Cape Arago Lumber Co.

In the Matter of CAPE ARAGO LUMBER COMPANY and INTERNATIONAL WOODWORKERS OF AMERICA, LOCAL 116, CIO Case No. 19 C-1365.-Decided July 18, 1946 Mr. Erwin A . Peterson, for the Board. Mr. George Browvn, of Portland, Oreg., and Mr. Marvin Berge, of North Bend, Oreg., for the CIO. Mr. Ralph T. Moore, of Coos Bay, Oreg. , for the respondent. Mr. J. W. Mclnturff, of Coos Bay, Oreg., for Local 2573. Mr. Nathan Saks, of counsel to the Board. DECISION AND ORDER On December 12, 1945, Trial Examiner Thomas S. Wilson issued his Intermediate Report in the above-entitled proceeding, finding that the respondent had engaged in and was engaging in certain un- fair labor practices, and recommending that it cease and desist there- from and take certain affirmative action, as set forth in a copy of the Intermediate Report attached hereto. Thereafter, Lumber and Sawmill Workers, Local Union No. 2573, filed exceptions to the Inter- mediate Report and a supporting brief; no exceptions were filed by the respondent. The Board has reviewed the rulings made by the Trial Examiner at the hearing and finds that no prejudicial error was committed. The rules are hereby affirmed. The Board has considered the Inter- mediate Report, the exceptions and brief, and the entire record in the case, and hereby adopts the findings, conclusions, and recom- mendations of the Trial Examiner, with the modifications and addi- tions hereinafter set forth. 1. The Trial Examiner found that the closed-shop contract between the respondent and Local 2573, which was in effect from March 15, 1944, to March 15, 1945, was not renewed either automatically by its terms, or in any other manner, for the succeeding year. The Trial Examiner, therefore, found that the contract, under which the re- 69 N. L. R. B., No. 73. 572 CAPE ARAGO LUMBER COMPANY 573 spondent attempted to justify the discharges here involved, termi- nated as of March 15, 1945, and accordingly, that by its discharges of Max Leneve and Frank Phillips on March 21, 1945, and Jack Krieschel and C. B. Wilson on March 22, 1945, the respondent dis- criminated in regard to the tenure and the terms and conditions of their employment, thereby discouraging membership in the CIO in violation of Section 8 (3) of the Act. In concluding that the contract did not automatically renew, the Trial Examiner confined his reasons therefor to a finding that the requests for revisions of articles in the contract made by Local 2573 on June 27, 1944, and by the respondent on July 22, 1944, were re- quests in writing to the other party to the contract for termination of or changes in the agreement made 60 days prior to its termination date, and by the terms of its termination clause, such action pre- vented the agreement from automatically renewing itself. In ef- fect, therefore, the Trial Examiner based his finding that the con- tract did not automatically renew on the ground that, since such requests for revision represented technical compliance with the termi- nation clause of the contract, they prevented automatic renewal under the terms of that clause. Local 2573 in its brief contends in substance, however, that although the requests for revisions by it on June 27, 1944, and by the respondent on July 22, 1944, may have represented technical compliance with the termination clause of the contract, both requests having been made 60 days prior to the anniversary date of the contract, such requests for revisions also represented technical compliance with the modification clause of the contract, both having been written notices of a desire to revise the contract given 30 days in advance of such contemplated changes, and that the parties in- tended these requests for revisions to be operative only under the modification clause, which would not have prevented the automatic renewal of the contract. We do not agree that such was the intent of the parties. We are convinced that the entire course of conduct by both parties to the contract from April 1944 through February 1945, displays a con- tinuing and almost uninterrupted intent to terminate the contract on or before March 15, 1945; that their requests for revisions of the contract in June and July 1944, were merely parts of that course of conduct and directed to the same end; and that the action taken by the respondent subsequent to March 15, 1945, indicates a belief on the part of the respondent at least that the contract had terminated on March 15, 1945. Thus, from April 1944 to May 18, 1944, the parties attempted unsuccessfully to replace their individual contract with an area-wide agreement. After the negotiations for an area-wide agree- ment had broken off, the parties made the requests for revisions in question in June and July 1944, and pursuant thereto, attempted 574 DECISIONS OF NATIONAL LABOR RELATIONS BOARD without success in August 19441 to negotiate changes in 17 out