Morand Brothers Beverage Co., et al.

In the Matter Of MORAND BROTHERS BEVERAGE CO., ET AL. and DIS- TILLERY, RECTIFYING AND WINE WORKERS INTERNATIONAL UNION OF AMERICA , A. F. L. Case No. 13-CA-250.Decided September 25, 1950 DECISION AND ORDER On September 21, 1949, Trial Examiner J. J. Fitzpatrick issued his Intermediate Report in the above-entitled, proceeding, finding that the Respondents had engaged in and were engaging in certain unfair labor practices in violation of Section 8 (a) (1) and (3) of the Act, and recommending that they cease and desist therefrom and take cer- tain affirmative action, as set forth in the copy of the Intermediate Report attached hereto. The Respondents filed exceptions to the In- termediate Report and a supporting brief. Briefs were also filed by the Union ' and the General Counsel in support of the Intermediate Report, and by the National Beer Wholesalers Association? All parties participated in oral argument before the Board on March 9, 1950. The Board has reviewed the rulings of the Trial Examiner at the hearing and finds that no prejudicial error was committed 2 The rulings. are hereby affirmed. The Board has considered the Inter- 1 The Association was granted leave by the Board to file a brief amicus curiae. The Respondents except to the action of the Trial Examiner in sustaining the General Counsel's motion to strike paragraph 9 of the amended answer, which alleged that Local 62 of the Union had unlawfully restrained and coerced the Respondents in the selection of their bargaining representative by seeking to negotiate individual contracts with each of the Respondents , contrary to the previous practice of association-wide bargaining, and by calling a strike against Old Rose. We find that the Examiner's ruling was not prejudicial, inasmuch as the contention set forth in paragraph 9 of the amended answer was , in fact, considered on its merits in the Intermediate Report, and is likewise considered on its merits in this Decision and Order. Moreover, except as noted below, the Respondents were per- mitted to adduce evidence in support of the allegations stricken from the amended answer by the Examiner. The Respondents except, also , to the Trial Examiner 's rejection of offers of proof relating to the history of bargaining between Local 62 of , the Union , on the one hand, and the Illinois Wholesale Liquor Dealers Association and the Chicago Wholesale Liquor Dealers Association ( hereinafter called the Associations), acting for the Respondents , on the other hand. We find , however, that the Respondents were not prejudiced by the Trial Examiner's rulings, as considerable evidence was, in fact , received relative to this bargaining history, and the rejected evidence was in essence merely cumulative . In any event , the Intermediate Report contains comprehensive findings concerning this bargaining history which are con- sistent both with the evidence in the record and the offers of proof. 91 NLRB No. 58. 409 410 DECISIONS OF NATIONAL LABOR RELATIONS BOARD mediate Report, the briefs and exceptions, the contentions advanced at oral argument, and the entire record in the case, and hereby adopts the findings, conclusions, and recommendations of the Trial Ex- aminer, with the following additions and modifications : We find, in agreement with the Examiner, that since 1943 Local 62 of the Union had bargained with the Respondents on behalf of their salesmen, through a joint negotiating committee consisting of repre- sentatives of the Local on the one hand, and representatives of both Associations, on the other. On March 16, 1949, after unsuccessful negotiations in the joint committee for a new contract, the Local sent directly to each of the Respondents for signature a proposed contract embodying the same terms as had been rejected by the representatives of the Associations in the joint committee. This contract was not accepted by any of the Respondents. The joint negotiations were thereafter resumed, but on April 6, 1949, after an impasse was reached, the Local called a strike limited to the salesmen of Old Rose Distrib- uting Co., one of the Respondents. On the next day, April 7, 1949, although none but Old Rose had been struck, every Respondent sent to its respective salesmen a letter, reading in pertinent part as follows : A strike against one house or small group of houses is not just a strike against one individual wholesaler, but it is a strike against our house and all the other wholesalers in Chicago. If we per- mitted the Union to do this, it would be merely a question of time until each house would be compelled to sign this unfair contract [requested by Local 62] or to close its business doors . . . since the salesmen of your Union walked out on one of these houses it is our position that you have decided to strike every wholesaler who has been a party to the industry-wide negotiations. Accordingly, we ask you to turn over to us immediately any records, papers, credentials, or monies that you have belonging to us, and come and see us immediately so that we may settle the financial differences that exist to date between us. After receipt of this letter, many of the Respondents' salesmen, construing the letter as a notice of discharge, failed to report for work. Others reported for work but were told by their employers that they were discharged, and they were not permitted to work. In view of all these circumstances, we find that the Respondents. discharged 3 their salesmen on or about April 8, 1949. Accordingly, 8 We disagree with the contention in the arniens brief , and the view of our dissenting col- league, that the letter of April 7 was intended merely as a notice of layoff pending settle- ment of the Respondents ' dispute with Local 62 . We agree with the General Counsel that that contention is not supported by the record, and it is , in fact, contrary to statements in the Respondents ' brief to the Trial Examiner, characterizing the action of the Respondents as a discharge of their salesmen , and contrary to the testimony of the president of Old Rose that the purpose of the April 7 letter was to "dismiss " the salesmen. MORAND BROTHERS. BEVERAGE1 CO., ET AL. 411 it is not necessary to pass on the question whether the Respondents were privileged to lay off their salesmen pending settlement of the contract dispute with the Local. The Board and the courts have held that- discharges, whether of individuals or groups of individuals, to combat or discourage concerted activities of employees,4 are unlawful. As to the Old Rose strikers, their discharge could have, had no pur- pose other than to punish them for striking, and -was reasonably cal- culated to deter them, as well as other employees of Old Rose, from engaging in any future strike activity. Reprisals against employees for strike activity have been uniformly held by the Board and the courts to be unlawful.5 We find, therefore, in accordance with the General Counsel's con- tention, and in agreement with the Trial Examiner, that the Old Rose strikers were unlawfully discharged, in violation of Section 8 (a) (1) and (3) of the Act. . . As to the salesmen of the other Respondents, they were discharged as stated in the letter of April 7, because in the opinion of such Re- spondents they had decided to strike. Viewed as a measure of reprisal against these salesmen for threatening to strike, or as a reprisal against them for the strike by members of the same union against Old Rose, their discharge is unlawful for essentially the same reasons as was the discharge of the Old Rose salesmen. The Respondents contend, however, that, at least insofar as the discharges of the nonstriking salesmen are involved, the instant case is distinguishable from the ordinary case of a discharge to discourage concerted activity; they assert that the action of April 7, with respect to these salesmen was not intended to undermine the Local, or as a measure of reprisal for concerted activity, but was "a purely defensive" measure necessary to protect the Respondents' bargaining position vis-a-vis the Local. Citing the Examiner's finding that the Local intended to strike other Respondents if the Old Rose strike was suc- cessful, the Respondents allege in their brief that no Respondent, standing alone, could withstand the pressure of this piecemeal strike strategy, and that in this sense a strike against one Respondent was a N. L. R. B. v. Electric Vacuum Cleaner Co., Inc., 315 U. S. 685,693; N. L. R. B v. Piedmont Cotton Mills, 179 F. 2d 345 ( C. A. 5, Jan . 30, 1950 ), enfg. as mod., 79 NLRB 1218; N. L. R. B. v. Cape County Milling Co., 140 F. 2d 543, 545 (C. A. 8) ; N. L. R. B. v. Hopwood Retinning Co., 98 F. 2d 97, 100 (C. A. 2) ; Scott Paper Box Company, 81 NLRB 535, 544 ; M. M. Jo flee Company, 74 NLRB 1568 ; N. L. R. B. v. Algoma Net Co., 124 F. 2d 730 (C. A. 7). ,I N. L. R. B. v. Mackay Radio d Telegraph Co., 304 U. S. 333 , 346-7; Moanalua Dairy, Limited, 65 NLRB 714, 717 ; Carter Carburetor Corp. v. N. L. R. B., 140 F. 2d 714, 718 ( C. A. 8) ; N. L. R. B. v. Barrett Co., 135 F. 2d 959 ( C. A. 7). 412 DECISIONS OF NATIONAL LABOR RELATIONS BOARD strike against all.° However, assuming the truth of these assertions, the Respondents' contention amounts only to this while an employer may not discharge his employees for the purpose of undermining their union, or in reprisal for concerted activity, he is justified in taking any "economic action" necessary to counteract economic action by a union. The General Counsel contends that there is no basis in the Act for this distinction.7 We agree. In our opinion, the Act does not permit a discharge to reduce, by' anticipatory action, the effectiveness of an expected strike by a labor organization." The Board has held, with judicial approval, that an employer's economic interest in preventing a strike does not justify him in engaging in conduct of the type proscribed by the Act .9 The fact that the expected strike may be so timed or so directed as to place severe economic pressure on the employer does not, in our judg- ment, remove the strikers from the protection of the Act. Strike activity, actual or threatened, is concerted activity, and concerted activity does not cease to be protected merely because it is, or may be, effective, or because it subjects the employer to economic hardship 1° Any other view would not only be in derogation of the right of em- ployees to,engage in concerted activities, but would also conflict with the express policy of the Act to minimize industrial strife-as the present case strikingly attests. Thus, if in the instant case we accepted the Respondents' view, or that of our dissenting colleague, we would be required to hold that a strike against one Respondent (Old Rose), directly involving only about 60 of its employees, justified the other 34 Respondents in discharging about '700 of their employees, even though they had not participated in the strike but had, in fact, re- mained at work. 9 Obviously, the Old Rose strike was not a "strike " against the other Respondents within the accepted meaning of the term, as there was no concerted cessation of work by the employees of the other Respondents . To hold that employees in a multiemployer unit who remain at work may be treated as strikers , solely because of a strike by other employees, would involve the introduction of a new concept in labor relations-i. e., the vicarious or con- structive strike. We know of no legislative or other warrant for introducing such a concept. _ 4 The General Counsel, in his brief, aptly characterizes this "economic action" argument of the Respondents as a contention that "the use of economic strength necessarily implies legal immunity." 8 In Duluth Bottling Association, 48 NLRB 1335, where a temporary shutdown by an employer in the face of a strike threat was found to be lawful , the Board was careful to point out that the shutdown was "intended solely to protect the respondents' property," and not "to interfere with or discourage union activity or to minimize the effectiveness" of the threatened strike. 