contributed support to It. See
Section III A , infra.
STEfEILI & CO., INC. 47
The respondent's main office is in New York City. Its principal
plant, which is the only one involved in these proceedings, is in Ross-
mere, just outside Lancaster, Pennsylvania. The respondent also
owns and operates throwing plants in Waynesboro and Harrisonburg,
Virginia, and owns plants at High Point, North Carolina, and Man-
heim, Pennsylvania, which it leases to other companies.
The Rossmere plant is chiefly a weaving plant. The raw materials
used consist mainly of rayon and silk, but also include cotton, wool,
and other miscellaneous yarns. The yarns are treated when necessary,
and then woven into fabrics, which are transported to plants, some
of which are within and others outside Pennsylvania, for finishing
and dyeing. They are then transported to the respondent's New York
office for marketing. More than 90 per cent of the rayon and silk
used at the Rossmere plant is imported from China, Japan, Italy,
and various States of the United States. About 60 per cent of all the
raw materials shipped to the Rossmere plant are produced at the
respondent's throwing plants in Virginia and at other plants outside
Pennsylvania not owned by the respondent.
The Rossmere plant produces in excess of 12,000,000 yards of fabric
a year, having a total sales value of approximately $5,600,000. More
than 90 per cent thereof is shipped to dyers and finishers located in
seven different States, from which points the merchandise is trans-
ported to the respondent's New York office for marketing. Approxi-
mately 6,000,000 yards of the respondent's products are sold to cus-
tomers in New York City, 5,000,000 yards are sold and transported
to customers throughout the" United States, and about-100,000 yards
are exported to customers in Cuba, Mexico, Australia, and Argentina.
The respondent purchases through its New York office in excess of
1,000,000 yards of woven fabrics a year, which are, manufactured in
six different States, and which have a sales value of approximately
$500,000. This merchandise is shipped to, and dyed and finished by,
plants located in six different States, and then transported to the
respondent's New York office for marketing. In addition to the busi-
ness described above, the respondent, through its New York office,
purchases on consignment from the Swiss corporation, and sells
throughout the United States, about 6,000 yards of finished silk.2
II. THE ORGANIZATIONS INVOLVED
Textile Workers Union of Lancaster , Pennsylvania and Vicinity,
Local #133, is a labor organization affiliated with the Textile Work-
z This statement of the respondent 's business is taken from Matter of Stehli •and Co.,
Inc. and Textile Workers Union of Lancaster , Pennsylvania and Vicinity, Local #133,
11 N. L. It. B. 1397 . Counsel for the Board and counsel for the respondent stipulated
at the hearing that the operations of the respondent have remained substantially the
same in volume and character.
48- DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ers Union of America and the Congress of Industrial Organiza-
tions. It admits to membership employees of the respondent.
Textile Workers Unit #1 is a labor organization affiliated with
the National Labor League, Inc. Its membership is limited to
employees of the respondent.
National Labor League, Inc., is a labor organization incorporated
under the laws of the State of Maryland in October 1937. It admits
to membership any "employee of_ any industry or profession ...
in any State of the United States, District of Columbia, or territories
and possessions of the United States," except aliens who have not
declared their "intention to become a citizen of the United States
before a proper official."
III. THE UNFAIR LABOR PRACTICES
A. Background
The respondent was involved in an earlier proceeding before the.
Board, in which the Board issued its Decision and Order on March
30, 1939,3 finding that the respondent had refused to bargain collec-
tively with the Union, which represented a majority of the respond-
ent's employees in an appropriate unit; had dominated and interfered
with the formation and administration of the Independent, formerly
known as Stehli Independent Silk Workers Association and as Inde-
pendent Silk Workers Union of Employees of Stehli, Inc., and con-
tributed support to it; had discriminated in regard to the hire, tenure,
and conditions of employment of 18 employees; and had interfered
with, restrained, and coerced its employees in the exercise of their
rights under Section 7 of the Act.
Pursuant to a stipulation signed by the respondent and by a repre-
sentative of the Board, respectively, on June 25 and July 10, 1940, a
consent decree was entered in the United States Circuit Court of
Appeals for the Third Circuit, dated July 23, 1940, which provided,
in substance, that the respondent would cease and desist from in any
manner dominating or interfering with the administration of the
Independent or the formation and administration of any other labor
organization of its employees, or contributing support to the Inde-
pendent or to any other labor organization of its employees; from
discouraging membership in the Union or in any other labor organiza-
tion of its employees by discriminating in any-manner in regard to
hire and tenure of employment or any term or condition of employ-
ment; and from in any other manner interfering with, restraining,
3 Matter of Stehlt and Co ., Inc. and Textile Workers Union of Lancaster, Pennsylvania
and Vicinity , Local #133 , 11 N. L . R. B. 1397. -
STPETILI & Co., INC. 49
or coercing its employees in the exercise of their rights under Section
7 of the Act.