of 21 clauses in their individual contract.2 From September 1944 through February 1945, the parties again held negotiations to re- place their individual contract with an area-wide agreement. An area-wide agreement was in fact tentatively agreed upon between the various unions and the member companies of the Association, including Local 2573 and the respondent, in September 1944. How- ever, before the agreement was executed, the unions made. further demands, requiring a reopening of negotiations on February 21, 1945. The resulting area-wide agreement was actually executed by all the unions including Local 2573, and all the member companies of the Association, except the respondent, on March 26, 1945. It was not until March 16, 1945, which was after the expiration of the indi- vidual contract, that Local 2573, for the first time since the various negotiations had begun, expressed an intention to continue under that old agreement and not to enter into an area-wide agreement insofar as its contractual relations with the respondent were concerned ; and it was not until March 19, 1945, that the respondent expressed a simi- lar intention.3 Moreover, the record indicates that the respondent and the Associa- tion both considered the individual contract as having already termi- nated on March 15, 1945, and the respondent's mere expression on March 19 of its intention to continue under that agreement as insuf- ficient to restore it. This is borne out by the fact that on March 26, 1945, when the respondent sought the Association's advice as to what the respondent should do in view of the filing with the Board of a peti- tion for certification as bargaining agent by the CIO, it was advised by Card, the secretary-manager of the Association, not to sign another contract with Local 2573 until after the representation question had "It is not stated by the Trial Examiner , but the evidence shows that the two negotia- tion meetings between the respondent and Local 2573 pursuant to the requests for revisions made in June and July were held on August 4 and about August 18. 2 As stated by the Trial Examiner , however, the action of E. H. Card, secretary -manager of the Oregon Coast Operators Association , the employer association in which the respond- ent is a member , and which handles labor relations on behalf of the respondent and a number of other employers in the district in the same industry , in sending on behalf of the respondent the request of July 22, 1944, to Local 2573 requesting revision of 15 articles in their individual agreement , was deliberately and concededly taken after full consultation with the respondent and other members of the Association for the purpose of "forcing" Local 2573 into negotiating a uniform area -wide agreement with the operators and other locals in the district . Similar letters were sent by Card on behalf of other operators in the Association for the same purpose. We are of the opinion, therefore, that although the respondent's request for revision of the individual contract was alleged to be for the purpose of revising that contract, its real purpose was thereby to force Local 2573 into negotiating an area-wide agreement which was intended to replace the agreements then existing at the individual operations . In the light of such purpose, it is obvious that the respondent 's request for revision in the individual contract on July 22, 1944, actually represented a continuation of its preexisting intent to terminate that contract on or before its next anniversary date, and not merely an intent to modify it. 3 And, as found by the Trial Examiner , there is no evidence that such intention , although expressed, was ever communicated by either party to the contract to the other. CAPE ARAGO LUMBER COMPANY 575 been settled by the Board. This advice was accepted by the respond- ent without question. Clearly this indicates a belief on the part of both the Association and the respondent, that the contract had termi- nated on March 15, 1945, and that a new agreement by the parties was required to reestablish contractual relationship. We are of the opinion, therefore, that although the requests for revisions in the contract by Local 2573 and the respondent in June and July 1944, absent other circumstances, could possibly be construed as having been made pursuant either to the modification clause or the termination clause of the contract, there having been technical com- pliance with both clauses, the entire course of conduct by the parties, up to and after March 15, 1945, including the action of the respondent on March 26, 1945, indicates that they intended these requests for revi- sions to be operative under the termination clause of the contract.' Moreover, we have held, in cases involving contracts with similar modification and termination clauses where similar action was taken by the parties thereto, that requests for