Walt Disney Productions

{ In the Matter of WALT DISNEY PRODUCTIONS ' and, ARTHUR BABBITT (AN INDIVIDUAL) Case No. C-2415.-Decided March 31, 1943 Jurisdiction : motion picture sound cartoon producing industry Unfair Labor Practices Interference, Restraint, end Coercion: anti-ninon statements by management officials, questioning of employees as to meinbeiship in union Discrirninattoa: discharge of one employee because of union membership and activity, e:astence of closed ahoy at time of discharge held not to preclude finding that discriminatory discharge discouraged membership in union. Remedial Orders : cease and desist unfair labor practices : offer of reinstatement upon timely application titter employee's discharge from armed services; back pay suspended from date of entrttuce upon active service to date 5 days after timely application for reinstatement. Practice and Procedure : presence of arbitration procedure in contract between employer and union held not to bar Board from taking jurisdiction to remedy and prevent unfair labor practices. DECISION AND ORDER , On November 11, 1942, the Trial Examiner issued his Intermediate Report in the above-entitled proceeding, finding that the respondent had engaged and was engaging in certain unfair labor practices and recommending that it cease and desist therefrom and take certain affirmative action as set out in the copy of the Intermediate Report attached hereto. Thereafter, the respondent filed exceptions to the Intermediate Report,and briefs in support thereof. The Board has considered the rulings of the Trial Examiner and finds that no preju- dicial error was committed. The rulings are hereby affirmed. , The Board has considered the Intermediate Report, the exceptions and briefs, and the entire record in the case,' and hereby adopts the find- ings, conclusions, and recommendations of the Trial Examiner, with the exceptions, modifications, and additions set forth below : 3 See footnote 1 of the Intermediate Report, page 896. is After the hearing the iespondent brought to the attention of the Board the decision of the Los Angeles Superior Court in a civil case brought by Babbitt against the respondent. The Board has noted the findings and conclusions of the court in this case , but finds them to be immaterial to the present pioceedmg 48 N. L R B., No. 102 892 WA'L'T, DrS1\TEY' PRODUCTIONS' 893 1. The Trial Examiner found that the respondent purchased cer- tain-materials valued at $55,000, originating outside the State of Cali- fornia. The record shows that respondent purchased $52,000 worth of such materials, of which at least $30,000 worth originated outside the State of California. 2. The respondent, in its brief, urges that certain evidence having a bearing on Babbitt's credibility and his general ability, not specifi- cally discussed by the Trial Examiner, compels the conclusion that Babbitt was an unreliable witness, and that he was laid off because he was not an able employee: We have fully considered the whole rec- ord, and find in it no ground for disagreeing with the Trial Examiner, who, upon the basis of his observation of the witnesses, credited Bab- bitt's testimony and placed no reliance upon that of Adelquist, the respondent's casting director.' Nor are we impressed by the volumi- nous evidence introduced by the respondent in support of its conten- tion that Babbitt was an animator of inferior ability. On the contrary, Babbitt's long continued standing as one of the respondent's highest paid or "lead" animators,-3 and his consistently high work ratings con- vince us, and we agree with the Trial Examiner, that the reasons ad- vanced by Disney for "laying off" Babbitt are false and without merit. These reasons, moreover, are in conflict with the reason advanced by Adelquist, that there was no work for Babbitt.4 3. We have found that the respondent discriminated in regard to Babbitt's hire and tenure of employment, thereby discouraging membership in the Union, and interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed them in Section 7 of the Act. The respondent contends that the existence of its closed-shop-contract with the Union precludes the finding that its discrimination against Babbitt discouraged membership.' in the Union. We find no merit in this contention. Babbitt's discharge 2 The Trial Examiner pointed out a seeming discrepancy between the testimony of Adel- quist regarding the date of shelh mg the feature picture "wind in the willows ," and certain exhibits prepared by the respondent . On December 8, 1942 , after the hearing , the respondent and an attorney for the Board entered into a stipulation , which is hereby approved and made a part of the record in the case, as to certain additional facts disclosing that Adel- quist's testimony and the exhibits were not actually inconsistent on the point in question The record elsewhere, however, supports the Trial Examiner 's general , conclusion , which was also ,based upon his observation of the witnesses , that Adelquist was not a reliable witness 3 Although the Tiial Examiner 's finding that Babbitt was the only animator in Class VIII to be laid off does not appear to be supported by the evidence, the record does show that Babbitt was the only lead animator to be laid off The classifications VIII and IX were based on the particular functions ( e. g, supervisory or non-supervisory ) being performed by the individual animators at any given time, and animators passed from one group to another as their functions changed Animators in those two groups were paid in accord- ance with their individual ability, however, and the salary giouping of the men involved, which thus reflects their ability , cuts across the lines of classifications VIII and IX, and shows that there existed a group of 11 lead animators , of whom only 5 were paid more than Babbitt, ' 4 The Trial Examiner 's finding that Babbitt completed his assignments about the first of November is erroneous , since Babbitt appears to have had some work up to about November 14. 894, DECISIONS OF NATIONAL LABOR RELATIONS BOARD was, an act of reprisal for his membership 'arid aggressive -activity iii' the Union. Such employer conduct is nonetheless proscribed; by, the Act because it may appear in a particular instance to have been fruitless. Nor do we assume that in this instance the conduct was- ineffective in any sense. The very existence of the closed-shop con- tract renders the respondent's discrimination against Babbitt a par- ticularly telling demonstration, of its "unabated resentment • of his union activity. Employer hostility thus demonstrated necessarily, tends to discourage union membership even though the membership of a certain group of employees in the particular labor organization may be prescribed for a t0 fn by contract. Moreover, the right to '!membership in [a] labor organization" is a nullity unless it includes the right, exercised by Babbitt, to take a leading part, as a member, of such organization, in union activity condemned by the employer. The respondent's discharge of Babbitt manifestly constituted dis- couragement of active union membership not only on the part of Babbitt himself but also on the part of his fellow union members. Section 8 (3) of th3 Act was designed to implement the protection of 'employees in the exercise of the rights guaranteed them in Section 7 and not merely to secure to particular labor organizations a stable enrollment. 4. Since it appears 'from the stipulation entered into -after the hearing 5 that Babbitt, since November 10, 1942, has been on active duty in the United States Marine Corps, the Trial Examiner's rec-, ommendation 'as to the payment of back pay and offer of reinstate- ment will be modified in accordance with our usual practice. ORDER Unon the entire record in the case, and pursuant to Section 10 (e) of the National Labor Relations Act, the National Labor Relations Board hereby orders that the respondent, Walt Disney Productions, its officers, agents, successors, and assigns, shall : 1: Cease and desist from : (a) Discouraging membership in Screen Cartoonists Local 852, affiliated with Brotherhood of Painters, Decorators and Paper Hang. ers of America, affiliated with the American Federation of Labor, or any other labor organization of its employees, by discharging or re- fusing to reinstate any of its employees, or in any other manner dis- criminating in regard to hire and tenure of employment or any term or condition of employment; (b) In any other manner interfering with, restraining, or coercing its employees in the exercise of the right to self-organization, to form, See footnote 2, above. - , 'WALT DISNEY PRODUCTIONS ;895 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 or 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) Upon his application within forty (40) days after his discharge from the armed forces of the United. States, offer Arthur Babbitt im- mediate and full reinstatement to his former or substantially equiva- lent position, without prejudice to his seniority or other rights and privileges; (b) Make whole Arthur Babbitt for any loss of pay he may have suffered by reason of the respondent's discrimination against him by payment to him of a sum of money equal to that which he would normally °have earned as-wages during the periods (1) between No- vember 24, 1941, the date of the discrimination against