B&Z Hosiery Products Co.

In the Matter of ABE ADOLPH BOCIINER AND ZHERSCTIEL ZYLBERBERG, INDIVIDUALLY AND AS CO-PARTNERS, DOING BUSINESS AS -B & Z HOSIERY PRODUCTS Co. and AMERICAN FEDERATION OF HOSIERY WORKERS Case No. 41-C-1809.-Decided August 10, 1949 DECISION AND ORDER On November 17, 1948, Trial Examiner Louis Plost issued his Inter- mediate Report in the above-entitled proceeding, finding that the Respondents had engaged in and were engaging in certain unfair labor practices and recommending that they cease and desist there- from and take certain affirmative action, as set forth in the copy of the Intermediate Report attached hereto. The Trial Examiner also found that the Respondents had not engaged in certain other alleged unfair labor practices and recommended dismissal of those allegations of the complaint. Thereafter, the General Counsel and the Union filed exceptions to the Intermediate Report and supporting briefs. The Board 1 has considered the rulings of the Trial Examiner at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Board has considered the Inter- mediate Report,2 the exceptions and supporting briefs, and the entire record in the case and, finding merit in certain of the exceptions, hereby adopts only such of the findings, conclusions, and recommen- dations of the Trial Examiner as are not inconsistent with this Deci- sion and Order. 1. The Trial Examiner found that Respondent Zylberberg's state- ments to Frank Rice on the night of April 4, 1947, and his telephonic request of Ernest Kelemen on April 5, 1947, constituted interference, restraint, and coercion by the Respondents of their employees in vio- lation of the Act.3 We also find that certain of the statements made ' Pursuant to the provisions of Section 3 (b) of the Act , the Board has delegated its powers in connection with this case to a three -member .panel [Chairman Herzog and Members Houston and Gray]. 2 The Intermediate Report states that the original charge in this case was filed April 4, 1947; it was in fact filed April 21, 1947. ' No exceptions were filed to these findings. 85 N. L. R. B., No. 116. 633 634 DECISIONS OF NATIONAL LABOR RELATIONS BOARD by Respondent Zylberberg to the employees at the shift meetings on April 9, 1947, likewise constituted interference, restraint, and coercion. Frank Rice and Stephen Kelemen testified credibly that Respondent Zylberberg told the employees on the day shift that if they joined the Union, he was going to stop payment of the customary Christmas and Easter bonus. Five employees from both shifts 4 testified without contradiction that Respondent Zylberberg made statements to the em- ployees on both shifts to the effect that he would discontinue his efforts to secure yarn, in addition to that regularly received from the manu- facturer, if the employees joined the Union. Respondent Zylberberg did not deny making the foregoing statements attributed to him. Accordingly, we find that Respondent Zylberberg made such state- ments to his employees. The Trial Examiner concluded that such statements, even if made by Respondent Zylberberg, were privileged as free speech under Sec- tion 8 (c) of the Act 5 We do not agree. No extended discussion is necessary to establish that Respondent Zylberberg's statements with respect to the bonus payments constituted a threat of reprisal if the employees engaged in activities protected by Section 7 of the Act.6 Likewise, his statements regarding his efforts to secure yarn, when viewed against the background of less than full-time operation of most of the knitting machines, and the obvious effect o71 the employees' earnings of a further reduction in hours of work resulting from a re- duction in yarn supplies ,7 also constituted threats of economic detri- ment. We conclude that these threats of economic reprisal against organizational activity were not protected under Section 8 (c) of the Act, and that by making such threats of economic loss the Respond- ents interfered with, restrained, and coerced their employees in the exercise of the rights guaranteed by Section 7 of the Act, all in viola- tion of Section 8 (1) of the Act and Section 8 (a) (1) of the amended Act.$ 4 Prank Rice and Stephen Kelemen from the day shift ; Adam McCaughey, Robert McCaughey, and Ernest Kelemen from the night shift. "The expressing of any views, argument, or opinion . . . shall not constitute or be evidence of an unfair labor practice . . . if such expression contains no threat of reprisal or force or promise of benefit." 8 See Matter of William P+. 11uffm an, d/b/a Radio Station WFHR, 71 N. L. R. B. 518, 519. 7 The fact that the quantities of yarn obtained by the Respondents from sources other than the manufacturer may, as Respondent Zylberberg testified, have been only an in- significant proportion of the Respondents' total yarn supplies, does not in our opinion remove from the statement the threat of reprisal. 'The General Counsel has also excepted to the Trial Examiner's failure to resolve the alleged conflict in testimony, between Respondent Zylberberg and Ernest and Stephen Kelemen, regarding Respondent Zylherberg's alleged statements concerning the plant he formerly operated in Europe, and to the Trial Examiner's findings that Respondent Zylber- berg's statements, at the shift meetings on April 9, 194-7, regarding "double jobs," were merely an exposition of the Union's policy, that such statements accurately represented the Union's policy, and that such statements were privileged free speech. In view of our findings herein , we deem it unnecessary to resolve these issues. B S: Z HOSIERY PRODUCTS CO. 635 2. On April 16, 1947, the Respondents, through one Edelman, ad- vised all the employees in the knitting department that the operation of that department was being discontinued as of the close of business that day, and that all employees in that department were laid off.9 The Trial Examiner rejected the General Counsel's contention that the shut-down and lay-off were discriminatory ; rather, he found that such conduct was prompted by legitimate business reasons, and ac- cordingly did not violate the Act. We do not agree. The Respondents advanced as the reasons for the shut-down and lay-off: (a) a substantial break in the market for 42-gauge nylon hosiery; (b) a shortage of nylon yarn; and (c) the need to convert the 42-gauge knitting machines to higher gauges and to repair the 45- and 51-gauge knitting machines. These alleged reasons will be dis- cussed seriatim. a. The alleged market breale The Respondents allege that one of the factors which prompted the shut-down of the knitting department and the lay-off of the knitters on April 16, 1947, was a substantial break in the market price for 42-gauge nylon hosiery,10 which break allegedly occurred immediately 0 The Respondents resumed operation of the knitting department on or about July 20, 1947, and reinstated 11 of the laid-off employees to their former or substantially equivalent positions on or about the following dates : Date of Employee reinstatement Joseph Feldenser------------------------ July 20, 1947. Calvin Hanley-------------------------- July 20, 1947. Robert McCaughey--------------------- July 20, 1947. John Motacki--------------------------- July 20, 1947. Walter Moyer--------------------------. July 20, 1947. Charles Reese--------------------------. July 20, 1947. Ernest Kelemen------------------------- August 1, 1947. Stephen Kelemen-----------------------. August 6, 1947 Joseph Matus--------------------------. September 15, 1947. Earl Stoyer---------------------------- September 15. 1947. George Farrell------------------------- September 22, 1947. Robert Daniels was offered reinstatement by the Respondents to his former or substan- tially equivalent position on or about July 20, 1947, but refused such offer. Adam Mc- Caughey and Frank Rice have neither been reinstated nor offered reinstatement to their former or substantially equivalent positions. Frank Rice applied for reinstatement on or about November 22, 1947 : on or about November 25, 1947, the Respondents refused to reinstate him. Adam McCaughey, who did not apply for reinstatement, was told by another employee at the Respondents' behest on or about September 13, 1948, to return to work on two 42-gauge machines ; before the shut-down he had worked on two 45-gauge machines, for which work he received more money than he would have received working on two 42-gauge machines. 10 On April 16, 1947, the Respondents operated ten 42-gauge machines, two 45-gauge machines, and one 51-gauge machine. The Respondents owned two additional 42-gauge machines which were not in operation. 636 DECISION'S OF NATIONAL LABOR IIELATIONS BOARD prior to the shut-down and lay-off." The record conclusively estab- lishes, however, that no such break, or intimation of such a break, in the general market occurred until after the lay-off.12 Moreover, the prices at which Respondents sold 42-gauge nylon hosiery remained steady from March 1, 1947, through May 16, 1947.13 Accordingly, we find that a break in the market price for 42-gauge nylon hosiery was not a factor which motivated the Respondent's decision to discontinue knitting operations on April 16, 1947, and to lay off the employees in the knitting department 14 b. The alleged yarn shortage In their answer to the complaint, the Respondents allege that one of the factors motivating the shut-down of the knitting department 11 Respondent Zylberberg testified that there was a substantial break in the market price for 42-gauge nylon hosiery shortly after he returned from a convention which had been held at Atlantic City, New Jersey. He admitted that prior to this convention, he had had no intimations of a substantial break in the market, and had had no intention of discontinuing the knitting operations. He alleged that he did not make the decision to close the knitting department and lay off the knitters until after the market broke. 12 Respondent Zylbcrberg admitted under cross-examination that the convention which, according to his previous testimony (see footnote 11, supra.), had preceded both the market break and any intimations thereof, and the lay-off, did not begin until April 28, 1947. Moreover, according to the uncontradicted testimony of the Union's research director, which we credit, no question as to a possible unfavorable market or decline in prices was raised during the negotiations preceding or at the time of the execution on April 25, 1947, of a contract, providing for a wage increase, between the Union and an association representing approximately 40 hosiery manufacturers. The testimony of the Union's research director establishes that a substantial break (approximately 10 percent) in the price of nylon hosiery occurred during May 1947, and that the first signs of such a break did not appear until about May 5, 1947. 