International Molders and Foundry Workers Union of North America

In the Matter of INTERNATIONAL MOLDERS AND FOUNDRY WORKERS UNION OF NORTH AMERICA (AFL) AND THE INTERNATIONAL MOLD- ERS AND FOUNDRY WORKERS UNION OF NORTH AMERICA, LOCAL No. 68 and THE HAMILTON FOUNDRY AND MACHINE COMPANY Case No. 9-CB-31.-Decided September 7, 1950 DECISION AND ORDER, On April 11, 1950, Trial Examiner Max Goldman issued his Inter- mediate Report, in the above-entitled proceeding, finding that the Respondents had not engaged and were not engaging in certain unfair labor practices and dismissing the complaint, as set forth in the copy of the Intermediate Report attached hereto. Thereafter the Com- pany filed exceptions to the Intermediate Report and a brief in sup- port of its exceptions and requested oral argument. The Respondent filed a brief in support of the Trial Examiner's Intermediate Report. As, in our opinion, the record and the briefs adequately present the position of the parties, the Company's request for oral argument is denied. The Board 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 Intermediate Report, the exceptions and briefs, and the entire record in the case, and hereby adopts the findings, conclusions, and recommendations of the Trial Examiner. We agree with the Trial Examiner's finding that company Vice- President McDaniel misunderstood Union Representative McCune in their telephone conversation of March 26, 1949, and that conse- quently no agreement was reached between the Company and the Respondents. In view of this disposition of the issue, we shall not pass upon the question, whether the repudiation of an oral agreement and the consequent refusal to reduce such an agreement to writing constitute a failure to comply with the collective bargaining obligation imposed by Section 8 (b) (3) and 8 (d) of the Act. 91 NLRB No. 21. 139 140 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 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 that the complaint against the Respondents International Molders and Foundry Workers Union of North America (AFL), and the International Molders and Foundry Workers of North America, Local No. 68, be, and it hereby is, dismissed. CHAIRMAN HERZOG and MEMBER MURDOCK took no part in the con- sideration of the above Decision and Order. INTERMEDIATE REPORT AND RECOMMENDED ORDER Mr. Alan A. Bruckner, for the General Counsel. Mr. Robert A. Wilson, of Cincinnati , Ohio, for the Respondents. Taft, Stettinus and Hollister , by Messrs . J. Mack Swigert and Robert T. Keelar, of Cincinnati , Ohio, for the Company. STATEMENT OF THE CASE Upon a charge filed April 20, 1949, by The Hamilton Foundry and Machine Company, Hamilton, Ohio, herein called the Company, the General Counsel by the Regional Director for the Ninth Region (Cincinnati, Ohio), of the National Labor Relations Board, herein called the Board, issued his complaint, dated July 18, 1949, against International Molders and Foundry Workers Union of North America (AFL), and the International Molders and Foundry Workers Union of North America, Local No. 68, herein called the Respondents, alleging that the Respondents had engaged in and were engaging in unfair labor prac- tices within the meaning of Section 8 (b) (3), and Section 2 (6) and (7) of the Labor Management Relations Act, 61 Stat. 136, herein called the Act. Copies of the complaint and the charge, together with the notice of hearing were duly served upon the Respondents and the Company. With respect to unfair labor practices, the complaint alleged in substance that the Respondents refused to bargain collectively with the Company by failing and refusing to execute a written contract incorporating an agreement reached between the Respondents and the Company when so requested by the Company. The Respondents' answer denies the commission of any unfair labor practices. Pursuant to notice, a hearing was held on various dates beginning August 2 through August 12, 1949, at Cincinnati, Ohio, before the undersigned, the Trial Examiner designated by the Chief Trial Examiner. Each of the parties was represented by counsel. Full opportunity to be heard, to examine and cross- examine witnesses, and to introduce evidence bearing on issues, was afforded the parties. The parties waived oral argument at the close of the testimony, but submitted briefs. Upon the entire record in the case, and from his observation of the witnesses, the undersigned makes the following : INTERNATIONAL MOLDERS AND FOUNDRY WORKERS 141 FINDINGS OF FACT 1. THE BUSINESS OF THE COMPANY The Company, the Hamilton Foundry and Machine Company, an Ohio corpora- tion with its main office and plant at Hamilton, Ohio, is engaged in the production of light and medium gray iron, alloyed iron, and Meehanite iron castings for customers from their patterns to their specifications. During the year 1948 the Company used raw materials consisting of pig iron, iron and steel scrap, alloys, coke, and mold sand valued at approximately $300,000, of which 