him,, and November 10, 1942, the date upon' which he entered upon active duty in the armed forces; and (2) between a date five (5) days after -his timely 6 application for reinstatement, if any, and the date of the offer of reinstatement, less his net earnings' during those periods; (c) Post immediately in conspicuous places throughout its studio at Burbank, California, and maintain for a period of at least sixty -(60) days from the date of posting notices stating : (1) that the re- spondent will not engage in the conduct from which it is ordered to cease and desist in paragraphs 1 (a) and (b) of this 'Order; (2) that it will take the affirmative action set forth in paragraphs 2 (a) and (b) of this Order; and (3) that its employees are free to become or remain members of Screen Cartoonists Local 852, affiliated with 'Brotherhood of Painters, Decorators and Paper Hangers of America, affiliated with the American Federation of Labor, and that it will not discriminate against any employee because of membership in or ac- tivity on behalf of that labor organization;' (d) Notify the Regional Director for the Twenty-first Region in writing within ten (10) days from the date of this Order what steps the respondent has taken to comply herewith. - 6As provided in paragraph 2 (a) of this Order. -'By "net earnings" is meant earnings less expenses , such as for transportation, room, and board, incurred by an employee in connection with obtaining work and working else- where than 'for the respondent , which would not have been incurred but for his unlawful dis- charge and the consequent necessity of his seeking employment elsewhere See Matter of 'Crossett Lumber Company and United Brotherhood of Carpenters and Joiners of America, Lumber and Sawmill Workers Union, Local 2590, 8 N. L. R. B . 440. Monies received for work performed upon Federal, State, county , municipal , or other work-relief projects`shall lie considered as earnings. - See Republic Steel Corpoi ation v. AT _ L. R. B., 311 U. S 7 896 DECISIONS OF NATIONAL LABOR , RELATIONS BOARD INTERMEDIATE REPORT Mr. Charles M. Ryan, for the Board. , , Mr. Gunther Lessing, and O'Melieny and Myers. by Messrs. Homer I.Mitchell and Jackson TV. Chance, for the respondent. STATEMENT OF THE CASE Upon a charge duly filed on May 2S, 1942, by Arthur Babbitt, an individual, the National Labor Relations Board, herein called the Board, by the Regional Director for the Twenty-first Region (Los Angeles, California), issued its complaint dated September 16, 1942, against Walt Disney Productions,' herein called the respondent, alleging that the respondent had, engaged in and was engaging in unfair labor practices within the meaning of Section 8 (1) and (3), and Section 2 (6) and (7) of the -National Labor Relations Act, 49 Stat. 449, herein called the Act. With respect to the unfair labor practices the complaint alleged in substance (1) that since 1938 and until the date of the complaint the respondent, by conduct of its officers and agents, had sought to discourage membership in any labor organization except the Federation of Screen Cartoonists, an unaffiliated laboe organization herein called the Federation, and had encouraged membership in the Federation by advising employees to become and remain members of that organization; (2) that on November 28, 1941, the respondent discharged Arthur Babbitt because he joined and assisted Screen Cartoonists Local 852, affiliated with Brotherhood of Painters, Decorators, and Paper Hangers of America, affiliated with the American Federation of Labor, herein called the Union, because he engaged in concerted activities with other employees for their mutual aid and protection, and because he refused to continue his efforts in behalf of the Federation; and (3) that by said activities the respondent has interfered with, restrained and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. The complaint and accompanying notice of hearing were duly served upon the respondent and Babbitt. The respondent, by its answer verified on October 2, 1942, and as amended during the hearing, denied that it had engaged in the unfair labor practices alleged, and affirmatively alleged (1) that the Board was without jurisdiction because the offenses alleged in the complaint have not led and could not lead to a labor dispute tending to burden commerce; (2) that; by terms of an arbitration agreement entered into by the respondent and the Union before the date of Babbitt's alleged discharge, all employees in specified classifications, including that in which Babbitt was assigned, were required to be union members, and that all subsequent grievances were to be submitted to arbitration; (3) that, Babbitt, together with 98 other employees was laid off in November, 1941, because of lack of work ; (4) that because of the "closed, shop" provisions of the agree- ment Babbitt's lay-off could not have the effect of discouraging union member- ship; (a) ,that the grievance of Babbitts lay-off was not submitted by the Union in accordance with provisions set up in the arbitration agreement; (6) that by assuming jurisdiction in these proceedings the Board would deprive the respond- ent and the Union of their right to settle the grievance of Babbitt's lay-off in accordance with the grievance procedure of said agreement ; and (7) that the ' At the opening of the hearing a motion was granted , without objection by counsel for the iespondent, to amend the title of the case'as it appeared on all formal papers by sub- stituting "Walt Disney Productions" for "Walt Disney Productions, Inc." A similar motion,'made by the iespondent to correct the name of the respondent as it appeared in its answer, as also gianted -WALT. DISNEY PRODUCTIONS 897 Board is barred from re-examining evidence concerning the Federation because the latter organization has been dissolved pursuant to Board's order in Case No. XXI-C-1554. Pursuant to notice, a hearing was held at Los Angeles, California, from 'October 8 to 15, 1942, before the undersigned, the Trial Examiner duly designated by the Acting Chief Trial Examiner. The Board and the respondent were represented by counsel and participated in the hearing. Full opportunity to be heard, to examine and cross-examine witnesses and to introduce evidence bearing upon the issues was afforded all parties. At the opening of the hearing the Trial Examiner overruled an objection by the respondent to proceeding with the hearing upon the ground of want of jurisdiction by the Board. A.motion by the respondent to strike certain parts of the complaint not set forth in the charge, was denied, as was a motion by the Board to strike certain portions of the answer. At the conclusion of the hearing motions were granted to conform the pleadings to the proof. A motion by the respondent to strike certain portions of the testimony, relating to events ,prior to Babbitt's discharge, was denied. Ruling was reserved upon a motion by the respondent to dismiss the complaint Said motion is hereby denied. Also at the conclusion of the hearing, counsel for the board and counsel for the respondent argued orally before the Trial Examiner, said argument appearing in the official transcript of the proceedings. Counsel for the respondent there- upon waived an opportunity to file a brief with the Trial Examiner. Upon the record thus made, and from his observation of the witnesses, the ,Trial Examiner makes, in addition to the above, the following: FINDINGS OF FACT I. THE BUSINESS OF THE RESPONDENT Walt Disney Productions is a California corporation with its principal office and place of business in Burbank, California, where it is engaged in the business of producing motion picture sound cartoons In operating its business the 'respondent purchases materials consisting of sound track films, colored negative films and celluloid. During the first 11 months of the fiscal year- ending September 30, 1942, the respondent purchased such materials valued at more than $55,000 and originating outside the State of California. During the same period the respondent delivered motion picture sound negative film, which cost more than $2,503,000 to Technicolor Company in Los Angeles, California. Technicolor thereupon prepared prints of such negatives and said prints were shipped to various persons, corporations and organizations, including the United States Army, United States Navy, the United States Treasury Department, the Government of Canada, The Coordinator of Inter-American Affairs, and RKO Pictures Corporation. Not less than 75 percent of such prints were shipped to States other than California and to foreign countries.2 II. THE ORGANIZATIONS INVOLVED Screen Cartoonists Local 852, affiliated with Brotherhood of Painters, Decora- tors and Paper Hangers of America, affiliated with the American Federation of Labor, is a labor organization, and Federation of Screen Cartoonists; unaftifiated, was a labor organization, admitting to membership employees of the respondent. 