9 N. L. R. B. v. Star Publishing Co., 97 F. 2d 465, 470 (discriminatory transfers ) ; Good- year Tire & Rubber Company of Alabama, 21 NLRB 306, 371 (discriminatory discharges) ; Ward Baking Company, 8 NLRB 558, 567; Humble Oil & Refining Co., 16 NLRB 112, 113-1'20. Cf. Leugel-Fencil Company, 8 NLRB 988 , which is distinguishable on the facts. so See N. L. R . B. v. National Broadcasting Co., Inc., 150 F. 2d 895, 900 (C. A. 2, 1945), and cases there cited. MORAND, BROTHERS BEVERAGE CO., ET AL. 413 As stated in the brief filed on behalf of the General Counsel in support of the Intermediate Report : In this case, the effect of granting immunity to the discrimina- tory lock-out by 34 employers, in reprisal against the strike against a 35th employer, would be to multiply the obstruction to commerce. It would set a sweeping precedent for the con- version of any single employer's dispute into an association-wide or industry-wide dispute. An isolated skirmish would become a civil war. Furthermore, adoption of the Respondents' view, or that of our dissenting colleague, would lead to other consequences clearly at variance with the policy of the Act. If, as is contended, the Old Rose strike justified the discharges in this case only because of the peculiar effectiveness of the piecemeal strike strategy of the Local, the same justification would presumably not have existed if the Local had chosen to strike all 35 Respondents simultaneously. The logical corollary of the Respondents' position is, therefore, that a union seeking to negotiate a contract with a group of employers, however large, must strike all or none. If it strikes less than all, its members will be deprived of the protection of the Act; if it strikes all, they will be protected. We cannot give such an incongruous construction, to an Act designed to minimize industrial strife. We find, therefore, in agreement with the Trial Examiner, and in accordance with the position of the General Counsel, that all the Respondents on or about April 8, 1949, discharged their salesmen, in violation of Section 8 (a) (1) and (3) of the Act. Defenses based on alleged violations of Section 8 (b) (1) (B) and 8 (b) (3) The Respondents and our dissenting colleague contend that the salesmen forfeited the protection of the Act because the Old Rose strike and other conduct of the Local allegedly violated Section 8 (b) (1) (B) and S (b) (3) of the Act. It is true, of course, as the General Counsel contends, that no complaint has been issued by the General Counsel alleging such violations, but we agree with the Respondents that this fact alone should not deprive them of the opportunity to have their affirmative defenses considered on the merits by the Board. Section 8 (b) (1) (B) The Respondents contend that the conduct of the Local, in seeking separate negotiations with Old Rose, violated Section 8 (b) (1) (B) 914 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 0 of the Act, which makes it an unfair labor practice for a union or its agents "to restrain or coerce an employer in the selection of his repre- sentative for the purposes of collective bargaining. ..." It is asserted that the employer representatives on the joint nego- tiating committee had been designated by Old Rose as its bargaining representatives, and that the purpose and effect of the strike against Old Rose was to coerce Old Rose, in violation of Section 8 (b) (1) (B), to bargain directly rather than through its designated representatives. The General Counsel contends that there was not, in fact, any refusal by the Local to meet with an agent of any of the Respondents. The evidence indicates only that prior to the strike the Associations had bargained for Old Rose and the other Respondents on an asso- ^ciation-wide basis ; that on April 6, after the collapse of these nego- tiations, the Local called the strike against Old Rose ; that on the following day the Local proposed to Frank, president of Old Rose, that he enter into negotiations for a separate contract; that Frank reserved decision on this proposal ; and that on the same day the dis- charge letters were sent out to all the salesmen, including the strikers. Section 8 (b) (1) (B) of the Act would have been violated, in our opinion, if the Local had coerced any Respondent to designate, as its agent to deal with the Local for a particular purpose, a representative other than the one already selected or desired by such Respondent for that purpose. In this 'case, while it is clear that Old Rose had at the time of the :strike designated the Associations to represent it in association-wide bargaining, there is no evidence that Old Rose desired the Associations to represent it in any separate negotiations for a contract with the Local, should occasion therefor arise; nor is there any evidence that at the time of the strike Old Rose had designated or desired any other representative for such separate negotiations. As the Local's proposal to Old Rose related only to separate negotiations, for which Old Rose had not yet chosen any representative, we find that the strike, insofar as it was designed to implement this proposal, could have had no tendency to restrain or coerce Old Rose in the choice of a representa- tive within the meaning of Section 8 (b) (1) (B).1 L Moreover, even if we assume that Old Rose had designated the Associations to represent it in separate, as well as joint, bargaining, 11 The Local's proposal included an invitation to Frank to act as the bargaining repre- sentative of his firm. As the president , he was the logical person to deal with the Local in the separate negotiations , and there is no reason to believe that if Old Rose had entered into such negotiations , it would have wished to designate a different representative , or that the Local would have refused to deal with a different representative . Chairman Herzog does not join in the reasoning contained in the paragraph that immediately precedes this footnote. MORAND BROTHERS BEVER1AGEl CO., ET AL. 415 the Local's invitation to Frank to meet with it in separate negotiations is not in itself sufficient evidence that the negotiators for the Asso- ciations would have been unacceptable to the Local as the representa- tives of Old Rose for the purpose of such separate negotiations. Such, an invitation does not per se constitute restraint or coercion. So far- as the record shows, the Old Rose strike was called, not because of any' objection by the Local to dealing with the negotiators for the Asso-- ciations, but solely because of the inability of the local to obtain a. satisfactory contract through joint bargaining. Under these circum- stances, wishing to bargain further during the strike on the basis of its demands, the Local had no alternative but to propose separate- negotiations, and such negotiations were in fact proposed to Old Rose.. Viewed in the light of these facts, such proposal could not reasonably be construed by Old Rose as having any object other than to secure- a satisfactory contract. 12 There is, accordingly, no basis in the record, in our opinion, for finding that the strike was designed to restrain- or coerce Old Rose- in the selection of a representative for separate negotiations. The Respondents and our dissenting colleague contend, however,. that even if the Local did not restrain or coerce Old Rose in the choice- of a particular individual or group as its bargaining representative,, the Local violated Section 8 (b) (1) (B) by seeking separate bargain- ing rather than joint bargaining. This contention is completely refuted by our finding below that such conduct by the Local would; not constitute a refusal to bargain within the meaning of Section. 8 (b) (3) of the Act. As we find that this conduct of the Local con stituted an appropriate attempt to engage in collective bargaining- within the meaning of the statute, it necessarily follows that the same- conduct may not be regarded as violative of 8 (b) (1) (B). Moreover, even assuming the validity of our dissenting colleague's: contention that legislative history indicates that one of the aims of Section 8 (b) (1) (B) was to prevent unions from coercing "an em- ployer into joining or resigning from an employer association which, negotiates labor contracts on behalf of its members," we are unable,- on this record, to agree that the Local in this case sought to, or did, coerce any of the Respondents to resign from their Associations or to revoke their designations of the Associations as their bargaining, 12 While the Local did state to Old Rose that "it seems as though a little clique is run- ning that association now," this was offered, we believe, only as an explanation of the failure of the joint negotiations and, in our opinion , falls short of expressing adamant opposition to further dealings with the persons who acted as negotiators for the Associations.. It is significant, in this connection, that about 3 weeks after this conversation, the Local: resumed joint negotiations with the Associations which resulted in settlement of the. contract dispute. '416 DECISIONS OF NATIONAL LABOR RELATIONS BOARD agents. The action of the Local in seeking to bargain on a single- ' employer basis was not inconsistent with retention by the Respondents of their membership in their Associations not, indeed, with the resump- tion of association-wide bargaining at an appropriate time. As we have already pointed out, the Local was not concerned with the Re- spondents' membership in the Associations; it was interested only in securing a satisfactory contract. In urging the applicability of the provisions of Section 8 (b) (1) (B) to this case, the dissenting opinion's reliance on congressional minority reports relating to entirely different provisions is, in our opinion, misplaced. These minority views, taken in their context, do not constitute appropriate evidence of congressional intent with respect to Section 8 (b) (1) (B). Failure to pass proposed legisla- tion banning industry-wide or multiemployer bargaining does not, in our opinion, reflect a congressional intent to foster and promote such bargaining in preference to individual employer bargaining, but only an intent to leave undisturbed the status quo which made such a prac- tice permissible. Nothing which we have decided today runs counter 'to that intent. Finally, the Respondents contend for a construction of Section 8 (b) (1) (B) which would preclude a union from seeking to enter into separate negotiations, in lieu of joint negotiations, even after joint negotiations have collapsed. Such a view is inconsistent with the basic policy of the Act to encourage the practice and procedure of collective bargaining, as it would prevent the parties to a labor dispute from exhausting the possibilities of settling their dispute by collective bar- gaining rather than economic attrition. We do not believe, and are not prepared to hold, that Congress intended Section 8 (b) (1) (B) to curtail collective bargaining in this fashion. Accordingly, upon the present record, we find, in agreement with the Trial Examiner and the General Counsel, that the Local's conduct would not be violative of Section 8 (b) (1) (B) of the Act. Section 8 (b) (3) Section 8 (b) (3) makes it an unfair labor practice for a labor organization or its agents "to refuse to bargain collectively with an employer, provided it is the representative of his employees subject to the provisions of Section 9 (a)." Section 2 (2) of the Act defines the term "employer" as including "any person acting as an agent of an employer." We agree with our dissenting colleague that, as the agent of each of the Respondents in,formulating their labor relations policies and negotiating their collective bargaining contracts, the MORAND BROTHERS BEVERAGE CO., Efr AL. 417 Associations were entitled to be treated as an employer of the em- ployees of each Respondent within the contemplation of the Act. We believe that under the statute the Local was, accordingly required to bargain in the first instance with the negotiators for the Associa- tions until an impasse was reached. This the Local did. Thereafter, on March 16, 1949, the Local sent identical proposed contracts to each Respondent, and on April 7, 1949, the Local proposed separate nego- tiations to Old Rose.. These proposals for separate negotiations and contracts are alleged by the Respondents, and found by our dissenting colleague, to violate Section 8 (b) (3). As already stated, there is no basis in the record for finding that these proposals for separate negotiations precluded the conduct of such negotiations by the representatives of the Associations. More- over, even if we assume that they did, we do not believe that such proposals for separate negotiations would be in derogation of the bargaining rights of the Associations under the Act. The duty of the Local under the Act to bargain with the Associations could be no broader than the authority vested in the Associations to bargain with the Local. The authority of the Associations was, so far as appears from the record, limited to association-wide bargaining, and did not extend to the separate bargaining proposed by the Local to'Old Rose and the other Respondents. Nor would such proposals for separate negotiations, even if they were to preclude participation by association representatives, violate the requirement of Section 8 (b) (3) that the Local bargain with an employer. For each Respondent continued to be an employer under the Act, with whom the Local was free to bargain after an impasse had been reached in association-wide bargaining. For notwithstand- ing its delegation of collective bargaining functions to the Associa- tions, each Respondent continued to maintain the conventional employer-employee relationship with its own employees, directing their day-by-day operations, paying their wages, and even executing separate, although identical, contracts with the Local for its employees. There remains for consideration the issue of whether the Local's proposals for separate bargaining, with or without the intervention of the Associations, violated its duty under Section 8 (b) (3), to bargain on the basis of an appropriate unit. We cannot agree with the dissenting opinion that the association-wide unit was the only appropriate unit in this case and that single-employer units would necessarily be inappropriate where, as in the instant case, the parties have exhausted the possibility of reaching agreement on the basis of a 418 DECISIONS OF NATIONAL LABOR RELATIONS BOARD multiemployer unit: There is nothing in the statute which requires that the unit for bargaining be the only appropriate unit, or the ultimate unit, or the most appropriate unit; the Act requires only that the unit be "appropriate." 