12 percent was obtained from sources outside the State of Ohio. During the same year, the Company sold rough iron castings exceeding $3,000,000 in value, of which 30 percent was shipped to points outside the State of Ohio. The undersigned finds that the Company is engaged in commerce within the meaning of the Act. II. THE LABOR ORGANIZATIONS INVOLVED International Molders and Foundry Workers Union of North America, (AFL), and the International Molders and. Foundry 'Workers Union of North America, Local No. 68, are labor organizations admitting to membership employees of the Company. III. THE UNFAIR LABOR PRACTICES The refusal to bargain A. The appropriate unit and representation of a majority therein The parties agree and the undersigned finds. that all employees of the Company in molding, core making, core assembly, and two miscellaneous job classifications defined as service men No. 2, sand slingers and machine operators, rollover core unit, excluding industrial engineering department employees, laboratory depart- ment employees, production schedule clerks, timekeepers, all clerical employees, all employees covered by the existing agreement between the Company and the United Steel Workers of America, CIO, and excluding supervisors, guards, and professional employees as defined in the Act, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9 (b) of the Act. The parties agree and the,undersigned finds that the Respondent Local from on or about March 1, 1948, and at all times thereafter has been and now is the exclusive representative of the employees in the above-described unit within the meaning of Section 9 (a) of the Act.' B. The alleged refusal to bargain The General Counsel alleges that the Respondents have refused to bargain in violation of Section S (b) (3) of the Act, in that they refused upon the Company's request to sign a document containing a collective bargaining agree- 'This finding represents the extent to which the parties agree in their pleadings. In view of the recommendations hereinafter made, it is unnecessary to pass upon the General Counsel's allegation which the International denied that it also was and is the statutory representative. 142 DECISIONS OF NATIONAL LABOR RELATIONS BOARD went which came into existence on March 26, 1949, as the result of an acceptance of the Company's proposals communicated by the Respondents to the Company during a telephone conversation on that date between Merlin D. McCune, district representative of the Miami Valley Conference Board,' and Donald McDaniel, vice president of the Company. The Respondents contend that no acceptance of the Company's proposal was given and that no agreement was reached.3 As the parties suggest, in resolving the issue as to the conflicting versions of the telephone conversation of March 26, 1949-McDaniel's version being that there was an acceptance of the Company's proposal and McCune's being that there was no acceptance but an offer to try the Company's proposal-an examination of the surrounding circumstances should be made. For several years prior to 1949, there had been written contracts covering molding and core room employees. On February 8, 1949, negotiations began for a new contract. McDaniel and Peter E. Rentschler, president, appeared on behalf of the Company ; McCune and employee Robert Harding, shop chairman, and others of the bargaining committee appeared on behalf of the employees- At this meeting the Company pointed out the necessity of cutting the cost of its products to meet competition from other producers and substitute products- The demand for the Company's products had dropped so that the employees in the bargaining unit had been working only 3 days a week, Monday, Wednesday, and Friday, since November 1948. Rentschler pointed out specific instances of customers who were cancelling orders or seeking to renegotiate prices and emphasized that they were in a period of recession and that he was seeking to adjust operations to the circumstances. He proposed that the contract be renewed without change except that the production molding operation be put under an industrial engineering system for the purpose of establishing job prices, similar to that which had been applied to the core room by previous contract. The employees engaged in production molding, up to that time, had been paid on a piecework basis, the price for a given job being established by agreement between the foundry superintendent and a price committee of the shop. The industrial engineering system would fix job prices upon the basisl of standard data or time studies of a particular job. The bargaining committee then submitted its proposal for the new contract, which provided among other things for a 5-cent an hour increase in wages and the maintaining of, the exist- ing system of bargaining for the piecework price of each item produced in the production molding operation. The next bargaining conference was held on February 24. Harding reported that the men had objected to the extension of industrial engineering to produc- 2 This board is affiliated with the Respondent International and is composed of several local unions in the general area, including the Respondent Local 68. In view of the recommendations below, it is unnecessary to pass upon McCune's status in relation to the Respondent International. 