2 The findings as to the respondent's business are based upon a stipulation entered into between counsel for the Board'and counsel for the respondent 898 DECISIONS , bF NATIONAL LABOR RELATIONS BOARD III. THE UNFAIR LABOR PRACTICES A. Background 1. Functional operations at.the respondent's studio, with particular respect to the work of animators After Walt Disney has approved a story for an animated sound cartoon, produc- tion steps are, in general, as follows. The story is assigned to a department head who, with the assistance of writers, artists and lyricists, plans possible action and a rough framework of the cartoon to be produced. As the plan or outline pro- gresses in this department a director, to whom production has been assigned, and animators who may be scheduled to assist in work, meet in numerous conferences for the purpose of pooling ideas. After a tentative plan of production has been approved by Disney, the director takes over'the responsibility of coordinating the various processes which go into actual production, including the "animation" of 'characters. The following descriptive paragraphs are quoted from "The Art of Walt Disney," by Robert D. Field, copyrighted in 1942 by Artists and Writers Guild, Inc., and by Walt Disney Productions : Animation is a type of expression differing from all other attempts to communicate ideas by visual means. Whereas the "still" picture is an entity, an animated picture is a series of drawings, each of which can be considered only, in relation to what has gone before and what is to follow. Only when a drawing surrenders its independence and becomes part of a moving sequence may it be said to justify itself. Only then may art be said to enter into the animated picture. Animators must possess the dramatic ability of a great screen actor. They must act, in their imaginations, the parts the characters are to play, releasing their feelings through the pencil point upon paper. This dramatic ability requires an acute sense of timing ; but timing is only a part of it. Each phase of a gesture must be clearly delineated. In a good "still" drawing, much is left to the imagination. In animation, every line, must not only be suggestive but must also be functional, both in the optical and structural sense. The forms must be made to work ; otherwise it will be impossible to impose a logical unity when they are seen in continual movement and from all angles at once. Depending upon his previous experience, and upon the simplicity or complexity of the sequence assigned to him for animation, the animator is called upon to use a greater or lesser amount of creative imagination and is allowed varying degrees of latitude in determining the details of the character's action. In general, however, he follows a graphic plan or "exposure sheet," previously prepared by the director or his assistants as a result of conferences in which the animator himself may have contributed ideas. The animator does not make each drawing in a sequence, but only the "extremes," or key drawings. Assistants to the animator, and "in-betweeners" make intermediary drawings and supply details. After a scene has been completed and approved, the drawings are sent on to the inking and painting department, where the drawings are traced and colored upon celluloid. Other production steps then follow, which are irrelevant to the consideration of issues raised in this case. WALT DISNEY PRODUCTIONS 2 Babbitt's employment as an animator a. His -employment record 899 Arthur Babbitt was first employed by the respondent in July, 1932. He worked .continuously until May, 1941, when he was discharged under circumstances -described below. In August he was reinstated in accordance with an award submitted by Commissioners of the U S. Conciliation Service. 40n November 24, .1941, he was again dismissed. The Board contends that this latter termination of Babbitt's employment was a discriminatory discharge, while the respondent urges that the employee was not discharged, but laid off, for reasons discussed below. Babbitt was an experienced cartoonist and animator before joining the staff of the respondent's studio. He had served as an animator for Paul Terry, also a producer of movie sound cartoons, of Long Island, New York. He began work for the respondent as an animator and remained in that general classification throughout the nine years of his employment. On various productions, however, he was a lead or supervising animator,' and in 1938 he was offered, but did not accept, a director's position.4- Babbitt started work for the respondent at a salary of $40 a week. Without request on his part, his salary was increased within the next 21/2 years to $150 weekly. By December, 1936, he was receiving $200 a week Beginning in 1934 he also received additional remuneration under an adjusted compensation plan, based upon relative ability. Between 1936 and 1941 Babbitt received more than $7000 in such compensation. In 1940 he shared in the distribution of preferred stock among the employees, being given 92 shares. Of 35 animators to whom such distribution was made, only three received a larger number of shares than Babbitt. In 1941 the respondent classified all employees in the animation department in grades from I to IX The top classification included supervising animators and unit supervising animators. Group VIII, in which Babbitt was classified, included employees coming within the following job description : A man not dependent on a director or supervising animator for extremes, staging or animation mechanics, etc. for his work-able to work straight, ahead with the director or supervisor who pass on his work. At the time these classifications were established, early in 1941, group VIII em- braced from 12 to 15 animators: In the fall of 1941, following a strike of the respondent's employees which is discussed below, classification IX was eliminated, and the supervising animators were thereafter included in group VIII. Babbitt was the only one of this latter classification to be laid off in November 1941. Babbitt was one of the four animators on "Three Little Pigs," and was largely responsible for the animation of "The Country Cousin," both of which shorts won the Academy Award. He animated parts of "Snow White," "Pinocchio," "Dumbo" and "Fantasia." ' As to his general experience, Babbitt testified without contradiction as follows : I think in my experience in the studio I have done practically every type of animation they have had there with the exception of Donald Duck. I 3 Thus Babbitt was listed as an "animation director" in a pieview theatre program of "`Pinocchio," and as having "animation supervision" in "The Pastoral Symphony"'sequence in "Fantasia." 4 Babbitt testified that he turned down the opportunity both•be aiuse'he preferred to work 'alone and because of his interest in union activities As later revealed, he was then d f F t th d I press ent o era ion e e 521247-43-%of 48-58 '900 DECISIONS OF NATIONAL LABOR RELATIONS BOARD mean I did animate a few scenes, but long before he was even established as Donald Duck . . . I did work on Mickey Mouse, I believe, in one picture, but just a short sequence. I was generally given the character "Goofy." I was given the queen in "Snow White." I did some of the animation of dwarfs in Snow White I have done a great deal of dance animation; I have done the mouse in "Country Cousin," birds in various pictures, includ- ing "Birds in Spring", and also the stork in "Dumbo." I have done char- acters which approached the human like Gepetto in "Pinocchio" and the gods in the Beethoven sequence ("Fantasia"). Well, almost every type of animation that they have had I have done-I have done Pluto the dog Throughout the 9 years of his service, on only two pictures which he helped to produce was Babbitt given less than an "A" rating by Walt Disney. On "Dumbo," the latest feature for which Babbitt was rated, he received an "A". Although by terms of the annual employment contract between the respondent And Babbitt it was provided that the employee might be laid off for a total of 4 weeks each year, at half-pay, and although there had been slack periods during the nine years of his employment, he was not laid off until November 24, 1941. b. His professional reputation In July 1942 Herbert Lamb, production manager of the respondent until June 1941, wrote a letter of recommendation for Babbitt, addressed to the United States Marine Corps. The letter read, in part, as follows : Mr. Babbitt is known to me as an experienced artist with a full and complete knowledge of the animated cartoon business. During the six year period that I was associated with Walt Disney Productions as Production Manager, he was under contract to the studio in the capacity of Animator. He successfully fulfilled assignments, and supervised the work of several groups of other artists C. M Jones, for 5 years a director of animated cartoons at Leon Schlesinger Productions, testified that he was familiar with Babbitt's work as an animator in many Disney productions, and stated that in his opinion Babbitt ranks among the first 10 animators in the industry.' It. E. Clampett, also a director at the Schlesinger studio, testified that he not only had knowledge of Babbitt's outstanding work for Disney, but also had observed the artist's work personally, since the latter had worked under him for 3 months immediately before the hearing. Clampett testified, "I believe from seeing his work and studying all other animators that he is definitely one of the top few." Prank Tashlin, now story director at Leon Schlesinger's studio, previously in charge of "Screen Gems," the Columbia cartoon organization and also former story director at the Disney studio, testified that 'he had been familiar with Bab- bitt's work for many years. He stated that in his opinion Babbitt is one of the "top" animators in the industry. 