Ozark Dam Constructors

In the Matter of BROWN AND ROOT, INC., IWTUNDERLICH CONTRACTING COMPANY, PETER KIE«'IT SONS COMPANY, WINSTON BROTHERS COM- PANY, DAVID G. GORDON, CONDON CUNNINGHAM COMPANY, MOR- RISON-KNUDSON COMPANY, INC., J. C. MCGUIRE & COMPANY, AND CHARLES H. TOMPKINS COMPANY, DOING BUSINESS AS JOINT VEN- TURES UNDER TIIE NAMES OF OZARK DAM CONSTRUCTORS AND FLIP PIN MATERIALS COMPANY and FORT SMITII, LITTLE ROCK & SPRING- FIELD JOINT COUNCIL, AFL. Case No. 32-CA-38.-Decided October 13, 1949 DECISION AND ORDER On July 12, 1949, Trial Examiner Horace A. Ruckel issued his In- termediate 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 therefrom and take certain affirmative action, as set forth in the copy of the In- termediate Report attached hereto. Thereafter, the Respondents filed exceptions to the Intermediate Report and a supporting brief. The Board 1 has reviewed the rulings made by the Trial Examiner at the hearing and finds that no prejudicial error was committed. The- rulings are hereby affirmed. The Board has considered the Interme- diate Report, the exceptions and brief, and the entire record in the case,. and hereby adopts the findings, conclusions, and recommendations of the Trial Examiner, with modifications set forth below 2 1. We agree with the Trial Examiner that the Respondents inter- fered with, restrained, and coerced their employees in violation of Sec- tion 8 (a) (1). However, we do not rely on Foreman Milam's speech,. as the record does not show that the speech was made less than 6 months before the service of the charge on the Respondents, as required by See- 'Pursuant to the- provisions of Section 3 (b) of the Act , as amended, the National Labor Relations Board has delegated its powers in connection with this case to a three- member panel [Chairman Herzog and Members Reynolds and Gray]. 2 The Respondents' request for oral argument is hereby denied, as the record ' and the exceptions and brief , in our opinion, adequately present the issues and the positions of the parties. 86 N. L. R. B., No. 72. 520 BROWN AND ROOT, INC. 521 Lion 10 (b) of the amended Act. Nor do we rely on Superintendent Lucas' speech, except to the extent that he stated that if the Union won, the job would be cut down from a 6-day to a 5-day week, and that the job would be "rougher" than previously. 2. We also agree with the Trial Examiner's conclusion that Re- 'spondent Constructors refused to bargain collectively with the Union, and thereby violated Section 8 (a) (5). This Respondent not only refused to bargain in good faith, but in addition insisted that the Union post a drastic performance bond, and granted unilateral wage increases ,during the course of the negotiations. That Respondent Construc- tors did not fulfill its statutory duty to bargain in good faith is amply ,evidenced by its "take it or leave it" attitude, its failure to invest real authority in its only negotiator, and its insistence upon sole control Cover matters affecting wages, hours, and other conditions of employ- ment, all of which are proper subjects for collective bargaining. ORDER Upon the entire record in the case, and pursuant to Section 10 (c) ,of the National Labor Relations Act, the National Labor Relations Board hereby orders : 1. That the Respondent Ozark Darn Constructors, Houston, Texas, :and its officers, agents, successors, and assigns, shall : 1. Cease and desist from : (a) Refusing to bargain collectively with Fort Smith, Little Rock •& Springfield Joint Council, AFL, as the exclusive representative of all its employees at the Bull Shoals Dam construction project in the units described in the notice attached hereto and marked "APPENDIX A"; (b) 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 Fort Smith, Little Rock & Spring- field Joint Council, AFL, 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, and to refrain from any or all of such activities except to the extent that such rights may be affected by an agreement requiring membership in a labor organization as a con- dition 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) Upon request, bargain collectively with Fort Smith, Little Rock & Springfield Joint Council, AFL, as the exclusive representative of the employees in the units described above in respect to rates of pay, wages, hours of work, and other terms and conditions of em- 522 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ployment and, if an understanding is reached, embody such understanding in a signed agreement; (b) Post at the dam site and at other work locations in the White River Watershed in Marion and Baxter Counties, Arkansas, copies of the notice attached hereto and marked "Appendix A." 3 Copies of said notice, to be furnished by the Regional Director for the Fifteenth Region, shall, after being duly signed by the Respondent's representa- tive, be posted by the Respondent 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 Re- spondent to insure that said notices are not altered, defaced, or covered, by any other material ; (c) Notify the Regional Director for the Fifteenth Region iii writing, within ten (10) days from the date of this Order, what steps the Respondent has taken to comply herewith. H. That the Respondent Flippin Materials Company, Houston, Texas, and its officers, agents, successors and assigns, shall : 1. Cease and desist from in any manner interfering with, restrain- ing or coercing its employees in the exercise of the right to self- organization, to form labor organizations, to join or assist Fort Smith. Little Rock & Springfield Joint Council, AFL, 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, and to refrain from any or all of such activities, except to the extent that such rights may be affected by an agreement 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) Post at the dam site and at other work locations in the White River Watershed in Marion and Baxter Counties, Arkansas, copies of the notice attached hereto and marked "Appendix B." 4 Copies of said notice, to be furnished by the Regional Director for the Fifteenth Region, shall, after being duly signed by the Respondent's representative, be posted by the Respondent immediately upon receipt thereof, and maintained by it for sixty (60) consecutive days there- after, in conspicuous places, including all places where notices to. 