13 It must be appropriate to ensure to employees, in each case, "the fullest freedom in exercising the rights guaranteed by this Act." 14 Balancing the instability resulting from the collapse of negotiations on a multiemployer basis against the benefits to be derived from further collective bargaining on a single- employer basis, we conclude that, in this case, to ensure the fullest freedom in exercising the collective bargaining rights guaranteed to employees single-employer units could be found appropriate 15 While such a conclusion might give to unions a limited alternative choice as - to bargaining units, it would reduce to that extent the existing disparity between the treatment accorded employers and unions. Our dissenting colleague has consistently joined in this Board's unanimous decisions 16 permitting employers unlimited free- dom unilaterally to fashion the scope of, or to completely destroy, multiemployer bargaining units by simply withdrawing at any time from such units at their will or fancy. In such cases it is solely the employer who, by his conduct alone, determines whether he will be part of a multiemployer unit or shall constitute a single-employer unit. - Yet, the Board has repeatedly and unanimously given its stamp of approval to units established in this manner regardless of the extent or effectiveness of the multiemployer bargaining history, and even in the absence of an impasse in such bargaining. Our colleague's unwillingness to accord even a semblance of such treatment to a union, under the limited circumstances where negotiations on a multiem- ployer basis have broken down, would seem to contradict his declara- tion, with which we are in wholehearted accord, that the same principles be applied to labor organizations as are applied to employers in determining whether there has been compliance with the statutory duty to bargain collectively. Moreover, even if we were to hold that the association-wide unit is the only appropriate unit in this case, it would still not follow that 13 Appropriate is a word with a well -defined meaning . Webster 's International Dictionary defines it as "Suitable for the purpose and circumstances ; befitting the place or occasion." It carries with it no overtones of the exclusive or the ultimate or the superlative. To convey such thoughts , the words "only" or "ultimate" or "most" must be conjoined with the word "appropriate." The statute does not conjoin them. See also Garden State Hosiery Co., 74 NLRB 318, 324. 14 Section 9 (b). 15 Foreman cf Clark, 74 NLRB 77 , cited in the dissenting opinion, is inapposite because an impasse was reached only with respect to one group of employees , the remaining employees, continuing to be covered by multiemployer contracts . Cf. Pioneer Incorporated, 90 NLRB No. 247 , where the Board refused to permit an'employer to withdraw from , a multiemployer unit only with respect to one group of employees. 10 See , e. g., Johnson Optical Company , et al., 87 NLRB 539 ; Association of Motion Picture Producers, Inc., et al., 88 NLRB 1155. MORAND, BROTHERS BEVERAGEI CO., ET AL. 419 the Local's conduct violated the Act. While it is true that under this, view any bargaining on a single-employer basis with a particular Respondent would be limited to a segment of the appropriate, multi- employer unit, Section 8 (b) (3) does not, in our opinion, require that all the employees in an appropriate unit, particularly in a multi employer unit, be bargained for simultaneously, or that they be covered by the same contract 17 It is sufficient that the party seeking to. bargain for a portion of the statutory unit intends, as did the Local in this case, to negotiate at an appropriate time for the rest of the employees in such unit. The dissenting opinion suggests, however, that the Local's over- tures to the individual members of the Associations are analogous to an employer's attempt to take unilateral action or to deal with individual employees directly, rather than through their statutory agent. As such conduct by an employer has been found, under cer- tain circumstances, to violate Section 8 (a) (5) of the Act, it is'urged that the Local's conduct should be deemed to contravene Section 8 (b) (3).18 However, passing over other possible grounds of dis- tinction, the cases relied upon in the dissent are wholly inapposite because the situations are not at all analogous. Underlying the Board's holdings in all those cases is the concept that an employer's unilateral action and individual bargaining is the antithesis of, and derogates from, the practice and procedure of collective bargaining, which it is the policy of the Act to encourage. Here, however, there was no attempt by the Local to substitute unilateral action or individ- ual bargaining for collective bargaining, but only to substitute for one type of collective bargaining (association-wide) another type of collective bargaining (on a single-employer basis). Thus, the Local's conduct, far from being in derogation of the statutory policy, may well have served to effectuate that policy. Finally, with respect to Section 8 (b) (3), as with respect to Section 8 (b) (1) (B), the Respondents and our dissenting colleague contend for a construction of the Act which would preclude "residual" collec- tive bargaining with individual employers, after negotiations with. the common representative of such employers have failed. As already stated, we are unwilling to take a view of the Act which would frus- trate its basic purpose of encouraging resort to collective bargaining rather than economic action, and which would have required the ' In fact , in the case of multiemployer units, the individual employers , like the employers, in the instant case, frequently execute separate , though identical, contracts. 18 See The Texas Company, et al. (National Maritime Union of America ), 78 NLRB 971, where the Board indicated that it would give the same content to the phrase "refusal to. bargain" in Section 8 (b) (3) as in Section 8 (a) (5). Accord : Conway's Express, 87- NLRB 972. 917572-51-vol. 91-28 420 DECISIONS OF NATIONAL LABOR RELATIONS BOARD salesmen of all the Respondents to strike simultaneously at the risk of forfeiting the protection of the statute. We find, therefore, in agreement with the Trial Examiner, and in accordance with the contentions made on behalf of the General Counsel, that the Local's conduct would not be violative of Section 8 (b) (3) or Section 8 (b) (1) (B) of the Act. In view of our finding above that the Local's conduct would not violate Section 8 (b) of the Act, we deem it unnecessary to pass on the further question whether, assuming that the Local did violate Section 8 (b) of the Act, the.conduct of the salesmen was sufficiently related to such violation as to remove them from the protection of the Act. 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 each of the Respondents, and its officers, agents, successors, and assigns, shall : 1. Cease and desist from : (a) Discouraging membership in Liquor & Wine Salesmen's Union, Local 62, Distillery, Rectifying and Wine Workers International Union of America, A. F. L., or in any other labor organization of its employees, by discharging or otherwise discriminating in regard to their tenure of employment or any term or condition of employment; (b) In any other manner interfering with, restraining, or coercing its employees in the exercise of the right to self-organization, to form labor organizations, to join or assist Liquor & Wine Salesmen's Union, Local 62, Distillery, Rectifying and Wine Workers International Union of America, A. F. L., or any other labor organization, to bar- gain collectively through representatives of their own choosing, and to engage in concerted activities for the purpose of collective bar- gaining or other mutual aid or protection, and to refrain from any and all such activities except to the extent that such right 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, as guaranteed by Section 7 thereof. 2. Take the following affirmative action, which the Board finds will effectuate the policies of the Act: (a) Make whole each of its employees listed in Appendix A attached to the Intermediate Report, in the manner set forth in the section of said Report entitled "The remedy"; 19 Is The Old Rose strikers , however, are not entitled to any back pay unless they uncon- ditionally requested reinstatement during the strike , in which case their back pay will be, computed from the date , of such request. Kallaher and Mee, 87 NLRB 410. MORAND' BROTHERS BEVERAGEI CO., ET AL. 421 (b) Post at its place of business in Chicago, Illinois, copies of the .notice attached hereto marked Appendix A.10 Copies of said notitce, to be furnished each Respondent by the Regional Director for the Thirteenth Region, shall, after being signed by representatives of the individual Respondent, be posted by said individual Respondent im- mediately 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 to insure that the notices are not altered, defaced, or covered by any other material; (c) Notify the Regional Director for the Thirteenth Region in writing within ten (10) days from the date of this Order what steps it has taken to comply herewith. MEMBER REYNOLDS, dissenting : The record in this case shows a history of collective bargaining be- tween the Union and the Respondents on an association-wide basis dating back to 1943. Under established precedent,1 at all times here material, the 'association-wide bargaining unit constituted the only appropriate unit for bargaining, within the meaning of Section 9 (a) of the Act. The Union recognized this fact, and bargained with the Association during the instant negotiations for such a unit up until the time the differences between it and the Association over economic terms in the proposed agreement reached the point of impasse. There- after, on March 16, 1949, the Union sent to each employer-member of of the Association a copy of the agreement containing the terms re- jected by the Association and stated, "It is imperative that this .. . agreement be executed without delay." On behalf of the Em- ployers, the Association replied to these letters, rejected the demand, and objected to the Union's attempted dealings with the individual employers. In March, and at about the time of this exchange of letters, employees of each of Respondents who were members of the Union vested in the Union general authority to strike. On April 6, 1949, the Union called Old Rose's employees out on strike for the admitted purpose of forcing Old Rose to sign the contract proffered to it. From these events, the employers comprising the Association de- duced, and the Trial Examiner in fact found, that each of them faced the threat of strike unless they acquiesced in the individual course of 20 In the event this Order is enforced by decree of a United States Court of Appeals, there shall be inserted in the notice, before the words, "Decision and Order," the words, "Decree of the United States Court of Appeals Enforcing." 21 E. g., Associated Shoe Industries of, America, Inc., 81 NLRB 224; Air Conditioning Company of Southern California, et al., 81 NLRB 946; International Typographical Union, et al. (Baltimore), 87 NLRB 1215; Indianapolis Cleaners and Launderers' Club, 87 NLRB 472: Cleveland Building Supply Co., et al., 90 NLRB 923. 