substantial modification of such a contract, followed by negotiations thereon, evidences an inten- tion to terminate the contract rather than merely to modify it.' We have so held, even where, unlike the instant case, the request is specifi- cally stated to be only under the modification rather than the termi- nation clause of the contract.' In the instant case, where the parties between them have requested revision of 17 out of a total of 21 clauses in their contract, including the closed-shop clause, they have obviously made requests for substantial modification of the contract. Such re- quests were followed by the two negotiation meetings thereon in August 1944. Accordingly, we consider the negotiations for substan- tial modification of the contract as further evidence that the parties intended the requests for revisions in question to be operative under the termination clause of the contract. We find, therefore, that the requests for revisions in their contract by Local 2573 on June 27, 1944, and by the respondent on July 22, 1944, were, contrary to the contention of Local 2573, intended by the parties to be operative under the termination clause of the contract, and, ac- cordingly, that under the terms of that clause the contract terminated on March 15, 1945. We find further, that regardless of whether the parties may have intended the June-July 1944 requests for revisions to be under the ° We do not consider the fact that the requests for revisions were made considerably in advance of "sixty (60) days prior to expiration " as having been made at an illogical time under the termination clause when viewed in the light of the other action taken both prior and subsequent thereto to terminate the contract in favor of an area -wide agree- ment , and in the light of our conclusion that the requests for revisions had the same under- lying purpose. See Matter of Great Bear Logging Company, 59 N. L. R. B. 701. See Matter of Heat Transfer Products, Ine., 63 N. L. R. B. 1124. 576 DECISIONS OF NATIONAL LABOR RELATIONS BOARD modification clause of the contract, the provisions of the termination clause were such as to prevent an automatic renewal of the contract. The termination clause provides for automatic renewal, absent request in writing either for (1) "changes," or (2) "termination." The written requests for revision made in June-July 1944 were obviously requests for "changes" in the contract. They had a continuing vitality because negotiations for a substitute agreement were still in process on January 15, the automatic renewal date. Inasmuch as a written request for "changes" was still outstanding on the automatic renewal date, the provisions of the termination clause preclude an automatic renewal of the contract regardless of the state of mind of the parties. 2. In footnote 11 of that Section of the Intermediate Report en- titled "The remedy," the Trial Examiner pointed out that there was some testimony indicating that offers of reinstatement had been made to and rejected by certain members of the "green chain gang," but that the record was not sufficiently clear to make definitive findings thereon. He made the observation that if, in fact, certain of these employees did receive and reject offers of reinstatement by the respond- ent subsequent to March 22, 1945, they would be entitled to back pay only to the date such offers were made. In the absence of facts showing the full circumstances surrounding the making of these alleged offers of reinstatement, and the rejections thereof, we do not deem it necessary or proper to attempt to lay down any principle regarding the effect which such offers and rejections would have on the back pay ordered herein. ORDER Upon the entire record in the case and pursuant to Section 10 (c) of the National Labor Relations Act, the National Labor Relations Board hereby orders that the respondent, Cape Arago Lumber Com- pany, Empire, Oregon, and its officers, agents, successors, and assigns, shall : 1. Cease and desist from : (a) Discouraging membership in International Woodworkers of America, Local 116, CIO, or any other labor organization of its em- ployees, or encouraging membership in Lumber and Sawmill Workers, Local Union No. 2573, A. F. L., or any other labor organization of its employees, by discharging or refusing to reinstate any of its em- ployees or by discriminating in any other manner in regard to their hire or tenure of employment or any term or condition of their employment; CAPE ARAGO LUMBER COMPANY 577 (b) By any like or related act or conduct interfering with, re- straining, or coercing its employees in the exercise of their right to self-organization, to form labor organizations, to join or assist Inter- national Woodworkers of America, Local 116, CIO, 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. 