Twin City Milk Producers Association

In the Matter of TWIN CITY MILK PRODUCERS ASSOCIATION and MILK DRIVERS AND DAIRY EMPLOYEES UNION, LOCAL 471, HAULERS' DIVI- SION, AFFILIATED WITH THE AMERICAN FEDERATION OF LABOR Case No. 18-C-1032.-Decided March 28, 1945 Mr. Clarence A. Meter, for the Board. Mr. R. O. Sullivan, of St. Paul, Minn., for the respondent. Messrs. Gene Larson and J. J. Cremers, of Minneapolis, Minn., for the Union. Mrs. Catherine W. Goldman, of counsel to the Board. DECISION AND 'ORDER STATEMENT OF THE CASE Upon an amended charge duly filed on April 6,1944, by Milk Drivers and Dairy Employees Union, Local 471, Haulers' Division, affiliated with the American Federation of Labor, herein called the Union, the National Labor Relations Board, herein called the Board, by its Regional Director for the Eighteenth Region (Minneapolis, Minne- sota), issued its complaint dated May 3, 1944, against Twin City Milk Producers Association, St. Paul, Minnesota, herein called the respond- ent, alleging that the respondent had engaged in and was engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (1) and (5) and Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat. 449, herein called the Act. Copies of the com- plaint, accompanied by notices of hearing thereon, were duly served upon the respondent and the Union. With respect to the unfair labor practices the complaint alleged in substance that the respondent : (1) from about February 7, 1944, by its officers, agents, and supervisory employees, questioned its employees concerning their union membership and activity; disparaged and ex- pressed disapproval of the Union; advised, urged, and warned its employees to refrain from assisting or becoming members of the Union; and advised and warned its employees that if they joined the Union, operations of the plant would be curtailed; (2) on or about Feb- 61 N. L. R. B., No. 7. 69 70 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ruary 17 and 21, 1944, and at all times thereafter, refused to bargain collectively with the Union, which was at all times the exclusive rep- resentative of its employees within an appropriate unit; and (3) by such acts interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. On May 15, 1944, the respondent filed its answer, admitting certain allegations of the complaint with respect to its business and denying all material averments relating to the unfair labor practices. Pursuant to notice, a hearing was held at Elk River, Minnesota, on May 15 and 16, 1944, before W. P. Webb, the Trial Examiner duly designated by the Chief Trial Examiner. The Board and the re- spondent were represented by counsel, and the Union by its repre- sentatives. All parties participated in the hearing. Full oppor- tunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing upon the issues, was afforded all parties. At the conclusion of the hearing, counsel for the Board moved to conform the pleadings-to the proof in respect to minor inaccuracies as to dates and spelling of names and-other matters not related to the fundamental issues. The motion was granted by the Trial Ex- aminer without objection. Rulings on other motions and on the ad- missibility of evidence were made by the Trial Examiner during the course of the hearing. The Board has reviewed all the rulings of the Trial Examiner and finds that no prejudicial error was com- mitted. The rulings are hereby affirmed. The opportunity to pre- sent oral argument before the Trial Examiner at the close of the hear- ing was waived by the parties. On May 29, 1944, counsel for the respondent and counsel for the Board submitted briefs to the Trial Examiner. On September 4, 1944, the Trial Examiner issued his Intermediate Report, copies of which were duly served upon the respondent and the Union. In the Intermediate Report the Trial Examiner found that the respondent had engaged in and was engaging in unfair labor practices within the meaning of Section 8 (1) and Section 2 (6) and, (7) of the Act, and recommended that the respondent cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act. He further recommended that the complaint be dismissed insofar as it alleged that the respondent had violated Section 8 (5) of the Act. Thereafter, the respondent and counsel for the Board filed exceptions to the Intermediate Report. No re- quest for oral argument before the Board at Washington, D. C., was made by any of the parties. The Board has considered the Intermediate Report, the exceptions filed by the parties, and the entire record in the case, and finds that the exceptions are without merit insofar as they are inconsistent with the findings of fact, conclusions of law, and order set forth below. TWIN CITY MILK PRODUCERS ASSOCIATION 71 Upon the entire record in the case, the Board makes the following : FINDINGS OF FACT I. THE BUSINESS OF THE RESPONDENT Twin City Milk Producers Association, a Minnesota corporation with its principal office and place of business in St. Paul, Minnesota, is a cooperative marketing association engaged in the manufacture of butter, cheese, skim milk, dry milk powder, and other dairy products. It operates 11 plants located in and around Minneapolis. Its plant at Elk River, Minnesota, which is about 30 miles from Min- neapolis, is the only plant involved in this proceeding. The respon- dent purchases its raw milk from its members pursuant to a contract with them. The members, about 7,000 farmers, reside within a radius of approximately 40 miles of St. Paul and Minneapolis, Minnesota. The respondent is not under contract to supply its products to the United States Government, but it is subject to a "set-aside order," under which all milk powder produced by it must be tendered to the Government before it can be sold through private commercial chan- nels. The butter produced by the respondent is marketed through the Land-O-Lakes Creameries, Inc., a cooperative marketing associa- tion of which the respondent is a member. During the period from July 1, to December 31, 1943, the respondent produced at its Elk River plant about 260,000 pounds of dry milk powder valued at $33,346, of which about 98 percent was sold outside the State of Min- nesota. The total sales of the Elk River plant during this period amounted to approximately $436,628.59 in value, of which about 7.47 percent was sold outside the State. During the same 6 months, the respondent purchased supplies, for the Elk River plant, valued at approximately $7,519.81, of which about 18.26 percent was shipped to it from outside Minnesota. We find that the respondent is engaged in commerce within the meaning of the Act.' II. THE ORGANIZATION INVOLVED Milk Drivers and Dairy Employees Union, Local 471, Haulers' Division, affiliated with the American Federation of Labor, is a labor organization admitting to membership employees of the respondent. i we also find without merit the respondent's contention that the Board is precluded from asserting jurisdiction because of election proceedings commenced pursuant to the Minnesota State Labor Relations Act prior to the filing of charges before the Board. Under Section 10 (a) of the Act, the Board is granted exclusive power to prevent any person from engaging in specified unfair labor practices affecting commerce. 