11 At the hearing it was stipulated, on the basis of the Respondents' records, that during the period from April 15, 1947, through May 16, 1947, the Respondents sold in excess of 1,700 dozen pairs of nylon hose at a price of $10.00 per dozen and, with the exception of 11 dozen pairs of inferior grade, sold no 42-gauge nylon hose at any other price. Respondent Zylberberg admitted that the Respondents made no appreciable reductions in the price of hosiery sold during .the period from March 1, 1947, through April.15, 1947, and that such reduction began after May 16, 1947. Likewise, in view of Respondent Zylberberg's admission and the Respondents' sub- stantial sales of 42-gauge nylon hosiery following the shut-down, we do not agree with the Trial Examiner's finding that, at the time of the shut-down, the Respondents' 42-gauge nylon hose were not readily salable. For the same reasons we do not credit Respondent Zylberberg' s assertion that at the time of the shut-down "there was no market at all" for 42-gauge nylon hose. 14 As the Respondents do not contend that the shut-down was motivated by any "isolated price drops" which might have occurred prior to the convention which began April 28, 1947, but rely on the substantial market break which followed, and in view of Respondent Zylberberg's admission that prior to the convention he had no intimations of such a break, we do not consider it necessary to comment further on the Trial Examiner's speculations as to the possibly calamitous effects on the Respondents' business of such possible "isolated price drops." Nor do we consider significant, with respect to this question, the efforts of the knitters to secure employment after the shut-down. They were originally advised that the lay-off was temporary, and it was not until about May 26, 1947, that they were advised to consider the lay-off as permanent. Moreover, the record does not support the Trial Examiner's finding that none of the knitters were able to secure employment in their trade. B & Z HOSIERY PRODUCTS CO. 637 was a shortage of nylon yarn. Although the Trial Examiner does not appear to adopt this particular facet of the Respondents' defense, it is. noteworthy that the record does not support this contention. On the contrary, the record establishes that the Respondents' supply of nylon yarn was not substantially different at the time of the shut- down from what it had been throughout the period subsequent to the change from rayon to nylon in January 194715 Accordingly, we find that at the time of the lay-off the Respondents experienced no un- usual shortage of nylon yarn and that the alleged shortage of nylon yarn was not a factor which motivated the Respondents' decision to discontinue knitting operations and to lay off the employees in the knitting department.16 c. The Respondents' regauging and repair program Ever since the acquisition of certain of their 42 -gauge knitting machines about August 1946, it had been the Respondents ' intention to regauge all their 42-gauge machines to higher gauges.' It had been the Respondents ' intention to undertake and complete this pro- grain gradually , one or two machines at a time, and without closing down the shop for that purpose.' The Respondents had initiated this 15 Respondent Zylberberg testified that a period of approximately 6 to 8 weeks must elapse from the time nylon yarn is delivered by the manufacturer until it is available for knitting. During the last 7 months of 1946, nylon yarn was delivered to Respondents by the manufacturer in the following quantities : June 1946-349 lbs. October 1946-357 lbs. July 1946-575 lbs. November 1946-334 lbs. August 1946-329 lbs. December 1946-343 lbs. September 1946-338 lbs. Beginning in January 1947 , the quantities of nylon yarn delivered to Respondents by the manufacturer were substantially increased as follows : January 1947-971 lbs. April 1947-922 lbs. February 1947-864 lbs. May 1947-738 lbs. March 1947-961 lbs. The record does not show the quantities of nylon yarn obtained by the Respondents from sources other than the manufacturer . Respondent Zylberberg testified , however, that such "grey market" yarn constituted but an insignificant percentage . of the Respondents' total yarn supplies . We conclude, therefore, that any variations which might have occurred in such supplies could not have been of sufficient magnitude to have affected the Respondents' decision to shut down the knitting department. That Respondents experienced no unusual shortage of yarn is further evidenced by the increase , during the period of the shut -down , in the quantities of hose which Respondents had knitted for them by other manufacturers with yarn furnished such manufacturers by Respondents, as follows : February 1947-644 dozen . May 1947-3,350 dozen. March 1947-601 dozen . June 1947-2,462 dozen. April 1947-1,743 dozen. July 1947-890 dozen. 16 It is evident that at the time of the shut-down , the Respondents did not have sufficient nylon yarn to enable them to operate all their machines full time . This condition had, however, prevailed since January 1947, when the Respondents discontinued the production of rayon hose, yet the Respondents had not previously considered a comparable or even greater shortage of nylon yarn as sufficient reason for discontinuing their operations. - ?[ Based on the testimony of Respondent Zylberberg. 638 DECISIONS OF NATIONAL LABOR RELATIONS BOARD program by having one of such 42-gauge machines regauged to a 51- gauge machine; the regauging of this machine was completed in January 1947. It is uncontradicted that the performance of this 51- gauge machine and the two 45-gauge machines was not wholly satis- factory, and that ultimately some repairs would have to be made on them; the Respondents had not intended, however, to close down the shop for that purpose.,"' The Respondents allege, however, that because of the alleged yarn shortage and/or the alleged serious break in the market, it became economically feasible and opportune to alter their previous inten- tions of carrying out their regauging and repair program gradually and without closing down the shop, and, instead, to close down the shop for the purpose of carrying out this program immediately. We find no merit in this contention. The Respondents do not contend that their regauging and repair program was the immediate cause of the shut-down; rather, they claim that they attempted to turn to their advantage the difficulties created by the economic situation, by undertaking to accomplish in a short period of time a program which they had initially intended to accomplish over a longer period of time.19 18 Moreover, Ernest and Stephen Kelemen, who operated the 51-gauge machine, testified credibly and without contradiction that sometime between January 1947 and the time of the shut-down, Respondent Zylberberg had told them lie intended to have the 51-gauge machine repaired during the July vacation, which consisted of a week's holiday received by the employes during the week which included the Fourth of July. Ernest Kelemen also testified credibly and without contradiction that during this same period Respondent Zylber- berg had told him that if more than 1 week was required to repair this machine, he [Kelemen] would be given employment on a 42-gauge machine until the 51-gauge machine was ready for operation. 19 Respondent Zylberberg testified in part as follows : Q. How long after you came back from the Manufacturer's Convention in Atlantic City did you decide to shut down your knitting shop? A. It wasn't long, it was just a few days. Q. A few days after? A. That is right. Q. And that was the first time you had made up your mind to close the shop? A. That is right. Q. Before that time you had no idea that you were going to close clown the whole shop? A. I didn't know this whole situation was coming. Q. Up until that time you had thought that what you would do was to reneedle or regauge these machines, a pair at a time or one at a time, is that right? A. That is right. s s t a o a e Q. When you were in Atlantic City at the convention, Mr. Hemmerich was there, wasn't he? A. That is right. Q. And you did not discuss with him the closing down of your shop then? A. I did not. Q. Is the reason for that that you did not expect to close down your shop then? A. Well, at that time, as I pointed out before, I did not expect ; I had expected to do my regauging gradually, because who does it otherwise? I would have done it two machines at a time. But when I came home, the market was breaking to pieces. I thought this is the best opportunity to do it, and to do it quickly. B & Z HOSIERY PRODUCTS CO. 639 We have found, however, that there was no yarn shortage or market break, actual or anticipated, immediately preceding the shut-down. Accordingly we find that such alleged economic factors could not have offered a favorable opportunity for or contributed to the Respondents' decision to accelerate their regauging and repair program .20 Nor could the record support a contention that the Respondents' re- gauging and repair program was a primary motivating factor for the shut-down. The Respondents had intended to accomplish this pro- gram gradually, without closing down the shop, and with a minimum interruption of production.21 As found by the Trial Examiner, the Respondents had for some months been negotiating with various firms for the regauging of their 42-gauge machines. Yet the record is wholly devoid of any evidence regarding any event, which occurred prior to or at the time of the shut-clown, which either required a closing down of the shop in order to accelerate the program'22 or from which the Respondents could reasonably have inferred that their program could, 20 We find here no more than that Respondents did not take advantage of a shut-down caused, induced, or motivated by legitimate business reasons, to accelerate their regauging and repair program. This does not mean, however, that the Respondents may not have taken advantage of the shut-down, caused by other factors, to attempt to accelerate such a program. 21 See footnotes 18 and 19, supra. 