2. Take the following affirmative action which the Board finds will effectuate the policies of the Act : (a) Offer to Max Leneve, Frank Phillips, Jack Krieschel, C. B. Wilson, and Marshall Rybin, Clyde Kuhn, Hawley Catfish, Marion Nicholas, Ray A. Muetchler, and Wilfred D. Horton, immediate and full reinstatement to their former or substantially equivalent posi- tions, without prejudice to their seniority and other rights and privileges; (b) Make Max Leneve, Frank Phillips, Jack Krieschel, C. B. Wil- son, Marshall Rybin, Clyde Kuhn, Hawley Catfish, Marion Nicholas, Ray A. Muetchler, and Wilfred D. Horton, whole for any loss of pay they may have suffered by reason of the respondent's discrimination against them, by payment to each of them of a sum of money equal to the amount which he normally would have earned as wages from the date of his discharge or refusal to reinstate to the date of the re- spondent's offer of reinstatement less his net earnings during such period ; (c) Post at its plant at Empire, Oregon, copies of the notice at- tached to the Intermediate Report marked "Appendix A." 7 Copies of said notice, to be furnished by the Regional Director for the Nine- teenth Region, shall, after being duly signed by the respondent's rep- resentative, be posted by it immediately upon receipt thereof, and maintained by it for sixty (60) consecutive days thereafter in con- spicuous 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; (d) Notify the Regional Director for the Nineteenth Region in writing within ten (10) days from the date of this Order, what steps the respondent has taken to comply herewith. 4 Said notice, however, shall be, and it hereby is, amended by striking from the first paragraph thereof the words "The Recommendations of a Trial Examiner " and substitut- ing in lieu thereof the words "A Decision and Order" ; also by inserting in the second para- graph thereof between the words "or any labor organization of our employees," and "by discharging or in any other manner discriminating in regard to their hire or tenure of employment" the words "or encourage membership in Lumber and Sawmill Workers, Local Union No. 2573 , A. F. L., or any labor organization of our employees." 701592-47-vol. 69-38 :578 DECISIONS OF NATIONAL LABOR RELATIONS BOARD INTERMEDIATE REPORT Dlr. Erwin A. Peterson for the Board. Mr. George Brown, of Portland, Oreg., and Mr. Marvin Berge, of North Bend, Oreg., for the CIO. Mr. Ralph T. Moore, of Coos Bay, Oreg., for the respondent. 31r. J. W. Mclnturff, of Coos Bay, Oreg., for Local 2573. . STATEMENT OF THE CASE Upon an amended charge duly filed on September 12, 1945, by International Woodworkers of America, Local 116, CIO, herein called the CIO, the National Labor Relations Board, herein called the Board, by its Regional Director for the Nineteenth Region, issued its complaint dated September 13, 1945, against Cape Arago Lumber Company, herein called the respondent, alleging that the respondent had engaged in and was engaging in unfair labor practices affecting ,commerce within the meaning of Section 8 (1) and (3) and Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat. 449, herein called the Act. -Copies of the complaint and notice of hearing thereon were duly served upon the respondent, the CIO, and Lumber and Sawmill Workers, Local Union No. 2573, herein called Local 2573. With respect to the unfair labor practices the complaint alleged in substance that: (1) the respondent on March 21, 1945, discharged Max Leneve, Frank Phillips, Jack Krieschel, and C. B. Wilson and refused thereafter to reinstate them because they assisted or became members of the CIO; (2) as a result thereof and on the same day employees Marshall Rybin, Clyde Kuhn, Hawley Catfish, Marion Nicholas, Ray A. Muetchler, and Wilfred D. Horton ceased work con- certedly and went on strike; (3) on March 22, 1945, the last named group of employees applied for reinstatement but respondent refused to reinstate them for the reason that they had assisted or had become members of the CIO and had participated in the said strike; and (4) by the discharge and refusal to reinstate all the employees above named the respondent violated Sections 8 (1) .and (3) of the Act. Thereafter the respondent filed its answer wherein certain allegations of the complaint were admitted but the commission of any unfair labor practices was denied. Pursuant to notice a hearing was held at Coos Bay, Oregon, from October 1 to October 4, 11,45, before the undersigned, the Trial Examiner duly designated by the Chief Trial Examiner. At the opening of the hearing, Local 2573 moved to intervene on the ground that it had a valid union shop agreement with the re- spondent which was jeopardized by the allegations of the complaint. The motion to intervene was granted without objection. The Board, the respondent, and Local 2573 were represented by counsel and the CIO was represented by its international representative and the business agent