72 DECISIONS OF NATIONAL LABOR RELATIONS BOARD III. THE UNFAIR LABOR PRACTICES The refusal to bargain; interference, restraint, and coercion 1. The appropriate unit We find, in accordance with a stipulation of the parties, that all production alid maintenance employees of the respondent at its Elk River plant, excluding supervisory employees,2 office and clerical em- ployees, and truck drivers, at all times material herein, constituted, and now constitute, a unit appropriate for the purposes of collective bargaining with respect to rates of pay, wages, hours of employment, and other conditions of employment, and that such unit insures to the employees of the respondent the full benefit of their right to self- organization and to collective bargaining and otherwise effectuates the policies of the Act. 2. Representation by the Union of a majority in the appropriate unit On February 7, 1944, there were 21 employees within the above- found appropriate unit; and on February 10, 1944, there were 24 employees in the unit. On February 7,1944,13 of the employees with- in the unit signed authorization cards designating the Union as their collective bargaining representatives; 3 and on February 8, 1944, 3 additional employees within the unit. signed authorization cards. We find that on February 7, 1944, and at all times thereafter, the Union was the duly designated representative of a majority of the em- ployees in the aforesaid appropriate unit, and that, pursuant to Sec- tion 9 (a) of the Act, the Union was on that date and at all times there- after, and is now, the exclusive representative of all the employees in the aforesaid unit for the purposes of collective bargaining with respect to rates of pay, wages, hours of employment, and other condi- tions of employment. ^. Sequence of events The Union's organizational campaign at the Elk River plant began on February 7, 1944, when Union Representatives Gene Larson and J. J. Cremers met with 16 of the respondent's employees. On that 2 The parties are in disagreement concerning the supervisory status of Chief Engineer Maurice Tiernan, the respondent contending that he is not a supervisory employee, and the Union , that he is. For reasons hereinafter stated, we find that Tiernan is a super- visory employee and, as such , should be excluded from the unit. 3 The authorization cards designated International Brotherhood of Teamsters , Chauffeurs, Warehousemen, and Helpers as the bargaining agent. This is the parent organization of the Union. TWIN CITY MILK PRODUCERS ASSOCIATION 73 date 13 of the employees signed authorization cards designating the Union as their collective bargaining representative, and Larson sent a telegram to H. L. Leonard, the respondent's general manager, advising him that the respondent's employees at the Elk River plant had joined the Union and had instructed the Union to proceed with bargaining negotiations.4 When 'the Union received no reply to this telegram, Cremers wrote a letter to Leonard on February 12, enclosing a pro- posed contract which he informed Leonard had been approved by the employees and requesting Leonard to set a time for meeting with the union representatives during the forepart of the week of February 14 "for the purpose of carrying on negotiations." 5 Again the Union received no reply to its communication. On February 17, Cremers telephoned to Manager Leonard, who then acknowledged receipt of the letter and suggested that a conference be held on February 21. On the afternoon of February 17, following his conversation with Cremers, Leonard, whose office was located in St. Paul, went to the Elk River plant where he called a meeting of all employees during working hours. No similar meeting had been held in 16 years. Ac- cording to the uncontradicted testimony of employees Joe Schwab and Robert Patenaude, whom we credit, they had completed their work shifts early in the afternoon but were requested by Plant Man- ager H. J. Twetten to return to the plant to attend the meeting which was conducted about 4 o'clock. Twetten asked Patenaude to return in order to hear the respondent's "side of the story." Employee Erwin Eull also credibly testified, without contradiction, that he was told about the meeting by Twetten. In the presence of Houlton, the respondent's vice president, and Chyst, a member of the respondent's managerial staff, Leonard read to the assembled employees the fol- lowing prepared statement : "Before proceeding with my remarks, I must explain why I am reading this prepared statement rather than discussing informally with you what I have to say on the situation that has developed from Mr. Cremer's proposal of a labor contract covering the employees 4 The full text of the telegram was as follows, ° "Be addised that your employees at Elk River plant have joined Milk Haulers Section Local 471, Minneapolis, and instructed us to proceed with negotiations . A proposed con- tract will be mailed to you in a few days. In the interest of continued good relations between your company and Local 471 may I suggest you instruct your Elk River manager to not in any way intimidate your employees for having joined our organization " We find that this constituted , and was regarded by the respondent as, a claim of majority representation. The respondent makes no contention to the contrary. 6 The letter stated : "We are herewith submitting to you a proposed contract covering wages and working conditions of your employees at the Elk River, Minnesota , Plant. This contract has been approved by your employees at the above-named plant In order to have an early com- pletion of negotiations , we request that you meet with us sometime the forepart of the week of February 14 for the purpose of carrying on negotiations , and we would appreciate your naming the time of the meeting " 74 DECISIONS OF NATIONAL LABOR RELATIONS BOARD of this plant. - Under the law I, as a representative of your employer, must refrain from making any statements or doing anything which could reasonably be interpreted as encouraging or discouraging membership in any labor organization or discriminating in favor of or against any-employe holding membership in any labor organiza- tion. Accordingly, so as not to be misunderstood or misquoted, I am forced to confine my remarks to this prepared statement. "Perhaps one of the first questions that should be considered is what about after the war? What about your job? What about our obligations under the law and under the proposed contract? Basically, the proposed