'In the event that this Order is enforced by decree of a United States Court of Ap- peals, there shall be inserted in the notice . before the words : "A DECISION AND ORDER," the words : "A DECREE OF THE UNITED STATES COURT OF APPEALS ENFORCING.` 4 In the event that this Order is enforced by decree of a United States Court of Appeals, there shall be inserted in the notice , before the words : "A DECISION AND ORDER," the words : "A DECREE OF THE UNITED STATES COURT OF APPEALS ENFORCING." BROWN AND ROOT, INC. 523. employees are customarily posted. Reasonable steps shall be taken by the Respondent to insure that said notices are not altered, defaced,. or covered, by any other material; (b) Notify the Regional Director for the Fifteenth Region in writ- ing, within ten (10) days from the date of this Order, what steps the Respondent has taken to comply herewith. 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, we hereby notify our employees that : WE WILL NOT in any manner interfere with, restrain, or coerce- our employees in the exercise of their rights to self-organization, to form labor organizations, to join or assist FORT SMITH, LITTLE ROCK & SPRINGFIELD JOINT COUNCIL, A. F. L. 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 protec- tion, and to refrain from any or all such activities, except to the extent that such rights may be affected by an agreement requiring membership in a labor organization as a condition of employ- ment, as authorized in Section 8 (a) (3) of the Act. WE WILL BARGAIN collectively upon request with FORT SMITH,, LITTLE ROCK & SPRINGFIELD JOINT COUNCIL, A. F. L., as the ex- clusive representative of all employees in the bargaining units de- scribed herein with respect to rates of pay, wages, hours of em- ployment, and other terms and conditions of employment, and if an understanding is reached, embody such understanding in a signed agreement. The bargaining units are : (1) All employees at the Bull Shoals Dam construction pro- ject, including welders, but excluding machinists, millwrights,, mechanic repairmen and their helpers, office clerical employees,. guards, professional employees, and all supervisors as defined. in the Act as amended. (2) All millwrights, excluding supervisors as defined above., OZARK DAM CONSTRUCTORS, Employer. Dated--------------------- By ------------------------------ (Representative ) ( Title) This notice must remain posted for 60 days from the date hereof,., and must not be altered, defaced, or covered by any other material. .524 DECISIONS OF NATIONAL LABOR RELATIONS BOARD APPENDIX B 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, we hereby notify our employees that : WE WILL NOT in any manner interfere with, restrain, or coerce our employees in the exercise of their rights to self-organization, to form labor organizations, to join or assist FORT S-.Nrrrll, LITTLE ROCK & SPRINGFIELD JOINT COUNCIL, A. F. L. 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 protec- tion, and to refrain from any or all such activities, except to the extent that such rights may be affected by an agreement requiring membership in a labor organization as a condition of employ- ment, as authorized in Section 8 (a) (3) of the Act. FLII'PIN MATERIALS Co., Employer. Dated---------------------- By ---------------------------- (Representative) (Title). 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 Messrs. Richard C. Keenan and Victor H. Hess, Jr., for the General Counsel. Mr. Ben H. Powell, Jr., of Austin, Tex., for the Respondents. Mr. G. L. Grant, Fort Smith, Ark., for the Union. STATEMENT OF THE CASE Upon a second amended charge filed on January 3, 1949, by G. L. Grant, attor- iney for Fort Smith, Little Rock & Springfield Joint Council, AFL, herein called ,the Union, the General Counsel of the National Labor Relations Board, herein called respectively the General Counsel and the Board, by the Regional Director for the Fifteenth Region (New Orleans, Louisiana) filed a complaint dated January 11, 1949, against Brown and Root, Inc., Wunderlich Contracting Com- pany, Peter Kiewit Sons Company, Winston Brothers Company, Morrison-Knud- --son Company, Inc., J. G. McGuire & Company, and Charles H. Tompkins Com- pany, doing business as joint venturers under the names of Ozark Dam .Constructors and Flippin Materials Company, herein jointly called the Respond- - eats, or separately Respondent Constructors and Respondent Flippin, alleging -that the Respondents had jointly engaged in and were engaging in unfair labor ,practices affecting commerce within the meaning of Section 8 (a) (1) and Sec- tion 2 (6) and (7), and the Respondent Constructors within the meaning of BROWN AND ROOT, INC. 525 Section 8 (a) (1) (5), and Section 2 (6) and (7) of the National Labor Rela- tions Act as amended, herein called the Act. Copies of the complaint, accom- panied by a notice of hearing, were duly served upon the Respondents and the Union. On January 21, 1949, the Respondents, filed a joint answer admitting certain allegations of the complaint with respect to the nature of their business, but denying that they were engaged in commerce within the meaning of the Act, and. further denying that they had committed any unfair labor practices. With respect to the unfair labor practices, the complaint alleged, in substance, that the Respondents by certain of their named officers, agents, and representa- tives, (1) on or about February 1948, through the date of the complaint, inquired of their employees as to their membership in the Union, advised them to vote against the Union in a representation election to be conducted by the Board,. threatened with discharge those who voted in favor of the Union, and made other statements of a coercive nature directed against the Union and the union mem- bership of its employees, and (2) on or about September 13, 1948, and sub- sequently, the Respondent Constructors refused to bargain collectively with the Union as the exclusive representative of all its employees in an appropriate unit.