22 The record contains no evidence that the quality of the work put out by the 51- and 45-gauge machines deteriorated during the period immediately preceding the shut-down. Respondent Zylberberg and Ernest and Stephen Kelemen all testified that the 51-gauge machine had not been completely satisfactory since it was placed in operation in January 1947. Frank Rice, who operated the two 45-gauge machines, testified credibly and without contradiction that the work put out by these machines was no worse immediately preceding the shut-down than it had been during the previous year. Other than the alleged economic reasons, which we have considered and rejected, supra, the record contains no evidence of any increased need to hasten the regauging of the 42-gauge machines. In view of these findings, we deem it unnecessary to consider Respondent Zylberberg's contention that the 45- and 51-gauge machines were his "bread and butter," and that it was unprofitable to operate the knitting department with the 42-gauge machines alone. We note in this connection, however, his earlier statement to Ernest Kelemen regarding the repair of the 51-gauge machine (footnote 18, supra) and the fact that although six of the 42-gauge machines were placed in operation on or about July 20, 1947, when the knitting department was reopened, the 51-gauge machine was not returned to full operation until about August 6, 1947, and the two 45-gauge machines until about October 19, 1947. We find unconvincing his explanation that unanticipated delays were experienced in securing the return of the parts of these machines, although at the time the knitting department was reopened he expected to be able to place them in operation "any day," particularly in view of the following circumstances: (1) The parts for the 51-gauge machine, shipped to the machine repair company about April 17, 1947, were returned to Respondents about June 13, 1947 ; (2) The parts for the first 45-gauge machine, shipped to the machine repair company about April 23, 1947, were returned to Respondents about June 3, 1947; (3) The parts for the second 45-gauge machine were not shipped to the machine repair company until about June 6, 1947. 640 DECISIONS OF NATIONAL LABOR RELATIONS BOARD by closing down the shop, be accelerated above the one-or-two-at-a-time pace which they originally had intended.23 Accordingly, we find that Respondents' regauging and repair pro- gram was not a factor which motivated their decision to discontinue knitting operations and to lay off the employees in the knitting de- partment 24 d. Conclusions On the basis of the foregoing, and on the entire record, we con- clude that the Respondents did not discontinue their knitting opera- tions and lay off the knitters on April 16, 1947, because of the reasons alleged by them. It does not automatically follow, however, that the shut-down and lay-off were discriminatory. The burden rests upon the General Counsel to prove affirmatively that such was the fact. We believe that the burden of proof has been sustained in this matter. This conclusion is based upon the chronology of events including the Respondents' conduct leading up to the shut-down and lay-off. Efforts to organize the Respondents' knitters began about the end of March 1.947.25 Respondent Zylberberg became aware of such ef- forts not later than April. 4, 1947, 26 whereupon on April 4, 5, and 9, Respondent Zylberberg made the afore-mentioned unlawful threats to defeat the unionization of the knitters. Several times during the pe- riod from April 7 through 15, 1947, Respondent Zylberberg made in- quiries of Adam McCaughey regarding the success of the efforts to 23 No contract for regauging any of the 42-gauge machines was executed by Respondents until about June 14, 1947, and no parts of such machines were shipped by Respondents for regauging until about June 16, 1947. Moreover, the following record establishes that the Respondents thereafter substantially pursued the original one-or-two-at-a-time regauging program with respect to their 42-gauge knitting machines: Ma- chine No. Type of agreement Date of agreement Parts shipped by re- spondents Parts returned to respond- ents Written contract_________________ ----- do--------------------------- --do--------------------------- ---do--- Option under written contract--- - do ---------------------------- oral contract - _______- -----do---------------------------- Oral or written contract __________ -----d0 --------------- June 14,1947__________ ---do----------------- July30, 1947---------- ----- do- - ------------ -----do---------------- ----- do---------- ------ After July 30, 1947----- ----- do--------------- -----do----------------- -----do----------------- ------------------------ June 16, 1947---------- ----- d0----------------- On or after July 30, 1947. ---- do---------------- ----- do----------------- ----- dO---------------- About Feb. 11, 1947--- M Aug. 1, 1948-_____-_--_ ------------------------ Aug. 29, 1947 Sept. 19, 1947 Nov. 10,1947 Dec. 5,1947 Jan. 9,1948 Feb. 10,1948 .Apr. 28,1948 Apr. 9,1948 July 29,1948 *Date does not appear in the record. **Not returned as of Sept. 23, 1948. ***Being operaled as 42-gauge machines on Sept. 23, 1948; to he regauged subsequently. 24 We consider immaterial, with respect to this question, any difficulties which the Respondents may have experienced in securing the return, on schedule, of parts shipped to the machine reconditioning firms. 25 Frank Rice testified he thought such efforts began about March 29. 1947. Based upon Respondent Zylberberg's statements to Frank Rice on that clay. B & Z HOSIERY PRODUCTS CO. 641 unionize the knitters .L1 On April 15, 1947, Adam McCaughey advised Respondent Zylberberg that all of the employees were members of the Union.2S On April 16, 1947, without prior notice, the employees in the knitting department, the only unionized department in the plant, were told that as of the close of business on that day knitting operations would be discontinued and the employees in the department laid off. All the other nonunionized departments of the plant con- tinued, however, at approximately the same level of operations as prior to the lay-off.29 The record thus shows, in summary, that immediately upon the ad- vent of union activities in the plant, the Respondents embarked on their own intensive campaign to defeat the organizational efforts of the Union; that the Respondents shut down the knitting depart- ment on the very first day after Respondent Zylberberg learned that the Union's organizational campaign had succeeded in that depart- ment, his own countercampaign failing there; 30 that the Respondents continued the operation of the nonunionized departments; and that the reasons advanced by the Respondents for the shut-down and lay- off are demonstrably false. On the basis of these facts, and upon the entire record in the case, we are forced to the conclusion that the shut- down of the knitting department and the lay-off of the knitters was motivated by and was the result of the Respondents' opposition to the unionization of the knitting department employees.31 Accordingly, n Based upon the testimony of Adam McCaughey, which the Trial Examiner did not discredit and which Respondent Zylberberg did not specifically deny. Although Respondent Zylberberg denied generally that he had, at any time other than at the shift meetings on April 9, 1947, discussed with any of the employees the efforts to unionize the plant, we do not credit his denial, in view of the Trial Examiner's findings with respect to the conversations of April 4 and 5, 1947, between Respondent Zylbcrberg and Frank Rice and Ernest Kelemeh. We further find that Respondent Zylberberg's interrogation of Adam McCaughey in this matter constituted an independent violation of Section 8 (1) of the Act and Section S (a) (1) of the iunended Act. See, for example, Matter of Morrison Turning Co., Inc., 77 N. L. R. B. 670, 671. 28 Based on the testimony of Adam McCaughey, which testimony we credit for the reasons stated in footnote 27, supra. 29 Based upon Respondent Zylberberg' s admissions under cross-examination. 30 In assessing the Respondent's motives for closing down the knitting department, we deem it immaterial that some employees in the knitting department may not have been or In fact were not members of the Union at that time. (See Matte, of Capital City Candy Company, 71 N. L. R. B. 447, 451.) Moreover, there is nothing in the record to indicate that Respondent Zyiberberg had any reason to doubt Adam McCaughey's information that all such employees were members of the union. 33 See Matter of Sifers Candy Company, 75 N. L. R. B. 296, enforced 171 F. 2d 63 (C. A. 10), and Matter of Pepsi-Cola Bottling Company of Montgomery, 72 N. L. R. B. 601, in which the Board found discriminatory lock-outs on similar sets of facts.' The Respond- ents' ultimate reemployment of, or offer of reemploynmt to, all but two of th employees who had joined the Union, after the original and first amended charges had been filed in this case. does not militate against the overwhelming effect of the evidence establishing discriminatory intent. N. L. It. B. v. Vincennes Steel Corporation, 117 F. 2d 169, 173 (C. A. 7). 642 DECISIONS OF NATIONAL LABOR RELATIONS BOARD . we find that by closing down the knitting department on April 16, 1947, and laying off the knitting department employees, the Respond- ents have discriminated with respect to the tenure of employment of such employees, thereby discouraging membership in American Fed- eration of Hosiery Workers, and by such conduct have interfe-red with, restrained, and coerced, and are interfering with, restraining, and coercing such employees in the exercise of rights guaranteed by Section 7 of the Act, in violation of Section 8 (1) and 8 (3) of the Act, and Section 8 (a) (1) and 8 (a) (3) of the amended Act. TILE EFFECT OF TILE UNFAIR LABOR PRAUT[CES UPON COMMERCE The activities of the Respondents set forth above, occurring ill con- nection with the operations of the Respondents described in Section I of the Intermediate Report, 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 thereof. THE REMEDY We have found that the Respondents violated the Act by, among other things, threatening Frank Rice with reprisal if he continued his activities on behalf of the Union, interrogating Adam McCaughey regarding the Union's organizational campaign, and threatening the knitting department employees with economic loss if they joined the Union. In' addition, the Respondents discriminatorily laid off the knitting department employees, on account of their organizational and concerted activities 32 Such discrimination, in the language of the Court of Appeals for the Fourth Circuit, "goes to the very heart of the Act." 33 Upon the entire record, we infer and find that the Respondents' illegal activities, mentioned above, disclose an intent to defeat self- organization and its objects, and an attitude of opposition to the pur- poses of the Act. Because of the Respondents' unlawful conduct and 31 As indicated hereinbefore , all the laid-off empldyees except Frank Rice and Adam McCaughey have been reinstated or offered reinstatement. We do not consider the Respondents' offer to Adam McCaughey through another employee (footnote 9, supra) as an adequate offer of reinstatement . As the Respondents initially discriminated against Frank Rice and Adam McCaughey by the unlawful shut-down and lock-out, they are under a continuing obligation to recall and reinstate them . Matter of Sifers Candy Company, supra. For this reason, we find it unnecessary to pass upon the allegations that, irre- spective of the nature of the lay-off, the Respondents discriminatorily refused reemployment to Frank Rice and Adam McCaughey. 