contract follows the provisions of the Selective Service Act, which in substance provides that a private employer `shall restore such person (soldier,' sailor, marine, etc.) to such position or to a position of like seniority, status, and pay (within forty days after discharge from service) unless the employer's circumstances have so changed as to make it impossible or unreasonable to do so.' "This does not present a serious question so far as your jobs at Elk River are concerned, as only three men so far would be affected by this provision, and with our usual turnover in help these men could work in very nicely when they return from Service, which we hope and pray will be real soon. So we can pass that question. "The next question goes to the entire contract submitted by Mr. Cremer, who claims the contract has been submitted to and approved by those of you who have joined the Union. This contract is much like the one prevailing in Minneapolis, but so far as we know, it ap- plies only to plants engaged in the retail milk business in that city, or the territory immediately surrounding it, which we believe in- cludes Delano where a company has eight milk wagons on the streets in Minneapolis, and possibly Watertown where there is a bottling machine and the headquarters of the Dairy Fresh Creameries of Minneapolis. "That type of operation is far different from that conducted here at Elk River which, as you know, is a manufacturing plant similar to others operating throughout Minnesota producing dairy, products such as we manufacture here. Our competition here is any creamery in Minnesota or Wisconsin that can make butter, sweet cream, powder and other manufactured dairy products and compete with us in our market. Our competitor is not the retail milk dealer operating in Minneapolis. "Typical of this is the proposal in Mr. Cremer's contract that a vacation of four weeks with pay be granted employees. This, pro- posal is so different from the practice prevailing in other creameries that we know of, operating in Minnesota, that it must be clear to TWIN CITY MILK PRODUCERS ASSOCIATION 75 you that this.will put our Association at a distinct disadvantage in competing with creameries having paid vacations of but one or two weeks at best. "There are other provisions in the proposed contract which will have pretty. much the same effect, such as the provision requiring new employes after a certain period to join the Union if they want to con- tinue on the job, requiring temporary or seasonal help to obtain a card from the Union permitting them to work, and requiring each employe who joins the Union to continue as a member if he wants to continue working in this plant. "Weekly pay periods would put us at a further disadvantage with other creameries. "In making these comments on the contract, do not get the impres- sion that we are, denying your right to propose these changes in the working conditions of the plant. We recognize full well your right to make these proposals through bargaining representatives chosen by a majority of the employees in 'the plant or by direct negotiation with Mr. Twetten, or myself, or in any other manner that you choose to follow. However, we DO think it is just as much to your ad- vantage, as it is to ours, for you not to do anything or demand some- thing which will put this plant in a position where it cannot meet its competition, as that would result in a situation which would be bad for all of us. In short, any contract proposals that are made by you or by management must be consistent with the operating factors in the Industry; otherwise, we are placed at a competitive disadvan- tage which, if long continued, will have a marked effect on our oper- ations and on your jobs. "The matter of wages and hours is always of interest to any em- ploye. I want to talk about that a little. Long before Mr. Cremer wrote us about any contract, we had been considering putting all of the Association's plants on the basis of a 40-hour workweek with time and one-half for over forty hours, but since this would affect the com- pensation of the employes involved it was necessary for us to pre- sent the matter to the War Labor Board. As you perhaps know, that Board will not let us increase wages by merely reducing the work- week and maintaining the same salary basis, although it might be willing to let us maintain the same hourly rate on a 40-hour work- week and pay time and one-half for all overtime over forty hours a week and then let us work a 48-hour week. If this should be done, it would amount to an 81/3 percent increase in wages to those em- ployees who then work forty-eight hours per week. "We are not suggesting this as a counter-proposal to Mr. Creiner's contract, but merely to point out that the entire subject of wages and hours has been given careful study and thought long before that con- 76 DECISIONS OF NATIONAL LABOR RELATIONS BOARD tract was ever heard of, and, most important of all , to acquaint you with the necessity of having any wage increase or reduction in hours cleared by the War Labor Board before it can be put into effect. "Just to show you how strict that Board is in matters of this kind, the men in our Saint Paul plant, who are members of the Saint Paul Milk Wagon Drivers Union, did not obtain the $10 raise given em- ployes in the country plants. Accordingly, we agreed with the Union when their contract expired we would grant a similar raise to these employes of the Saint Paul plant and would join with the Union in submitting this increase to the War Labor Board. On September 11, 1943, this was done but as yet no approval has been received from the War Labor Board, and , because of the penalties imposed for violation, we cannot pay the $10 raise to our men until we get the approval re- quested. "Regarding this whole subject of wages paid in other dairy plants operating in Minnesota, similar to that at Elk River, we have studied the wage scales prevailing in those plants and find that our average wage scale is above that in these other plants. If we are to cover our relations with you by written contract , then we will be guided by the contracts in force in these other plants which are competitive with the Elk River Plant and take into consideration the basic wage rate, workweek, etc., that prevail in these other plants operated in coun- try areas . Some of these plants , such as Litchfield, Waconia, Roches- ter, Rush City and the Northfield Condensery, now have Union con- tracts which we undoubtedly could get and take into consideration. "If we should get clearance and place our plant operations on a basis of a 40-hour workweek , that would place our wage scale that much further beyond that paid by the ordinary creamery . The entire subject of a 40-hour workweek with time and one-half above the 40 hours is now being discussed by us with the local office of the Wage- Hour Division . We met