- Pursuant to notice, a hearing on the complaint was conducted from January 27 to 31, 1949, at Mountain Home and Little Rock, Arkansas, before Horace A.. Ruckel, the undersigned Trial Examiner duly appointed by the Chief Trial Examiner. Full opportunity was accorded all parties to appear, to examine and, cross-examine witnesses, and to introduce evidence in their behalf. At the con- clusion of the hearing the undersigned granted a motion by the General Counsel to amend the complaint to conform to the proof in formal matters, and reserved. ruling upon a motion by the Respondents to dismiss the complaint. This motion is disposed of by the recommendation hereinafter made. Upon the entire record in the case, and from his observation of the witnesses,, the undersigned makes the following: FINDINGS OF FACT I. THE BUSINESS OF THE RESPONDENT Ozark Dam Constructors, of Houston, Texas, and the Flippin Materials Com- pany, Inc., are joint venturers composed of the contractors above named doing, business under the name of Ozark Dam Constructors and Flippin Materials Company. Ozark Dam Constructors was organized to build Bull Shoals Dam and works. appurtenant thereto on the White River watershed in Marion and Baxter Counties, Arkansas. The total contract price of this project is $22,146,444. Thee total cost of the dam including materials furnished by the United States Govern- ment will be about $37,000,000. During the time of the events herein complained of Respondent Ozark Dam Constructors had purchased materials and services in the amount of more thane $3,000,000, of which approximately $2,000,000, had been purchased outside the State of Arkansas. It had placed further orders having a total value of more- than $3,000,000, of which orders valued at approximately $3,000,000 were placed outside the State of Arkansas. The United States Engineers estimates the total value of materials which will go into the dam to be more than $19,000,000, of which approximately $10,000,000 will come outside the State of Arkansas. The- Government has furnished or will furnish materials worth more than $16,000,000,_ .526 DECISIONS OF NATIONAL LABOR RELATIONS 'BOARD of which materials with an estimated value of approximately $7,000,000 will come from outside the State of Arkansas. The dam is a part of a flood control and electrical power development project of the War Department. The cost of the entire project is estimated at more Than $69,000,000. Under existing law' the Secretary of War must deliver all electricity not required to operate the project to the Secretary of the Interior, who is required to transmit and dispose of the same in such manner as to encourage the most widespread use thereof at the lowest possible rates to consumers con- sistent with sound business principles. Respondent Flippin was organized to bid upon and to perform a contract with the United States Government to make and supply aggregate to the Government for use by Respondent Constructors in the construction of the dam and for such other purposes as the Government might approve, including the sale of agricultural lime stone. The Respondents have the same project superintendent and certain common officials, and have in effect an arrangement whereby 30 percent of the overhead of Respondent Constructors, including wages of certain common supervisors, is -charged to Respondent Flippin. Brown and Root, Inc., is the sponsoring or leading contractor in the joint venture. It is a managing partner and subject to the superior authority and control of the joint venturers, and is in charge of all direct operations including ,personnel management and labor relations. Herman Brown of Brown and Root, Inc., is attorney in fact for the joint venturers with full power to act and bind all of them, and to delegate such au- thority to his agents. Each of the joint venturers stands ready to contract for construction work .anywhere within the continental limits of the United States where they are -authorized to do business. Despite the great value and amount of interstate shipments necessitated by the construction of the dam, the Respondents claim that they are not engaged in interstate commerce within the meaning of the Act, basing its contention on the fact that the Board has in the past refused to exercise jurisdiction in certain construction cases. The Board disposed of this contention adversely to the Respondents in a previous representation case,' and that decision is binding upon -the undersigned. U. THE ORGANIZATIONS INVOLVED Fort Smith, Little Rock & Springfield Joint Council, AFL, is a labor organiza- tion composed of the various building trades unions in Little Rock and Fort -Smith, Arkansas, and Springfield, Missouri, affiliated with the building trades department of the American Federation of Labor, which admits employees of the Respondent to membership. III. THE UNFAIR LABOR PRACTICES A. Interference, restraint, and coercion J. W. Milam, prior to June 1948 a carpenter foreman in the employ of Respond- ent Constructors, admitted while testifying that in February of that year, when the Union was engaged in organizing the employees, he made a speech to a group of those under his direction in which, referring to a union application card which he held in his hand, he declared that Brown and Root had always operated an 1 58 Stat . 887, 890. 