33 N..L . R. B. v. Entwistle Manufacturing Co., 120 F. 2d 532 , 536 (C . A. 4). See also N. L. R. B. v. Automotive Maintenance Machinery Co., 116 F. 2(1 350, 353 (C. A. 7). B & Z HOSIERY PRODUCTS CO. 643 the underlying purposes manifested thereby, we are convinced that the unfair labor practices found are persuasively related to the unfair labor practices proscribed by the Act and that danger of commission in the future of any or all of the unfair labor practices defined in Sec- tion 8 (a) of the Act is to be anticipated from the Respondents' con- duct in the past. The preventive purposes of the Act will be thwarted unless our order is coextensive with the threat. 34 In order, therefore, to make effective the interdependent guarantees of Section 7, to pre- vent a recurrence of unfair labor practices, and thereby minimize in- dustrial strife which burdens and obstructs commerce, and thus effec- tuate the policies of the Act, we shall order the Respondents to cease and desist, not only from the unfair labor practices herein found, but also from in any other manner interfering with, restraining, or coerc- ing their employees in the exercise of the rights guaranteed in Section 7 of the Act, and to take certain affirmative action designed to effectuate the policies of the Act.35 Having found that the Respondents discriminated in regard to the hire and tenure of employment of Adam McCaughey, Frank Rice, Robert Daniels, Joseph Feldenser, Calvin Hanley, Robert McCaughey, John Motacki, Walter Moyer, Charles Reese, Ernest Kelemen, Stephen Kelemen, Joseph Matus, Earl Stoyer, and George Farrell, we shall order the Respondents to : (1) Offer Adam McCaughey and Frank Rice immediate and full reinstatement to their former or substantially equivalent positions,36 without prejudice to their seniority or other rights and privileges, and make them whole for any loss of pay they may have suffered by reason of the Respondents' discrimination against them, by payment to each of them of a sum of money equal to the amount which he would nor- mally have earned as wages during the following periods: (a) from the date of the" discrimination against him to November 17, 1948, the date of the Intermediate Report herein, and (b) from the date of our 34 Cf. N. L. R. B. v. Express Publishing Company, 312 U . S. 426 ; May Department Stores Co. v. N. L. R. B., 326 U. S. 376. 35 Although the Respondents have posted the notices as recommended by the Trial Examiner in his Intermediate Report, we believe that, because of the additional violations found herein , and the character of such violations, the purposes of the Act will be best effectuated by requiring the Respondents to post the notices provided for herein. "The expression "former or substantially equivalent position " is intended to mean "former position wherever possible, but if such position- is no longer in existence, then a substantially equivalent position." See Matter of The Chase National Bank of the City of New York, San Juan, Puerto Rico, Branch, 65 N. L. R. B. 827. 857829-5O-vol. 85-42 644 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Decision and Order herein to the date of the Respondents' offer of reinstatement '17 less his net earnings 38 during the said periods; (2) Make whole Robert Daniels for any loss of pay he may have suffered by reason of the Respondents' discrimination against him, by payment to him of a sum of money equal to the amount which he would normally have earned from the date of the discrimination against hire to the date of the Respondents' offer of reinstatement, less his net earnings during the said period; (3) Make whole Joseph Feldenser, Calvin Hanley, Robert Mc- Caughey, John Motacki, Walter Moyer, Charles Reese, Ernest Kele- men, Stephen Kelemen, Joseph Mattis, Earl Stoyer, and George Farrell for any loss of pay they may have suffered by reason of the Respond- ents' discrimination against them, by payment to each of them of a sum of money equal to the amount which he would normally have earned from the date of the discrimination against him to the date of his reinstatement, less his net earnings during the said period. We expressly reserve the right to modify the back-pay and rein- statement provisions if made necessary by a change of conditions in the future, and to make such supplements thereto as may hereafter become necessary in order to define or clarify their application to a specific set of circumstances not now apparent.3° ORDER Upon the entire record in this case, and pursuant to Section 10 (c) of the National Labor Relations Act, as amended , the National Labor Relations Board hereby orders that the Respondents, Abe Adolph Bochner and Herschel Zylberberg, individually and as co-partners, doing business as B & Z Hosiery Products Co., Ridge Pike, Norris- town, Pennsylvania, and their agents and assigns, shall: , 1. Cease and desist from : (a) Discouraging membership in American Federation of Hosiery Workers, or any other labor organization of their employees , by dis- 37 This abatement of back pay for the period between the issuance of the Intermediate Report and our Decision and Order follows our practice in cases in which, as here, the Trial Examiner did not recommend the reinstatement of these employees or the award of back pay to them. 33 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 Respondents. which would not have been incurred' but for the unlawful discrimination and the consequent necessity of his seeking employment elsewhere. See Matter of Crossett Lumber Company, 8 N. L. It. B. 440. Monies received for work per- formed 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. 3D Matter of Fairmount Creamery Company, 64 N. L. It. B. 824: cf. N. L. R. B. v. New York Merrbandise Company, Inc.. 134 F. 241 949 (C. A. 2) : International Union v. Eagle-Picker Mining and Smelting Co.. 325 U . S. 335. B & Z HOSIERY PRODUCTS CO. 645 charging, laying off, or refusing to reinstate any of their employees, or by discriminating in any other manner in regard to their hire or tenure of employment, or any term or condition of their employment; (b) Interrogating their employees concerning their union affilia- tion, activities, or sympathies, or threatening their employees with reprisal or economic loss because of their union affiliation, activities, or sympathies ; (c) In any other manner interfering with, restraining, or coercing their employees in the exercise of the right to self-organization, to form labor organizations, to join or assist American Federation of Hosiery Workers, or any other labor organization, to bargain collec- tively through representatives of their own choosing, to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any or all of such activi- ties, except to the extent that such right may be affected by an agree- ment requiring membership in a labor organization as a condition of employment as authorized in Section 8 (a) (3) of the Act. 2. Take the following affirmative action which the Board finds will effectuate'the policies of the Act : (a) Offer Adam McCaughey and Frank Rice immediate and full reinstatement to their former or substantially equivalent positions, without prejudice to their seniority or other rights and privileges; (b) Make whole Adam McCaughey and Frank Rice for any loss of pay they may have suffered by reason of the Respondents' discrimina- tion against them, by payment to each of them of a sum of money equal to the amount which he would normally have earned as wages during the following periods : (1) from the date of the discrimination against him to November 17, 1948, and (2) from the date of our Decision and Order herein to the date of the Respondents' offer of reinstatement, less his net earnings during the said periods; (c) Make whole Robert Daniels for any loss of pay he may have suffered by reason of the Respondents' discrimination against him, by payment to him of a sum of money equal to the amount which he would normally have earned from the date of the discrimination against him to the date of the Respondents' offer of reinstatement, less his net earnings during said period; (d) Make whole Joseph Feldenser, Calvin Hanley, Robert Mc- Caughey, John Motacki, Walter Moyer, Charles Reese, Ernest Kele- men, Stephen Kelemen, Joseph Matus, Earl Stoyer, and George Far- rell for any loss of pay they may have suffered by reason of the Re- spondents' discrimination against them, by payment to each of them of a sum of money equal to the amount which he would normally have 646 DECISIONS OF NATIONAL LABOR RELATIONS BOARD earned from the date of the discrimination against him to the date of his reinstatement, less his net earnings during the said period; (e) Post at their plant on Ridge Pike, Norristown, Pennsylvania, copies of the notice attached hereto and marked Appendix A.4o Copies of such notice, to be furnished by the Regional Director for the Fourth Region, shall, after being duly signed by the Respondents or their representative, be posted by the Respondents upon receipt thereof, and maintained by them for sixty (60) consecutive days there- after, in conspicuous places, including all places where notices to em- ployees are customarily posted. Reasonable steps shall be taken by the Respondents to insure that said notices are not altered, defaced, or covered by any other material; (f) Notify the Regional Director for the Fourth Region in writing, within ten (10) days from the date of this order, what steps the Re- spondents have taken to comply herewith. IT IS FURTHER ORDERED that the complaint be, and it hereby is, dis- missed, except as otherwise found herein. APPENDIX A NOTICE To ALL EMPLOYEES Pursuant to a Decision and Order of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Relations Act, as amended, we hereby notify our employees that : WE WILL NOT discourage membership in AMERICAN FEDERATION OF HOSIERY WORKERS, or any other labor organization of our em- ployees, by discharging, laying off, or refusing to reinstate any of our employees, or by discriminating in any other manner in regard to their hire or tenure of employment, or any term or condition of employment. WE WILL NOT interrogate our employees concerning their union affiliation, activities, or sympathies, or threaten them with reprisal or economic loss because of their union affiliation, activities, or sympathies. WE WILL, NOT in any other manner interfere with, restrain, or coerce our employees in the exercise of their right to self-organi- zation, to join or assist AMERICAN FEDERATION OF HOSIERY WORKERS, or any other labor organization, to bargain collectively through representatives of their own choosing, to engage in 40 In the event this