422 DECISIONS OF NATIONAL LABOR RELATIONS BOARD bargaining demanded by the Union. They collectively determined therefore to protect their interest by taking the economic steps giving, rise to the complaint. More specifically, each member of the Associa- tion simultaneously notified every employee that it was his and the Association's belief that the union strike strategy was directed to piecemeal dissipation of their concerted bargaining position, that they could not operate under such circumstances, and that accordingly they were suspending operations. They further requested each em- ployee to settle immediately all business he may have had outstanding with the respective companies. Subsequently, after the Union had resumed bargaining with the Association, each of the association mem- bers including Old Rose reinstated all employees without discrimina- tion. Concededly there was a clear causal connection between the Union's actual and anticipated economic action and the Respondents' decision to suspend operations. However, this Board has long recognized that "an employer may lawfully discontinue or reduce operations for any reason whatsoever, good or bad, sound or unsound, provided only that the Employer's action is not motivated by a purpose to interfere with and defeat its employees' union activity." 22 Applying this principle to the instant case, I am satisfied that the operative facts negate, indeed preclude, a finding that the Employer's conduct was illegally moti- vated or represented willful interference with lawful employee con- certed activity. Thus, at all times since 1943, except for the short period of time embraced by the complaint, the bargaining relations between the Union and the Employers have been amicable, without any intimation in the record of any unfair labor practices on the part of the Employers. The Employer's lack of antiunion bias is further reflected by the fact that during the period of the instant controversy, no attempt was made to replace the employees but in- stead their jobs were kept open and upon the successful conclusion of association-wide bargaining all were actually reinstated without discrimination. Upon the entire record, especially the above facts, and the tenor of the letter notifying the employees to settle their financial affairs with the Employers, I cannot subscribe to the ma- jority's view that the Respondents' temporary shutdown was intended to sever the employee relations of their respective salesmen so as to constitute a "discharge" in any real or practical sense. Indeed, I re- gard such action as an economic lockout in the sense that the term is employed in Section 8 (d) (4) of the Act, which was not intended in fact to disturb the existing employee-employer relationship. 22 Pepsi-Cola Bottling Company of Montgomery, 72 NLRB 601, 602. MORAND' BROTHERS BEVERAG'E1 CO., ET A'L. 423 In my.opinion, such an economic lockout, not unlawfully motivated, is not rendered illegal simply because it had the effect of neutralizing the economic pressure exerted by a union to resolve in its favor an impasse arising out of good-faith bargaining negotiations. We are here testing the legality of the Respondents' conduct in the light of a statutory scheme designed to equate the rights of unions and em- ployers in the conduct of labor relations and to insure to each full opportunity to use their bargaining power in effecting an agreement. As indicated above, the Union here sought to take advantage of the highly competitive nature of the Employers' operations by resorting to a "divide and conquer" strategy designed to force the Employers to abandon association-wide bargaining and to capitulate to its eco- nomic demands on an individual basis. In these circumstances I am compelled therefore to recognize the Employers' decision that all or none should continue operations to be a. proper exercise of defensive •economic power under the present statutory scheme of collective bar- gaining, and I would therefore dismiss the complaint in its entirety. The majority's attempt to equate the instant situation with those unfair labor practice cases cited in footnotes 4 and 9 is entirely mis- leading. Substantially all of those cases turn on a, finding of unlawful motivation, which is here lacking; and none involve the present question of an economic lockout affecting members of a union which is 'contemporaneously seeking to resolve an economic issue on the picket line and not at the conference table. Indeed, in the only two cases <called to my attention where discriminatory motivation was not pres- ent, the Board found that the involved lockout was not violative of the Act.23 Finally, to the extent that the majority argues that any dismissal ,of the instant complaint reflects a new decisional trend, I wish to emphasize that my holding is limited to the facts of this case which :show, inter alia: (a) A long history of multiple-employer bargaining devoid of any unfair labor practices by the Employers; (b) a com- plete temporary cessation of operations by the Employers without :any attempt to replace employees; (c) the reinstatement of all em- ployees without discrimination upon the resumption of association- wide bargaining; and (d) an economic boycott designed not to inter- fere with the relations between the Union and its members or to thwart collective bargaining but having as its principal objective the pro- tection of the Employers' legitimate economic interest and the re- sumption by the Union and its members of collective bargaining in a 23 Lengel-Fencil Company, 8 NLRB 988; Duluth Bottling Association, 48 NLRB 1335. 424 DECISIONS OF NATIONAL LABOR RELATIONS BOARD unit which even the majority concedes to be the most appropriate one. But even if I were to assume, as the majority. finds, that the Em- ployers' conduct would normally constitute unlawful discrimination, I would nevertheless conclude that the Respondent Old Rose cannot be held liable for unfair labor practices under the facts of this case. For unlike my colleagues I believe that : (1) The Union's conduct was violative of Section 8 (b) (1) (B) and 8 (b) (3) of the Act; and (2) that the strike of the Old Rose employees constituted active support of this proscribed Union action and was hence not the kind of concerted activity Section 7 of the Act protects.24 My reasons in support of each of these separable propositions follow : This record clearly established that Old Rose and the other Em- ployers had designated the Association as their "representative for the purposes of collective bargaining," within the meaning of Section 8 (b) (1) (B). It is equally clear to me that the Union, by resort to strike action, sought to force each Employer to bargain directly and individually without the benefit of its duly designated representa- tive-the Association. In reaching a contrary conclusion, the ma- jority resorts to rationalization which disregards reality. Thus, the majority, after conceding that Old Rose desired the Association to represent it in association-wide bargaining, states that "there is no evidence that Old Rose desired the Association to represent it in any separate negotiations for a contract with the Local, should the occa- sion arise"; that "there is insufficient evidence that the negotiators for the Association would have been unacceptable to the Local as the representatives of Old Rose for the purpose of such separate negotia- tions"; and that the Union's coercive demand for separate bargaining with Old Rose could not be construed "as having any object other than to secure a satisfactory contract." The short answer to these views is the fact that separate negotiations are incompatible with employer- wide bargaining. The Union well knew that the Association was functionally organized to represent employers only on a city-wide basis and that all the Employers had empowered it so to act. There- fore, when the Union coercively sought to force Old Rose and the other Employers to engage in separate negotiations, it was virtually requir- ing those Employers to revoke their prior designation of the Asso- ciation. Indeed, I am convinced that the Union deemed the Associa- tion in its representative capacity to be the real stumbling block to a 24 Both the Board and the courts have recognized that not every kind of concerted or union activity is protected . See for example, N. L. R. B. v. Fansteel Metallurgical Corpo- ration, 306 U. S. 240; N. L. R . B. v. The Draper Manufacturing Corporation, 145 F. 2d 199 (C. A. 4) ; American News Company, Inc., 55 NLRB 1302 ; Fontaine Converting Works, Inc., 77 NLRB 1386. MORAND BROTHERS BEVERAGE( CO., ET AL. 425 "satisfactory" contract and that it intended to eliminate the Associa- tion, at least temporarily, from the bargaining table as a means of attaining its immediate bargaining goal. Among other things, this conclusion is indicated by the fact that the Local, in seeking to bargain separately with Old Rose, stated that "it seems as though a little clique is running that Association now," 25 and by the further fact that after the Association, on behalf of each of its members, advised the Union that the individual contracts would not be executed because the Asso- ciation had not agreed to the terms thereof, the Union continued to ignore the Association, responded directly to the Employers, and took economic action to force capitulation through direct negotiation with the Employers. In any event, it cannot be denied that the Union's coercive demand for individual bargaining constituted an attempt to force the Em- ployers to abandon the established practice of multiemployer bar- gaining. The applicability of Section 8 (b) (1) (B) to such an attempt is clearly evidenced by legislative history disclosing gen- erally that Congress desired to protect, in an appropriate case, the practice of bargaining by employers on an industry-wide or multi- employer scale through employer associations.' Thus, it considered and rejected a proposal contained in the House bill as reported 26 which would have banned the practice of industry-wide or multi- employer bargaining. Such rejection took place in the light of state- ments by the opposition that the ban on industry-wide bargaining would preclude "actions by employers to form voluntary associations for the purposes of collective bargaining," would deny employer or- ganizations "the protection afforded employee organizations," and "would create a situation where the weakest member of an industry would set the standard for others." 27 In addition, and more spe- cifically, the Senate Labor Committee, in recommending the enact- ment of 8 (b) (1) (B) provisions in the Senate bill,28 described one of its aims to be the imposition of prohibitions on unions against coercing "an employer into joining or resigning from an employer association which negotiates labor contracts on behalf of its mem- 25 The majority attempts to minimize this evidence by reference to the irrelevant fact that 3 weeks later the Local resumed joint negotiations . Such resumption of joint negoti- ations occurred only after the Local 's economic action had failed to cause the Employers to repudiate their representative. 26 Section 9 (f) of H. R. 3020, as reported ( 80th Cong., 1st Sess.). 27 Senate Minority Report No . 105, Part 2 ( 80th Cong., 1st Sess.), at p. 7 . See also to the same effect the House Minority Report, No. 245 (80th Cong., 1st Sess. ), at p. 88. 2e Section 8 (b) (1) (B ) originated In the Senate as part of S. 1126. Except for the deletion of the word "interfere" from the injunctive clauses , the Act incorporates the lan- guage of the Senate bill in full. 426 DECISIONS OF NATIONAL LABOR RELATIONS BOARD hers." 29 In my opinion, this statement referred to the subject of multi- -employer association for the purposes of concerted bargaining 30 and indicated a clear desire to protect employers against the economic coercion of unions in choosing between bargaining through an asso- ciation on a multiemployer basis or bargaining on a single-employer -basis 31 In the light of the foregoing, I cannot subscribe to my colleagues' .disposition of the 8 (b) (1) (B) facets of this case. On the contrary, I would find, that where, as here, a union coercively demands that individual employers abandon an established practice of collective -bargaining on an association-wide basis and revoke their prior desig- nation of an employer association for the purposes of joint collective bargaining,* the union negates the obligations imposed upon it by :Section 8 (b) (1) (B) of the Act. Nor do I agree with the majority that the Union did not refuse to bargain collectively within the meaning of Section 8 (b) (3) of the Act by seeking to contract separately with the individual members of the Association in this case. My difference with the majority on this phase of the case goes to two aspects of their opinion, viz: (1) That -bargaining within the meaning of the statute could be appropriately -channelized by the Union into a unit confined to the employees of one -member of the'Association under the circumstances of this case; and (2) that bargaining with individual members constitute bargaining ,with "an employer," as that term is employed in Section 8 (b) (3). -I shall discuss each of these findings of my colleagues seriatim. As I have indicated above, established precedent compels a finding 'here that the only appropriate unit for the purposes of collective bar- gaining contemplated by the Act is one association-wide in scope. I would so find. That a single employer unit might be found appro- priate in other circumstances is not here material; for I am convinced that to satisfy the statute bargaining must be within the unit which is deemed to be appropriate under the facts and law in any given 29 Senate Report No . 