2 See Matter of Brown and Root, Inc., 77 N. L. R . B. 1136. BROWN AND ROOT, INC. 527 open shop and that if the employees wanted to stay on the job they should stay ,out of the Union . As an example of the futility of the Union he declared that if each of the carpenters would give him $50, which he stated was the amount of the initiation fee, lie-would give him a wage raise which would last as long as the $50 lasted , and no longer. The employment application card in use by Respondent Flippin during the events herein complained of, required each applicant to list the "trade, profes- sional, fraternal , etc." organizations to which he belonged. Such a requirement has been held to constitute interference by an employer in violation of the Act.' Kern Russell, a carpenter, and several other witnesses called by the General Counsel, testified that on July 28, 1948, the day of the election to determine a bar- gaining representative , William Lucas , carpenter superintendent employed by Respondent Constructors , made a speech to assembled groups of carpenters on the project during which he stated , in substance , that Brown and Root had not worked and would not work under a union contract ; that Brown and Root would contest in the courts any case arising as the result of the certification of the Union, and would keep it there indefinitely ; that if the Union won the election the job would be cut down from a six day work week to a five day week; ' that the job would be "rougher " than previously ; and that, although the em- ployees could vote as they pleased , the job would never go Union as long as Brown and Root had it. Lucas , while testifying, admitted the purport of some ,of the remarks attributed to him, although denying others . The undersigned finds that they were made substantially as related above. The undersigned finds that by the above described statements and activities -ef supervisory employees , which the undersigned finds to be attributable to both Respondent Constructors and Respondent Flippin, and by their totality, the Respondents interfered with, restrained, and coerced their employees in the -exercise of the rights guaranteed in section 7 of the Act. B. The refusal to bargain 1. The appropriate unit The complaint alleges that each of the following groups of employees at the Bull Shoals Dam Construction project of the joint venturers doing business as Ozark Dam Constructors excluding, however, in each instance, in addition to others specifically mentioned therein, all supervisors as defined in Section 2 (11) of the Act as amended, constitutes a unit appropriate for the purposes of collec- tive bargaining within the meaning of Section 9 (b) of the Act : (1) All employees at the Bull Shoals Dam Construction project of the joint venturers doing business as Ozark Dam Constructors, including welders, but ex- cluding machinists, millwrights, mechanic repairmen and their helpers, office and -clerical employees, guards, and professional employees ; (2) All millwrights. 2. Representation by the Union of a majority in the appropriate unit On or about July 28, 1948, a majority of the employees in the units described above, by a secret election conducted under the supervision of the Regional Director for the Fifteenth Region of the Board, designated and selected the ' In the Matter of Stewart Warner Corporation , 55 N. L. R . B. 593 , 610, where similar language was used in an application form. 4 The employees were receiving overtime pay for work done on Saturdays. 528 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Union as their representative for purposes of collective bargaining, and on August. 19, 1948, the Board certified the Union as such representative. The undersigned finds that at all times since July 28, 1948, the Union has been the representative for the purposes of collective bargaining of a majority of the- employees in said unit, and by virtue of Section 9 (a) of the Act, has been and is now the exclusive representative of all the employees in said unit for the purposes of collective bargaining in respect to rates of pay, wages, hours of- employment, and other conditions of employment. 3. The refusal to bargain (a) The meetings on September 13 and 14 On August 25, the Union, by P. J. Gentry, its attorney, wrote the Respondent Constructors requesting a meeting for the purpose of discussing a contract. The- Respondent Constructors, by its attorney, replied on August 27, agreeing to meet with representatives of the Union, but only on the condition that the Respondent did not thereby waive its objections to the jurisdiction of the Board in issuing, its order in the representation case and reserved its objections to the validity of the Board's order. After some further exchange of correspondence a meeting was arranged at Mountain Home, Arkansas, for September 13. At this meeting the Union was represented by Gentry and a committee of the Union, and the Respondent Constructors by Ben Powell, Jr., its attorney. Discussions took place on September 13 and 14. The Union submitted a proposed contract which was first read section by section. Powell, on behalf of the Respondent Con- structors, agreed to the whereas clauses in the proposed contract, and to a clause which provided for payment of wages for certain specified holidays where work. was not to be performed with the reservation, however, that the particular sug- gested holidays would have to be checked with company practice. A proposaF that employees should as far as possible be hired in the immediate community- was also approved. Provisions relative to hours of employment, check off, griev- ance procedure, and a 30-day wage reopening clause were rejected. All other provisions of the proposed contract were passed. The Respondent made no, counterproposals with respect to any of the rejected clauses. At the meeting on September 14, Powell withdrew his previously expressed: agreement as to the whereas clauses and the provisions relating to holidays,. stating, according to the credible testimony of Gentry and other representatives of the Union who were present, and uncontradicted by Powell who later testified,. that he, Powell, had acted hastily the day before because the number of holidays, previously agreed to were contrary to the Company's existing policy. There was no further agreement between