3 The document prepared by the Company which is alleged to set forth the agreement of the parties contains, among other things, the following provisions: (1) Provision that "This Agreement is made and entered into as of the 30th day of March, 1949" and shall be "effective as of March 28, 1949" ; (2) section I entitled "wages," which after setting forth certain wage rates, states in paragraph 6 that "To put into effect the day work rates specified above, it is understood that upon the signing of this Agreement, the exist- ing individual day work rate of each employee covered by this Agreement shall be increased 5 cents (5¢) per hour effective March 28. 1949." ; (3) it complex piecework system ; (4) a union-shop provision ; (5) a checkoff provision; (6) a no-strike, no- lockout clause ; and (7 ) provision that the agreement shall continue in effect until March 27, 1950 , and renew itself annually thereafter unless certain-notice, is=given by either party. INTEIRNATIONAL MOLDERS AND FOUNDRY WORKERS 143 tion molding. The Company then pointed out that the selling prices of its products had to be set upon a sound basis so that it would relate to actual labor costs and not merely prices arrived at by bargaining-labor representing about 50 percent of the Company's costs-otherwise competitors would get ,customers for the items which the Company had overpriced and the Company would remain with customers for its underpriced items only. Rentschler also declared that if the industrial engineering system proved inequitable, employees could use the grievance procedure to resolve any issues which might arise. In addition, the Company undertook to conduct a class to demonstrate to the men the operation of the system. McCune stated that the committee was not in a position to accept or reject proposals and all that it could do was to agree to take the Company's proposals back to the membership. The parties met next, with a conciliator, on March 3. The Company again emphasized the necessity for industrial engineering, and the committee stated its opposition to the system. Rentschler replied that he would not enter into a con- tract which did not provide for industrial engineering. The Company agreed, however, to the 5-cent hourly increase which the committee had suggested and to certain holiday provisions. The committee agreed to present the new proposal to the employees; and if they accepted it, a contract was to be executed on March 11, to become effective March 14. After the meeting of March 3 the Company prepared new price tickets for the production molding jobs in accordance with the industrial engineering system. McCune, however, thereafter informed the Company that the membership had rejected the proposal.' The parties met again with the conciliator on March 17. The committee stated that the most significant objection the members had to the Company's proposal was the industrial engineering system. It pointed out that the members had voted 38 for rejection and 10 for acceptance of the proposal, and that a vote for strike sanction, or a request for approval and support from the Respondent International to conduct a strike, had been sustained by a vote of 40 to 8. The committee declared that it was instructed to return to its original proposal; and the Company then insisted that there be industrial engineering in the contract, pointing out the economic need for the system. The committee undertook to sub- init substantially the same proposal to the membership. The parties again agreed upon an execution and effective date for a contract if the proposal should be accepted. The Company again was ready with preparations for the new system, but hNIcCune telephoned Rentschler on March 19, informing him of the rejection of the proposal by a small margin and suggesting some concession by the Company so that the proposal could be resubmitted to the membership. On March 24 the parties met again with the conciliator. This time Chester A. Sample, president of the Respondent International, was also present . Rentschler again reviewed the economic necessity for industrial engineering to fix prices and repeated that the system must be included in the contract. Rentschler explained, too, that the Company had to set the prices of its products for the quarter beginning April 1. He also pointed out that lie had offered to conduct school to explain the industrial engineering system to the employees, but only seven had appeared for class. McCune ^ stated the committee . had sought to persuade Respondent Local 68 is composed of employees of various employers in the area. This rejection and other action, except if otherwise indicatedk was based upon the vote of employees of the Company who were members of the Local. 