105 on S. 1126 (80th Cong., 1st Sess. ), at p. 21. 3° This view is consistent with the conclusion reached by Senator Thomas that the effect -of Section 8 (b) (1) (B ) would be to impair the freedom of unions to negotiate with em- ployers as to the scope of bargaining where, as here, a number of employers were associ- ated together. 93 Cong. Rec . 4897. His remarks on this matter quoted in full , were as ^follows : If 8 (b ) ( 1) (13) is designed , as the Chairman of the Committee suggests , to make it an unfair labor practice for a labor union to insist on bargaining on an area or indus- try-wide basis, then it may have, in effect , the exact opposite of that intenOed. This Section then deals not with the procedure of bargaining, but with - the scope of bar- gaining itself. Limiting the subject of collective bargaining does not make for free collective bargaining . On the contrary, it restricts collective bargaining and promotes industrial strife and confusion. 31 I am supported in this reading of the statute by the opinion of Judge Goldsborough in ,Madden v. U . M. TV. A., et al., 79 F. Supp . 616 (U. S . D. C. for the District of Columbia). MORAND, BROTHER'S BEVERAGE CO., Err AL. 427 case.32 Any other view would permit the parties to fix units without regard to whether they achieved the statutory objective of stability and introduced chaos into industrial relations. Indeed, the very con- duct we are considering here, provides demonstrable proof of the deleterious effect upon the public interest in orderly collective bar- gaining, of a "divide and conquer" 33 strategy resorted to as nothing more than an economic expedient and in utter disregard of the estab- lished unit which had for many years stabilized labor relations in the industry. Approval of this conduct thus renders nugatory the very policy upon which the Board relies 34 in finding that the only appro- priate unit in situations of this kind is one association-wide in scope. I therefore find that by seeking to coerce the individual employers to bargain in a unit other than the appropriate one, the Union violated Section 8 (b) (3) of the Act. As I have noted, I also differ with the view of my colleagues that under the facts of the case individual members of an employer asso- ciation are "employers" for the purposes of collective bargaining,, within the meaning of Section 8 (b) (3). This view loses sight of the fact that the individual Employers had actually delegated the employer function of collective bargaining to the Association and thereby made the Association "the employer" for collective bargaining purposes. Accordingly, absent affirmative proof-and none exists here-that the individual members of the Association had withdrawn their delegation of collective bargaining power to that entity, I would find that the Association enjoyed at all times here material the status of "the employer" within the meaning of Section 8 (b) (3). In view of the designated status of the Association, I believe that applicable decisional principles 35 require the conclusion that the. 3, The short answer to the majority 's anomalous view that under the facts of this case' either a single-employer or a multiemployer unit may be appropriate for collective bargain- ing, is indicated by the holding in J. W . Harkins, et al. (47 NLRB 650 ). There , in a con- verse situation involving an employer 's alleged unlawful refusal to bargain for a single- employer unit , the Board stated in part : The evidence before us indicates that the respondent is one of a city-wide group of- employers engaged in the soft-drink business , all of whom have participated in collec- tive bargaining with the Brewers on behalf of their soda-pop bottlers and drivers for a period of several years , and have signed identical contracts with the Brewers . We are, therefore, not convinced that a unit composed of the soda -pop bottlers and drivers, employed by the respondent alone is the appropriate one. 33 It is significant that Congress anticipated the very situation we have presented here in weighing the social desirability of bargaining negotiations on an industry -wide or multi- employer scale . Thus, throughout the reports of both House and Senator Labor Committee members opposed to the proposed ban reference is made to the encouragement such ban' would offer "to follow a policy of divide and conquer" and to "pick . . . off employers- one by one" in situations where standardization of conditions on an industry -wide basis- had proved to be essential to the economic welfare of the public . See e. g., the Senate. Minority Report No. 105, Part 2, on S. 1126 (80th Cong., 1st Sess.), at p. 7. 34 See cases cited footnote 21, supra. As the majority recognizes ( see footnote 18, supra), we are required to test union un- fair labor practices relating to bargaining by the same principles by which we have been guided in determining employer unfair labor practices in the same field. 428 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Union, by negotiating on any matter appropriate for bargaining with any person or group of persons other than the Association committed an unfair labor practice within the meaning of Section 8 (b) (3) of the Act 3s In finding, as I have, that the Union committed violations of the bargaining obligations imposed by the Act, I have not been unmindful of the fact that the delicate problems here presented come to us in the posture of an impasse situation. But I can find no warrant either in policy or precedent for treating the existence of an impasse as a con- trolling factor in the application of the statutory rules pertaining to the collective bargaining relation, and to the responsibilities the existence of such a relation necessarily implies. To the contrary, we have specifically held in the Foreman & Clark representation case (74 NLRB 77) that the existence of impasse in a segment of a multiem- ployer unit "is not sufficient reason for holding that a unit for [such a segment] alone is appropriate," where it appears that "the Council had been duly designated by the [company involved] and its other members to bargain in their behalf." Likewise, in cases involving complaints against employers, I find, rather, an application of the statutory bar- gaining concept preempting the consideration of "impasse" facts as justification for a resort, by either party to a bargaining relation, to action which, if permitted, would endanger the normal operation of the bargaining process, even though it seem economically expedient in a given case. Thus, with the almost uniform approval of the courts, we have not allowed employers to resolve an impasse by going to individual members of a bargaining committee with their, proposals," proffering to striking employees directly the terms last offered to the bargaining representative,38 or by instituting, without prior reference to the bargaining representative, employment terms the latter had indicated would be acceptable before the impasse occurred.39 I am certain that if we had been presented with the problem, we would not have allowed an employer to use his economic strength to channelize the conduct of collective bargaining into a unit less than a, In Medo Photo Supply Corp v. N. L. R. B., 321 U. S. 678, 684, the Supreme Court pointed out that "Bargaining carried on by an Employer directly , with the employees, whether a minority. or majority , who have not revoked their designation of a bargaining agent, would be subversive of the mode of collective bargaining which the- statute has ordained . . . °'' See Air Associates, Incorporated, 20 NLRB 356, 359-362 , enforced with modifications not here pertinent, 121 F. 2d 586 (C. A. 2) ; Reed & Prince Manufacturing Company, 12 NLRB 944 , likewise enforced with modifications not material here, 118 F. 2d 874 (C. A. 1). 88 E. g., Sam'l Bingham's Son Mfg. Co., 80 NLRB 1612. Cf. Cathey Lumber Company, 86 NLRB 157. Kansas Milling Company, 86 NLRB 925; Anchor Rome Mills, Inc., 86 NLRB 1120; The Cincinnati Steel Castings Company, 86 NLRB 592. 89 Crompton-Highland Mills v. N. L. R. B., 337 U. S. 217, enforcing 62 NLRB 1346; of. Craddock-Terry Shoe Corporation, 73 NLRB 1339. MORAND BROTHERS BEVERAGEI CO., ET AL. 429 that comprising the unit appropriate under the law in any given case, even if this seemed to be an economically feasible expedient in the face of an impasse in prior negotiations. Indeed, in those cases where we have certified a union as the representative for the appropriate unit, we have refused to permit the employer to escape liability for refusing to bargain in such an appropriate unit.40 Admittedly, we do not have here a prior certification, but I see no cogent reason for applying a different standard of liability in a case of this kind where the Union recognized and bargained in the association-wide unit as the appropriate one, except for a short period of time when it employed its "divide and conquer" strategy.41 Underlying all decisions. in cases dealing with the employer's bar- gaining obligations, is our firm resolve to furnish to employers no weapon for dissolving the collective strength of employees and for impairing their opportunity-as guaranteed under the Act-to meet with an employer on equal footing and to enjoy the benefits of collective representation.42 I think we would with good reason be subject to grave criticism reflecting on the proper exercise of our judicial func- tions if we were to apply different principles here in the face of a legislative scheme to "impose upon labor organizations the same duty to bargain which under Section 8 (a) (5) . . . was imposed upon employers." 43 The remaining question posed by the Respondent's defense is whether or not employees who support and participate in the unfair labor practices of unions lose the protection of the Act so as to render them vulnerable to discharge by their employer. In my opinion the legislative history of the Act and the Supreme Court's interpretation thereof 44 impel an affirmative answer to this question. Thus, for example, the House Conference Report 45 contains the following perti- nent statements among others : 40 40 See , for example, Conlon Brothers Manufacturing Company, 88 NLRB 107; Clark Shoe Company, 88 NLRB 989 ; J. I. Case Company, Bettendorf Works, 89 NLRB 269; and Landis Tool Company, 89 NLRB 503. 41 The majority would establish a different standard of liability here as a means of counterbalancing our representation rule concerning the employer's ability to fashion the scope of multiemployer units. However, in my opinion , this is not the proper case for such counterbalancing . The voluntary aspect of multiemployer bargaining is more appropriately equitable to joint bargaining by various unions in any given multiemployer unit. Thus, just as an employer is permitted to withdraw from such a unit, it would seem equally appropriate to recognize the right of any union to abandon joint bargaining in a multiemployer unit and to permit it to establish its representative status in a unit confined to a particular employer, whose employees it claims to represent. 41 See the Medo Photo case, supra, footnote 36. 43 The quotations are from the House Conference Report No. 205 (80th Cong., 1st Sess.), at p. 43. 44 In International Union, U. A. W. A., A. F. of L. v. Wisconsin Employment Relations Board, 336 U. S. 245. 45 House Conference Report No. 510, on H. R. 3020 ( 80th Cong., 1st Sess.). 46 Other quotations from this report are appended hereto as the "Appendix to the Dissenting Opinion." 