the parties as to any of the provisions of the- contract during the day of September 14, and the parties decided to call in a. labor conciliator who arrived that evening. At the suggestion of Wheeler, the conciliator, the parties agreed to recess farther negotiations until September 23,. at which time Powell, on behalf of Respondent Constructors, agreed to submit counterproposals, and the Union agreed to submit a wage proposal. (b) The meetings on September 23, 29, and 30 The same parties were present at negotiations resumed on September 23. The Union in the meantime had submitted its wage proposal which provided for wages somewhat in excess of those then being paid to various categories of labor. At this meeting Powell admitted receiving the Union's wage proposal and discuss- BROWN AND ROOT, INC. 529 -ing it with Respondent, and stated that the Respondent had instructed him to -make no counterproposals in view of the Union's "outlandish" wage demands. He went on to state that the Respondent was then paying the highest wage scale :they could and that it could not discuss wages at all. In response to Gentry's suggestion that the negotiators take up the other provisions of the contract, passing the matter of wages until later, Powell stated that wages would have to be settled first and that until the parties were together on that the Respondent -could not discuss the Union's other proposals. Later during the discussion, Gentry reduced the demand for wage increase to 1 cent an hour in all categories, and then entirely withdrew any wage demands. In response to this suggestion, Powell stated, according to the credible testimony of the Board's witnesses, un- contradicted by his own testimony, that he had been caught off his guard and that he would have to go back to Austin, Texas, to confer with the Respondent's officials. As a result, no further discussion took place with respect to the other provisions of the Union proposed contract, and a further meeting was scheduled for September 29. At the meeting of September 29, the Respondent submitted a contract proposal of its own which formed the basis for discussion during that and the following day. The Union initially agreed to the preamble, the whereas clauses, and an article recognizing the Union as the bargaining agent but reserving the right of employees to join or not to join the Union as they saw fit, as well as to the principle of a no strike clause. The Union suggested modification of some of the other clauses in the Respondent's proposed contract with respect to holidays, .seniority, and length of the work week. With respect to these clauses, it is not denied that the Respondent refused to entertain any modification of the proposed contract as it had been drafted by the Respondent. The only substantial contradiction in the evidence as td the meetings of Sep- tember 29 and 30, has to do with proposals of Respondent that the Union post a bond in the amount of $100,000, as a guarantee of compliance with a provision of the contract for $25,000 a day liquidated damages in the event of violation of the no strike clause, the Union contending that it could not obtain any such bond, and charging that the Respondent had inserted these clauses in the proposed contract with the intention of preventing any agreement between the parties. The Union gave as the reason for the Union's unwillingness to post any such bond, assuming that it could be obtained, the fact that the contract as submitted by the Respondent did not provide for any control of any kind by the Union over the employees such as might serve to protect the Union against liability under the bond. Powell testified that he subsequently stated that if the Union found itself unable to post such a bond, or other equivalent security, and such fact was demonstrated to him, the Respondent would agree to eliminate the provision from the proposed contract. The testimony of the Union's representatives is that at no time did Powell offer to eliminate the bond proposal, but at the most suggested that some amelioration of it might be in order, without any concrete suggestion as to what such amelioration might be. The undersigned having carefully observed the witnesses, concludes and finds that Powell at no time retracted his requirement that the Union post a bond, or give equivalent security. The credible testimony of Gentry and Odell Smith, the Union's secretary and one of its negotiators, is that during a recess in the negotiations on Sep- tember 29 or 30, Powell pleaded with them personally that they were aware of the "previous attitude" of the Respondent toward signing a Union contract, and that he himself did not think the parties would ever be able to get together on such a contract . Smith's detailed testimony on this point was as follows : 530 DECISIONS OF NATIONAL LABOR RELATIONS BOARD . . . Mr. Powell remarked to me that he thought that maybe, that maybe he was of the opinion that maybe we could have reached an agreement on this. thing, and I said, "Well, I don't know. I thought maybe we could reach, an agreement, too, Mr. Powell, but I don't think that Brown and Root have_ changed their position with the labor organizations." He said, "Well, you know they never have signed any agreement with any labor organization." I said, "Yep, that's right." He said, "1 don't think they are going to sign one now." I said, "Well, I'm. of the same opinion you are. I don't think they are going to sign one." The testimony of Gentry and Smith with respect to the above statements of Powell were not denied by the latter when testifying, and the undersigned finds. that they were made. The Respondent remained adamant in its determination that the Union should post a performance bond, and the meeting of September 30 adjourned without making any further progress toward an agreement. No further meetings be- tween the parties were held until the following January. The January meetings On December 3, 1948, the employees, of the Bull Shoals dam project went on: strike. Pursuant to an exchange of letters initiated by the Union, representa- tives of the Respondent and the Union met at Mountain Home, Arkansas, on January 5, 1949, to resume discussion of a contract. The Respondent was again represented by Ben Powell and the Union by G. L. Grant, its attorney, in place of Gentry. To initiate the discussion the Union presented a contract in a form somewhat different from that presented the previous September. It provided„ among other things, for recognition of the Union by Respondent Flippin as well as by Respondent Constructors, but this demand was withdrawn at the outset.. After some discussion it became clear that the Respondent was unwilling to grant any of the Union's demands, particularly one providing for a wage increase, whereupon it was agreed that the Respondent should itself submit a contract as a basis for negotiation. Such a proposed contract was discussed on January 7 and S. The contract submitted by the Respondent did not differ in any material respect from the contract which it had submitted at the September meetings,. except that the amount of the bond required of the Union was reduced from $100,000, to $50,000, and the liquidated damages per day in the event of a strike in violation of the contract was reduced from $25,000 to $10,000. Wages were not in issue, the Union representatives advising the Respondent that it would accept the prevailing wages. It should be noted, however, that since the nego- tiations in September the Respondent had increased the wages of employees on the graveyard shift by 5 cents an hour. This increase was made unilaterally without discussion with, or notification to, the Union, and in spite of the Re- spondent's position taken in the September meetings that it could not make any increase at all over prevailing rates. Whereas originally the Respondent's proposed contract had provided that the employees should be entitled personally to take up grievances with the Re- spondent without the intervention of the Union, the Respondent's position in this respect had been somewhat changed and substantial agreement was reached on a grievance provision which provided for the presence of Union representatives on any adjustment of a grievance. The Respondent's proposed contract of January 6, however, removed from the realm of grievances any with respect to, BROWN AND ROOT, INC. 531. changes in work schedules , respecting the hiring or discharging , promoting or demoting of employees , leaving these to the discretion of management as an employer prerogative.' In the end , the Union waived its objections to the Respondent 's proposed con- tract, except with respect to the term of the contract and the performance bond or its alternative . Even in these two respects , however, the Respondent refused to make concessions . With the single exception , therefore, of the modification as to the grievance procedure , outlined above, which itself was tied in with Article 4, Section 1, as set forth above, the Respondent refused to modify any portion of the proposal it had drafted. On January 8, Grant on behalf of the union , addressed a note to Powell stat- ing that the Union was willing to make all reasonable concessions and urging the Respondent to Slo the same, stating that in spite of the difficulties it did not intend to break off negotiations . Powell , in reply addressed a note to Grant as follows: "The Company is of the position that further negotiations will be of no avail due to the basic differences in policy of the Company and the Union and hence we terminate negotiations which are at a standstill . We regret that. this condition exists." With this exchange of notes the meetings were adjourned.. Conclusions The undersigned is convinced and finds that the Respondent Constructors at no time during its negotiations with the Union, beginning on September 13, 1948 and ending in January 1949, bargained in good faith with the Union. At the first meeting with the Union's representatives in September, Powell on behalf of the Respondent, agreed to certain formal clauses in the Union's proposed con- tract, including the Union's proposal with respect to holidays. On the next day, however, and after consultation with the Respondent's officers Powell stated that such agreement as he had made the previous day did not correspond to company policy and retracted it. This, as well as the subsequent course of the negotiations, convinces the undersigned that Powell, although he had authority to meet and discuss and to execute a contract with the Union provided it did not depart in any substantial particular from the Respondent's proposals, had no authority to make or accept any counter proposal binding upon the Respondent. This failure to invest its appointed negotiator with any real authority to nego- tiate an agreement if arrived at constituted, in itself, a failure to bargain.' When the Union waived any demands with respect to wage rates and offered to negotiate with respect to the remaining terms of the contract, Powell stated that he was caught by surprise and would have to get in touch with the Respondent's offices in Austin, Texas, before proceeding further. 