of Local 116. All parties participated in the hearing and were afforded full opportunity to be heard, to examine and cross-examine witnesses, and to intro- duce evidence bearing upon the issues. At the conclusion of the evidence, counsel for the Board moved to conform the pleadings to the proof. This motion was granted without objection. The Board stated its position orally at the hearing and Local 2573 thereafter filed a brief with the undersigned which has been duly considered. Upon the entire record in the case, and from his observation of the witnesses, the undersigned makes the following: CAPE ARAGO LUMBER COMPANY FINDINGS OF FAVr 1. THE BUSINESS OF THE RESPONDENT 579 Cape Arago Lumber Company is an Oregon corporation having its principal of ice and place of business in the City of Empire, Oregon, where it is engaged in the manufacture and sale of lumber and lumber products. In the course of its business operations, respondent manufactures such products valued in excess of $500,000 annually, of which approximately 90 percent is transported in inter- state commerce to and through the States of the United States from the State of Oregon. IL THE ORGANIZATIONS INVOLVED International Woodworkers of America, Local 116, is a labor organization affiliated with the Congress of Industrial Organizations, and admits to member- ship employees of the respondent. Local 2573, Lumber and Sawmill Workers is a labor organization affiliated with the American Federation of Labor, and admits to membership employees of the respondent. - III. THE UNFAIR LABOR PRACTICES A. Tice sequence of events The respondent began its operations at Empire, Oregon, oil May 7, 1941, with a crew composed almost exclusively of members of Local 2573. On May 24, 1941, the respondent and Local 2573 executed a working agreement covering wages, hours, and conditions of employment at the plant. On April 20, 1942, Local 2573 and the respondent executed a new working agreement which superseded the above-mentioned agreement. Among other things, this agreement provided for a check-off of dues. Paragraph XV of this agreement entitled "Union Shop" provided in part as follows : A. The Company agrees to retain in employment only persons who main- tain continuous membership in good standing in Local 2573. C. In event that any employee fails to maintain continuous membership in good standing or make application to join the Union as herein provided, or after making application is rejected by the Union, he shall be discharged by the Employer within a reasonable time upon written notice from the Union. The "Duration and Termination" clause contained in Article XXI of this agree- ment provided in part as follows : This agreement is for a period of time extending from the date of execu- tion to March 15, 1943. When either party to this agreement desires to modify, add to or revise same, lie shall give written notice to the other party at least thirty ( 30) days in advance of such contemplated changes .. . . . . If neither party, sixty ( 60) days prior to expiration , requests in writ- ing changes or termination , this agreement to continue from year to year. Counsel for the Board conceded that this contract was automatically renewed on March 15, 1944 , and continued in full force and effect to March 15, 1945. Neither party requested changes or termination prior to March 15, 1944. 580 DECISIONS OF NATIONAL LABOR RELATIONS BOARD A number of the employers in the district, including the respondent, had formed the Oregon Coast Operators Association for the purpose of handling labor rela- tions on their behalf. In April 1944, this Association and Local 2,573, together with other local unions who had individual contracts with the members of the Association, attempted to negotiate a uniform "area wide" working agreement. After three meetings had proved unfruitful, the negotiations were broken off on May 18, 1944 ; they did not resume until September. On June 27, 1944, Local 2573 addressed the following letter to the respondent: I am instructed by the Union to request you to set a date for a meeting to take up the matter of revising the present working agreement, to conform to standard working agreements. Several months ago the same matter was taken up with your Company, at which time it was reported to the Union that you wished to negotiate a uniform agreement for your branch of the industry. The Union is asking to negotiate at this time, in as much as the negotiating Committee of The District Council has been informed by Mr. E. H. Card, Manager of the Oregon Coast Operators Association, that they think that further negotiations will be useless. The Union would like to revise two "articles" of the present working agreement, the one being, the "hours of labor" article, the other being, the "vacation" article. The War Labor Board has written, standard forms which have been or are being incorporated