144 DECISIONS OF NATIONAL, LABOR RELATIONS BOARD the membership to accept industrial engineering, but the membership had informed the committee that the system was not acceptable. The Company affirmed that it was not changing its position. McCune then proposed a trial period of 90 days, pointing out that under the proposed contract and previous contracts the Company, but not the employees, had the right upon certain notice to change the pay plan. McCune also suggested a change in the no-strike clause at the close of the grievance process, and this was also rejected. The Company, agreed to a change in pay for a certain job classification, but rejected a certain apprentice ratio proposal. Rentschler then suggested that if the proposed agree- ment should be accepted that week, he would put it into effect on Monday, March 2S.6 The committee thereafter raised an instance of an employee who had been timed and who had complained of the results of the study. The Company empha- sized its insistence upon industrial engineering and agreed to make the 5-cent wage increase retroactive to March 14. Finally it was arranged that McDaniel was to be informed on Saturday, March 26, as to the outcome of the meeting of the employee members to be held the next evening, Friday, March 25. On Friday evening, March 25, the employee members -of the Respondent Local met to consider the Company's proposal. Harding of the shop committee pre- sided. The committee reported on the negotiations and McCune recommended acceptance of the proposal. McCune was criticized for taking a position on the proposal because he was a member of the committee. The men in a boisterous but unmistakable fashion expressed their disapproval of the proposed contract. They stated their belief that acceptance would mean a reduction in wages and pointed out that they had twice before rejected essentially the same proposal. The proponent of a motion to accept the Company's proposal withdrew the motion, and a motion was made that the strike sanction which the International had granted be invoked and a strike commence the following Monday morning, March 28. Sample cautioned against striking, urged the men to return to work on Monday, suggested that they take the matter up at the meeting of the full Local on the following Monday night, and pointed out that a satisfactory arrangement might yet be worked out. It was also pointed out that voting against striking at this time would not mean approval of the Company's proposal. There were about 48 persons present at the meeting, and by a majority of 8 or 9 the men voted by secret ballot not to strike on Monday morning. McCune telephoned Harding from his home in another city on Saturday morn- big, March 26, to get Harding's approval to make the following statement to McDaniel : namely, that the employees had voted not to put the strike sanction in effect and they would work on Monday, and that if the Company put the industrial engineering system into effect it would give the men an opportunity to work under the system and probably by the Monday night meeting of the Local, after the men had worked under the system for a day, the parties might be able to reach an agreement. McCune also explained to Harding that in view of the impasse on industrial engineering and their belief that the Company would install the system, that in order to avert a strike, the men should have an oppor- tunity to work under the system and see what it was like. Harding approved the proposed statement and shortly thereafter McCune reached McDaniel by long distance telephone: This is the conversation disputed by the parties. McDaniel's version of the telephone conversation was that McCune stated that "the boys had decided to go along with the agreement that we [the Company] had presented to them" on Thursday. McDaniel then inquired, "Did you have 6It is not entirely clear whether Rentschler was speaking about the retroactive pay aspects of the contract only or about the effective date of the contract in general. INTE'RNATION'AL MOLDERS AND FOUNDRY WORKER.Si 145 any trouble?," and McCune replied, "Well, it wasn't easy ; but they have decided to go along." McDaniel then stated that they would start the new system Monday morning and McCune agreed. McCune also stated that he would not be able to come to town until Wednesday afternoon to sign the agreement. McDaniel's further testimony was that he (lid not remember whether McCune requested him to inform Harding of it or whether he asked McCune if Harding, chairman of the shop committee, knew about it, but that he, McDaniel, undertook to inform Harding on Monday of the conversation of acceptance. McDaniel also testified that there was no mention of the men trying the Company's proposal and that he did not remember anything being said about a strike vote. McCune's version of the telephone conversation was that McDaniel inquired, "Welt, how did you make out