3. Babbitt's leadership in the Federation, in 1937-1940 During the latter part of 1937 it was rumored at the respondent's studio that the International Alliance of Theatrical Stage Employees, herein called the d 5 Jones also testified : ". . . among animators and director s there are certain animators that are known to be among the top and there are certain that are known to be in the middle brackets and certain others are in the bottom brackets. I would not state that most direc- tors would know who would be in the bottom bracket, but I would be safe in saying that most directors know who are in the top bracket of the industry " c_• , WALT; DISNEY PRODUCTIONS 901 .1. A. T. S. E., was, planning to organize the employees of the industry. Babbitt approached Roy Disney, Walt Disney's brother-and the respondent' s business manager, told him that he was disturbed' by the rumor and asked what could be done about, it. Roy, Disney, referred him to Gunther Lessing, the respondent's viee-president and general counsel. When Babbitt reported his concern to him, ,Lessing advised getting the "boys" together in some sort of an organization, and offered his assistance. Following, Lessing's advice, Babbitt called meetings of the employees in the studio. Lessing and other production officials attended. Babbitt served as chairman. Lessing addressed the employees, advised against forming a union, but urged the formation of a loosely-knit social organization As a result of these meetings, the Federation was formally organized' in January 1938 At its first membership meeting Babbitt was elected president; he continued in•that office until, October 1939, when he became vice president.' In July, 1939, the Board certified that the Federation had been designated and selected by a majority of the respondent's employees in an appropriate unit,' and ,found that the Federation was the exclusive bargaining representative for such employees. Soon after this certification the Federation submitted a proposed contract to the respondent, but no agieement was reached between, the parties. The Federation's negotiating committee was told by Roy,Disney that he had no use for any unions, and the committee did not thereafter press its demands. Sometime in October, 1940, babbitt and other members of the negotiating com- mittee were summoned to Lessing's office, where Herbert Lamb, then production' control manager, informed the employees that the I. A. T. S. E. had signed up members in the camera department, and asked what the Federation was going to do about it. The Federation president, William Roberts, replied that there was nothing they could do, since no contract had been signed. Lessing and Lamb urged the committee to revive interest in the Federation. Babbitt objected and stated that be refused to be used as a stooge. The committee then left Lessing's office, and decided to take no action in reviving the Federation. Early in December, 1940, Babbitt and other members of the same committee were -called to the office of Walt Disney. With Disney were Lessing, Lamb, casting director Harold Adelquist and personnel manager Hugh Pressley. Disney called the employee committee's attention to a letter he had received from the Union attorney, which informed the respondent that the Union represented the majority of its employees and requested a meeting for the purpose of obtaining recognition. Disney declared that it was an emergency, and that something must be done. He instructed them to "get their gang together" in order to "stop this thing." Babbitt replied that he would be ashamed to face the Federation membership after the respondent's refusal to consider the demands previously submitted. Disney stated,, according to Babb ctt's . undisputed testimony, "'You know how I am, -boys; if I can't hive my, ow;n way-if somebody tries to tell me-if somebody tells me to do something, I will do just the opposite, and if necessary I will close down "Babbitt testified that he was disturbed because I . A T. S. E. was headed by Willie Bioff and George Browne The record contains a large amount of uncontradicted testimony showing that organiza- tion of the Federation took place on company property and company time. 'As is found hereinafter, the Federation was subsequently disestablished by consent decree, and the under- signed considers many of such details to be Immaterial to-the determination of the issues in this proceeding. 8 13 N. L. R. B. 865. The unit included : animators , animation effects, In-B-Tween, story department, directors and, assistants , lay out and background, camera-test and checking, process laboratory, multiplane plan, special effects, cell washers, inking , production steno- graphic (front office ), painting a,nd miscellaneous production workers. 902 DECISIONS OF NATIONAL LABOR' RELATIONS BOARD this studio.'" Disney further said that he would now sign a closed shop with the Federation , and urged the committee to send for its attorney 8 Although some members of the negotiating committee thereafter made an effort to revive the Federation , Babbitt relinquished leadership and became active, as discussed below, in the Union. On May 6, 1941, the Board issued a complaint against the respondent alleging, znter alia, that the Federation was company-dominated. A hearing was held on May 19. 'At the hearing, the respondent consented-to the-entry of a Circuit Court decree enforcing a Board order disestablishing the Federation . Thereafter the respondent entered into a contract with the Union, as discussed below, and the Union withdrew its charges upon which the above complaint was based. The :complaint was dismissed, by the Regional Director, on November 27, 1941. I B. Events lead ing to Babbitt's discharge 1. His -leadership in the Union ; the respondent's acts of interference, restraint and coercion During the latter part of 1940, the Union began soliciting membership among the respondent's employees. As found above, on December 5 the Union informed the respondent that it represented a majority of the employees in the studio. Babbitt joined in the Union's efforts On February 6 Walt Disney prepared and had posted a notice to all employees which read , in part, as follows : The Company recognizes the right of employees to organize and to join in any labor organization of their own choosing, and the Company does not intend to interfere in this right. HOWEVER, the law clearly provides that matters of this sort should be done off the employer's premises and on the employees' own time, and in such a manner as not,to interfere with production. ,Due to world conditions , the studio is facing a crisis about which a lot of you are evidently unaware. It can be solved by your undivided attention to production matters. This is an appeal to your sense of fairness and I trust it will be sufficient to remedy the matter A meeting of employees was held at a Hollywood hotel about February 15, 1941 -Babbitt attended, joined the Union, and addressed the employees over the loud- speaker system, stating that he had been unable to get "to first base" through the Federation and urging that the employees needed a good, strong union that was -not company-dominated Soon after this meeting Babbitt noted that the volume of his work-assignments was decreasing. He consulted Adelquist, who was respon- sible for distributing assignments. Adelquist told him that the situation,had a direct relation to his union activities, and that Walt Disney did not like it. Adel- quist further stated that they did not need a union and advised Babbitt to "get wise to himself" and drop -his outside activities" In March, 1941, Babbitt was nominated for the chairmanship of the Disney unit of the Union. His nomination was announced in "Variety", a trade magazine. -A few days later Lessing asked Babbitt if he was going to accept the office. Bab- bitt replied that he intended to. Lessing warned the employee that he would be 0 The findings ,as to Disney's statements at this meeting are based upon Babbitt's testi- mony Although Disney Ras called as a witness, be was not questioned about this incident 10 The findings as to Adelquist's remarks at this interview rest upon the credible testimony of Babbitt Adelquist at first denied making any of the statements attributed to him by Babbitt but thereafter admitted that he had "several times"'discussed the Union with the employee, and had told him that no union was needed In view of Adelquist 's partial admissions , and having observed both witnesses on the stand , the Trial Examiner places no reliance upon Adelquist 's denial. - WALT DISNEY PRODUCTIONS 903' getting himself into trouble , and advised him to be sick or to go away fora few days." Babbitt was thereafter elected chairman of the local. - In April Babbitt called 'Walt Disney by telephone, and requested a $2 raise for: his assistant, who was receiving $18 weekly. Disney replied,. according to Bab- bitt's undisputed, testimony , "'Why don't you mind your own God damn business. If you stopped messing around in other people's business and stopped carrying the torch for a bunch of guys who don't deserve to be fought for in the first place, you would be a hell of a lot better off. The trouble with you is you are nothing but a God damn Bolshevik sitting in a little corner