in all working agreements. Please advise the Union when a meeting may be had, giving date and hour. The respondent turned this letter over to E. H. Card, secretary-manager of the Association , who, under date of July 22, 1944, replied on behalf of the respondent as follows : This is in reply to your letter addressed to the Cape Arago Lumber Company, Empire , Oregon, in which you ask for a meeting date to take up the matter of revising the present working agreement . You specify two "articles," namely, "hours of labor" and "vacation," as the particular articles you wish to revise. Please be advised the Company will be prepared to meet with your Committee August 4, 1944, at 7:30 P . M., in the Company office at Empire. This letter will serve as notice that the Company desires to revise Articles I, II, III, IV, VIII, IX, X, XI, XII , XIII, XIV, XV, XVI, XX and XXI, of the above-mentioned agreement. The respondent and Local 2573 held two negotiation meetings as a result of this correspondence but little , if anything, was accomplished and the attempt was abandoned. Beginning in September 1944, the Association and the local unions, including Local 2573 , resumed their meetings . A number of such meetings were held, at the end of which a proposed area-wide agreement was tentatively agreed upon. D. H. Miller, Sr., respondent's general manager, was one of the Association's representatives during these negotiations and Local 2573 was also present. How- ever, before the agreement was executed , the unions made further demands requiring a reopening of the negotiations on February 21, 1945. Sometime in February or early March 1945, some of respondent 's employees became dissatisfied with Local 2573 and began working secretly to organike the ' Similar letters were sent to each of the individual members of the Association by Local 2573 or the other A. F. L. locals having contracts with such members. CAPE ARAGO LUMBER COMPANY 581 employees into the CIO. Miller, Jr., knew of the CIO activity in the early part of March through "grapevine reports." Local 2573 learned of the CIO activity sometime in February. On March 9, 1945, the respondent's employees met and decided that the terms of the proposed area-wide agreement were unsatisfactory to them and that they preferred to retain their present working agreement with the respondent' The plant committee of the respondent's employees so notified D. H. Miller, Jr., the respondent's plant manager, who had no authority to negotiate for the re- spondent. Miller, Jr., told the committee that he "would notify the management of their request and was positive that it would be acceptable." About March 10, 1945, Marvin Berge, CIO organizer, called upon Miller, Jr., at respondent's plant and informed him that the CIO represented a majority of the employees 3 Miller, Jr., acknowledged that there was some activity in favor of the CIO. Berge stated that he did not want any trouble at the plant and mentioned having heard a rumor that the respondent might discharge some of the CIO adherents. According to Berge, Miller, J'r., stated that there would be no discharges.' About this time, the CIO activity came into the open and its organizing was no longer concealed. About March 15, 1945,$ Max Leneve, respondent's boom foreman and an active CIO adherent, walked into Miller, Jr.'s office where he was surreptitiously informed by Miller, Jr., that Fritz Hagen, business agent for Local 2573, was in another part of the office. Leaving the office, Miller, Jr., inquired if Leneve was a member of the CIO. Leneve, apparently on very friendly terms with the plant manager, replied that this was "none of [his] business." On March 16, a meeting of Local 2573 was held at which the proposed area- wide agreement was discussed and the members voted to "leave Cape Arago as it is." This decision was made due to the opposition of the respondent's em- ployees at the meeting to the terms of the area-wide agreement. On March 19, Ralph T. Moore, respondent's vice-president, who was author- ized to negotiate agreements with Local 2573, was informed for the first time by Miller, Jr., that the plant committee had expressed its desire to continue under the old agreement rather than the area-wide agreement. Moore testified that he just wanted to know "where we stood" in regard to the working agree- ment and that the employees' desire was "satisfactory" to the respondent. Miller, Jr., testified that he believed that Miller, Sr., informed the plant com- mittee of respondent's willingness to continue under the old agreement. The date of this communication was not given in the testimony, but it could not have been until March 19 or thereafter. The respondent was not informed of the action of Local 2573 taken on March 16, nor is there any evidence that the respondent communicated to Local 2573 its willingness to continue under the terms of the old contract. On March 19, at Hagen's request, Leneve met with him in Miller, Jr.'s office. Hagen accused Leneve of having joined the CIO and presented him with the option of signing either a statement that he had never joined the CIO and would 2It is to be noted that this was not a meeting of Local 2573, the holder of the con- tract, but merely of respondent's employees ; the membership of the Local included em- ployees of other plants as well. 3 Neither Berge, witness for the Board, nor Miller, Jr., could definitely set the date of this conference. 