Order is enforced by decree of a United States Court of Appeals, there shall be inserted before the words, "A DECISION AND ORDER" the words, "A DECREE OF THE UNITED STATES COURT OF APPEALS ENFORCING." B & Z HOSIERY PRODUCTS CO. 647 concerted activities for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any or all of such activities, except to the extent that such right may be affected by an'agreement requiring membership in a labor organi- zation as a condition of employment, as authorized in Section 8 (a) (3) of the Act. WE WILL OFFER to the employees named below immediate and full reinstatement to their former or substantially equivalent positions, without prejudice to any seniority or other rights and privileges. previously enjoyed, and make them whole for any loss of pay suffered as a result, of the discrimination : Adam McCaughey, Frank Rice. WE WILL MAKE WHOLE the employees named below for any loss of pay suffered as a result of the discrimination against them : Robert Daniels Charles Reese Joseph Feldenser Ernest Kelemen Calvin Hanley Stephen Kelemen Robert McCaughey Joseph Matus John Motacki Earl Stoyer Walter Moyer George Farrell All our employees are free to become or remain members of the above-named union or any other labor organization. We Will not discriminate in regard to the hire or tenure of employment or any term or condition of employment against any employee because of member- ship in or activity on behalf of any such labor organization. ABE ADOLPH BOCHNER and HE, RSCHEL ZYLBERBERG, individually and as co-partners doing business as B & Z HOSIERY PRODUCTS Co., Employer. By----------------------------------------------------- (Representative ) (Title) Dated-------------------- This notice must remain posted for 60 days from the date hereof, and must not be altered, defaced, or covered by any other material. INTERMEDIATE REPORT Mr. John H. Wood, Jr., and Miss Helen F. Humphrey, for the General Counsel. Shoyer, Rosenberger, Highley, Spiegel and Cunniff, by Mr. Geoffrey J. Cunniff, of Philadelphia, Pa., for the Respondents. Mr. Julian E. Goldberg, of Philadelphia, Pa., for the Union. 648 DECISIONS OF NATIONAL LABOR RELATIONS BOARD STATEMENT or THE CASE Upon a third amended charge filed September 10, 1948,' by American Federa- tion of Hosiery Workers, herein called the Union, the General Counsel of the National Labor Relations Board 2 by the Regional Director' for the Fourth Region (Philadelphia, Pennsylvania), issued a complaint dated September 10, 1948, against Abe Adolph Bochner and Herschel Zylberberg, individually and as co-partners, doing business as B & Z Hosiery Products Co. of Norristown, Pennsylvania, herein called the Respondents, alleging that the Respondents had engaged in and were engaging in unfair labor practices affecting commerce within the meaning of Section S (1) and (3) and Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat. 449, as reenacted in Section 8 (a) (1) and (3) and Section 2 (6) and (7) of the Labor Management Relations Act of 1947, 61 Stat. 136, herein called the Act. Copies of the complaint, the amended charge, and a notice of hearing were. duly served on the Respondents and the Union. With respect to the unfair labor practices the complaint alleged in substance : (a.) that the Respondents on or about April 16, 1946, terminated the employment of 14 named individuals because they joined or assisted the Union or engaged in other concerted activities; (b) that the Respondents wholly failed and refused to reinstate 3 of these individuals and discriminatorily reinstated the others; (c) that the Respondents warned and threatened their employees with unfavor- able working conditions if they adhered to the Union, threatened employees with loss of employment, interrogated employees regarding their union membership and activities, offered special inducements to employees if they refrained from joining or remaining members of the Union and initiated and sponsored activities among their employees to establish a committee to act as their bargaining agent; (d) that by the foregoing conduct the Respondents have interfered with, re- strained, and coerced their employees and are interfering with, restraining, and coercing their employees in the exercise of the rights guaranteed in Section 7 of the Act, and in re particularly have violated Section 8 (1) and (3) of the National Labor Relations Act, 49 Stat. 449, and have violated and are violating Section 8 (a) (1) and (3) of the Act (61 Stat. 136). The Respondents filed an answer dated September 15, 1948, in which they ad- mitted that they were engaged in commerce within the meaning of the Act; admitted that the Union was a labor organization within the meaning of the Act; and denied that they had engaged in any of the unfair labor practices alleged in the complaint. Pursuant to notice, a hearing was held at Philadelphia, Pennsylvania, on September.20 to 24, 1948, inclusive, before Louis Plost, the undersigned Trial Examiner duly designated by the Chief Trial Examiner. All the parties were represented by counsel participated in the hearing and were afforded a full opportunity to be heard, to examine and cross-examine witnesses, and to intro- duce evidence bearing upon the issues. I The original charge was filed April 4, 194T; the first amended charge was filed June 10, 1947 ; and the second amended charge was filed Tune 22, 1948. All these charges are against B & Z Hosiery Products, Inc. The original complaint was issued against B & Z Hosiery, Inc . and is dated July 29, 1948. The third amended charge and the complaint issued thereon are dated September 10, 1948, and are against Abe Adolph Bochner and Herschel Zylberberg d/b/a individually and as co-partners as B & Z Hosiery Products Co. %The General Counsel and his representatives are herein referred to as the General Counsel, and the National Labor Relations Board as the Board. 0 The original complaint was by an Acting Regional Director. B & Z HOSIERY PRODUCTS CO. 649 At the conclusion of the evidence in the General Counsel's case-in-chief and again at the close of the hearing the Respondents moved to dismiss the com- plaint on various grounds. The undersigned denied the motion in part and reserved ruling in part . The rulings reserved are hereinafter disposed of. At the close of the hearing the General Counsel moved to conform all the pleadings to the proof with respect to names, dates, spelling, and like matters not sub- stantive . The undersigned granted a motion without objection. The parties waived oral argument . A date was set for the filing of briefs, or proposed findings of fact or conclusions of law or both , with the undersigned. After the close of the hearing the time for such filing was extended to November 1. Briefs have been received from the General Counsel and the Respondents and have been considered by the undersigned. Upon the entire record and from his observation of the witnesses the under- signed makes the following: FINDINGS OF FACT I. THE BUSINESS OF THE RESPONDENTS The Respondents Abe Adolph Bochner and Ilerschel.Zylberberg are co-partners doing business under the style and name of B & Z Hosiery Products Co. The Respondents' principal place of business is on Ridge Pike near Norristown, Montgomery County, Pennsylvania, where they maintain a plant for the manu- facture of hosiery. In the course and conduct of their business the Respondents use nylon yarn valued in excess of $40,000 annually, all of which yarn comes to the Respondents from outside the State of Pennsylvania. The Respondents manu- facture hosiery in excess of $60,000 annually. Approximately 50 percent of the products manufactured by the Respondents are shipped by them to points outside the State of Pennsylvania. The Respondents also maintain a sales office in New York, New York.` II. THE ORGANIZATION INVOLVED American Federation of Hosiery Workers is a labor organization admitting employees of the Respondent to membership. III. THE UNFAIR LABOR PRACTICES A. The Respondent's plant and operations At all times material her the Respondents had in their plant a total of 15 hosiery knitting machines , divided by gauges as follows : 12 machines 42-gauge 2 machines 45-gauge 1 machine 51-gauge Two of the 42-gauge machines were not in operation in April 1947 ; of the others the 51-gauge machine - was operated as a single unit by 1 knitter , the remaining 12 machines were operated "double," meaning that 1 knitter • operated 2 machines. The plant operated on a 2-shift basis , there being 7 knitters on each shift. The double operation was of great advantage to the knitters , as by operating two machines the operator was paid for virtually 2 days' work each shift (although all work was on a piecework basis ), and was able to average earnings of $3.50 per hour. ' The above is based on stipulated facts. 650 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The operations of the plant are directed by the Respondent Herschel Zylberberg. The Respondents manufacture nylon hosiery. Nylon yarn is obtainable from, a single source identified in the record as "Dupont," which apparently has a manufacturing monopoly and arbitrarily allocates the quantity sold to each user of yarn monthly. However, it seems customary for users of nylon yarn to "trade" and to sell from their allocated supplies. Nylon yarn not obtained directly from "Dupont" brings a price double that charged by the manufacturer. In addition to the hosiery they manufacture the Respondents also buy hosiery for resale in both finished and partly finished condition, they contract for the knitting of hosiery by other manufacturers, the yarn used being furnished by Respondents, and the Respondents also trade, buy, and sell yarn. The Respondents hold contracts with large distributors of hosiery but in times of price decline or unsettled market conditions they either cannot or are reluctant to enforce their contract, and compel acceptance from unwilling buyers. The above findings are all made on uncontradicted and mutually corroborative testimony which the undersigned credits. B. Interference, restraint, and coercion The record is clear that the Union organized Respondents' employees during the last days of March 1947. Frank Rice, who was at the time employed by the Respondent as a knitter, testified that on the night of April 4, 1947, while Rice was at work, Herschel Zylberberg came to him and made certain statements regarding the organization of the Union. Rice testified : Q. (By Mr. WooD). What did he say? A. Why, he said, "Aren't you satisfied with the machines you are run- ning now?" I said, "Yes, I am,. now that we are runing good yarn." He started as if to walk away and then lie came back again and he says, "Do you know what I heard today? I heard that Frank Rice was organizing a union in this shop. I couldn't believe it. What did I ever do to you