The decree- provided further that the respondent would refrain
from recognizing the Independent, "by whatever name now known,
as a representative of any of its employees for the purpose of deal-
ing with the respondent concerning grievances, labor disputes, rates
of pay, wages, hours of work, or other conditions of employment, and
completely disestablish said organization as a representative of its
employees"; offer to seven employees immediate and full reinstate-
ment and make whole 16 employees for loss of pay by payment to
each of them of a specified sum ; and post immediately, and maintain
for a period of at least 60 days, notices to its employees that it would
not engage in the conduct from which it was ordered to cease and
desist, that it would take the affirmative action prescribed above, and
that its employees were free to become or remain members of the
Union.
B. Domination of and interference with the formation and admnimis-
tration of the Unit and the League
1. Formation of the Uriit and the League
On February 28, 1938, the Trial Examiner in the former case
involving the respondent issued his Intermediate Report, in which,
among other things, he found that the respondent was responsible
for the formation and continuance of three successive unaffiliated
labor organizations at its plant-namely, Stehli Independent Silk
Workers Association, Independent Silk Workers Union of Em-
ployees of Stehli & Co., Inc., and Independent Silk Workers Union of
Rossmere, and recommended that the respondent cease and desist
from dominating and interfering with the last-named organization
and from contributing financial or other support to it. The issuance
of that Intermediate Report, as will appear, constituted an incentive
for the organizers of the Independent and its, predecessors to make
still another attempt to satisfy the desires of their employer by
forming another "inside" organization.
On March 18, 1938, W. Hensel Brown, attorney for the Independ-
ent and its predecessors, wrote to one Young, attorney for the.Cam-
bridge Workers Association, a labor organization among employees
of another manufacturing concern, asking him to recommend some-
one with considerable experience to help Brown in advising and
steering the proper course for the Independent. Young replied that
if Brown wanted an independent organization "local in every
respect," he would recommend one Vernard L. Edmunds, and that if,
on the other hand, the Independent was ready, for affiliation with a
50 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
national labor organization, he would recommend someone from the
A. F. of L. Without having consulted the Independent concerning
the type of organization it might prefer, Brown requested Edmunds,
who was vice-president of the League, a labor organization which
up to that time had no contracts with any employer, and had been
successful only in setting up one embalmers' unit in the undertaking
industry, to come to Rossmere. Early in April 1938, Brown called
Clarence Davis, the secretary of the Independent, who has been em-
ployed by the respondent for about 40 years, to his office and told him
that the Independent was illegal and "they had to find some other
means." Brown arranged a meeting between Davis and Edmunds,
and Davis in turn arranged a meeting between Edmunds and all the
officers of the Independent. Edmunds explained the set-up of the
League to the assembled officers, who later discussed the matter
among themselves.' W. Ralph Murr, the president of the Inde-
pendent, who has been employed by the respondent for about 21
years, testified that they felt that if they accepted the verdict of
the Board and simply "crumbled up," they would be "admitting
defeat," so they decided to "stay together." As to the League, Davis
testified, "We thought it was an all right body."
George Whittlinger, who began working for the respondent almost
40 years ago, and who has been working there uninterruptedly for
more than 21 years, had been the leader in organizing the,Independ-
ent. Sometime prior to April 30, 1938, he was consulted by Edmunds
and the Independent officers with regard to the League.' Whitt--
linger testified that "we decided to affiliate with the National Labor
League . . . we as the old Union."
The officers of the Independent called a special meeting on April
30, which was open to members only. About 65 of approximately
400 members of the Independent attended. Brown addressed the
meeting and stated, as Edmunds testified, that he saw "no hope of
resuscitation"- of the Independent in view of the "order of the
Board," 5 and, further, that "he had taken the liberty of searching
to find some method whereby they could continue their activities
legally." Brown stated further, according to the minutes of this
meeting, that he had investigated the League and that the officers of
the "old Union had previously a long conference with Mr. Edmunds
and were satisfied that this was what they were searching for."