last night?" McCune replied, "Not so good," and then explained upon McDaniel's inquiry, "Well, they voted last night not to go out on strike or put the strike sanction into effect." McDaniel asked what that meant, and McCune answered, "I presume it means they are going along and try the proposition. If we put it into effect and you are as fair about it as you stated in our negotiations, there probably won't be any trouble and the boys will go along with it." McDaniel declared, "Well, Mac, you know we are going to be fair about it. You know there is some adjustment to be made." McCune then stated that he understood from the negotiations that adjustments were to be made on the underpriced and the overpriced jobs. McDaniel inquired about signing the contract and McCune replied, "Well, if everything goes all right, we will probably be able to sign the contract on Wednesday." McDaniel stated that the Company would get the new system ready for installation.' That Saturday afternoon and Sunday the Company set new price tags on the jobs and otherwise installed a new price system so that for practical purposes it was ready for operation on Monday morning, March 2S. The employees worked on Monday under the new system. McDaniel testified that he informed Harding that day of his telephone conversation with McCune on Saturday, giving his, McDaniel's, version of the conversation,-uncondi- tional acceptance. The record does not show Harding's reaction to McDaniel's version of the conversation.? That night the employee members of the Local met with the full Local, and the next clay, Tuesday, the parties held a conference. Rentschler, McDaniel, McCune, Harding, and the negotiating committee were present as usual. Sample was not present at this conference ; and although McCune had not attended the meeting of the Local the night before, he reported what he had learned had occurred. Rentschler had with him copies of a document asserted in this proceeding as containing the agreement of the parties. Rentschler opened the conference by stating that the men were a day ahead of themselves and that he had expected the signing of the agreement to take place the next day, Wednesday.' McCune replied: "Mr. Rentschler, I might O It was shown during the Company's examination of McCune that McCune had given essentially the same testimony concerning this conversation on July 11, 1949, when counsel for the Company had taken McCune's deposition in connection with another proceeding. 'Harding was not called as a witness and McDaniel was not asked to testify on the subject of Harding's reaction. According to McCune, Harding's name was not mentioned in his telephone conversation with McDaniel on March 26. 8 The findings made as to the conversations at this and the other meetings of the parties, except as otherwise noted, are based upon verbatim stenographic reports made for the Company by experienced court reporters. The volumes of these reports were introduced into evidence by the General Counsel. 146 DECISIONS OF NATIONAL LABOR RELATIONS BOARD as well start this thing. I don't know what we did. We hit a snag. We started this production time study out here yesterday and started cutting them raises in jobs. . . After an exchange relating to reductions in earnings under the industrial engineering system, McCune continued : "At the meeting of-that we had last Friday, which I called Mr. McDaniel on Saturday morning stating that they had voted to try this proposition out, and that we had set up the meet- ing to come in and complete the negotiations on the contract on Wednesday at three-thirty. This morning Mr. Sample called me and told me of the diffi- culties he had down there, He had between forty and fifty people down here from this shop, down at the meeting last night very near tore the building down, and had a sort of falling out, and instructed the committee not to sign this agreement." McCune further stated, "We went back to get our people to try this thing, and those people here seem to feel that one day was enough ; that was all we can stand of it." He also pointed out that his instructions were that if the situation could not be worked out in a manner satisfactory to the men, they were not going to work the next Monday, April 4. Rentschler deplored the situation, pointing out that the Company had tried to answer any question about the industrial engineering system, had given the employees an oppor- tunity to go to school to learn about it, and was not going to mutilate the in- dustrial engineering system at the plant merely because of the dissatisfaction of a few individuals. The parties discussed specific complaints that had arisen under the time studies, and the Company pointed out that it had already had a meeting that day with its foremen and had considered the complaints that they had received the day before. In the course of the conference after the discussibn of Monday's experiences McCune stated : "The committee has taken it upon themselves in endeavoring to