430 DECISIONS OF NATIONAL LABOR RELATIONS BOARD As previously stated, employees are subject to the prohibiti6ns of Section 8 (b) only when they act as agents of representatives, but in these and other cases, when they are disciplined or dis- charged for engaging in or supporting unfair practices, they do not have immunity under section 7 [p. 54]. Under existing principles of law developed by the courts and recently applied by the Board, employees who engage in violence, mass picketing, unfair labor practices, contract violations, or other improper conduct, or who force the employer to violate the law, do not have any immunity under the act and are subject to discharge without right of reinstatement. The right of the employer to discharge any employee for any such reason is pro- tected in specific terms in section 10-(c) [p. 59]. The Supreme Court, in discussing this phase of the amended Act and its legislative history, said as follows (336 U. S. at pp. 260-262) : That Congress has concurred in the view that neither § 7 nor 13 confers absolute right to engage in every kind of strike or other concerted activity does not rest upon mere inference; indeed the record indicates that, had the courts not made these interpre- tations, the Congress would have gone as far or farther in the direction of limiting the right to engage in concerted activities, including the right to strike. The House Committee of Confer- ence handling the bill which became the Labor Management. Relations Act, on June 3, 1947 advised the House to recede from its disagreement with the Senate and to .accept the present text. upon grounds there stated under the rubric "Rights of Em- ployees." H. R. Rep. No. 510, 80th Cong., 1st Sess., p. 38. The Committee pointed out that "the courts have firmly established the rule that under the existing provisions of section 7 of the National Labor Relations Act, employees are not given any right to engage in unlawful or other improper conduct. In its most recent decisions the Board has been consistently applying the principles established by the courts. . . ." And "it was believed that the specific provisions in the House bill excepting unfair labor practices, unlawful concerted activities, and violation of collective bargaining agreements from the protection of section 7 were unnecessary. Moreover, there was real concern that the inclusion of such a provision might have a limiting effect and make improper conduct not specifically mentioned subject to the protection of the act." 41 "The full text of this section of the report is printed in the margin of the Supreme Court's decision as footnote 15 at this point. MORAND BROTHERS BEVERAGE1 CO., ET AL. 431 Thus, the obvious purpose of the Labor Management Amend- ments was not to grant a dispensation for the strike but to outlaw strikes when undertaken to enforce what the Act calls unfair labor practices, .. . Applying the foregoing principles to this case , I would find that by striking, the Old Rose employees sufficiently identified themselves with the unfair labor practices of the Union to render themselves vul- nerable to lockout at least for that reason . Although, as noted above I would otherwise dismiss the complaint as to the other Employers as well, I am not satisfied that the state of the present record estab- lishes that the nonstriking employees sufficiently identified themselves with the Union's unfair labor practices , so as to render applicable the alternative theory upon which I rely as to the Respondent Old Rose. APPENDIX TO THE DISSENTING OPINION EXCERPTS FROM HOUSE CONFERENCE. REPORT NO. 510,48 ON H. R. 3020, 80TH CONG., 1ST SESS., AT PP. 38-40 "Both the House bill and the Senate amendment in amending the National Labor Relations Act preserved the right under section 7 of that act of employees to self-organization, to form, join, or assist any labor organization, and to bargain collectively through represent- atives of their own choosing and to engage in other concerted activi- ties for the purpose of collective bargaining or other mutual aid or protection. The House bill, however, made two changes in that section of the act. First, it was stated specifically that the rights set forth were not to be considered as including the right to commit or partici- pate in unfair labor practices, 'unlawful concerted activities, or viola- tions of collective bargaining contracts. Second, it was specifically set forth that employees were also to have the right to refrain from self-organization, etc., if they chose to do so. "The first change in section 7 of the act made by the House bill was inserted by reason of early decisions of the Board to the effect that the language of section 7 protected concerted activities regardless of their nature or objectives. An outstanding decision of this sort was the one involving a `sit down' strike wherein the Board ordered the reinstatement of employees who engaged in this unlawful activity. Later the Board ordered the reinstatement of certain employees whose concerted activities constituted mutiny. In both of the above instances, however, the • decision of the Board was reversed by the Supreme 11 See also Senator Taft 's summary of these statements at 93 Cong. Rec. 6600. 432 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Court. More recently, a decision of the Board ordering the rein- statement of individuals who had engaged in mass picketing was reversed by the Circuit Court of Appeals (Indiana Desk Co. v. N. L. R. B., 149 Fed. (2d) 987) (1944). "Thus the courts have firmly established the rule that under the existing provisions of section 7 of the National Labor Relations Act, employees are not given any right to engage in unlawful or other improper conduct. In its most recent decisions the Board has been consistently applying the principles established by the courts. For example, in the American News Company case (55 NLRB 1302) (1944) the Board held that employees had no right which was pro- tected under the act to strike to compel an employer to violate the wage stabilization laws. Again, in the Scullin Steel case (65 NLRB 1294) and in the Dyson case (decided February 7, 1947), the Board held that strikes in violation of collective bargaining contracts were not concerted activities protected by the act, and refused to reinstate employees discharged for engaging in such activities. In the second Thompson Products case (decided February 21, 1947) the Board held that strikes to compel the employer to violate the act and rulings of the Board thereunder were not concerted activities protected by the provisions of section 7. The reasoning of these recent decisions ap- pears to have had the effect of overruling such decisions of the Board as that in Matter of Berkshire Knitting Mills (46 NLRB 955) (1943), wherein the Board attempted to distinguish between what it con- sidered as major crimes and minor crimes for the purpose of deter- mining what employees were entitled to reinstatement. "By reason of the foregoing, it was believed that the specific provisions in the House bill excepting unfair labor practices, unlawful concerted activities, and violation of collective bargaining agreements from the protection of section 7 were unnecessary. Moreover, there was real concern that the inclusion of such a provision might have a limiting effect and make improper conduct not specifically mentioned subject to the protection of the act. "In addition, other provisions of the conference agreement deal with this particular problem in general terms. For example, in the declara- tion of policy to the amended National Labor Relations Act adopted by the conference committee, it is stated in the new paragraph dealing with improper practices of labor organizations, their officers, and members, that the `elimination of such practices is a necessary condi- tion to the assurance of the rights herein guaranteed.' .This in and of itself demonstrates a clear intention that these undesirable concerted activities are not to have any protection under the act, and to the extent that the Board in the.past has accorded protection to such activi- MORANDD BROTHERS BEVERAGE CO., ET Air. 433 ties, the conference agreement makes such protection no longer possible. Furthermore, in section 10 (c) of the amended act, as pro- posed in the conference agreement, it is specifically provided that no order of the Board shall require the reinstatement of any individual or the payment to him of any back pay if such individual was suspended or discharged for cause, and this, of course, applies with equal force whether or not the acts constituting the cause for dis- charge were committed in connection with a concerted activity. Again, inasmuch as section 10 (b) of the act, as proposed to be amended by the conference agreement, requires that the rules of evidence ap- plicable in the district courts shall, so far as practicable, be followed and applied by the Board, proof of acts of unlawful conduct cannot hereafter be limited to proof of confession or conviction thereof. "The second change made by the House bill in section 7 of the act (which is carried in the conference agreement) also has an important bearing on the kinds of concerted activities which are protected by section 7. That provision, as heretofore stated, provides that em- ployees are also to have the right to refrain from joining in concerted activities with their fellow employees if they choose to do so. Taken in conjunction with the provisions of section 8 (b) (1) of the conference agreement (which will be hereafter discussed), wherein it is made an unfair labor practice for a labor organization or its agents to restrain or coerce employees in the exercise of rights guaranteed in section 7, it is apparent that many forms and varieties of concerted activities which the Board, particularly in its early days, regarded as protected by the act will no longer be treated as having that protection, since obviously persons who engage in or support unfair labor practices will not enjoy immunity under the-Act." 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 right to self-organization, to form labor organizations, to joint or assist LIQUOR & WINE SALESMEN'S UNION, LOCAL 62, DISTILLERY, RECTIFYING AND WINE WORKERS INTERNATIONAL UNION OF AMERICA, A. F. L., or any other labor organization, to bargain collectively through 434 DECISIONS OF NATIONAL LABOR RELATIONS- BOARD representatives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mu- tual aid or protection, or to refrain from any or all of such ac- tivities except to the extent that such right may be effected by an .agreement requiring membership in a labor organization as a con- dition of employment as authorized by Section 8 (a) (3) of the amended Act, as guaranteed by Section 7 thereof. WE WILL MAKE the following employees whole for any loss of pay suffered as a result of the discrimination against them, as set forth in the Decision and Order:* All our employees are free to become or remain members of the above-named union or any other labor organization except to the extent that this right may be affected by an agreement in conformity with Section 8 (a) (3) of the amended Act. We will not discriminate in regard to hire or tenure of employment or any term or condition of employment against any employee because of membership in or ac- tivity on behalf of any such labor organization. I 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. Edward T. Maslanlca and George L. Weasler, for the General Counsel. Messrs. Samuel L. Golan and Chester F. McNamara, of Chicago, Ill.,, for the Respondents. Mr. S. G. Lippman, of Chicago, Ill., for the Union. STATEMENT OF THE CASE Upon a charge and a supplemental charge duly filed respectively on April 12 and April 29, 1949, by Distillery, Rectifying and Wine Workers International Union of America, A. F. L., herein called the Union, the General Counsel of the National Labor Relations Board,' by the Regional Director of the Thirteenth Region ( Chicago, Illinois ), issued a complaint dated May 4, 1949, against the wholesale liquor dealers named in the caption above (herein collectively re- ferred to as the Respondents ) alleging that the Respondents and each of them had engaged in and were engaging in unfair labor practices affecting com- merce within the meaning of Section 8 (a) (1) and ( 3) and Section 2 (6) and (7 ) of the National Labor Relations Act as amended ( 61 Stat. 136), herein * The Regional Director will insert at this point for each Respondent the names of its salesmen which are listed in Appendix A, attached to the Intermediate Report. I The General Counsel and his representatives at the hearing shall be referred to herein as the General Counsel, the National Labor Relations Board will be called the Board. MORAND, BROTHERS BEVERAGE CO., ET AL. 435 called the Act. Copies of the charges, the complaint, and notice of hearing were duly served upon each of the Respondents and on the Union. With respect to the unfair labor practices, the complaint alleges in substance that on April 7, 1949, each of the Respondents discharged all of its salesmen 2 and has since failed and refused to reinstate any of said employees for the reason that each of them was a member of and assisted the Union and Local 62 of said Union, and engaged in concerted activity for the purposes of collective bargaining or other mutual aid and protection. The Respondents collectively filed an answer and then an amended answer, in both of which they deny the commission of any unfair labor practices or that any of the employees listed in the complaint had been discharged. Pursuant to notices a hearing was held at Chicago, Illinois, on June 14, 15, and 17, 1949, before J. J. Fitzpatrick, the undersigned Trial Examiner duly designated by the Chief Trial Examiner. The General Counsel, the Respondents, and the Union were represented by Counsel.' All participated in the hearing and were granted full opportunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing upon the issues. At the opening of the hearing General Counsel's motion was granted without objection to strike the name Sol Bloom; Inc., as a Respondent from the complaint, and to correct the spelling of two employees listed under Respondent South Shore Liquors, Inc., in Ap- pendix A thereof : Kokin to Lakin and Episoni to Epifani. The General Counsel also moved to strike certain portions of paragraph 9 of the answer and paragraphs 9 and 10 of the amended answer, whereupon coun- sel for the Respondents withdrew their answer and elected to stand on the amended answer. Before ruling was made on General Counsel's motion to strike paragraphs 9 and 10 of the amended answer, Respondents' motions were granted (a) to strike the allegations in paragraph 9 of the amended answer that Local 62 had violated Section 8 (b) (1) (A) of the Act and to substitute in lieu thereof that Local 62 "unlawfully restrained and coerced" the Respondents, and (b) to strike paragraph 10 of the amended answer' Over objection, the General Counsel's motion was granted to strike paragraph 9 of the amended answer .5 2 See Appendix A attached hereto for the list of the salesmen and their employers. 