by yourself and you don't know what is going on in the rest of the studio.' " . Early in May, Babbitt met Walt Disney in a studio corridor. Disney declared, also according to Babbitt's undisputed testimony, "'If you don't cut out organizing my employees you are going to get yourself into trouble .'" Babbitt countered by stating that there had been no complaint about his work, and Disney replied, "'I don't care if you keep your God damn nose glued to the board all day or how much work you turn out or what kind of work it is, if you don't stop organizing my employees I am going to throw you right the hell out of the front gate.""' Also in May, Lessing summoned "in-betweener" Franz Bauer and several messenger boys to his office and questioned them about a meeting of employees held , during ,lunch hour the day before, at which Babbitt had spoken . Lessing' asked for the names of employees attending, wanted to know if membership cards had been passed out and if- Bauer had signed, and particularly inquired if the meeting had extended beyond the lunch hour period. Lessing also told Bauer that he wanted information concerning these "union agitators" ." In mid-May the respondent laid off a number of Union members . The Union protested this action , but the respondent refused to meet with its representatives in negotiation . On May 27 a meeting of the Union membership was held, -at which it was voted to call a strike two days later unless Walt ,Disney would meet with their committee . A telegram to this effect was'sent to Disney. On the following day, May 28, Babbitt was approached by the chief of the studio police and handed an envelope containing a letter from Lessing stating that the employee • was discharged because he had "on numerous occasions engaged in union activities of various kinds and descriptions on the company 's property and on the company's time.", 2. Babbitt's leadership in the ensuing strike - On the following -day,' May 29, employees of the respondent went on strike. As head of the Union , Babbitt directed the Union 's activities during the nine-week period of the strike . He conducted meetings and addressed employees daily from a loudspeaker set up across the street from the studio. In July, while the strike was still in progress, the Union submitted a proposed contract to the respondent, and, by a signed agreement entered into between the respondent and the Union on July 30, the issues raised in the proposed contract and by the strike itself were referred to two Commissioners of the United States Conciliation Service.._ The strike terminated upon the agreement between the "The findings as to Lessing's statements are based upon Babbitt's uncontradicted testimony. ' Disney's remarks are quoted from Babbitt's uncontradicted testimony. is Lessing admitted , at the bearing , having "talked to approximately four of the traffic boys, and Bauer was one of them " He further testified , "I asked them about the meeting in the old Animation Building, which had been reported to me, conducted by Mr Babbitt." He also stated ; "Well, I got very little information out of them , although he did say there had been a meeting. I believe this boy said he just went there and he wasn 't interested and walked out and left. And I don't believe he could name anyone. I believe he named one boy wlio'had been present That, in substance; is what happened." t_ 904 DECISIONS OF NATIONAL LABOR RELATIONS BOARD respondent and the Union to submit the dispute to Federal arbitrators. On August 2, the Federal arbitrators: submitted" their"award, recommending the adoption of the proposed contract with certain changes. The award also contained the following specific decision : - Layoffs, (together with the status of the reinstated discharge cases in question ) shall be referred to the agreed-on joint committee before any action is taken, and where disagreement occurs same shall be referred to a Federal Arbitrator to be named by Director J. R. Steelman. However, with respect to the case of Art Babbitt, it is the judgment of the arbitrators that he be reinstated to his former` position and not subject to discharge incident to' reorganization except for cause. On July 29 Babbitt was informed by a memorandum from the respondent that he was being reinstated upon the payroll. Immediately upon issuance of the arbitrators' award on August 2, casting director Adelquist and other management officials prepared a list of employees who were not to be reinstated because of a retrenchment program. The list was submitted to the Union, which protested that the selection was discriminatory in that non-strikers were to be retained while strikers' were -to. be laid off. The dispute was thereupon submitted to one of the U. S. Conciliation commissioners for arbitration, and the entire studio was closed until the middle of September. On September 9, the second arbitration award was handed down, providing for the maintenance of the proportion of strikers to non-strikers in the proposed reorganization program. As a result of this award the respondent drew up a new list and 263 employees were not re-employed when the studio reopened on September 17. Babbitt was among the employees who reported for work on this date. 3.,-Union-membership requirement in the award of August 2. The arbitrators' ,award of August 2, above referred: to,_ included the following provision : The Employer agrees to employ in the classifications : herein, members in good standing in the Union, only provided however, that if the Union is unable to furnish competent help in the opinion of the employer within forty- eight (48) hours after request the Employer may employ any person provided such person becomes a member of the Union or obtains a Work permit there- from within fifteen (15) days thereafter. According to the undisputed testimony of Anthony O'Rourke, now the respondent's Director of Labor Relations, this provision of the arbitration agreement was thereafter observed by the respondent. On October 6, 1942 the respondent and the Union entered into another contract, containing a similar Union-membership requirement. 4. Failure of the respondent to provide Babbitt with customary equipment and work assignments; the respondent's hostility, toward him Upon return to the studio Babbitt found that his customary room had been assigned to a non-striker. He was placed in another room, with different furni- ture and not equipped with a movieola, an apparatus essential to an animator's profession." After a delay of about ten days, and following protests made to Adelquist, Babbitt was again provided with a movieola. 14 "The Art of Walt Disney", previously referred to. thus describes the "movieola" : "The animator has also a movieola ( a peepsight projection machine in which the picture is seen WALT DISNEY PRODUCTIONS 905' Babbitt's first work assignment, following his reinstatement, was the re- animation-of two, scenes produced by, animator, John Sibley -during the strike, When assigned this work by Director Jack Kinney, Babbitt was told, according to the employee's undisputed testimony, " `Here are a couple of scenes that Sibley has done and they are unsatisfactory; he didn't put the point across at all.'," After completing this assignment Babbitt was given another job of re- animating a character, being told by Director Dick Lundy that the work was to be done over partly because of story changes and partly because the animators who had worked on it before had not put the idea across Babbitt completed this assignment, in rough, but was unable to have it previewed by the director to learn whether or not any changes were required He completed both assign- ments about the first of November. Babbitt made numerous requests of Adelquist for additional work until Walt .^ Disney, who had been in South America for several weeks, returned to the studio Adelquist made promises of such assignments. Thereafter Adelquist treated Babbitt's requests noncommittally, and the animator was given no assignments Early in November, Public Relations Director Verne Caldwell, requested the Union business agent, M. William Pomerance, to ask Babbitt not to have any further discussions with him as to the respondent's relationship to the Union, because of a "good deal of feeling" between the "Disueys" and Babbitt. 