get these people to come with the Company to see if they can't get this thing eased out. I don't know. We're in a position here where we're instructed not to sign this agreement, and we thought it was advisable to get in here to get this thing straightened out." He then urged that the job prices had been cut too much. Rentschler, on the other hand, attempted to demonstrate the fairness of the system. Toward the close of the conference Rentschler stated : "I'd say, Mr. McCune, that you fellows will have to tell your people that they better cooperate a little bit and get the thing going through. If you're not going to sign the agreement, why, that puts a different aspect on it, as to just where we're going to be, be- cause we presumably made an agreement. We were told the agreement was in effect. There was some arrangement as to retroactive pay, and the effective date of the agreement. Now, if the agreement isn't in effect, that's one thing we should know, and we might as well clear it up today, unless you're coming back tomorrow." McCune replied : "The only thing I can say-I didn't attend the meeting. I'll have to talk to Mr. Sample and get in touch with you ; that's all I can do. Because I was instructed to come in here and see what we can do. I come down here, and I found the body last night told the committee not to sign the agreement. Now, he was at the Meeting, and I was supposed. to call him and let him know what happened here today. I think I got your picture of what you intend to do, and I think the people should try to cooperate with you and try to get it straightened out. I think they should file grievances and have them straightened out." INTERNA'TION'AL MOLDERS AND FOUNDRY WORKERSI 147 Rentschler thereafter stated : ". . . we've got to know pretty soon where we. stand on an agreement, because we're not going to figure that we're under any obligations for anything on an indefinite basis: I mean, we-the world is mov- ing on, and business is going on. And we've got a terrific number of problems that we're involved in, and the main one is, right now, prices to customers. We made our decision, what we're going to do to customers in the way of revised prices." As the conference was closing Rentschler stated : "Now, another thing you better make up your mind is as to whether or not we do or do not have an agreement, because as far as we're concerned, we're supposed to sign tomorrow afternoon. I thought you were coming in here early to, sign today. Now, we want to know where we stand, because we can't go along indefinitely." McCune replied that the Company would receive an answer on Wednesday and pointed out that an agreement depended upon the men and that he had other engage- ments on Wednesday: Rentschler declared, "As far as we're concerned, we have been advised by you that the agreement would be signed Wednesday afternoon." McCune responded, "And they rescinded the action last night." Rentschler stated that he could not help that, and that it was up to them to determine whether the document would be signed on Wednesday, and emphasized that the Company had to know "whether we do or do not have an agreement." McCune answered that the Company would be informed the next day: Rentschler and McDaniel pointed out that it had been quite a task changing the job pricing system during the week end and that some errors had thus resulted. McCune declared, "Well, as I told you at that time, we had a pretty rugged time at that meeting when they agreed to try this thing. It may be such a thing as you hit a bad day, and it put them in a bad mood. Now, whether tomorrow the thing will change, I don't know." Rentschler stated that the Company was not concerned with moods, and only wanted to know whether they had an agreement. McCune replied that he could not tell until the next day.' After a few inconsequential remarks the conference adjourned. 9 The findings concerning the March 25 meeting of the employee members of the Local are based upon Sample's and McCune's credible and uncontradicted testimony . The Com- pany contends that the employees ratified the proposed contract at the March 25 meeting. The General Counsel expressed no views on this subject. The Company relies on the fol- lowing circumstances in support of its view: (1) The telephone conversation on March 19 between Rentschler and McCune when McCune reported that the Company's proposal of March 17 had been rejected by a narrow margin and he, McCune, suggested that the Com- pany make some change in its proposal so that the proposal could be resubmitted to the employees ; ( 2) the Company's agreeing to some changes _ in its proposals at the March 24 conference but maintaining industrial engineering ; ( 3) the new factor, knowledge of actual earnings under the industrial engineering system, did not enter the picture until the actual experience with the system on March 28, and then produced an adverse reaction at the Monday night meeting; (4) McCune's statement at the meeting on Tuesday, March 