4 Our finding that this incident occurred prior to April 30 is based upon whittlinger's
testimony to that effect which the Trial Examiner credited . Edmunds and Davis testified
to the contrary, that it took place after a meeting on that day , at which the Independent
affiliated with the League , but they gave no independent account of the incident nor contra-
dicted Whittlinger 's version of it . That version would be meaningless if the consultation
had occurred after the affiliation of the Independent with the League.
5 Brown apparently was referring to the findings and recommendations of the Trial
Examiner. -
STEHLI & CO., INC. 51
Brown then introduced Edmunds, who explained the set-up of the
League. The record is not entirely clear as to what happened next.
Numerous witnesses for the respondent testified, and we find, that
at the conclusion of Edmund's speech, a motion was made to dissolve
the Independent and to affiliate with the Leagues Although the
League had not theretofore organized in the textile industry, Ed-
munds had brought to the meeting printed membership cards provid-
ing for 2 years' membership "in the TEXTILE WORKERS UNIT
of the National Labor League Incorporated," and they were distrib-
uted. About 55 members of the Independent signed these cards.
At the conclusion of the April 30 meeting, Murr announced that the
next meeting would be held on May 14, the next regular meeting day
of the Independent, at the regular meeting place of that organization.
The minutes of the May 14 meeting, which are contained in the
same book as the minutes of the April 30 meeting, state that this was a
meeting of "the Lancaster Unit #1 of the National Labor League,
Inc." The minutes state further that Murr presided, that there
was a "roll call of officers and all present," that "the minutes of last
meeting were read and approved as read," and that "a statement was
made that in as much as the Silk Workers Union had ceased to exist,"
officers were elected for the new organization. Those elected were
Murr, chairman; Edgar Norton, vice chairman; Davis, financial sec-
retary; Henry Whittlinger, recording secretary; and-Raymond War-
fel, treasurer. All these individuals had held the same offices in the
Independent.
Although the Unit had collected no dues, the minutes of the May 14
meeting contain a treasurer's report showing a balance carried over
of $60.28, $8 in donations, and $16 from the social committee, making
a total in the treasury of $84.28. At the July 9 meeting, a bill of
$13.30 for rent was sent to the League for payment, but a bill of $7.66
for expenses incurred by the financial secretary was ordered paid
out of the "local treasury," 7 leaving a balance of $76.62. Although
there was testimony that the funds of the Independent following its
dissolution were paid to Brown for legal services, Warfel testified
that he did not turn the money over to Brown until about four months
after the formation of the Unit, and that he did not know of any
vote on the part of the members to pay the money to Brown. Ac-
cording to the minutes, moreover, the money carried over from the
Independent treasury remained in the Unit treasury at least until
"In their brief, the Unit and the League take exception to the failure of the Trial Ex-
aminer to find that the Independent was formally dissolved at the April 30 meeting. Not-
withstanding the fact that the minutes of the meeting do not definitely state that such
action was taken, the evidence compels the conclusion that a motion of dissolution was
made and carried.
7 Referring, presumably, to the treasury of the Unit.
451270-42-vol. 35-5
52 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
October 8, 1938, and some of it was used for Unit expenses. It thus
appears, and we find, that the funds of the Independent remained for
some months in the possession and control.of the Unit.
During the, course of the Unit's organizing campaign, which fol-
lowed the April 30 meeting, Davis sent a notice to the respondent's
employees who were on furlough urging them to become members
of "Silk Workers Unit #1," thus confusing the names of the three
earlier inside organizations, all of which used the phrase' "Silk
Workers," with the name of Textile Workers Unit $ 1. In view of
the circumstances of the formation of the new organization at a meet-
ing of the Independent, such confusion, even on the part of one of
the organizers, is readily understandable. From the many likenesses
between the Independent and the Unit,'the latter must have appeared
to the employees generally to be a continuation of the former. The
respondent took no steps to disabuse them of this understanding.8
Indeed, counsel for the respondent stipulated at the hearing that not
until after the entry of the consent decree on July 23, 1940,0 more than
2 years after the formation of the Unit, did the respondent take any
steps to inform its employees that the Independent was illegal and
that they were free to join any organization of their choice.
Between May 14 and May 28, 1938, another circular letter was sent
out by the Unit, this time to those of the 400 former members of the
Independent who had not yet joined the Unit. The letter began
"Dear Member" and was signed by Murr as president and Davis as
secretary. It urged membership in the-Unit, and concluded with the
warning, ". . . ieturn this agreement signed or unsigned by return
mail, as it is very important to your welfare and to all of us in making
our living. If we fail now, it may be that we may not have any jobs
at all." The persuasive effect of this document is evidenced by the
fact that it immediately brought the Unit 160 new members.