them with our attorney on December 23, 1943, and a few days later had another meeting with them, which resulted in their suggestion that we take until March 1 to consider the whole situation that would develop from placing our plants on a 40-hour workweek basis and then let them know what we decide to do about it. "We want you men to know that this whole subject is being given careful consideration by our management and that as a result your `carry home pay' may be raised as much as eight percent. At the same time , we want you to know that there is no assurance that we can carry out the proposal to place this plant and the others on a 40-hour workweek basis, as it depends to a large degree upon obtaining ap- proval from the War Labor Board, and that is just as true with Union contract as without one, as shown by our Saint Paul experience. So, TWIN CITY MILK PRODUCERS ASSOCIATION 77 when we are considering this problem, let us all remember that wage increases are not just a matter of agreement between us, but must finally clear the War Labor Board and obtain its approval. "There is still another matter in the contract proposed by Mr. Cremer which is very vital to us and we believe vital to each one of you, namely, the creation of a `closed shop' in this plant. A `closed shop', as we understand it, means that no one can be employed here unless he is a member of the particular union or has a card from the Union permit- ting him to work in the plant. This is not the first time this provision has been presented to the 51 farmers who constitute our Board of Directors. The Board is unalterably opposed to this `closed shop' idea. They have passed a resolution instructing our officers not to sign ally contract containing a `closed shop' clause, because they claim that every man in our employ should have the right to join a Union or not to join a Union, as he sees fit, and that this organization can do nothing contrary to the basic idea that the American workman need not pay dues, initiation fees or any other monetary consideration to anyone for the privilege of getting or holding a job. "At the same time, it is the established principle of this organization not to play any favorites because any employe joins or refrains from joining any Union. Each employe is to be treated exactly the same as the next in that respect, so that no employe, whether he belongs to a union or not, will be discriminated against by this Association as his employer merely because he does or does not hold membership in a labor organization. These instructions have gone out to all of our Plant Managers as a fundamental employment policy of this Associa- tion. Our Board feels very definitely that this is one of the freedoms for which we are fighting a war, and is as equally true at home as it is abroad. "I need not remind you that we in the food industry are in a very serious war emergency. Our first consideration should be to try to get along as employers and employes, so that working together we can continue to produce the greatest possible amount of food and keep our relationship on a basis of friendship and understanding not only dur- ing the war emergency but beyond. Any other situation would be most unfair to our fighting men and undermine the very thing they are fighting for. "One further thing remains for discussion, namely, our meeting with a representative selected by a majority of the employes in this plant. In doing this we do not wish to ignore such of the employes who have not had a voice in selecting those representatives or have noted [sic] against their selection. By law, we are required to meet with the representative selected by the majority of the plant employes as their bargaining representative, but under that same law we as the employer 639678-45-vol. 61-7 78 DECISIONS OF NATIONAL LABOR RELATIONS BOARD must be reasonably satisfied that a majority in the particular plant have actually designated a certain person or organization as their bar- gaining representative. "Unless we are reasonably satisfied that the claim of representation is sustained, under the State law we cannot enter into negotiations with the bargaining representatives , because if they do not represent a majority of the employes we would then be violating the law. Ac- cordingly, if occasion requires, the employer can petition the Labor Conciliator of this State to investigate the bargaining representative to determine by a supervised vote of the employes involved , voting by secret ballot, that they have selected or designated a certain person or organization as their bargaining representative. "For your information such elections are by secret ballot, so that you can record your vote without fear or favor. You have the right to vote in accordance with your own desires , regardless of whether or not you then belong to any group, or whether you have signed an applica- tion card, authorization , or anything else with any Union or other organization. "The theory is that the will of the majority of the employes of the plant must govern. But, in passing, permit me to say that under the democratic theory that the will of the majority controls, there 'is the companion principle that the majority when acting as such must at all. times recognize and respect the rights of the minority. If it be prop- erly determined that Mr. Cremer or the labor organization he repre- sents has been properly selected as the bargaining representative for a majority of the employes in this plant , the Association will certainly meet with them and endeavor to negotiate a `labor contract.' In doing this, we will be but continuing the most friendly relations we have had with all our employes and which we hope will long continue. If it be determined that no bargaining representative has been selected, we will continue as we have before to meet with any employe or group of employes at any time to discuss any matter regarding their employ- ment or our operation of this plant . We feel certain that Mr. Twetten, the Manager, has the confidence of each one of you and that you all feel perfectly free to discuss any matter with him at any time. This is as it should be. - "In closing, let me say this one thing further : Whatever you decide to do in connection with Mr.' Cremer , or the labor organization he represents , we, as your employer will try to work with you or your representatives in a spirit of full cooperation just as far as we can do so, having in mind that, as your employer , we have certain rights, obligations and duties to the farmers who own and operate this Association. "I want to thank each of you for giving me this opportunity to pre- dent our views to you on these various matters in which we both have TWIN CITY MILK PRODUCERS ASSOCIATION 79 considerable at stake, and I want you to know that I appreciate the attention you have given me while I read this statement." At the close