5. Testimony with respect to the lay off of November 24, including the termination of Babbitt's employment Adelquist admitted, at the hearing, that Babbitt was moved to another room upon his reinstatement on September 17, and that he had complained about the lack of equipment He explained that the move was made because of the reduction in personnel and the resultant confusion, but that the equipment was provided Babbitt "as quickly as possible" because "we were very anxious to get Mr. Babbitt set up and to work again " As to the amount of work in progress at the studio following its reopening, Adelquist testified that, in addition to a number of "shorts", two features were "actually in production",-the ."Mickey Feature" and "Wind in the Willows". During the latter part of October or early in November Walt Disney returned to the studio from an extended trip to South America. Disney previewed both of the above-mentioned features, and ordered that they be shelved. Since then, and until the hearing, work on these two features has not been revived.' On this point the testimony of both Adelquist and Wilt Disney is in agreement. Walt Disney brought with him, from South America, a number of short projects, still in a preliminary story stage, which the respondent was to produce for the Coordinator of Inter-American Affairs. These projects were turned over to the story department, and were "in story" until about the first of 1942. Adelquist testified that because of "an over-produced state from the standpoint of short subjects, the reduction, the elimination of the feature output, the fact that the South American pictures were still in the story stage, it was obvious that we were over-staffed And as such, we contemplated by necessity reduction of personnel." Walt Disney also testified that because of these conditions it was necessary to lay off about one hundred employees. through a small glass window), which allows him to analyze in detail, frame by frame, the results of his work after the drawing has been photographed upon the rough try-out film . . . without the final check of the movieola he could not see how things would look on the screen or be able to time action according to the needs of the Exposure Sheet " 906 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Adelquist testified that he conferred with two other management officials early in November concerning the necessity for a further lay off of personnel. Accord- ing to his testimony, he then prepared' a proposed list of layoffs, and checked it "with the various directors and other persons in the plant who were in a posi- tion to authorize the issuance of work." He then submitted the list, which in- cluded Babbitt, to Walt Disney, who approved it. With respect to his method of selection of lay-offs in the animation depart- ment, Adelquist testified as follows : The initial steps-well, as I said before, we had a lack of work in the or- ganization ; so it was necessary to check very carefully with each assign- ment that each animator had, to find out exactly what he was doing and what available work there might be. . . . Now, checking very carefully on the amount of work available and the' work at hand, we decided thereby that the men that had no work should be laid off. Now, also in connection with that there were other things that entered into it As a matter of fact, there were, several of them. We wished to retain naturally the most versatile group of men possible that we could'from the standpoint of the anticipated work that was going to come in and the work that we were then on... . He further testified, ". . However, the most, important point was the fact that we had no work for the men that were laid off." As to the selection of Babbitt for the lay-off, Adelquist stated, "I checked; around with Mr. Kinney (a director) and all other directors in the plant, at- tempted to' get some work for Mr Babbitt, and was unsuccessful." Kinney, however, denied that anyone consulted him with respect to Babbitt's layoff prior to November 24. Director Jackson, also a witness for the respondent; /denied that he was consulted before Babbitt's layoff Producer David D. Hand, named by Adelquist as one of the management officials who assisted him in preparing the lay-off.list, also denied taking any part in Babbitt's lay-off and being consulted with respect to it. When Walt Disney was asked what considerations were made by him in approving the lay-off of Babbitt, he testified : Well, the man's adaptability to the various types of work that we might have, the quality of his work as the standard at that time would demand ; whether he was a progressive sort and things of that kind, to size him up, or any person-to qualify a person. He also testified, in part : In Mr. Babbitt's case the type of work that I was able to give Mr. Babbitt was no longer possible. Mr. Babbitt for years had been a difficult man to ° cast because for some reason or other he would not conform to the stand- ardiz'ation of our models, which was very necessary. -. . . Mr. Babbitt, when he started in there, was very progressive, very eager but that was at a time when the organization was small. ... At that time he was-he was doing a good job, but the business pro- gressed, moved up and standards changed. Pictures that I made ten years ago I couldn't release today. Other things crept into it-little subtleties. It is not the drawing. It is not the drawing . . . I did everything possible to encourage Mr. Babbitt . But many times I went out of my way to encourage Mr Babbitt. Mr. Babbitt got into the habit and it came as a result of 'an effort on my part to try to advance a certain part of the business-that was when we started Snow White. I was WALT DISNEY PRODUCTIONS ,907 up against quite a problem of human characters. Naturally when we ani- mate a little rabbit or animate a duck or something, we take,a,lot of. latitude. There is a lot of latitude-a lot of liberties taken. We can do this-stretch this and stretch that and we can defy the laws of gravity and everything, but when you get into human characters there is a certain parallel that must be maintained there on the screen to make them consistent, so in order to do that I employed live models as a guide, as an inspiration to my men . . . The result was that they began to-I wanted to get graceful actors and actresses. Now, that started what I called-we called the "live action model type of"-oh, I forget what we called it. But' I was worried at the time. I knew what would happen. I was worried because it happens with a lot of artists when they begin to draw and sketch from a model ... I wanted them to analyse it and work out all these little things that are very important to the production of a picture and get it in their minds just like the modern way of teaching girt today is to look at things and then turn around and draw it, not literally copy the thing. Mr. Babbitt persisted in using this particular thing as a crutch. I warned Mr. Babbitt ; I pleaded with 1\ir. Babbitt to lay off that thing. , I said, "It is going to change your whole style " And it did. He began to use that, literally copied and traced from the character and after Pinocchio, when I carried it into the short subjects, Mr Babbitt insisted on using live action for the short subject "Goof". No one else used it. ... Now, that affected Mr. Babbitt's work. It got to a point where all his work was stiff. . . . None of the other artists were using it All of the directors were afraid of Babbitt's work for that reason because the man had changed. The man had changed. We would have a wonderful world if we progressed instead of either sitting still and if we sit still, why, we are going backwards is what I maintain, and we can even go back%Vaids. Now, that is the case of Mr. Babbitt. When asked why he continued to pay the artist a high salary, in view of his above opinion of his work, Disney testified that he did so "to throw confidence to Mr. Babbitt," 'and renewed his contract "for that reason and no other reason." Babbitt testified, in rebuttal, that no complaints had been made to him, as to his use of "live action " He denied "tracing" pictures of such action, and his denial was supported by the testimony of his assistant, William Hurtz. Only one of four directors who had supervised Babbitt's work and were called by the respondent as witnesses, gave support to Disney's complaint about Babbitt's use of "live action." Director Kinney testified that, "for his money", Babbitt's "Goof" was "too close' to live action. He admitted, however, that Babbitt's "Goof" was only "slightly different than those of the Goof I liked the best," and it has been established that Babbitt was selected by hire to redraw unsatis- factory scenes produced by Sibley during the strike. Furthermore, as to the use of "live action" generally, the following is quoted from "The Art of Walt Disney", above referred to as bearing the respondent's copyright : Whether we are dealing with Snow White herself, or-the dwarfs, or sticks and stones, if they are to come to life they must do so in the manner to which we are accustomed as human beings We see them in terms of our- selves. If Dopey falls over backward when the door unexpectedly flies open, regardless of his own unique characteristics, how would he fall as a human being? We can use our imaginations, but only the live-action camera photographing a man in a comparable situation can show us precisely what will occur With this in mind it is customary to take live-action films of character actors experimenting in all possible ways of portraying the scene 908 DECISIONS OF NATIONAL LABOR RELATIONS, BOARD in,question. In this way action analysis of all sorts of little behavior traits is suggested that would not otherwise have been noticed and that may modify the whole treatment of a subject. The respondent produced, at the hearing, a list of all animators employed on November 24, including both those laid off and those retained. Noted opposite each of the 31 names is the date of the employee's original employment, his salary,, and the production to which he was on that date assigned. The document establishes that Babbitt was the only one of the top-salary group to be dismissed, and that of the other five animators to be laid off, four were receiving only $85 a week, and one receiving $90. Of the 25 animators retained, the document reveals that only 5 (including those supervisors who, as discussed above, had