Although, according to the minutes of the May 14, meeting, only
22 members were present, at the next meeting on June 11, Davis
"reported a sufficient number of employees signed to ask for recog-
nition," and steps were taken to that end. It does not appear how
many members constituted this "sufficient number," but the League
gained membership rapidly because of the many advantages it had
in organizing. As has been stated, the organizers first sought to sign
up all those employees who had been members of the Independent.
8 Such action was found to be required under similar circumstances in Westinghouse
Electric & Manu facturing Co v. National Labor Relations Board, 112 F. ( 2d) 657, aff'd,
312 U. S 660, wherein the Court stated .
. . . although the new union would be lawful , If freely formed , It had in fact arisen
out of the earlier organization , and the company had done nothing to mark the
separation between the two, and publicly to deprive the successor of the advantage of
its apparently continued favor.
See Section III A, supra.
STEtILI & CO., INC. 53
When they. began to seek members among the other employees, Davis,
who worked in the respondent's office, obtained the names and ad-
dresses of employees, which he handed over to the organizers, usually
during working hours. Some of the respondent's loom fixers, who are
supervisory employees, were also active in behalf of the Unit .10
Other supervisory employees who also had been members of the In-
dependent became members of the Unit, and some of them were active
in promoting the Unit. Thus Helen Wenger, a forelady, went to
the homes of employees with Unit organizers and urged them to
give up their membership in the Union and to become members of
the Unit. Other foreladies and foremen solicited employees in the
plant during working hours to join the Unit, and urged employees
who were members of the Union to renounce the C. I. O. In ad-
dition to the officers of the Independent who became officers of the
Unit, other employees who had been active in behalf of the In-
dependent were also active in behalf of the Unit. Many of them
were,"old and trusted employees" who had been working for the
respondent for periods of from 15 to 40 years."
It thus appears that the Independent officers and organizers, when
informed that they must give up the Independent because it had
been found to be company dominated, refused to "admit defeat," and
proceeded to find "some other means" of "staying together." The
"means" they selected was the League, which they foisted upon some
of the respondent's employees at a meeting of the Independent called
and conducted by Independent officers, who had already decided the
League was "an all right body." The ease with which the transi-
tion from one employer-dominated union to another took place may
be attributed, in part, to thq fact that the Union at this time was
still suffering from the demoralizing effects of the employer's unfair
labor practices.,, -At the first meeting of the League, also called and
conducted by Independent officers, the name of the, organization was
changed and the officers of the Independent were elected to the same
offices in the Unit.- It appears, furthermore, that the Independent
10 The loom fixers were found to be supervisory employees and agents of the respondent,
and to have actively engaged in breaking the strike called by the Union in 1937, in our
prior decision , discussed in Section III A, supra
11 It was with reference to such employees , and upon a similar set of facts, that the
Court of Appeals for the District of Columbia stated that :
Men accustomed to such submission seldom regain independence over night. The
interval, if there was one, required for the transfer of allegiance ( of such employees
from a company-dominated organization to its successor ] was too brief for disruption
of the old and basic loyalty
See International Association of Machinists v. National Labor Relations Board, 110 F.
(2d) 29, aff'd 311 U. S 72, Nov. 2, 1940
11 The record indicates that the Union was quiescent until after the Issuance of our
Decision and Order in 1939, at which time it wrote to the respondent demanding that it
,abide by the l3oaid' s decision
'B See the- Westinghouse case (footnote 8, above) wherein the Court stated that a suc-
cessor organization appeared "on the surface " to be a "revision or amendment" bf the
54 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
and the Unit had the same organizers, the same officers, the same
assistance by supervisory employees, the same meeting place and
meeting dates, the same minute book, the same treasury, and the same
attorney. Indeed, it is impossible from a study of the minutes and
other evidence to determine where one organization left off and the
other began. These factors, as the United States Supreme Court
recently stated in the Link-Belt case '14 "all corroborate the conclusion
that the employer facilitated and aided the substitution of the union,
,which it preferred, for its old company union." Accordingly we
find that Unit $k 1 of the League is the same organization as the
Independent, functioning under a different name, and that its domina-
tion by the respondent continues.
We further find that by the activities of its supervisory employees,
set forth above, in promoting and soliciting membership in the Unit
and the League, and by other support to those organizations, to
which we shall allude below, the respondent has dominated and inter-
fered with the formation and administration of the Unit and of the
League and contributed support to them.