of the speech, which lasted about a half hour, Leonard asked the employees if they had any questions. It appears that one question was asked, and the employees then returned to their work. During the period between the Union's organizational meeting of February 7 and the scheduled bargaining conference of February 21, Plant Manager Twetten and Chief Engineer Maurice Tiernan, super- visory employees whose conduct is attributable to the respondent,' spoke to individual employees about the Union and its possible ad- verse effect on their working conditions. According to the undenied testimony of employee Robert Patenaude, whom we credit as did the Trial Examiner, Tiernan spoke to him several times about the Union in February 1944. On one occasion during the week following the first union meeting, Tiernan warned Patenaude that if the Union came into the plant the employees would be laid off during the slack season 7 and the milk hauled to another plant. During that week Manager Twetten informed Patenaude that he would receive a 2-cent per hour wage raises In other conversations, which usually occurred after union meetings, Tiernan questioned Patenaude concerning the attendance and happenings at the meetings. The undenied testimony of employee Joe Schwab, which we credit as did the Trial Examiner, discloses that although the employees had been working 7 days a week since January 1944, on Saturday, Feb- ruary 12, Tiernan directed Schwab not to report to work on the fol- , lowing day, stating that if "the boys" were going into the Union, they would not work overtime. Thereafter, Schwab worked only 6 days a week. Employee Eull credibly testified that he was told in Feb- ruary that he would work only 6 days a week instead of 7 as he had been. Employee Patenaude also credibly testified that he "never We are unable to accept the respondent's contention that Tiernan is not a supervisory employee for whose conduct the respondent is responsible. Tiernan bears the title of chief engineer and is the only employee in the plant holding a chief engineer 's license. He is responsible for the operation of the boiler room ; sets the duties and hours of work of First-Class Engineers Joe Schwab and John Dale ; approves their requests for leave ; and tells them whether they should work overtime. He also directs the work of laborer Edward Belanger who acts as his assistant on maintenance and repair work. Tiernan receives a higher rate of pay than do the three employees who work under his direction. Moreover, the record reveals that after Tiernan obtained his license as chief engineer in June 1943, Chryst, a member of the respondent's managerial staff, told employee Schwab that Tiernan would be his "boss." Other employees also regarded him as a "boss." We find that Tiernan is a supervisory employee ; that he was held out to, and reasonably regarded by, the employees as a representative of management ; and that his conduct is attributable to the respondent. 7 According to the credible and undisputed testimony of Patenaude, who at that time had been employed by the respondent since April 1942, it was not customary for employees to be laid off during the slack season. 8 The raise was given to Patenaude on March 5, 1944, and was made retroactive to February 1. The respondent offered no explanation as to the reason for the raise or concerning any custom or practice to give raises 80 DECISIONS OF NATIONAL LABOR RELATIONS BOARD had a regular day off until joining the Union." The respondent offered no explanation for this change in hours. The undenied and credible testimony of employee Erwin Eull re- veals that about the middle of February 1944, Chief Engineer Tiernan requested Eull to stop by after work. When Eull appeared in re- sponse to this summons, Tiernan asked Eull what he thought of the Union ; stated that it would be a good idea if the employees would '`just stick together" the way they had been working; cautioned- Eull that if the Union were successful in organizing the plant, a time clock would be installed and half of the employes would be laid off in the slack season; and stated that he had "been around" more than Eull and could give Eull some advice. About February '19, 1944, Manager Twetten asked employee War- ren Brown what he thought of the Union. Brown replied that he did not know much about it and asked Twetten if he thought the plant would be unionized. Twetten answered that he thought it would some day, but that "right now they [the respondent] wasn't really ready to deal with the Union." On February 21, 1944, the scheduled bargaining conference was held at the respondent's St. Paul office. The respondent was represented by W. S. Moscrip, president; S. M. Houlton, vice president; Fred Roche, secretary-treasurer; A. T. Frank, member of the Executive Committee ; and General Manager Leonard. The Union was repre- sented by Larson and Cremers. The meeting lasted about 40 minutes, and the Union's proposed contract was briefly discussed. Moscrip stated that the respondent would not accept the contract, which it considered unsuitable for a rural plant such as the one at Elk River. The provisions concerning wages, hours, vacations, and union security were mentioned, and Moscrip informed the union representatives that the respondent would never agree to a closed shop and could not pay the wages nor grant the vacations outlined in the contract. Larson pointed out that the terms were "negotiable and subject-to adjust- ment." Moscrip, however, offered no counterproposals. Instead, he then, for the first time, questioned the Union's authority to represent the employees at the Elk River plant. Larson suggested that the Union's majority status be determined by submitting its authorization cards for examination to a neutral party and a handwriting expert, but Moscrip insisted that it be determined by an election. The Union submitted to the respondent's request, and an unsuccessful attempt was made to communicate with the State Labor Conciliator, under whose auspices. an election could be held. After some discussion in regard to expediting the conduct of the election, the conference was The findings in this paragraph are based upon the uncontradicted and credible testimony of Brown. TWIN CITY MILK PRODUCERS ASSOCIATION 81 adjourned with the understanding that negotiations would be 'sus- pended until the Union's majority was established by the election. Larson and Cremers then went to the union office where Larson again telephoned to the State Labor Conciliator and requested him to ar- range a consent election." On February 25, 1944, Union Representative Cremers and the re- spondent's president, Moscrip, met with the State Labor Conciliator in the latter's office in St. Paul for the purpose of executing a consent election agreement. There was no controversy concerning the appro- priate unit, but the parties were in disagreement with respect