3 At the opening of the hearing -Marshall Korshak entered an appearance as attorney on behalf of the Respondent Windy City Liquor Distributors, Inc. Korshak at that time stated that his client adopted as its answer , the answer and the amended answer, previ- ously filed by Samuel L. Golan on behalf of all the Respondents. Korshak then left the hearing after stating that Mr. Golan was general counsel for the Illinois Wholesale Liquor Dealers Association, of which his client was a member, and that he, therefore, did not intend to participate in the hearing. 4 Paragraph 9 of the amended answer as so amended alleged in substance that in January 1949, the Respondents were engaged in negotiations with Local 62 relative to the terms of a new contract through a committee consisting of representatives of the Illinois Whole- sale Liquor Dealers Association and the Chicago Wholesale Liquor Dealers Association (herein respectively called Illinois Association and Chicago Association) ; that from Jan- uary to April 1949, the Local, contrary to the method of negotiations employed since about 1942 unlawfully restrained and coerced the Respondents in the selection of their bargain- lag representative by attempting to negotiate individual contracts with each Respontlent and, in furtherance of its plan to coerce the Respondents, struck Respondent Old Rose Distributing Co., Inc. G In granting the motion I stated, "I want to make it clear that if it should develop later that the pleadings are not in sufficiently adequate form so far as the answer is con- cerned to permit the Respondents, or any of them, to meet the allegations in the complaint, IVwill entertain a motion to amend the answer at any time providing it conforms to my idea of the proof on the issues." Although the Respondents made no later motion to amend the answer, considerable testimony was thereafter received as background evidence relative to negotiations between the parties prior to 1949. 917572-51-vol. 91-29 436 DECISIONS OF NATIONAL LABOR RELATIONS BOARD At the conclusion of the hearing, counsel for the Union and the Respondents argued very briefly on the record , and since the close of the hearing briefs have been received from the General Counsel and from the Respondents. Upon the entire record in the case, and from my observation of the witnesses, I make the following : FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENTS I find, as alleged in the complaint and admitted in the amended answer, that each of the Respondents herein, namely: Morand Brothers Beverage Co., Sam Cassel Company, Crescent Wholesale Liquors, Inc., Continental Distributing Co., Inc., Judge & Dolph Ltd., Kusper Old Fort Dearborn Co., National Wine & Liquor Co., Inc., Old Gold Distributors, Inc., Old Rose Distributing Co., Old Rose Dis- tributing Co., d/b/a Colonial Liquors, Pioneer Atlas Liquors, Inc., South Shore Liquors, Inc., Union Liquor Co., Inc., Metropolitan Liquor Company, South Side Central Liquor Distributors, Inc., Central Liquor Distributors, Inc., Star Liquors, Inc., Blue Rose Liquor Co., Inc., Casey & Evans, Inc., Gershuny & Epstein, Inc., Inter-National Liquor Co., a Corp., Old Castle Distributors, Inc., Standard Liquors, Inc., Universal Wine & Liquor Co., The Universal Liquor Company, Inc., Windy City Liquor Distributors, Inc., National Cordial Co., Inc. (all Illinois corporations), Sam Friedman, Lena Friedman, Sidney Friedman, Meyer Smith, Mae Smith, Hyman Smith, and Rose H. Smith, individually and d/b/a Capitol Wine & Liquor Co., John L. Piconi and \eno Brauchini, individually and d/b/a City Wine & Liquor Co., Angelo Fantozzi, Stella Fantozzi, Gino Del Dotto and Louis Del Dotto, individually and d/b/a A. Fantozzi & Co., Abraham Cooper, Ida Cooper, Rufus Cooper and Dresmond Rosen, individually and d/b/a West Side Wholesale Liquor Distributor, Dresinond Rosen, Abraham Cooper, Ida Cooper and Max Cooper, individually and d/b/a Merchants Liquor Distributors, Jack Holt and George 1\Iarcus, individually and d/b/a Hol-Mar Co., Oscar Levy d/b/a La Salle Wine & Liquor Co., Harry Weinstein and Joseph Weinstein, individually and d/b/a Roseland Liquor Co., is and at all time material herein has been engaged in the wholesale purchase, distribution, and sale of alcoholic beverages in Chicago, Illinois, and in the course and conduct of its business causes and has continuously caused large quantities of liquor to be purchased, sold, and transported fromand through States of the United States other than the State of Illinois.' I therefore find that each of the above-named Respondents is engaged in com- merce within the meaning of the Act. II. THE ORGANIZATIONS INVOLVED Distillery, Rectifying and Wine Workers International Union of America, A. F. L., and Liquor & Wine Salesmen's Union, Local 62, Distillery, Rectifying and Wine Workers International Union of America, A. F. L., are labor organiza- tions tions within the meaning of the Act. e In the year 1948 , the amount of business transacted by the various Respondents ranged from in excess of $6,000,000 in purchases and $11,000 ,000 in sales by Pioneer Atlas Liquors, Inc., to purchases of over $250 ,000 and sales of about $375,000 by Standard Liquors, Inc. During that year approximately 95 percent of the total purchases and about 5 percent of the total sales of each of the Respondents was outside the State of Illinois. MOIIAt D BROTHERS BRVER'AGE; CO., ET AL. 437 III. THE UNFAIR LABOR PRACTICES A. Background and sequence of events Local 62 was organized in 1942, and since 1943 has had a collective bargaining contract with each of the Respondents herein covering all such Respondents' salesmen. The Respondents although competing for business against each other in the same field are all members of either the Illinois Wholesale Liquor. Dealers. Association or The Chicago Wholesale Liquor Dealers Association.' From the beginning , in working out the terms for the annual contract the following pro- cedure was followed : a joint negotiating committee, consisting of union repre- sentatives on one side, and representatives of the Illinois Association and usually the Chicago Association on behalf of the employers on the other side, negotiated and agreed to the terms and conditions of a contract. This contract was then submitted for approval to the Local and also to each individual Respondent. When all had approved, identical individual contracts were then executed by the Local with each Respondent. The'1948 contract by its terms expired at the end of January 1949. So, about January 4, a joint negotiating committee, selected in the manner above outlined, began conferring on the terms for it new contract to be executed individually by the various Respondents and the Union. By January 22 the negotiators had reached an impasse on the question of an increase in the commission to be paid the salesmen, as demanded by the Union, and a written supplement extending the terms of the current agreement to March 15, 1949, was executed by Joseph O'Neill, president of Local 62,' and Samuel L. (lolan "for and on behalf of each employer member of" the Illinois Association and Allen I3. Schultz on behalf of each employer member of the Chicago Association.' However, the stalemate in the joint committee on the question of additional commission for the salesmen con- tinued. On March 16, after the extension agreed upon by the negotiators had expired, President O'Neill on behalf of the Local sent to each of the Respondents mimeographed copies of a "second supplemental agreement" which extended the terms of the 1948 contract to Janury 31, 1950, and changed the section thereof covering the salesmen 's commission. Accompanying the proposed supplemental Agreement was a letter from O'Neill, as follows : GENTLEMEN : Enclosed please find proposed second supplemental agreement covering your salesmen for the year 1949 and ending February 1, 1950. It is imperative that this second supplemental agreement be executed without further delay. Very truly yours, JOSEPH O'NEILL, President. None of the Respondents executed .the supplement, but on . March 18 Golan as general counsel for the Illinois Association wrote O 'Neill as , follows: This is in reply to your letters of March 16, 1949 in which you urged mem- bers of the Illinois Wholesale Liquor Dealers Association and some of their affiliated companies to sign without delay a contract entitled "Second Supple- mental . Agreement." % T The larger concerns among the Respondents ( called jobbers ) are members of the Illinois Association . The smaller subjobbers are members of the Chicago Association. 8 O'Neill is also president of the International Union. Golan was and is general counsel for the Illinois Association and Schultz was and is counsel for the Chicago Association. 438 DECISIONS OF NATIONAL LABOR RELATIONS BOARD During all the years in which contracts were in existence with your Union, all negotiations have been conducted on an industry-wide basis and no con- tract was ever sent by you to be executed by our members until it was approved by yourself, representing the salesmen and our Labor Committee, representing all the members of our Association in the Chicago area. This fact that negotiations and contracts have been conducted on an indus- try-wide basis, was recognized by you as recently as the extension agreement executed 2 months ago by your attorney on behalf of the Union and by Mr. Allen Schultz and myself, as attorneys for the Chicago Wholesale Liquor Dealers Association and' the Illinois Wholesale Liquor Dealers Association, respectively. We were surprised to find that you on this occasion mailed out these contracts without having previously reached an agreement. You are, of course, cognizant of the fact that neither our Labor Committee, nor Mr. Schultz and myself have agreed to the covenants contained in this Second Supplemental Agreement. Under these circumstances we regret that we must decline to execute these agreements. Sometime in March, probably the latter part of the month, at a meeting of Local 62 attended by salesmen from each of the Respondents, those present voted unanimously to authorize a strike. The strike authorization was general and not limited to any particular Respondent. Rumors of the strike vote came to the attention of the Respondents and at a meeting in the Illinois Association offices about the 1st of April, a form letter was prepared as follows : DEAR : Since the existence of the salesmen's union all contracts have been negotiated and signed on an industry-wide basis. During the negotia- tions last year and this year, we exhibited financial statements prepared by certified public accountants to the Union officials which demonstrated our inability to give any increase in the commission rate. The Union officials agreed that we were unable to give an increase last year and, accordingly, the contract was signed without changing the commission rate. Business conditions certainly cannot be any better in 1949 than in 1948, and it would be sheer folly and economic disaster on our part to grant the salesmen any increase in their present high commission rate. During our negotiations this year, the Union officials admitted that if the commission rate was increased, a large number of wholesalers would have to go out of business, nevertheless, the salesmen's union has called their men off the job and are now picketing. A strike against one house or small group of houses is not just a strike against one individual wholesaler, but it is a strike against our house and all the other wholesalers in Chicago. If we permitted the Union to do this, it would merely be a question of time until each house would be compelled to sign this unfair contract or to close its business doors ; we consider this action by the union to be in the same category as a strike called against all of the wholesalers. The Union officials have been advised and are fully aware of our position and since the salesmen of your Union walked out on one of these houses it is our. position that you have decided to strike every wholesaler who has been a party to the industry-wide negotiations. Accordingly, we ask you to turn over to,us immediately any records, papers, credentials or monies that you may have belonging to us, and come and see us immediately so that we may settle any financial differences that exist to date between us. Very truly yours, NIORAI' D BROTHERS BEVERAGEi CO., ET AL. 439 Copies of this letter were made on the stationery of each individual Respondent and after being signed by management of the particular Respondent, were turned over to the Illinois Association together with the names and addresses of all salesmen working for the Respondent. On April 5 Local 62 over the signature of its president and secretary-treasurer sent to each of the Respondents, except Old Rose, the following communication: GENTLEMEN : We wish to inform you that as an outgrowth for a successor contract covering your salesmen, that not withstanding rumors to the con- trary, the Union has no intention of calling a stoppage of work at your establishment or of interfering with your operations in any manner. Should practical circumstances require a change in point of view, previous ample notice will be given you with an opportunity to adjust outstanding. differences. We wish to affirm that regardless of action taken at any other establish- ment it would be erroneous to interpret such action as a threat of a strike in your establishment. It is our sincere desire that ways and means will be found for the peaceful adjustment of outstanding differences. Certainly the Union as always is receptive to any suggestions you may have in the matter. Very truly yours, The next day, April 6, about noon, the Local struck Old Rose.'