29, quoted in full above , that the employees had rescinded the action at the Monday meeting when Rentschler declared that so far as the Company was concerned they had been advised by McCune that the agreement would be signed on Wednesday ; and (5) a state- ment by Harding at a conference to resolve the issues between the parties held about 2 months later on May 26: when Rentschler stated, "If you want to meet to draft the final setup , why, we can set a date then and know when you are coming back to work and so on ;" Harding replied, "Have them signed before we go back to work. That way there won't be any more jumping the cart." The General Counsel does urge that the last quoted exchange between Harding and Rentschler tends to show that McCune informed McDaniel during the telephone conversa- tion on March 26, that the Company 's proposal had been accepted. The Company also relies upon the employees' acceptance of certain checks for a retroactive pay increase as ratification. This matter is discussed in footnote 11. 917572-51=vol. 91-11 148 DECISIONS OF NATIONAL LABOR RELATIONS BOARD On Wednesday, March 30, Rentschler and McDaniel met with Harding and the shop committee. They discussed specific complaints as to the new system raised by the men, and Harding stated that some of the men were not even inter- ested in giving the system a trial. Harding declared that they could not sign, but that the men would work on Friday, and if the matter was not worked out satisfactorily, a strike would commence Monday, April 4. Rentschler pointed out that so far as the Company was concerned the contract was in effect and signing had been scheduled for that time." The parties were not able to resolve their differences, and 'on April 4 the strike commenced and a picket line was established." Thereafter by letters dated May 16 to the Local and the International, the Company announced that because of breach of the no-strike clause it was cancelling the contract which it stated had come into existence on March 26. The strike was in progress at the time of the hearing. It is argued in support of the view that McCune on March 26 informed Mc- Daniel of an acceptance of the Company's proposal that there are certain unreasonable aspects to McCune's version of the conversation. It is urged that in light of the fact that there was boisterous and unmistakable opposition to the Company's proposal at the March 25 meeting of the men, it is unreasonable. to believe that McCune would suggest a trial period to the Company. If there is any merit to this position, the view that McCune communicated an uncondi- tional acceptance-which would have been directly opposed to the sentiment of the men-would appear to be more unreasonable. The Respondents point out, on the other hand, that an impasse had been reached on industrial engineer- ing. The negotiations which had gone on for almost 2 months showed that there would have to be an acceptance of the new system by the men if there was to be a contract and that the men were opposed to it. The men had, however, voted not to strike at the March 25 meeting, thus making possible an.opportunity for learning about the system by working under it if the Company should install it at McCune's suggestion. Actual experience would then either convince the men that they should accept the new system or that they should reject it and demonstrate to the Company the need for reappraising its views on the subject.. It is argued, too, that at the last bargaining conference on March 24 the Com- pany had rejected a suggestion by McCune for a 90-day trial period of the indus- trial engineering system. This was, however, the only time a trial period had been suggested. Although the Company was adamant in its position on industrial engineering]-as it and the employees had a right to be-the Company had 10 There was no stenographic report of this conference. 11 The Company contends that ratification of the Company's proposal is demonstrated by the fact that after the strike had begun and the picket line had been established, almost all of the employees involved, including members of the bargaining committee, accepted and cashed certain checks dated April S. marked retroactive pay, March 14 to 27. Rentschler testified that these checks were issued pursuant to a verbal agreement reached on March 24. These checks so far as the record shows were in amounts under 3 dollars . They were dis- tributed after the Company had announced in letters dater April 6, addressed to the employees, that the Company would distribute checks for retroactive pay "under the new contract." The General Counsel makes no contention in this regard. The Respondents argue that the payment was a gratuity and was not provided for in the document urged as the contract, and point to the provisions which show the effective date as March 28 and that the pay increase was to become effective upon signing ; see footnote 3. It is found that the employees did not evince an intent to ratify the alleged contract by accepting these checks while at the same time showing their opposition to the terms of the alleged contract by striking. 