to the eligibility date for voting in the election. Cremers contended that February 7 should be used to determine eligibility; Moscrip contended that February 14 should be used." Cremers finally agreed to the date proposed by Moscrip. The consent election agreement was not signed, however, because Moscrip stated that he could not do so until it was approved by the respondent's Executive Committee. So far as the record shows, no action was taken thereon by the Executive Commit- tee; and the instrument was never executed. In fact, the Union re- ceived no further communication from Moscrip or any other repre- sentative of the respondent. On February 28, 1944, the Union filed a petition under the State Labor Act, requesting an investigation and certification of representa- tives of employees at the Elk River plant. On March 14, 1944, the State Labor Conciliator conducted a hearing as to the appropriate date for determining eligibility and fixed it as February 9. On March 20, an election was ordered to be held on March 24. Meanwhile, the Union, having learned of the speech delivered by General Manager Leonard to the employees at the Elk River plant, filed charges of unfair labor practices with the Board on March 22. Thereupon, the State Labor Conciliator postponed the election indefinitely. On March 23, the day before the election was scheduled to be held, Chief Engineer Tiernan repeated to employee Joe Schwab the warning which he had previously given to employees Patenaude and Eull that if the employees joined the Union, they would be laid off during the slack season and the milk would be hauled to another plant.12 Sometime in March, following the posting in the plant of a notice postponing the election, employee Warren Brown spoke to Plant Manager Twetten concerning the postponement. At that time, ac- cording to the undisputed testimony of Brown, whom we credit as 10 This discussion of the bargaining conference of February 21 is based upon the credible and undisputed testimony of Larson and Cremers . The respondent 's representatives at the meeting did not testify at the hearing. 11 The respondent had -hired three new employees within the appropriate unit on February 10. 12 This finding is based upon the credible and undenied testimony of Schwab. 82 DECISIONS OF NATIONAL LABOR RELATIONS BOARD did the Trial Examiner, Twetten informed him that he did not have to join the Union in order to get a raise in pay. 4. Conclusions (a) Interference, restraint, and coercion 'Upon the facts here disclosed the respondent has engaged in a coercive course of conduct designed to defeat the self-organization of the employees at its Elk River plant. Ignoring the Union's plea in its telegram of February 7, 1944, to General Manager Leonard that he inform the manager at the Elk River plant not to intimidate the employees for having joined the Union, the respondent began its anti-union campaign immediately thereafter. Plant Manager Twet- ten and Chief Engineer Tiernan indicated to the employees the re- spondent's hostility to the Union and intimated that economic re- prisals would result from organization of the plant. Thus, Tiernan interrogated Patenaude and Eull concerning- the Union; warned Patenaude, Eull, and Schwab that employes would be laid off during the slack season, contrary to the respondent's prior custom, if the Union succeeded in organizing the plant; cautioned Eull that a time clock would be installed if the plant were organized; threatened Schwab with abolition of overtime work if the employees joined the Union, and implemented this threat by, in fact, not permitting em- ployees to work overtime. Twetten impressed upon Brown the futility of union organization by telling him that the respondent was not yet ready to deal with the Union and advising him that he did not have to join the Union in order to obtain a wage increase. Dur- ing this period employe Patenaude was, in fact, granted a wage in- crease which Manager Twetten had promised him shortly after the Union's organizational meeting. We find that the foregoing activi- ties of Tiernan and Twetten constituted interference, restraint, and coercion, within the meaning of the Act. Since these activities were coerciye, they were not privileged under the Constitution as the re- spondent contends. On February 17, 1944, General Manager Leonard made more evi- dent to the employees the respondent's opposition to the Union. Al- though he was previously informed that the employees had already selected the Union as their collective bargaining representative and had approved the proposed contract which the Union had submitted as a basis for negotiations, General Manager Leonard, before the scheduled meeting with the union representatives to discuss the terms of the proposed contract, had the employees assembled at the plant during working hours for the express purpose of discussing the terms of the Union's proposed contract. After paying lip service to the c TWIN CITY MILK PRODUCERS ASSOCIATION '83 statutory mandate that he refrain from discriminating against em- ployees because of their union membership, Leonard discussed the specific provisions of the contracl and pointed out the probable com- petitive disadvantage to the respondent's business and the consequent undesirable effect upon the employees' terms and conditions of em- ployment which would result from the execution of such a contract. He categorically stated that the respondent was "unalterably op- posed" to a closed shop and would sign no contract containing such a clause. Instead, he promised what amounted to about an 8-percent wage increase subject to approval of the War Labor Board and the Wage and Hour Division. Despite Leonard's bland observation to the employees that this was not being suggested as a counterproposal to the Union's proposals, the employees could not help but so regard it. Viewed realistically in the setting in which it was made, we find that, the promise of an 8-percent wage increase constituted a counter- proposal to the Union's proposals and was so intended and regarded. Pointing out that the respondent's average wage scale was higher than that in other comparable plants, Leonard threatened to adopt a lower wage scale if a contract with the Union were executed, because in that event he stated that the respondent would be guided by the lower wage scales prevailing in competitive plants which had contracts with labor organizations. Without having previously questioned the Union's majority representation claim and without informing the employees of the meeting with the Union scheduled for February 21, Leonard concluded his speech by discussing the Minnesota State Labor Law with its election procedure, the implication of which was that the employees would be given an opportunity to decide whether ,they wanted the Union and Representative Cremers to represent them. We find no merit in the