° On the 7th of April, under instructions from the various Respondents, the Illinois Association dated the copies of the form letter heretofore referred to and stamped "Old Rose Dist. Co." at the end of the second paragraph thereof" and mailed a copy to all the salesmen employed by each Respondent. On April 8 the salesmen of the various Respondents except. Old Rose, who reported for work, with the exception of those employed by Respondents' Star Liquors, Inc., La Salle Wine & Liquor Co., and Union Liquor Co. were informed that they were no longer employed. The salesmen of Star Liquors, La Salle Wine, and Union Liquor worked on Friday, April 8, but were then notified by management that their employment had ceased. In the meanwhile, on the morning of April 8 a picket line was established by the Local at Old Rose. On Monday, April 11, the picket line was extended to include the premises of Respondents Capitol Wine & Liquor Co., Continental Distributing Co., Inc., Pioneer Atlas Liquors, Inc., South Shore Liquors, Inc., and many of the other distributors.12 The pickets carried banners stating, "Locked out and discharged." On or about May 1, the joint negotiating committee agreed upon the terms of a new contract," and all the salesmen were returned to work. 10 Various members of the Union, including President O'Neill, testified that the strike against Old Rose was called because of failure of that Company to satisfactorily settle a pending grievance. The record fails to disclose that the negotiations of the Union with Old Rose relative to this grievance had reached an impasse. On the contrary, negotiations relative thereto at the time of the strike were proceeding in a reasonably satisfactory manner. There is certainly nothing in these negotiations to indicate dissatisfaction on the part of the Union or any of its members toward the attitude of Old Rose. While the pending grievance may have been an additional reason for selecting Old Rose, I am satisfied from the record and find that the main reason for striking Old Rose was to force it to sign the second supplemental agreement heretofore described. 11 So that the second paragraph concluded with "are now picketing Old Rose Dist. Co." 11 The record is incomplete as to whether a picket line was actually established and main- tained at the premises of each and every one of the Respondents who had released its salesmen. 13 At the time of the hearing the terms of the new contract had not been agreed to by all of the individual Respondents, nor had copies thereof been submitted for signatures in accordhnce with past practice. 440 DECISIONS OF NATIONAL LABOR RELATIONS BOARD B. Conclusions There can be no question that the employees of Old Rose were discharged on or about April 8 and the employees of the other Respondents were locked out because of the action of the Local in striking Old Rose, and I so find. Such action constitutes discrimination on the part of each Respondent against its employees. The Respondents' contention at the hearing and in their brief, as I understand it, is that, while there may have been discrimination against these employees, it was incidental, and brought about because of the action of the Local -(of which all these employees were members) in illegally striking one of the Respondents to force it to sign a contract with the Local, contrary to the traditional industry- wide method of negotiating annual contracts theretofore existing between the Local and all the Respondents ; that having struck Old Rose in violation of the existing working agreement, the Respondents were justified in assuming that if the Local succeeded in securing an individual contract on its terms with Old Rose, it could and would individually strike the other Respondents with the same objective; and that because the action of the Local was a violation of the previ- ously existing contract negotiation arrangements and placed all the Respondents in an embarrassing position economically, the members of the Local should not be permitted to benefit thereby by collecting back pay for the short time theywere not permitted to work. There was no certification or order of the Board covering bargaining between the Local and the Respondents. The parties agreed when they started bargain- ing in 1942 that the negotiations should contemplate arriving at terms that would apply uniformly in all individual contracts eventually executed. The Local employed this time-honored method in 1949 until a stalemate was en- countered. It then decided to take up individually with each Respondent the question of an increased commission, the only matter in serious dispute in the joint negotiating committee. In so doing, the Local was not violating Section S (b) (1) (B) of the Act, as the Respondents maintain-there was no attempt by it to "restrain or coerce" the Respondents in the .selection of their bargaining representative. What the Local did in the spring of 1949 was to bring economic pressure against an individual Respondent (no doubt intending if successful to bring such pressure later against other Respondents) so that it could secure a satisfactory contract for the employees it represented. - There was nothing per, se illegal about this procedure. Furthermore neither a strike nor the threat of a strike (otherwise legitimate) 11 nor fear of economic pressures" or economic hardship 1G justifies discriminatory action against individual workers. In essence, the Respondents' defense to the unfair labor practice allegation in the complaint is that the Local refused to bargain with the Respondents on _t multiemployer unit basis. But the sole issue before me is whether the Respond- ents discriminated against the salesmen in violation of Section 8 (a) (3) of the Act. Unlawful conduct on the part of the Local, if established, would not justify infringement by the Respondents of rights of their employees protected by the Act. (Cf. Sun-Set'Line and Twine Conzpami, etc., 79 NLRB 1487.) Moreover, accepting as proven fact ail the rejected testimony in support of the above defense (most of which testimony already being in the record as background), it appears 14 Natiohal Licorice Co., 309 U. S. 350. Fred.P. Weissman Company, 170 F. 2d 952, enfg. 69 NLRB 1002 (C. A. 6), cert. den., May 9, 1949. American Car and Foundry Co., 161 F. 2d 501 (C. A. 7), enfg. 66 NLRB 1031. "Lakeshore Electric Mfg. Co., 67 NLRB 804. MORAND, BROTHERS BEVERAGE! CO., ET AL. 441 that in 1942 and thereafter the parties adopted the practice of negotiating through the joint committee as a matter of convenience and good business. There is no indication whatsoever that the parties mutually intended to extinguish the right of the employees of each Respondent, at appropriate times, to select and change their bargaining representative. In support of their position that the salesmen are not entitled to back pay, the Respondents cite American Ncics, 65 NLRB 1302 and Thompson Products, 70 NLR73 13, and 72 NLRB 886. But in the American News case the Board based its refusal to reinstate,the employees because it found that they had gone on strike in an effort to force their employer to violate the terms of an existing Federal Statute, and in the Thompson Products case, after reconsideration, the Board refused to order back pay for employees who had struck because the com- pany refused to recognize and bargain with one union at a time when another union had been certified by the Board as the exclusive bargaining agent. In the instant case there was no showing that the strike against Old Rose was for the purpose of causing the Respondent or any of them to violate any existing order or law." I therefore find that no legal justification has been shown for the discriminatory 'treatment of the employees involved herein, and further find that the Respondents, and each of them, by their action in releasing from employment the salesmen listed in Appendix A, have interfered with, restrained, and coerced their em- ployees in the exercise of the rights guaranteed in Section 7 and in violation of Section 8 (a) (3) and (1) of the Act. IV. THE EFFECT OF UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondents, and each of them, set forth in Section III, above, occurring in connection with the operations of the Respondents, and each of them set forth in Section I, above, have a close, intimate, and substantial rela- tion 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. V. THE REMEDY Having found that the Respondents have engaged in certain unfair labor prac- tices, it will be recommended that they cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act. It has been found that the Respondents have discriminated in regard to the tenure of employment of the salesmen listed in Appendix A by discharging or locking them out on or about April S, 1949. Although the record shows that each of these employees was reinstated to his former position about May 1, 1949, he is entitled to reimbursement for working time lost as a result of the dis- criminatory action. It will therefore be recommended that each of the Re- spondents make whole each of the employees listed under its name in Appendix A for any loss of pay or commissions he may have suffered by reason of the discrimination against him, by payment to him of a sum of money equal to that which he normally would have earned in such position from the date of dis- "Even if the Old Rose strike , contrary to the evidence , had been an attempt to force that company to violate the law , a refusal to order back pay could only apply to the Old Rose salesmen because the record shows conclusively that the salesmen of all the other companies were locked out. 442 DECISIONS OF NATIONAL LABOR RELATIONS BOARD criminationagainst him to the date of his reinstatement, less his net earnings during said period." Upon the basis of the foregoing findings of fact, and upon the entire record in the case I make the following : CONCLUSIONS OF LAW 1. Distillery, Rectifying and Wine Workers International Union of America, A. F. L., and Liquor & Wine Salesmen's Union, Local 62, Distillery, Rectifying and Wine Workers International Union of America, A. F: L., are labor organizations within the meaning of Section 2 (5) of the Act. 2. The Respondents, and each of them, by discriminating in regard to the tenure of employment of the employees listed under their names in Appendix A hereof, thereby discouraging membership in Liquor & Wine Salesmen's Union, Local 62, Distillery, Rectifying and Wine Workers International Union of Amer- ica, A. F. L., have engaged in and are engaging in unfair labor practices within the meaning of Section 8 (a) (3) of the Act. 3. By interfering with, restraining, and coercing their employees in the exercise of rights guaranteed in Section 7 of the Act, the Respondents and each of them, have engaged in and are engaging in unfair labor practices within the meaning of Section 8 (a) (1) of the Act. 4. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2 (6) and (7) of the Act. [Recommended Order omitted from publication in this volume.] 11 Crossett Lumber Company, 8 NLRB 440; Republic Steel Company, 311 U. S. 7.