that you should do this to me? Didn't I always treat you right? I•can tell you right now that you will never get away with it. You will be sorry if you join the union. I will pay you for cleaning the machines, if that is what you want. That is the trouble, I was always too good to you fellows. It is not too late yet to change your mind. Think it over, and I hope you do, because you will regret it if you don't." Then he left me. Except to deny generally that he ever talked to any of the employees alone about the Union, Zylberberg did not deny the above testimony, which is therefore cred- ited by the undersigned. Adam McCaughey, who was also at the time employed by the Respondents as a knitter, testified that on April 5, Zylberberg telephoned him at his home and asked McCaughey "who was the ringleader" of the Union. McCaughey replied that he did not know. McCaughey further testified that later in the same day Zylberberg cause to his home and asked McCaughey "what I (McCaughey) could do about breaking it up," and told McCaughey that Zylberberg had "other methods," such as shutting down the plant and starving them (the knitters) into submission. During his visit Zylberberg, according to McCaughey, stated that the Respondents were "going to get rid of" employees Rice and Ernest Icelemen. McCaughey also testified that "I said I would see what I could do up the shop, which I done," and that Zylberberg promised that "if I could swing B Ss Z HOSIERY PRODUCTS CO. 651 the deal with some help lie would provide for ine, take care of Inc." McCaughey further testified that on April 7, Zylberberg again phoned to him and asked that McCaughey discuss with employee Joseph Feldenser the possibility that these two employees "throw a little weight" in order "to swing the union out of the mill" and "have a company union of our own." Zylberberg testified that McCaughey telephoned to him and asked Zylberberg to come to his home. Zylberberg did so and on arriving at McCaugheyy's home he found the latter intoxicated and upon observing McCaughey's condition merely asked why he had been called and left after a few minutes. Zylberberg denied that he made any of the statements attributed to him by McCaughey, or that he at any time asked McCaughey to break up the Union. McCaughey did not favorably impress the undersigned; he seemed to be telling a rehearsed story and his entire attitude while on the witness stand can best be described as "smart aleck." Zylberberg impressed the undersigned as being worthy of belief ; he made no attempt to evade or deny matters damaging to the Respondents' case. As between McCaughey and Zylberberg, the undersigned is persuaded that Zylberberg's account of the incidents relating to the latter's visit to McCaughey's home, including the telephone call which prompted it, and the alleged telephone call requesting McCaughey to speak to Feldenser, is the more accurate account of these incidents, and therefore the undersigned does not credit McCaughey's testimony with respect to them. Employee Ernest Kelemen testified, that sometime in January 1947, Zylberberg, in conversation with Ernest Kelemen and his brother Stephen Kelemen, in the plant, told them that at the time Zylberberg had a plant in Europe, if any labor trouble occurred he would shut down and "just hire back the fellows that suited him." Ernest Kelemen further testified that during the afternoon of April 5, he received a phone call at his house from Zylberberg during which : A. Mr. Zylberberg said, "I hear that Frank Rice is trying to organize the shop" ; and that he always tried to treat Frank Rice fair, that he couldn't understand that part of it. And then he went on to say "I wonder if you could do anything about this by approaching the boys when you come in to work." And I told him, "Mr. Zylberberg, it is out of my hands," and it was. "It is in the hands of the union. All the cards are signed. There is nothing I can do about it. I am nobody. There is no one leader to this thing." Q. (By Trial Examiner Plost) That is what you told him over the phone? A. That is what I told him on the phone, as I recall it. Employee Stephen Kelemen testified : Q. (By Mr. Wood) Did Mr. Zylberberg ever talk to you about unions during the first part of 1947? A. Well, there was that conversation that he had with my brother and I. Q. When did it occur? A. This occurred in January, of labor trouble that he had while operating a mill in Europe ; that he had labor trouble there and the way he eliminated it was by closing the plant down and rehiring the help he wanted. That was the only time lie ever talked about labor. 652 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Zylberberg denied that he at any time discussed "labor troubles" in a plant he formerly operated in Europe , with the Kelemens . However , inasmuch as the statement is alleged to have been made in January , some 3 months prior to the events material to the complaint , the undersigned does not find it necessary to resolve this conflict in the testimony. Zylberger was not asked to deny Ernest Kelemen 's testimony with reference to the telephone call made by Zylberberg to Kelemen , The undersigned credits Ernest Kelemen's testimony relative to the above -mentioned telephone call. Rice testified that on April 9, at about 11.'30 a. in. all of the seven knitters on the , shift gathered about Zylberberg in the plant and a general discussion regarding the effort to organize the union was entered into between the men and Zylberberg. Apparently Zylberberg was responsible for the calling of the gathering, which seems to have been unplanned , and in which all present freely participated as a discussion rather than to deliver opinions and argument in the form of speeches . According to Rice he asked Zylberberg "what is on your mind?" and Zylberberg replied that "lie can't see why we want an outside union. He is paying more than the union rate, and he says lie can 't see why we should pay dues to another union. It would just be wasted ." According to Rice, Zylber- berg also told the knitters that "if we joined the union lie was going to cut out paying the bonus" and "that if we insist on going through with the union, he was going to single up all the jobs," and that he would not pay $9 a pound for yarn to keep the plant operating if it were unionized. Stephen Kelemen corroborated Rice and . testified that Zylberberg stated that "he would single up the jobs if the fellows joined the union, the future 51's." There was only one 51-gauge machine in the plant but the record shows that it was common knowledge that all the other machines were at some future time to be reconverted. Adam McCaughey testified that during the night shift on April 9 , Zylberberg came to the plant and asked _McCaughey to call the knitters together . After the men had assembled , only five being present, Zylberberg entered into a discus- sion with them that lasted "maybe an hour or more" during which Zylberberg asked why they wanted to organize the shop , that "he would single the machines up" and "that he didn 't have the heart to go out and buy yarn for knitters if they didn 't want to be one big happy family and not go along with him ." McCaughey testified that Zylberberg did not mention the bonus paid employees , Ernest Kele- men and Robert McCaughey testified in corroboration of Adam McCaughey. Zylberberg testified that he talked to both day and night shift knitters on April 9. He testified that the meetings were held after lie had learned of the union organization among his employees and that the day shift meeting was spontaneous. Zylberberg freely admitted that he told the knitters that he saw no point in their joining the Union , or paying dues. He did not specifically deny the other statements attributed to him except the one relating to "double jobs." As to the "double jobs" Zylberberg testified that he told the employee knitters "if the union comes in the union is not in favor of double jobs." Zylberberg testified that he told the night shift substantially the same things as the day shift. The matter of "double jobs " is of great importance to the Respondents ' employ. ees. As previously found herein the Respondents operate their plant with one knitter operating two machines . This system enables the knitters to earn 2 days' pay each day . There is evidence in the record that this method of operation is not looked upon with favor by the Union. B & Z HOSIERY PRODUCTS CO. 653 Robert Lesnick, a union representative, testified that in most mills operating -under union contract a knitter is permitted to operate only one machine; that where the Union finds a "double job operation" it trys to eliminate it ; that in the Philadelphia area no plants operating under union contract operate "double jobs." Lesnick testified : Q. (By Mr. Cunniff) Wouldn't it be a fair statement, Mr. Lesnick, to say that as a matter of policy your organization does not approve of a knitter operating more than one machine? A. To that I would say yes. Although witnesses called by the General Counsel testified on direct that Zylberberg threatened to "single up" the jobs and thus cut their pay by 50 percent if they joined the Union, their testimony on cross was quite different thus: Rice testified : "and he says if we get a union, we will have to go on single jobs." Ernest Kelmen testified : "He said that if the union would come in, `You fellows would have to run 51 gauges, single job.'" John Motacki, a knitter employed by the Respondents, and called by them, testified that he attended the clay shift meeting and described the meeting as a general discussion during which Motacki and Rice engaged in a heated argu- ment regarding the advantage of unionization, Motacki being opposed to the Union. Motacki testified that Zylberberg told the employees "that the union's policy is to run single jobs, whereas we are running double jobs." Motacki also testified that Zylberberg did not mention the bonus payments, but that the bonus was mentioned during Motacki's discussion with Rice. From all the testimony and from his observation of the witnesses, the under- signed is persuaded that Zylberberg told the Respondents' employees that the union policy would prevent their operating "double jobs," meaning two ma- chines at a time. The clear inference being that a union contract would mean a 50-percent loss in pay. There is therefore no doubt that Zylberberg's re- marks contained, if not a threat of economic loss in the event of unionization, as well as a promise of benefit if the status quo was maintained, a powerful argument against the Union based on loss of benefit. It is quite clear that Zylberberg was stating the union's policy quite ac- curately as evidenced by the testimony of union representative Lesnick. In the circumstances the undersigned is of the opinion that Zylberberg's statement did not constitute the Respondents' independent threat of reprisal or force or promise of benefit" but was merely such an argument against the unioniza- tion of the Respondents' employees which cannot be used as a basis for a finding of unfair labor practices. The undersigned further finds that all of Zylberberg's remarks made to the Respondents' employees during the two meetings held April 9, 1947, are also privileged under the constitutional guarantee of free speech. The undersigned finds that by Zylberberg's statements to Frank Rice to the effect that Rice would "never get away with" organizing the employees, would be sorry if he joined the Union, that he would "regret it" if he did not change his mind about organizing the Union, and further by Zylberberg's request to ' Section 8 (c) L. M. R. A., 1947. 