During the summer of 1938, the Board's Regional office informed
the respondent that it had received reports that supervisory em-
ployees were interfering with the union activities of the employees.
As a result, in July 1938 the respondent posted on bulletin boards in
the plant the following notice :
All officers, superintendents, foremen, and other super-visory em-
ployees are hereby warned and directed that they shall not in
any manner approach employees concerning, or discuss with
the employees, the matter of their labor affiliation, or threaten
employees in any manner because of their membership in any
labor organization in general or in the Textile Workers Organiz-
ing Committee, Local No. 133, affiliated with the C. I. O. in
particular. 4
This notice, however, does not absolve the respondent from the respon-
sibility for the acts of its supervisors in urging employees to give up
the C. I. O. and to join the League, particularly in view of the fact
that it was not posted until after the Unit had succeeded in signing
up a large number of employees,15 and the further fact that the in-
structions contained in the notice were later violated.1e
predecessor company-dominated union "for It emanated from the old elected representatives,
and that alone established an appearance of continuity between the two."
14 National Labor Relations Board V Link -Belt Company, 311 U. S 584 , Jan. 6, 1941.
ss The record shows that on June 21 , 1938, and on several occasions thereafter, the
Unit wrote to the respondent claiming that It had signed up a majority of respondent's
employees
"See Section III B 2, infra; Swift of Company v. National Labor - Relations Board,
106 P. ( 2d) 87; and Matter of The Solvay Process Company and Oil Workers' International
Union, Local No . 424, 21 N. L R..B. 882, enf'd (C. C. A. 5), Jan. 4, 1941.
STrEHLI & CO., INC. -. 55
2. Support of the Unit and the League
As stated above, the Unit officials decided at the June 11, 1938,
meeting that it had sufficient membership to justify seeking, recog-
nition from the respondent. They were granted a conference with
the respondent shortly after this meeting. The respondent refused
at this conference to recognize the Unit in view of the Trial Exam-
iner's Report, which found that the Union represented a majority
of the respondent's employees in the appropriate unit and recom-
mended that the respondent bargain with the Union. The Unit
thereafter made a number of requests for recognition, which the re-
spondent refused. After the Board issued its decision on March 30,
1939, however, affirming the findings of the Trial Examiner and
ordering the respondent to bargain with the Union, the respondent,
in direct defiance of the Board's order, proceeded to negotiate with
the Unit. A conference was held at the office of Zimmerman, the
respondent's counsel, on May 3, 1939, between the Unit representa-
tives and the respondent. According to Edmund's testimony, Zim-
merman stated at this conference that-
... the legal obstructions that have up to this point or up to a
certain point prevented action on the part of Stehli & Company,
had been somewhat changed; that the final order of the Board
had come through and that he was now ready to entertain the
idea of a contract-I mean recognition.
The Unit left with the respondent evidence of its membership.
Another conference was held on May 10. There was further dis-
cussion, about majority representation and 'other matters. Finally,
according to Edmunds' testimony, Henry Stehli, who was present at
this conference, stated that-
I am willing to recognize this National Labor League because
of the memberships that you have lodged here with us for evi-
dence, providing you say it is legal.
An agreement dated May 10, 1939, was signed by representatives
of the Unit, the League, and the respondent.17 This agreement was
entered into on the basis of signed pay orders authorizing the deduc-
tion of dues, and a list of Unit members which the respondent checked
to ascertain whether the people listed were employed at the tim2,
but no effort was made to determine the genuineness of the
signatures-"
"The respondent on May 10, 1939, informed the Board that it would not comply with
its Decision and Order but would recognize the Unit as the bargaining representative of
its employees . A copy of this letter was later sent to the Union in response to its
requests for bargaining negotiations in accordance with the Board 's Order
va Although Huber, the respondent ' s general manager, stated at the hearing that the
signatures were checked to determine their authenticity, Hershey, the respondent's pay-
master, testified on direct examination by counsel for the Unit that he and Sidler, the
56 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Henry Stehli, when questioned at the hearing as to why he entered
into an agreement with the Unit in view of the Board's Order that
the respondent bargain with the Union, answered that-
We wholly disagree with the findings of the Board first of all,
and, secondly, there was definitely a majority and how could
there be a majority of the National Labor League in 1939 and
also a majority of the Textile Workers' Organizing Committee
of the C. I. 0., Local No. 133, or whatever it is. You couldn't
have two majorities in the mill in 1939.