12 Sample and McCune testified that they believed from what bad occurred that the Company would install the industrial engineering system on Monday , March . 28, whether 'INTERNATIONAL MOLDERS AND FOUNDRY WORKERS 149 made concessions in the course of negotiations in order to make its position, on industrial engineering more acceptable to the men. It was not unreasonable to assume that the Company would yield in some regard on a trial period in an effort to convince the men of the fairness of its proposal, it appearing that few of the employees had availed themselves of the school the Company had held for this purpose. Lastly, it is asserted in urging the unreasonableness of McCune's version of the conversation with McDaniel that the proposed trial period could only have been for 1 day, March 28, the Company's operation at that time having been limited to Monday, Wednesday, and Friday. McCune's testimony concerning this conversation, however, was that after he had suggested a trial period he stated, "if everything goes all right, we will probably be able to sign the contract on Wednesday." The General Counsel suggests as the explanation of what occurred that Mc- Cune accepted the Company's offer during the telephone conversation with McDaniel on Saturday, March 26; that the Respondents then saw at the Mon- day evening meeting that they had a "minor revolt" on their hands after the- men had worked under the new system for a day ; and that the Respondents' representatives found themselves "in the middle" and acted accordingly. The Respondents point out, however, that McCune would have had nothing to gain and much to lose in misrepresenting the wishes of the men. It may be added that 'the. installation of the industrial engineering system on Monday and the objection by the men at the meeting that night are also consistent. with the trial-period version of the conversation. The Respondents suggest that the explanation for the difference in McCune's and McDaniel's versions of the conversation of March 26 is a misunderstanding. Support for this explanation is found in the remarks, quoted in detail above, which show that at the conference of Tuesday, March 29, 3 days after the telephone conversation, each of the parties talked in terms of his own version of the conversation. These remarks are also consistent with the General Coun- sel's explanation that the Respondents' representatives had evolved a fraud- ulent design before that time in an effort to solve their difficulties. Yet, as the Respondents point out, it is difficult to perceive what reason McCune would have had to make the original misrepresentation of the employees' action. There appears to the undersigned to be an improbability in McDaniel's ver- sion of the March 26 telephone conversation which indicates some misunder- standing on his part. McDaniel testified that he undertook either at McCune's or his own suggestion to inform Harding that McCune had represented that the men had accepted the Company's proposal. It seems highly improbable, however, that McCune woulfl have made such a suggestion or would have failed to attempt to dissuade McDaniel from passing on to Harding informa- tion which McCune would have realized Harding would recognize as a mis- representation betraying the trust of the men. In view of this improbability in McDaniel's version of the conversation of March 26, the lack of a convincing explanation of why McCune would have breached the trust of the men, the fact that at the March 29 conference each of the parties spoke in terms of his own version of the March 26 conversation, and the undersigned's observation that both McDaniel and McCune appeared to be credible witnesses, it is found that McDaniel did not have a full understanding of what McCune said and accepted or rejected by the men. Although April 1 marked the beginning of the new quarter for the purpose of fixing prices to customers , a review of the negotiations fails to reveal support for this position. 15O DECISIONS OF NATIONAL LABOR RELATIONS BOARD that McCune did not state that the Company 's proposal had been accepted. It is accordingly recommended that the complaint be dismissed. On the basis of the foregoing and upon the entire record in the case, the undersigned makes the following : CONCLUSIONS OF LAw 1. The operations of the Company constitute trade, traffic, and commerce among the several states, within the meaning of Section 2 (6) and (7) of the Act. 2. International Molders and Foundry Workers Union of North America, (AFL), and the International Molders and Foundry Workers Union of North America, Local No. 68 are labor organizations within the meaning of Section 2 (5) of the Act. 3. The Respondents have not engaged in the unfair labor practices alleged in the complaint. It is therefore recommended that the complaint be dismissed in its entirety.