654 DECISIONS OF NATIONAL LABOR RELATIONS BOARD employee Ernest Kelemen to influence the employees against the Union, the Respondents have interfered with; restrained, and coerced their employees in the exercise of rights guaranteed in Section 7 of the Act, and more particularly have violated Section 8 (a) (1) thereof. C. The alleged discrinhnatori discharges On April 16, 1947, the Respondents laid off all of their knitters; ° however, the other departments of the plant were kept in operation. The complaint alleges that the Respondents terminated the employment of these knitters because they joined or assisted the Union or engaged in other concerted activities for the purpose of collective bargaining or other mutual aid or protection. The record is clear, that the Union organized the Respondents' employees dur- ing the last part of March, and that at the time of the lay-off all of the knitters had become members of the Union. The knitting department of the plant had been operating on a 3-clay-a-week schedule since January. Zylberberg testified that between January and July 1947, there was a sharp break in the hosiery market ; "prices went down sharply, dollars per hour, like the stock market." Zylberberg further testified that dur- ing this period no nylon yarn was available, yet at the same time the hosiery market was flooded. During this period according to Zylberberg "there was no market" for 42-gauge hosiery "at all." There is evidence in the record that 42- gauge is not a popular gauge of hosiery and that leading houses wholly dis- continued its manufacture. The Respondents' knitting department consisted of ten 42-gauge machines in operation, two 45-gauge and one 51-gauge machine. The latter three were described by Zylberberg as the Respondents' "bread and butter" without which the operation of the plant was not profitable. The 42- gauge machines were obsolete and produced a type of hosiery not readily salable. Zylberberg and the knitters had discussed the Respondents' intention to convert these machines to a more popular gauge. The knitters understood that these machines would be regauged as soon as possible. The 51-gauge machine was faulty in its operation and required reneedling. The Kelemen brothers, who operated the 51-gauge machine on alternate shifts, both testified that the machine needed reneedling and that Zylberberg had told them that it would be reneedled. Rice who operated the two 45-gauge machines admitted that the machines had been putting out bad work, and Adam McCaughey who operated the same ma- chines on the alternate shift admitted that he had complained about their condi- tion. Zylberberg testified that as early as January 1.947, the Respondents had nego- tiated with various machine reconditioning firms with respect to. having their machinery put in shape and had at least made tentative arrangements to have the work done on some of the machines. Zylberberg further testified that the break in the market decided the Respondents to shut down the knitting depart- ment and recondition their machinery while waiting a change in market condi- tions. This meant shipping the working parts of their machinery to a recondi- tioning plant. However, they did not anticipate that the various reconditioning ° The following named employees were laid off: Robert Daniels, George Farrell, Joseph Feldenser, Calvin Hanley, Ernest Kelemen, Stephen Kelemen, Joseph Matus, Adam Mc- Caughey, Robert McCaughey, John Motacki, Walter Moyer, Charles Reese, Frank Rice, and Earl Stoyer. B & Z HOSIERY PRODUCTS CO. 655 jobs would consume as much time as they eventually did,' but during this period machinery houses became crowded with similar work from hosiery manufacturers taking advantage of the market break as "everybody did it," causing unforeseen delay. The Respondents' reconditioning program has entailed an expenditure of more than.$100,000. The Respondents reopened their knitting department in July 1947. Between April and July the Respondents apparently were able to continue in business as usual ; they had hosiery knitted for them in other plants, they bought hosiery, they traded in yarn. The plant other than the knitting department was kept in operation. As has been found herein the knitters were laid off on April 16. On May 26, 1947, the Respondents sent a letter to each of the knitters they had laid off advis- ing them that "you may consider your layoff permanent." The above findings are all based on the uncontraclicted or mutually corrobora- tive testimony of witnesses for the General Counsel and the Respondents, which is credited by the undersigned. In addition to the above testimony the under- signed is mindful of the testimony of William Rafsky, research director of the Union, that there was a 10-percent drop in the wholesale price of hosiery in May 1947; that such a drop is considered sharp ; and that there might have been "isolated" price drops during April 1947. Zylberberg testified on cross-examination that he attended the hosiery manu- facturers' convention at Atlantic City in 1947, and that the decision to lay off the employees because of business conditions was made after the convention. There is undisputed evidence that the convention began on April 28, 1947. In the opinion of the undersigned the fact that Zylberberg testified to an erro- neous date does not impeach his credibility. Zylberberg was on the witness stand for a considerable time on every day of the hearing and the undersigned does not regard his failure to recall a date with accuracy under the battering of severe cross-examination as being of any great importance inasmuch as the general impression he made upon the undersigned was that of an honest witness. It is also apparent from the entire record that the Respondents' manufactur- ing operations were at the time material herein largely marginal, and being so their business operations would be among the first to reflect a market change. The undersigned credits the testimony of the Union's research director to the effect that a severe break in the 1947 hosiery market occurred in May and that there might have been "isolated" price drops during April. In a business such as the Respondents' is disclosed to have been by the record, including their "trad- ing" in yarn, buying and selling of finished and partly finished hosiery, relying on "commission knitting" and the like, the tremor of the "isolated price drops" might well spell calamity. There is also evidence in the record that none of the knitters laid off on April 1C were able to secure employment in their trade. These men were evidently highly skilled knitters, able to earn twice the regular scale of wages ; therefore, the very fact that they could not obtain employment in their trade would serve to buttress the Respondents' testimony that the hosiery manufacturing industry was severely disorganized during this period. Upon all the evidence in the record considered as a whole, the undersigned is persuaded that the Respondents on April 16, 1947, laid off their knitters because of valid business reasons, and that they did not discriminatorily lay them off T The record shows that the entire reconditioning program had not been fully completed at the time of the hearing. 656 DECISIONS OF NATIONAL LABOR RELATIONS BOARD because of their membership in and activities on behalf of the Union as alleged in the complaint. The undersigned so finds. Inasmuch as an employer is not prohibited by the Act from discharging his employees for any reason other than their union activities and may even capri- ciously discharge them for any reason or no reason whatever, it follows that the Respondents' discharge of their employees by the letter of May 26, 1947, was legally effective. The undersigned so finds. Having found that the Respondents did not illegally lay off or discharge their employees, it follows that once having effectively discharged their employees the Respondents were under no legal obligation to again reemploy them, absent a refusal on the part of the Respondents to give employment to any of the men because of their membership in the Union. The complaint alleges that the Respondents refused to reinstate 3 of the knitters discharged as herein found, namely, Frank Rice, Robert Daniels, and Adam McCaughey, and discriminatorily reinstated the other 11. The record is clear that on July 20, the Respondents again began their knitting operations and recalled six of their former knitters, and that these men were put to work on the same machines they had formerly operated.' As the machines were again put in operation, all of the knitters formerly employed were recalled to work with the exception of three who were not offered employment by the Respondents. The first was recalled approximately July 20, the last was recalled September 22, 1947: The General Counsel contends that the Respond: nts discriminatorily recalled its employees in that the Respondents failed to recall the employees formerly laid off in order of their seniority, and also wholly refused to reinstate three named employees. The undersigned has found' that the Respondents effectively discharged the knitters ; however, there can be no possible ground for the contention that those recalled to work were recalled discriminatorily. The Respondents knew that all of the knitters had joined the Union, they recalled all but three of them as they needed their services and were not required to follow any seniority system. Seniority is a matter of contract and not a matter of right. As to the three men not recalled : having been legally discharged, in order to establish any claim for employment it was first necessary that these men ask the Respondents for employment, otherwise no basis exists for a charge of dis- crimination. 8 The parties stipulated that the Respondents' conversion program was as follows : No. Kind of machine Date shipped for repair Date returned Ready for opera- tion 51 gauge----------------------- Apr. 17,1947 -_ _ _ _-_ _ June 13, 1947______ July 13, 1947. 