When asked why he had selected the League, he stated that it was
because it had proven its majority. When asked if the Union had
not proven its majority at the hearing, he replied, "No; we con-
sidered that completely biased." Stehli admitted that he knew that
many employees had signed up in both organizations, and that super-
visory and clerical employees were members of the Unit.
The Unit committee which negotiated the contract with the re-
spondent had been appointed by Murr. The Unit sought in the
course of its negotiations with the respondent to obtain a preferential
shop. The respondent did not accede to this. The compromise on
the preferential shop as contained in the agreement reads as follows:
The Employer agrees that if,'in its sole judgment, all things are
equal in the hiring, retaining in employment, laying off and re-
calling employees, that the members of Textile Workers Unit
Number One of the National Labor League shall 'be given pref-
erence, provided that such action shall in no manner operate to
discriminate against any non-member employee.
Henry Stehli testified that he did not intend by this clause to grant
any preference to Unit members. However, as we find below, the
clause, as interpreted by the respondents' supervisory employees, be-
came an effective means of forcing membership in the Unit.
No dues were collected by the League until recognition was obtained
on May 10, 1939. Thereafter, the respondent checked off the dues
of 50 cents a month from the wages of Unit members who signed
pay orders.1° Cards showing payment of monthly dues were attached
to the pay checks of employees and distributed in the plant by
foremen. The respondent sent to the League the money" collected
for dues, deducting therefrom, by agreement with the,League, certain
amounts to pay for time spent by foremen in distributing dues cards
and other League material to the employees.
auditor , did the actual checking of the cards, and that they did not check the signatures -
on the pay orders against the signatures on the pay-roll sheets because "we did not
think that was necessary."
"The respondent produced records at the hearing showing that up to that time it had
checked oit' dues totaling $4,667.50.
STEULI & CO., INC. 57
On January 16, 1940, the Unit and the League entered into an
"Addenda and Supplement to the Contract of May 10" with the re-
spondent, setting forth the wage rates for the various kinds of work
in the plant, providing that after application of the "preferential
shop" clause in the May 10 agreement, plant-wide seniority should
govern lay offs, and providing for "mutual consent to reduction of
wages ..., whenever by reason of competition or unusual lack of
business it becomes necessary, in the opinion of the employer, to re-
duce labor costs of production .. ." The wage rates provided for
in the Addenda were the same rates which existed at the plant at
the time the contract was signed.
The contract committee of the Unit, which was also the grievance
committee, accompanied by Edmunds as the League representative,
met with the respondent every 2 weeks regularly until the time of
the hearing. At these meetings, the respondent first presented its
grievances against the employees, and after these were discussed, the
Unit presented its grievances against the management. These griev-
ances were generally concluded, as was the dispute on the preferential
clause, as matters within the sole discretion of the respondent.
Although the matter of preference between Unit and non-Unit
members was left within the sole discretion of the respondent, super-
visory employees frequently invoked the "preferential clause" in the
contract against those employees who resisted becoming members of
the Unit, and particularly against those employees who persisted in
remaining members of the Union, to lay them off sooner, to rehire
them later, and to give them less desirable jobs than in the case-of
Unit members. Enforcement of this provision in the course of time
had the effect of inducing a number of employees to join the Unit
who were in principle strongly opposed to it.20
3. Conclusions
The respondent's well-known hostility to "outside" labor organiza-
tions, its formation and domination of three successive labor organi-
zations culmulating in the Independent, its support given the League's
formation through the assistance of supervisory employees and of
"old and trusted employees" who had served the respondent in the
formation of the earlier organizations'21 its failure to inform its
employees that the Independent was illegal and that they were free
to join any organization of their choice till long after the Unit had
become securely established, and the various means by which it
contributed support to the Unit and the League after their forma-
' *The foregoing findings concerning preferences afforded to Unit' members are based
upon the uncontradicted testimony of Irma Trapnell , Kathryn Shearer, Elsie Long, and
Madora Miller.
31 See footnote 11, .supra.
58 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
tion 22 show unmistakably that the respondent interfered with and
coerced its employees in the exercise of their right to bargain col-
lectively through representatives of their own choosing, and sought
by the formation and continuation of inside unions which the respond-
ent could dominate and control, to stifle the outside labor organization
formed for the purpose of collective bargaining. When all these
factors are viewed against a background of the respondent's flagrant
and numerous violations of the Act, as found in the Board's Decision
'of March 1939, there can be no doubt that the respondent has flouted
that Decision, as well as the Decree of the Circuit Court, by the
formation and domination of an organization to succeed the
Independent.