5 Article 4, Section 1, reads as follows : The management of the construction project and the direction of the employees and the operation of the plan and work , including the hiring , promoting , seniority, demoting and retiring of employees, the dismissing, discharging or otherwise dis- ciplining of employees , the laying -off or calling to work of employees in connection with any reduction or increase in the number of employees, the assignment of work, transfer of employees, the classification of employees and jobs, the scheduling of work and the control and regulation of the use of all the equipment and other prop- erty of the Company are the exclusive function of the Employer ; except as specifically limited by any of the provisions of this agreement it is understood and agreed that any of the rights, powers or authority the Employer has prior to the signing of this agreement are retained by the Employer. See Webster Atant,faettiring Inc., 27 N. L. R. B. 1338 ; V-0 Milling Co., 43 N. L. It. B. 348. .532 DECISIONS OF NATIONAL LABOR RELATIONS BOARD When the Union, despairing of reaching any agreement as result of negotia- tions based upon its own proposed contract, accepted the Respondent's proposed contract as the basis for discussion, the Respondent at no time evidenced any willingness to depart from the contract as it had formulated it. It is difficult to avoid the conclusion that Respondent's position, throughout, on any proposal of any substantial importance, was one of "take it or leave it." The Respondent's position with respect to a performance bond and liquidated damages in the event of a strike, a position from which it did not recede from first to last, although. lowering the amount of the requested bond from $100,000 to $50,000 and liquidated damages from $25,000 to $10,000 per day, was calcu- lated to result in no agreement whatsoever with the Union. Such a demand has been previously found to constitute a refusal to bargain.' During the negotiations of the Respondent, although refusing to discuss any wage increase whatsoever arrived at through negotiations with the employees' bargaining representative, unilaterally granted employees on the graveyard shift a five cent an hour increase. A wage increase under such circumstances has been repeatedly held to constitute a refusal to bargain. In only one respect did the Respondent make any substantial concession to the Union. This concerned the grievance procedure and was more apparent than real. Although the Respondent agreed to permit the Union to be present when the grievances of an individual employee was discussed with management, it effectively removed from the area of collective bargaining almost all matters from which grievances normally arise, such as working hours, and the hiring, discharging, promoting, and demoting of employees. These were reserved to the Respondent as a matter of management prerogative although they were matters which concerned the conditions of employment. This insistence upon sole con- trol over matters which vitally concern working conditions has been found to constitute a refusal to bargain! When finally, because of the Respondent's continued refusal to make any sub- stantial concession on any important phase of the contract, an impasse was reached, the Respondent on January S broke off negotiations, although the Union offered to continue them. That the Respondent at no time intended to bargain in good faith with the Union, is further evidenced by Powell's own statement that he had never entered into a contract with any union and probably would not do so in this instance. The undersigned finds that on September 23, 1948 and at all times material thereafter, the Respondent failed and refused to bargain collectively with the Union as the representative of the majority of its employees within an appro- priate unit, thereby, interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondents set forth in Section III, above, occuring in con- nection with their operations 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. 7 See Scripto Manufacturing Co., 36 N. L. It. B. 411 ; Tower Hosiery Mills, 81 N. L. It. B. 658. 8 See N. L. It. B. v. Westinghouse Air Brake Co., 120 F. 2d 1004, enforcing 25 N. L. It. B. 1312. BROWN AND ROOT, INC. V. THE REMEDY 533 Having found that the Respondents have engaged in certain unfair labor prac- tices, the undersigned will recommend that they cease and desist therefrom and that they take certain affirmative action which the undersigned finds will effectu- ate the policies of the Act. The undersigned has found that on September 23, 1948, and at all times there- after, Respondent Constructors refused to bargain collectively with the Union as the exclusive representative of its employees in an appropriate unit. In order to effectuate the policies of the Act, the undersigned will recommend that upon request the Respondent Constructors bargain collectively with the Union as the exclusive representative of the employees in the appropriate unit in respect to rates of pay, wages, hours, and other terms and conditions of employment. Because of the widespread hostility to the efforts of their employees to organize as demonstrated by this record, including warnings and threats to employees by both Respondents herein, to withhold their support from the Union the under- signed will recommend that the Respondents cease and desist from in any manner interfering with, restraining, or coercing their employees in the right to self- organization s Upon the basis of the foregoing findings of fact, and upon the entire record in the case, the undersigned makes the following : CONCLUSIONS OF LAw (1) Fort Smith, Little Rock & Springfield Joint Council, AFL, is a labor organization within the meaning of Section 2 ( 5) of the Act. (2) Each of the following groups of employees of the Bull Shoals Dam Con- struction Project of the joint venturers doing business as the Ozark Dam Con- structors , excluding however in each instance , in addition to others specifically mentioned therein, all supervisors as defined in Section 2 (11) of the Act, as amended, constitutes a unit appropriate for the purposes of collective bargaining within the meaning of Section 9 ( b) of the Act : (a) All employees at the Bull Shoals Dam Construction Project of joint venturers doing business as Ozark Dam Constructors , including welders , but ex- cluding machinists, millwrights , mechanic repairmen and their helpers, office and clerical employees , guards and professional employees ; (b) All millwrights. 3. Fort Smith , Little Rock & Springfield Joint Council , AFL, was on July 28, 1948, and at all times thereafter has been the exclusive representative of all the employees in said unit for the purposes of collective bargaining within the mean- ing of Section 9 (a) of the Act. . 