been in classification IX) were receiving a salary greater than Babbitt and only 4 had greater seniority with the respondent than he The document also shows that of all 31 animators employed on that date, Babbitt was the only one unassigned to any work. In significant contrast to the testimony of both Adelquist and Disney that the "Wind in the Willows" feature had been shelved before this date, the same document bears notations that two 15 of the animators retained had no other assignment on November 24 except "Wind in the Willows" and that six were assigned, in part, to this feature." Adelquist testified that no new animators had been employed by the studio since November 24,-and that no new personnel had been added to the anima- tion department since that date. Although there was testimony to the effect that Sibley had done animation work at the studio prior to the strike, and had been assigned to the position of assistant animator when the studio reopened after the November 24 lay-off, his name does not appear on the respondent's list of animators on November 24, above referred to. Adelquist himself, later in his testimony, stated that Sibley was promoted to animator in January, 1942. It is therefore clear that Sibley, some of,whose work had been given to Babbitt for correction, after the strike, was promoted to the position of animator after Babbitt was discharged on November 24. C. The lay-offs of November 24 Babbitt's discharge, and events following On November 24 Babbitt received a mimeographed notice stating, in part, that "At 5: 30 P M. November 24, 1941, a general' layoff, in which you are included, will become effective. . . .. It also stated, "We sincerely trust that shortly we may be able to call you back Although the Union took up with the respondent the question of certain grievances, occasioned by the 97 other lay-offs of November 24, it did not submit Babbitt's dismissal as a grievance under the procedure set up by the arbitrators' award. Babbitt and M William Pomerance, the Union's business agent, agreed that his dismissal would not be made a subject of this grievance procedure because, according to the arbitrators' award, he was not subject to lay-off, except for cause, and it was considered that his case fell into a category different from that of the other lay-offs. ,On December 1, Babbitt wrote the following letter to Walt Disney: This is to advise you that notwithstanding the notice of layoff of Novem- ber 24, 1941, I consider my status as an employee of your company unchanged. I am, and have been since the date of said notice, ready, willing and able to continue the performance of my duties. 11 Davis and Toombs. 26 Johnston, Kahl, Larson, Luske, Thomas, and Tytla _ - WALT - DISNEY PRODUCTIONS 909 Under -the:circumstances, I, shall, expect ' payment of my regular weekly salary whether or not you wish to avail yourself of my services.. He received no,reply from Disney . During the latter part of November Babbitt received a telephone call from - Dante Quinterno, an animated cartoon producer in Buenos Aires, Argentina, South America. As a result of this conversation, on January 17; 1942, `•Babbitt went to South America in ' search of employment. He returned to this 'country - on April 23, 1942. As found above, on May 28 be filed 'with •the,Board charges against the respondent. - At the time of the hearing, Babbitt was still a member of the Union. D. Conclusions as to Babbitt's discharge 1. The discharge As above revealed, the testimony of Adelquist and Walt Disney as to the reasons for dismissing Babbitt on November 24 is not only inconsistent , but,in many respects is refuted by testimony of other supervisors called by the re- spondent. Thus, Adelquist's repeated testimony that he consulted producer Dave Hand and "all directors ," is flatly denied by Hand and three directors . Disney stated that the main 'reason for Babbitt's layoff was his lack of ability and his failure to abide by his instructions , while Adelquist declared that the real reason was lack of work available. Nor can the Trial Examiner place reliance upon the testimony of Adelquist and the document produced by him as to work assignments on November 24. As found above, the document states that certain animators were still at work upon a feature which both Adelquist and Disney testified had been shelved some time before November 24. Babbitt's high rank among animators in the industry is not only established by unprejudiced executives of another studio, but also by the high salary and ratings accorded him up to the time of his discharge in" May, 1941. Disney's explanation that he had only continued to pay Babbitt his salary in order "to encourage him" is not only unreasonable , but is inconsistent with ratings,- all of which required Disney's approval, given to the artist on his assignments. Furthermore, it is undisputed that the only work assigned to Babbitt , following his reinstatement in September , 1941, was re-animation of unsatisfactory work performed by other animators during the strike. ' Adelquist's testimony that no work developed after November 24, for which Babbitt was qualified , is inconsistent with the established fact that Sibley, whose work Babbitt had been called upon to correct in September , was pro- moted to the position of an animator in January, 1942. The Trial Examiner is persuaded by all of the evidence, and so finds, that there is no merit in the reasons advanced , either by Adelquist or by Disney, as to Babbitt's dismissal on November -24, and that the condition claimed by them did not, in fact, exist. The real reason for the termination of Babbitt's employment is plainly re- vealed in undisputed evidence concerning his Union activities and the threats made by Walt Disney before his discharge in May, 1941. Late in 1940 Babbitt not only refused to yield further to the respondent 's domination of the Federa- tion, which he had headed since its inception , but joined and became the leader of the Union. Lessing's above quoted letter dismissing Babbitt in May, 1941, frankly admits .that the action was in punishment for his Union activities. And that the May dscharge was discriminatory in the judgment of the U. S. Con- ciliation Service commissioners is attested by the fact that, in their award, 910 DECISIONS OF NATIONAL LABOR ` RELATIONS BOARD Babbitt was ordered reinstated and not to' be dismissed 'incident- to reor- ganization. The evidence establishes, that Babbitt was not reinstated fully, to his former position in September, but was placed in another room, with inadequate equip- ment, and assigned only tasks of correcting others' unsatisfactory work. , The evidence leads directly to the conclusion, and the Trial Examiner so finds, that Adelquist purposely avoided assigning work to Babbitt, following his reinstatement in September, thus creating a pretext for his lay-off on November 24, together with 97 other employees, while the real reason was his Union leader- ship and activity before and during the strike. The Trial Examiner further finds that the respondent had no intention of re-employing Babbitt, after November 24, 1941, and that the alleged lay-off was, in fact, a discharge. Therefore the Trial Examiner concludes and finds that the respondent, by dis- charging Arthur Babbitt on November 24, 1941. has discriminated in regard to his hire and tenure of employment, thereby discouraging membership in the Union, and interfering with, restraining, and coercing its employees in the exercise of rights guaranteed in Section 7 of the Act. The Trial Examiner further concludes and finds that, by the inquiries as to Union membership made by Lessing of Bauer and other employees, as described above, and by the threats made to Babbitt by Walt Disney, the respondent has interfered with, restrained, and coerced its employees in the exercise of rights guaranteed in Section 7 of the Act. - 2. Other Contentions of the Respondent a. Failure of Babbitt to submit his grievance through agreement procedure The respondent contends, in its answer and in its oral argument at the close of the hearing, that the Board is without jurisdiction in this case because at the time of Babbitt's discharge there existed between the respondent and the Union, Babbitt's authorized representative, an agreement providing a grievance procedure for the handling of such lay-off disputes, and because neither Babbitt nor his representative availed themselves of this procedure. The Trial Examiner finds this contention to be without merit This finding is consistent with the following language, quoted from the Court's opinion in N. L. R B. v Newark Morning Ledger Co., 120 F. (2d) 266, (C. C. A. 3) 17 : The Board found, upon sufficient evidence, that Miss Fahy was discharged because of her membership and activity on behalf of the Guild, and that this discouraged membership in the Guild We conclude that these findings establish the existence of an unfair labor practice on the part of the Ledger Company with which the Board was empowered to deal, and that its restrain- ing order and direction to reinstate Miss Fahy with back pay were appro- priate remedies It is settled that it is a public right created by the act which was thus enforced. In Amalgamated Utility Workers v. Consolidated Ede-son Co, 309 U. S. 261, Mr. Chief Justice Hughes, speaking for the Supreme Court, made this quite clear. After reviewing the procedure prescribed by the act, he said : So far, it is apparent that Congress has entrusted to the Board exclusively the prosecution of the proceeding by hearing,, the adjudication and the\grant- ing of appropriate relief. The Board as a public agency acting in the public interest, not any private person or group, not any employee or group of 17 Cert. denied, 314 U. S 693. WAfLT DISNEY PRODUCTIONS, 911 employees, is chosen as the instrument to assure protection from the de- scribed unfair conduct in order to remove obstructions to interstate commerce." b Alleged -failure of `Board to prove that discharge of Babbitt did, or could, discourage Union membership The respondent also contends that the presence of the "closed shop" provisions in the agreement between itself and the Union at the time of Babbitt 's dismissal, and the consequent necessity for all remaining employees to be Union members, as well as Babbitt's continued membership in the Union , bar a finding that his discharge either did or could discourage membership in the ,Union. The Trial. Examiner finds no merit in this-,contention. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE 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 tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. 0 v. THE REMEDY Having found that the respondent has engaged in certain unfair labor practices the Trial Examiner will recommend that it cease and desist therefrom and take certain affirmative action deiigned . to effectuate the policies of the Act. It has been found that the respondent discriminated as to the hire and tenure of employment, of Arthur Babbitt, because of his membership in and activities on behalf of the Union, and because he engaged in concerted activities with other employees for their mutual aid and protection . In order to effectuate the pur- poses and policies of the Act, it will be recommended that the respondent offer Arthur Babbitt immediate reinstatement to his former or substantially equivalent position , without prejudice to his seniority and other rights and privileges. It will also be'recommended that the respondent make Arthur Babbitt whole for any loss of pay he has suffered by reason of the respondent 's discrimination by payment to him of a sum of money equal to the amount he normally would have earned as wages from the date of the discrimination to the date of the offer of reinstatement, less his net earnings " during that period. 1s See also In the Matter of North American Aan.ation, Inc and United Automobile, Air- craft -and Agricultural Implement -Worker8 of America, Local 887, C. I 0 , 44 N L . R: B. No. 113, wherein the Board said, with respect to a similar claim by an employer that the Board lacked jurisdiction because of an arbitration clause in an existing contract , that "Since Section 10 ( a) of the Act provides that the power of the Board to prevent unfair labor practices affecting' commerce `shall be exclusive and shall not be affected by any other means of adjustment or prevention that has been or may be established by agreement, code, law, or otherwise,' it is clear that the contract's arbitration provision does not deprive the Board of jurisdiction it would otherwise have The no-strike, no -lockout provision in the contract is, of course, designed to keep disputes between the parties from interrupting' the respondent's operations and thereby burdening or obstructing commerce, but it constitutes no guarantee that such interruptions will not occur. Furthermore, a labor organization's agreement not to strike cannot be regarded as precluding the Board from proceeding under the Act to prevent unfair labor practices ; the very purpose of the Act is to remove unfair labor practices before `they *result in labor disputes affecting commerce " 19 By "net earnings " is meant, earnings less expenses , such as for transportation, room, and board , incurred by an employee in connection with obtaining work and working else- where than for the respondent , which would not have been incurred but for his unlawful 912 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Conclusions of Law 1. Screen Cartoonists Local 852, affiliated with Brotherhood of Painters, Deco- rators and Paper Hangers of America, affiliated with the American Federation of Labor, is a labor organization, and Federation of Screen Cartoonists, un= affiliated, was a labor organization, within the meaning of Section 2 (5) of the Act. 2. By discriminating in regard to the hire and tenure of employment of Arthur Babbitt, thereby discouraging membership in Screen, Cartoonists, Local 852, affiliated with Brotherhood of Painters, Decorators and Paper Hangers of America, affiliated with the American Federation of Labor, the respondent has engaged in and is engaging in unfair labor practices, within the meaning of Section 8 (3) 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. 0 RECOMMENDATIONS Upon the basis of the foregoing findings of fact, and conclusions of law, the undersigned recommends that the respondent, Walt Disney Productions, Burbank, California, and its ,officers, agents, successors, and assigns, shall: 1. Cease and desist from : (a) Discouraging membership in Screen Cartoonists Local 852, affiliated with Brotherhood of Painters, Decorators and Paper Hangers of America, affiliated with the American Federation of Labor, or any other labor, organization of its employees, by discharging or refusing to reinstate any of its employees or in any other manner discriminating in regard to their hire or tenure f of 'employment or any term or condition of their employment ; (b) 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 choos- ing, and to engage in concerted activities for the purposes of collective bargaining or other mutual aid or protection, as guaranteed in Section 7 of the National Labor Relations Act. 2. Take the following affirmative action which the Trial Examiner finds will effectuate the policies of the Act : (a) Offer, to Arthur Babbitt immediate and full reinstatement to his former or substantially equivalent position without prejudice to'his 'seniority"acid other rights and privileges ; (b) Make whole Arthur Babbitt for any loss of pay he may have suffered by reason of the respondent's discrimination against him by payment to him ofa sum of money equal to that which he would normally ,have earned as wages from the date of the respondent's discrimination against him to the date of such offer of reinstatement, less his net earnings 2' during said period ; (c) Immediately post notices to its employees in conspicuous places throughout its studio at Burbank, California, and maintain such' rotices fora period of at discharge and the consequent'necessity of his seeking employment elsewhere See Matter of Crossett Lumber"Company and United Brotherhood of Carpenters and Joiners of America, Lumber and .sawmill workers Union, Local 2590, 8 N. L. R. B. 440 Monies received for work performed upon Federal, State, county, municipal,; or other work-relief projects shall be considered as earnings . See Republic steel Corporation v. N L. R. B., 311 U. S. 7. 211 See footnote 19. WALT DISNEY PRODUCTIONS 913 least sixty (60) days from the date of posting, stating (1) that the respondent will not engage in the conduct from which it is recommended that it cease and desist in paragraphs 1 (a) and (b) of these Recommendations; (2) that it will take the affirmative action set forth in paragraphs 2 (a) and (b) of these Recom- mendations ; and (3) that its employees are free to become or remain members of Screen Cartoonists Local 852, affiliated with Brotherhood of Painters, Decorators and Paper Hangers of America, affiliated with the American Federation of Labor, and that it will not discriminate against any employee because of membership,in or activity on behalf of said labor organization ; (d) Notify the Regional Director for the Twenty-First Region (Los Angeles, California) in writing within ten (10) days from the date of the receipt of this Intermediate Report what steps the respondent has taken to comply therewith. It is further recommended that unless on or before ten (10) days from the receipt of this Intermediate, Report the respondent notifies said Regional Director in writing that` it has complied with the foregoing recommendations, the National Labor Relations Board issue an order requiring the respondent to take the'action- aforesaid. As provided in Section 33 of Article II of the Rules and Regulations of the National Labor Relations Board-Series 2-as amended, any-party may within fifteen (15) days from the (late of the entry of the order transferring the case to the Board, pursuant to Section 32 of Article II of said Rules and Regulations, file with the Board, Shoreham Building, Washington, D. C, an original and four copies of a statement in writing setting forth such exceptions to the Inter- mediate Report or to any other part of the record or proceeding ( including rulings upon all motions or objections) as he relies upon, together with the original and four copies of a brief in support thereof. As further provided in said Section 33, should any party desire permission to argue orally before the Board, request therefor must be made in writing to the Board within ten (10) days from the date of the order transferring the case to the Board. C. W. WHITTEMORE, Dated November 11, 1942. Trial Examiner.