respondent's contention that Leonard's speech is privileged under the constitutional guarantee of free speech. In this speech the respondent ignored the Union as the employees' exclusive bargaining representative and dealt directly with the em- ployees concerning wages, hours, and working conditions at a time when negotiations on these subjects were pending with the Union. Such conduct is a direct violation of Section 8 (1) of the Act. Furthermore, Leonard's threat of economic reprisals against the em- ployees by adopting a lower wage scale in the event of the execution of a contract with the Union, in itself constituted interference, re- straint, and coercion within the meaning of. the Act. Delivered in a setting where the listeners were economically dependent upon, and compelled to give heed to, the speaker, the whole tenor of the speech was to coerce the, employees into repudiating the Union which had already been selected by them as their exclusive bargaining repre- 84 DECISIONS OF NATIONAL LABOR RELATIONS BOARD sentative and the proposed contract which they had previously ap- proved and concerning which negotiations with the Union were then pending. We find that by the statements and conduct of Plant Manager Twetten and Chief Engineer Tiernan, as hereinabove set forth, and by the prepared statement of General Manager Leonard, the respon- dent interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. (b) The refusal to bargain The respondent's policy concerning negotiations with the Union was both vacillating and deceptive. Upon receiving the Union's telegram of February 7 advising the respondent that its employees had selected the Union as their bargaining representative and had instructed it to proceed with negotiations, and the Union's letter of February 12 enclosing a proposed bargaining contract and requesting the respond- ent to set a time for meeting with the Union, the respondent made no attempt to communicate with the Union. It was only when Union Representative Cremers telephoned on February 17 that General Man- ager Leonard acknowledged receipt of the Union's claim and the pro- posed contract. Leonard then agreed to hold a bargaining conference with the Union on February 21, but later in the afternoon of February 17, he bypassed the Union by appealing over its head directly to the employees assembled through his direction at the plant during work- ing hours. Although Leonard had been informed by the Union that its proposed contract had been approved by the employees, he never- theless,-on that occasion, discussed the terms of the Union's proposed contract as a whole and then took up the specific provisions relating to vacations with pay, the closed shop, weekly pay periods, wages, and hours. The burden of his discussion was that the respondent was opposed to the Union's proposals and that their adoption would react to the employees' disadvantage. As an alternative Leonard offered a counterproposal of about an 8-per cent wage inciease, subject to gov- ermental approval but without the necessity for collective bargaining with the Union, and threatened economic reprisals in the form of a lower wage scale if the employees required the respondent to execute a contract with the Union. In sum, Leonard attempted to undercut the Union's authority and dissipate its claimed majority by dealing di- rectly with the employees on matters pending for negotiation with the Union and by coercing them in their self-organizational rights. Such conduct is in direct derogation of the statutory mandate requiring the respondent to deal only with the exclusive bargaining representative, in this case the Union. At the same time, the coercive statements and TWIN CITY MILK PRODUCERS ASSOCIATION 85 conduct of Plant Manager Twetten and Chief Engineer Tiernan, here- inabove found, were directed toward the achievement of the same result. Leonard's speech foreshadowed the position which the respondent took at the bargaining conference with the Union on February 21. At that time the respondent evinced an uncompromising attitude by asserting its unalterable opposition to the closed-shop provision and by rejecting, without any counterproposals, the provisions relating to wages, hours, overtime, and vacations, provisions which constituted the very marrow of the proposed contract. After having thus gone through the formal motions of bargaining, the respondent then, for the first time, questioned the Union's majority status. It refused the Union's suggestion of a card check, insisting that the Union's majority be established only by an election, a method of proof which would enable the respondent to benefit from its prior unfair labor practices directed toward the dissipation of the Union's majority. The re- spondent may not take advantage of its unfair labor practices to refuse to bargain with the Union 13 When the Union acceded to the respondent's demands concerning the election and the eligibility date, the respondent adopted a shifting position with respect to the election, first agreeing to a consent election and then failing to execute the con- sent election agreement or even to notify the Union about its change of position in regard to it.14 That the respondent did not approach the negotiations with an open mind, a spirit of cooperation, and a sincere effort to reach an agreement is apparent from Plant Manager Twetten's statement to employee Brown about February 19, that the respondent was not "really ready to deal with the Union." We find that the respondent, by its whole course of conduct, here- inabove outlined, evinced an unwillingness to take an active and sin- cere part in negotiating with the Union to the end that a collective agreement might be consummated and failed to bargain with the Union in good faith. We find further that by conditioning its will- ingness to bargain with the Union upon proof of the Union's majority status only through the conduct of an election, after having engaged in- unfair labor practices directed toward the dissipation of the Union's prior unchallenged majority representation claim and status, the respondent refused to bargain with the Union within the 11 Cf N. L R. B. v Burke Machine Tool Co , 133 F ( 2d) 618 ( C C A 6 ), enf'g as modified, 36 N. L. R. B . 1329 ; and Medo Photo Supply Corp v. N L R B , 321 U. S 678, enf'g 43 N L. It. B 989. 14 See Matter of Concordia Ice Company, Inc, 51 N. L. It. B. 1069 , enf'd 143 F (2d) 656 (C C A. 10 ), where the Board found that an employer violated Section 8 (5) of the Act by its shifting position on the issue of a consent election , together with its other acts and conduct. 