We find, as did the Trial Examiner, that the respondent has con-
tinued its domination of and interference with the Independent by
continuing it in existence under the name of the Unit and the League;
and that the respondent has dominated and interfered with the
formation and administration of the Unit and the League, and has
contributed support to these organizations. We further find that
by such acts the respondent has interfered with, restrained, and
coerced its employees in the exercise of their right to self-organization,
to form, join, or assist labor organizations, to bargain collectively
through representatives of their own choosing, and to engage in
concerted activities for the purposes of collective bargaining or other
mutual aid and protection.
The discriminatory application of the so-called "preferential
clause," above described, was in no wise justified by the contract of
May 10, 1939, and the Addenda and Supplement thereto of January
16, 1940, entered into by the respondent with the Unit and the League,
since both of these organizations, as found above, were assisted by
the respondent's unfair labor practices and did not represent the free
choice of the employees. The respondent's agreement with them is
but a means of utilizing an employer-dominated organization to
frustrate a free choice by its employees such as is guaranteed to them
in Section 7 of the Act.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
We find that the activities of the respondent set forth in Section III
above, occurring in connection 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
with foreign countries, and tend to lead to labor disputes burdening
and obstructing commerce and the free flow of commerce.
21 See Section III B 2, supra.
S1 EiFILI & Co., INC.
V. THE REMEDY
59 ,
Having found that the respondent has engaged in unfair labor
practices, we shall order it to cease and desist therefrom, and take
certain affirmative action designed to effectuate the policies of the
Act and to restore, as nearly as possible, the situation that existed
prior to the respondent's commission of the unfair labor practices.
We have found that the respondent has dominated and interfered
with the formation and administration of the Unit and the League,
and has contributed support to these organizations. By such domi-
nation, interference, and support the respondent has prevented the
free exercise of its employees' right to self-organization and to col-
lective bargaining. In order to remedy the respondent's unlawful
conduct and restore to the employees the full measure of their rights
guaranteed under the Act, we shall order that the respondent with-
draw all recognition from the Unit and from the League, and com-
pletely disestablish both organizations 23 as representatives of its em-
ployees for the purpose of dealing with the respondent concerning
grievances, labor disputes, wages, rates of pay, hours of work, or other
conditions of employment.24
We have also found that the agreement of May 10, 1939, and the
Addenda and Supplement thereto of January 16, 1940, are not the
result of bona fide collective bargaining between the respondent and
the freely designated representatives of its employees but were ex-
ecuted in furtherance of the respondent's program to foster the Unit
and the League. We shall order the respondent to cease and desist
from giving any effect to the contract of May 10, 1939, and the
Addenda and Supplement of January 16, 1940, or to any extension,
renewal, modification, or supplement thereof, or to any superseding
contract which may now be in force. Nothing in this Decision and
Order shall be taken to require the respondent to vary any non-
discriminatory wage, seniority, or other substantive features of its
relations with the employees themselves which the respondent estab-
lished in performance of the-invalid contract as extended, renewed,
modified, supplemented, or superseded.
29 Since it appears that the League, as well as the Unit, acted as a representative of
the employees, was a signatory party to the contract and to the Addenda and Supplement,
participated in the negotiations leading to the consummation of these agreements with
the 'respondent and also in the meetings of the grievance committee with the respondent,
and since the dues checked off by the respondent were sent to the League, it is necessary
that the League, as well as the Unit, to ,ihatever extent it exists in the respondent's
plant, be disestablished
'+ See National Labor Relations Board v. H. E. Fletcher Co., 108 F. ( 2d) 459, cert. den.
March 25 , 1940, wherein the Circuit Couit stated :
To get rid of [the virus of control ], a complete destruction of the body it has
lodged in is usually made necessary and with that body any feeble and ineffectual
antidote in the form of a supporting organization administered to effect a cure. Such
a proceeding is more salutary and presents the obvious possibilities involved in a fresh
start.
60 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
In view of our findings above, it is apparent that the respondent
has, by varying methods and over a long period of time, dominated
and interfered with labor organizations of its employees and thereby
interfered with, restrained, and coerced its employees in the exercise
of rights guaranteed in Section 7 of the Act. The respondent's course
of conduct in this respect, by virtue both of its intensive and ex-
tensive character discloses a fixed purpose to defeat self-organization
and its objects. Thus the respondent, by dominating and interfering
with four successive labor organizations in its plant, and by con-
tributing support to each of them, and by the activities of its super-
visory employees hereinabove set forth, interfered with its employees'
right to self-organization, and to form, join, and assist labor organi-
zations, denied its employees the free opportunity to bargain collec-
tively through representatives of their own choosing, and substantially-
deprived its employees of their right to engage in concerted activities
for the purpose of collective bargaining or other mutual aid or
protection, except in the channels directed by the respondent.