2 Apr. 23 1947________ June 3, 1947_-_._-_ Oct. 19 1947 45 gauge----------------------- , June 6,1947--------- Sept. 19__________- , . Do 2 June 16, 1947-------- Aug. 29, 1947__--__ Sept. 22. 4 42 gauge----------------------- --- - do--------------- July 30______________ Sept.19____-___--_ Nov.10___-____--_ Dec. 5- Oct. 15. Dec. 10. Jan. 10 1948. 42 gauge-------------------- do------------- Jan.9,1948________ , Feb. 9. 42 gauge---------------------- -do----------- --- ---------------- Feb. 10___-________ Apr. 28, 1948 ------ Mar. 10. May 28. 42 gauge----------------------- -------------------- Apr. 9----------- May 29. 42 gauge____ - ------------------- July 29____________ Aug. 29. 42 gauge------------------- ---------------------- Aug. 1------------ 2 machines still not shipped for reconversion. B & Z HOSIERY PRODUCTS CO. 657 Adam McCaughey testified that from the time he was discharged to the time of the hearing he did not apply to the Respondents for work. Robert Daniels testified that in July 1947 "when the others were called back, I was called back." Daniels refused the employment tendered him by the Respondent. Frank Rice, who was the leader in the union activity among the Respondents' employees, testified that in August 1947, he went to the plant and removed his tools. Rice testified that prior to this, in September 1947, he bought a house in Milwaukee, Wisconsin, and moved his family there. Rice obtained work as a knitter in Milwaukee December 29, 1947. Rice testified at the request of the Union he wrote to the Respondents from Milwaukee, Wisconsin, on November 22, 1947, and asked "for reinstatement to the job I had with you." ° Under date of November 25, 1947, the Respondents replied, "there are at the present time no available openings for you." Rice operated the two 45-gauge machines. These machines were not put in operation until October 19, 1947. Zylberberg testified that he had been told by relatives of Rice who also worked in the plant.tha:t Rice had moved to Milwaukee and had left no address. When he received Rice's letter of November 22, there was no opening and he so wrote Rice. According to Zylberberg an opening for Rice's services presented itself. in December but at that time Zylberberg had learned that Rice had bought a house in Milwaukee and was established there and therefore Zylberberg thought Rice would not be interested in a job with the Respondents. On the entire record the undersigned is persuaded that the Respondents' explanation for its failure to hire Rice is reasonable and therefore finds that the Respondents did not discriminate against Rice by refusing him employment. The General Counsel argues in his brief : It is submitted that in view of the other circumstances in this case it is not unreasonable to assume that Respondents delayed deliberately the reconditioning of the 45 gauge machines and putting them back into operation until both Rice and Adam McCaughey had come for their tools in August, and until word had been received that Frank Rice had moved to Milwaukee, Wisconsin. The undersigned is of the opinion that in order to make the assumption urged by the General Counsel he must impute to the Respondents either such diabolical cunning or such boundless stupidity, nurtured on such vindictive hatred as to wholly blind any self-interest . The undersigned finds it impossible to be so unrealistic. Upon all the evidence in the case the undersigned finds that the evidence does not support the allegations of the complaint to the effect that the Respondents discharged and failed to reinstate any of their employees and will recommend that the complaint be dismissed insofar as it so alleges. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondents set forth in Section III, above, occurring in connection with the operations described in Section I, above, have a close, intimate, and substantial relation to trade, traffic, and commerce among the ° The quotation is from the letter. 0 658 DECISIONS OF NATIONAL LABOR RELATIONS BOARD several States and such of them as have been found to be unfair labor practices tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that the Respondents, Abe Adolph Bochner and Herschel Zylber- berg, individually and as co-partners, doing business as B & Z Hosiery Products Co., have engaged in unfair labor practices within the meaning of Section 8 (1) of the National Labor Relations Act, 49 Stat. 449 as reenacted in Section 8 (a) (1) of the Act (61 Stat. 136), the undersigned will recommend that they cease and desist therefrom and take certain affirmative action in order to effectuate the policies of both statutes. Upon the basis of the foregoing findings of fact and upon the entire record in the case, considered as a whole, the undersigned makes the following: CONCLUSIONS or LAW 1. The operations of the Respondents Abe Adolph Bochner and Herschel Zylber- berg, individually and as co-partners, doing business as B & Z Hosiery Products Co. (Norristown, Pennsylvania), constitute commerce within the meaning of Section 2 (6) and (7) of the Act. 2. American Federation of Hosiery Workers is a labor organization within the meaning of Section 2 (5) of 49 Stat. 449 and the Act (61 Stat. 136). 3. By interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of 49 Stat. 449 and the Act, the Respondents have engaged in and are engaging in unfair labor practices within the meaning of Section 8 (1) of 49 Stat. 449 as reenacted in Section 8 (a) (1) of the Act (61 Stat. 136). . 4. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2 (6) and (7) of 49 Stat. 449 (61 Stat. 136). The Respondents have not engaged in unfair labor practices by laying off, dis- charging, or in reinstating Robert Daniels, George Farrell, Joseph Feldenser, Calvin Hanley, Ernest Kelemen, Stephen Kelemen, Joseph Matus, Adam Mc- Caughey, Robert McCaughey, John Motacki, Walter Moyer, Charles Reese, Frank Rice, and Earl Stoyer. RECOMMENDATIONS Upon the basis of the above findings of fact and conclusions of law the under- signed hereby recommends that the Respondents, their successors, and assigns, shall : 1. Cease and desist from : In any manner interfering with, restraining, or coercing its employees in the exercise of the right to self-organization, to form labor organizations, to join or assist American Federation of Hosiery Workers, or any other labor organization, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection, as guaranteed in Section 7, 49 Stat. 449, and of the Act (61 Stat. 136). B & Z HOSIERY PRODUCTS CO. 659 2. Take the following affirmative action, which the undersigned finds will effectuate the policies of the Act : (a) Post at their plant in Norristown, Pennsylvania, notice attached hereto and marked Appendix A. Copies of said notice, to be furnished by the Regional Director of the Fourth Region, shall, after being duly signed by the Respondents, be posted by it immediately upon receipt thereof, and maintained by it for sixty (60) consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondents to insure that said notices are not altered, defaced, or covered by any other material; (b) Notify the Regional Director for the Fourth Region in writing within ten (10) days from the date of the receipt of this Intermediate Report,'what steps the Respondents have taken to comply with the foregoing recommendations. It is further recommended that, unless the Respondents shall, within ten (10) days from the receipt of this Intermediate Report, notify the Regional Director for the Fourth Region in writing that they will comply with the foregoing recommendations, the National Labor Relations Board issue an order requiring the Respondents to take the action aforesaid. It is also recommended that the complaint, insofar as it alleges that the Respondents discriminated in regard to the hire and tenure of employment of any of their employees, be dismissed. As provided in Section 203.46 of the Rules and Regulations of the National Labor Relations Board-Series 5, as amended August 18, 1948, any party may, within twenty (20) days from the date of service of the order transferring the case to the Board, pursuant to Section 203.45 of said Rules and Regulations, file with the Board, Rochambeau Building, Washington 25, D. C., an original and six copies of a statement in writing setting forth such exceptions to the Intermediate Report or to any other part of the record or proceeding (including rulings upon all motions or objectives) as he relies upon, together with the original and six copies of a brief in support thereof ; and any party may, within the same period, file an original and six copies of a brief in support of the Intermediate Re- port. Immediately upon the filing of such statement of exceptions and/or briefs, the party filing the same shall serve a copy thereof upon each of the other parties. Statements of exceptions and briefs shall designate by precise citation the portions of the record relied upon and shall be legibly printed or mimeographed, and if mimeographed shall be double spaced. Proof of service on the other parties of all papers filed with the Board shall be promptly made as required by Section 203.85. As further provided in said Section 203.46, 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 service, of the order transferring the case to the Board. In the event no Statement of Exceptions is filed as provided by the aforesaid Rules and Regulations, the findings, conclusions, recommendations, and recom- mended order herein contained shall, as provided in Section 203.48 of said Rules and Regulations, be adopted by the Board and become its findings, conclusions, and order, and all objections thereto shall be deemed waived for all purposes. Dated at Washington, D. C., this 17th day of November 1948. Louis PLOST, Trial Examiner. 857829-50-vol. 85-43 660 DECISIONS OF NATIONAL LABOR RELATIONS BOARD APPENDIX A NOTICE TO ALL EMPLOYEES Pursuant to the recommendations of a Trial Examiner of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Relations Act, we hereby notify our employees that : WE WILL NOT in any manner interfere with, restrain, or coerce our employees in the exercise of their right to self-organization, to form labor organizations, to join or assist American Federation of Hosiery Workers or any other labor organization, to bargain collectively through representa- tives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection. All our employees are free to become or remain members of this union, or any other labor organization. ABE ADOLPH BOCHNER AND HERSCHEL ZYLBERBERG, individually and as co-partners, doing business as B & Z HOSIERY PRODUCTS Co., Employer. By --------------------------------------------------- (Representative ) (Title) Dated -------------------- This notice must remain posted for 60 days from the date hereof , and must not be altered, defaced, or covered by any other material.