86 DECISIONS OF NATIONAL LABOR RELATIONS BOARD meaning of Section 8 (5) of the Act. 15 Accordingly, we find that on February 17 and 21, 1944, and at' all times thereafter, the respondent refused to bargain collectively with the Union as the exclusive rep- resentative of its employees in an appropriate unit, thereby inter- fering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the respondent set forth in Section III, above, oc- curring in connection with the operations of the respondent described in Section I, above, have a close, intimate, and substantial relation to trade, traffic, and commerce, among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that the respondent has engaged in and is engaging in certain unfair labor, practices, we shall order it to cease and desist therefrom and to take certain affirmative action designed to effectu- ate the policies of the Act. We have found that the respondent refused to bargain collectively with the Union as the exclusive representative of its employees in an appropriate unit. Accordingly, we shall order the respondent, upon, request, to bargain collectively with the Union as such representative with respect to rates of pay, wages, hours of employment, or other conditions of employment. Upon the basis of the foregoing findings of fact and upon the entire record in the case, the Board makes the following : CONCLUSIONS OF LAW 1. Milk Drivers and Dairy Employees Union, Local 471, Haulers' Division, affiliated with the American Federation of Labor, is a labor organization within the meaning of Section 2 (5) of the Act. 2. All production and maintenance employees of the respondent at its Elk River plant, excluding supervisory employees, office and clerical 'employees, and truck drivers, at all times material herein constituted, and now constitute, a unit appropriate for the purposes '5,The Union 's acquiescence in the suspension of negotiations pending the outcome of the election indicated no more than a willingness to accept the best terms it could obtain under the circumstances and did not relieve the respondent of its statutory duty to bar- gain with the Union at that time . Cf. McQuay-Norris Mfg Co. v. N. L. R. B., 116 F. (2d) 748 (C. C A. 7 ), cert. denied 313 U. S. 565 , where the Union' s acceptance of a contract granting recognition for its members only was held not to relieve the employer of its statutory duty to grant exclusive recognition. - TWIN CITY MILK PRODUCERS ASSOCIATION 87 of collective bargaining within the meaning of Section 9 (b) of the Act. 3. Milk Drivers and Dairy Employees Union, Local 471, Haulers' Division, affiliated with the American Federation of Labor, was on February 7, 1944, and at all material times thereafter has been, the exclusive representative of all the employees in the aforesaid appro- priate unit for the purposes of collective bargaining within the mean- ing of Section 9 (a) of the Act. 4. By refusing to bargain collectively with Milk Drivers and Dairy Employees Union, Local 471, Haulers' Division, affiliated with the American Federation of Labor, as the exclusive representative of its employees in the aforesaid appropriate unit, the respondent has en- gaged in and is engaging in unfair labor practices within the meaning of Section 8 (5) of the Act. 5. By interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act, the re- spondent hac engaged in and is engaging in unfair labor practices within the meaning of Section 8 (1) of the Act. 6. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2 (6) and (7) of the Act. ORDER Upon the basis of the foregoing findings of fact and conclusions of law and pursuant to Section 10 (c) of the National Labor Relations Act, the National Labor Relations Board hereby orders that the re- spondent, Twin City Milk Producers Association, St. Paul, Minnesota, its officers, agents, successors, and assigns shall : 1. Cease and desist from : (a) Refusing to bargain collectively with Milk Drivers and Dairy Employees Union, Local 471, Haulers' Division, aff=iliated- with, the American Federation of Labor, as the exclusive representative of all production and maintenance employees of the respondent at its Elk River plant, excluding supervisory employees, office and clerical employees, and truck drivers ; (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 Milk Drivers and Dairy Employ- ees Union, Local 471, Haulers' Division, affiliated with the American Federation of Labor, or any other labor organization, to bargain col- lectively through representatives of their own choosing, and to engage in -concerted activities, for the purpose of collective bargaining or other mutual aid or protection as guaranteed in Section 7 of the Act. 88 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 2. Take the following affirmative action which the Board finds will effectuate the policies of the Act : (a) Upon request, bargain collectively with Milk Drivers and Dairy Employees Union, Local 471, Haulers' Division, affiliated with the American Federation of Labor, as the exclusive representative of all production and maintenance employees of the respondent at its Elk River plant, excluding supervisory employees, office and clerical em- ployees, and truck drivers, with respect to rates of pay, wages, hours of employment, or other conditions of employment; (b) Post at its plant at Elk River, Minnesota, copies of the notice attached hereto, marked "Appendix A." Copies of said notice, to be furnished by the Regional Director of the Eighteenth Region, shall, after being duly signed by the respondent's representative, be posted by the respondent immediately upon receipt thereof and maintained by it for sixty (60) consecutive days thereafter in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the respondent to insure that said notices are not altered, defaced, or covered by any other material; (c) Notify the Regional Director for the Eighteenth Region in writ- ing, within ten (10) days from the date of this Order, what steps the respondent has taken to comply herewith. Mx. GERARD D. REILLY took no part in the consideration of the above Decision and Order. 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 Milk Drivers and Dairy Em- ployees Union, Local 471, Haulers' Division, affiliated with the Ameri- can Federation of Labor, or any other labor organization, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection. All our employees are free to become or remain members of this union, or any other labor organization. ' We will bargain collectively upon request with the above-named union as the exclusive representative of all employees in the bar- gaining unit described herein with respect to rates of pay, hours of k TWIN CITY MILK PRODUCERS ASSOCIATION 89 employment or other conditions of employment , and if an under- standing is reached , embody such understanding in a signed agree - ment. The bargaining unit is : All production and maintenance employees at the Elk River plant, Elk River, Minnesota , excluding supervisory employees , office and clerical employees , and truck drivers. TWIN CITY MILK PRODUCERS AssoCIATION, (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. q