Because of the respondent's unlawful conduct and its underlying
purpose, we are convinced that the unfair labor practices found are
persuasively related to the other unfair labor practices proscribed
and that a danger of their commission in the future is to be anticipated
from the course of the 'respondent's conduct in the past.2 , The pre-
ventive purpose of the Act will be thwarted unless our order is co-
extensive with the threat. In order, therefore, to make effective
the interdependent guarantees of Section 7, to prevent a recurrence
of unfair labor practices, and thereby to minimize strife which burdens
and obstructs commerce, and thus effectuate the policies of the Act,
we will order the respondent to cease and desist from in any manner
infringing the rights guaranteed in Section 7 of the Act. '
Upon the basis of the above findings of fact, and upon the entire
record in the case, the'Board makes the following :
CONCLusioNS OF LAW
1. Textile Workers Union of Lancaster, Pennsylvania and Vicinity,
Local #133; Textile Workers Unit #1 of the National Labor League,
Inc., formerly known as Independent Silk Workers Union of Ross-
mere, as Stehli Independent Silk Workers Association, and as Inde-
pendent Silk Workers Union of Employees of Stehli, Inc. ; and Na-
tional Labor League, Inc., are labor organizations, within the meaning
of Section 2 (5) of the Act.
2. By continuing its domination of and interference with the
administration of the Independent, by dominating and interfering
25 See National Labor Relations Board v. Express Publishsng Co., 312 U. S. 426 ; Bethle-
hem Steel Company v. National Labor Relations Board (App. D. C.), May 12, 1941.
SrrEHLI & CO., IN. 61
with the formation and administration of Textile Workers Unit #1
of the National Labor League, Inc., and of National Labor League,
Inc., and by contributing support to these organizations, the re-
spondent has engaged in unfair' labor practices, within the meaning
of Section 8 (2) of the Act.
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.
ORDER
Upon the basis of the foregoing findings of fact and conclusions
of law and pursuant to Section 10 (c) of the National Labor Relations
Act, the National Labor Relations Board hereby orders that the re-
spondent, Stehli & Co., Inc., Rossmere, Pennsylvania, and its officers,
agents, successors, and assigns, shall:
1. Cease and desist from :
(a) In any manner dominating or interfering with the administra-
tion of Textile Workers Unit #1 of the National Labor League, Inc.,
or of National Labor League, Inc., or .the formation or adminis-
tration of any other labor organization of its employees, or con-
tributing support to the above-named labor organization's, or to any
other labor organization of its employees;
(b) In any manner giving effect to the contract of May 10, 1939,
or to the Addenda and Supplement thereto of January 16, ,1940,
entered into with Textile Workers Unit #1 of the National Labor
League, Inc., and with National Labor League, Inc., as well as to
any extension, renewal, modification, or supplement thereof, and
any superseding contract with the Unit and the League which may now
be in force;
(c) In any other manner interfering with, restraining, or coercing
its employees in the exercise of the right to self-organization, to
form, join or assist labor organizations, to bargain collectively through
representatives of their own choosing, and to engage in concerted
activities for the purposes of collective bargaining or other mutual
aid and protection as guaranteed in Section 7 of the Act.
2. Take the following affirmative action, which the Board finds will
%effectuate the policies of the Act :
(a) Withdraw all recognition from, and completely disestablish,
Textile Workers Unit #1 of the National Labor League, Inc., and
62 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
National Labor League, Inc., by whatever name known, as represent
atives of any of, its employees for. the purpose of dealing with the
respondent concerning grievances, labor disputes, rates of pay, wages,
hours of work, or other conditions of employment;
(b) Post immediately in conspicuous places throughout its plant in
Rossmere, Pennsylvania, and maintain for a- period of at least sixty
(60) consecutive days from the date of posting, notices to its employees
stating : (1) that the respondent will not engage in the conduct from
which it has been ordered to cease and desist in paragraphs 1 (a),
(b), and (c) of this Order; (2) that the respondent will take the
affirmative action set forth in paragraph 2 (a) of this Order;
(c) Notify the Regional Director for the Fourth Region in writing
within ten (10) days from the date of this Order what steps the
respondent has taken to comply herewith.