4. By refusing to bargain collectively with Fort Smith, Little Rock & Springfield Joint Council , AFL, as exclusive representative of the employees in the appropriate unit, Respondent Ozark Dam Constructors has engaged in and is engaging in unfair labor practices within the meaning of Section 8 ( a) (5) of the Act. 5. By interfering with, restraining , and coercing their employees in the exercise of the rights guaranteed in Section 7 of the Act , the Respondents Ozark Dam Constructors and L+lippin Materials Company have engaged in , and are engaging in, unfair labor practices within the meaning of Section 8 (a) (1) of the-Act. 6..The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2 ( 6) and ( 7) of the Act. 5 See : May Dept . Store v. N . L. R. B., 326 376 , affirming as modified 1.46 F. 2d. 66 en- forcing 53 N. L. R. B. 1366. 867351-50-vol. 86-35 534 DECISIONS OF NATIONAL LABOR RELATIONS BOARD RECOMMENDATIONS Upon the basis of the foregoing findings of fact and conclusions of law, the undersigned recommends that Ozark Dam Constructors and Flippin Materials Company, their officers, agents, successors and assigns shall: 1. Cease and desist from the following : (a) Ozark' Dam Constructors from refusing to bargain collectively with Fort Smith, Little Rock & Springfield Joint Council, AFL, as the exclusive representa- tive of all its employees at the Bull Shoals Dam Construction project of the joint venturers in the unit found appropriate, with respect to rates of pay, wages, hours: of work, and other conditions of employment ; (b) Ozark Dam Constructors and Flippin Materials Company from in any manner interfering with, restraining, or coercing their employees in the exercise of their rights to self-organization, to join or assist Fort Smith, Little Rock & Springfield Joint Council, AFL, or any other labor organization of its employees; 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 of the Act. 2. Take the following affirmative action which the undersigned finds will effectuate policies of the Act : (a) Ozark Dam Constructors upon request to bargain collectively with Fort Smith, Little Rock & Springfield Joint Council, AFL, as exclusive representative of the employees in the appropriate unit, in respect to rates of pay, wages, hours of work and other conditions of employment and, if an understanding is reached, embody such understanding in a signed agreement: (b) Ozark Dam Constructors and Flippin Materials Company to post at the Dam site, and at the other locations work in the White River Water Shed in Marion and Baxter Counties, Arkansas, copies of the Notice attached hereto and marked "Appendix A." Copies of said notice to be furnished by the Regional Director for the Fifteenth Region shall, after being duly signed by the Re- spondent's representatives, be posted by the Respondents immediately upon receipt thereof and maintained by them for at least sixty (60) consecutive days thereafter in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps to be taken by the Respondents to insure that such notices are not altered, defaced, or covered by other material. (c) Notify the Regional Director of the Fifteenth Region in writing within ten (10) days from the date of the receipt of this Intermediate Report what steps the Respondents will take to comply therewith. It is further recommended that unless on or before ten (10) days from the date of the receipt of this Intermediate Report, the Respondents notify said Regional Director 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. 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, Washington 25, D. C., an original and six copies of a state- ment in writing setting forth such exceptions to the Intermediate Report. and Recommended Order or to any other part of the record or proceeding (including BROWN AND ROOT, INC. 535 rulings upon all motions or objections) 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 Inter- mediate Report and Recommended Order. 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, re- quest 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 12th day of July 1949. HORACE A. RUCKEL, Trial Examiner. 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: AVE WILL NOT in any manner interfere with, restrain, or coerce our em- ployees in the exercise of their right to self-organization, to form labor organizations, to join or assist FORT SMITH, LITTLE ROCK & SPRINGFIELD JOINT COUNCIL, A. F. L. or any other labor organization, to bargain collec- tively through representatives of their own choosing, and to engage in con- certed 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. OZARK DAM CONSTRUCTORS WILL BARGAIN collectively upon request with the above-named union as the exclusive representative of all employees in the bargaining unit described herein with respect to rates of pay, hours of em- ployment or other conditions of employment, and if an understanding is reached, embody such understanding in a signed agreement. The bargaining unit is: Each of the following groups of employees at the Bull Shoals Dam of the joint venturers doing business as Ozark Dam Constructors, ex- cluding, however, in each instance, in addition to others specifically mentioned therein, all supervisors as defined in Section 2 (11) of the Act as amended, constitutes a unit apropriate for the purposes of col- lective bargaining within the meaning of Section 9 (b) of the Act: (1) All employees at the Bull Shoals Dam construction project of Ozark Dam Constructors, including welders, but excluding machinists, 536 DECISIONS OF NATIONAL LABOR RELATIONS BOARD millwrights, mechanic repairmen , and their helpers, office and clerical employees, guards, and professional employees. (2) All millwrights. OZARK DAM CONSTRUCTORS, Employer. FLIPPLN MATERLALS Co., Employer. Dated------------------------------ By -------------------------------- (Representative ) ( Title) This notice must remain posted for 60 days from the date hereof , and must not be altered, defaced, or covered by any other material.