4 Although Miller, Jr., testified that Berge mentioned that he did not wish any trouble, he could not recall whether or not the discharge rumor had been mentioned. S This date was indefinite in the testimony but apparently occurred just prior to the shut-down of March 16. 582 DECISIONS OF NATIONAL LABOR RELATIONS BOARD not assist that organization, or a statement promising never to aid the CIO again. Leneve refused to sign either. Hagen then left the office to call in the plant committee. During this interim, Moore saw Leneve and told him to keep his temper for otherwise he would say something which he would regret. When Hagen and the plant committee appeared, Hagen stated he had in his possession the CIO card which Leneve had signed. After considerable argument, Leneve executed the statement to the effect that he had never joined the CIO .' Later the same day, Hagen and the plant committee called Ralph Phillips, green chain chairman, into the office of Miller, Jr., who left the room when this conference began. Phillips was told that he had been passing out CIO cards and admitted the truth of the accusation. Hagen then demanded that he sign one of the two statements noted above in connection with the Leneve conference. Phillips signed the statement, promising not to wort- c.n behalf of the CIO. On the evening of March 19, 1945, the executive ooard of Local 2573 went on record "as recommending a fine" of $500 be placed against Max Leneve, F. W. Phillips, C. B. Wilson, and Jack Krieschel. On April 6, 1945, Local 2573 voted to approve the minutes of the Executive Board meeting. The above-mentioned employees worked as usual on March 20. None of them were notified of the fines recommended against each of them. The first notice any of them had of the fines carne some weeks later. Nor were any of them notified of any charges placed against him by Local 2573 until May 1945. At 2: 30 p. in. on March 21, Hagen handed five letters to Moore and Miller, Jr. These letters were on the letterhead of Local 2573, signed by its secretary, and contained a print of the seal of said local. One of the letters read as follows: I am instructed to inform you that Max Leneve is not in good standing with the Union. According to the terms of our contract, we demand his immediate discharge. The other letters, identical in language, referred respectively to Jack Krieschel,. C. B. Wilson, Frank Phillips, and a man named Crawford.7 Moore immediately telephoned Miller, Sr., at Bandon, Oregon, the respondent's main office, and after some discussion they determined to accede to the demand of Local 2573 on the theory that their union shop agreement required such action. Respondent was never specifically and directly told nor did it inquire why the employees were no longer in good standing in Local 2573. It knew, however, that the dues of the men were paid to date through the check-off. How much more it was aware of is discussed hereinafter. About 3 p. in., Miller, Jr., informed Leneve and Phillips that Local 2573 had demanded their discharge because they were no longer in good standing with the Union and that they therefore could not continue to work for the respondent until they got "straightened out" with Local 2573. Phillips inquired whether the respondent could discharge at the request of Local 2573 in view of the Wagner Act. Miller, Jr., replied that he did not know, that all he was trying to do was to keep the plant operating. He stressed the fact that the men's jobs would be waiting for them as soon as they returned to good standing in Local 2573. When Phillips reported these events to the men working in his green chain gang, they decided to walk out in sympathy with him. Marshal Rybin, Clyde Kuhn, Hawley Catfish, Marion Nicholas, Ray A. Muetchler, Wilfred D. Horton, Byron Brown, and Mark Kinkart thereupon left the plant. Within 5 minutes ° Leneve had, In fact, signed a CIO application card. 7 The following day, Local 2573 withdrew the letter regarding Crawford and he con- tinued to work unmolested. CAPE ARAGO LUMBER COMPANY 583 the plant whistle blew in accordance with instructions previously given by Miller, Jr. On the morning of March 22, Miller, Jr., informed Krieschel and Wilson that Local 2573 had demanded their discharge because they were not in good standing, and hence he had to lay them off until they returned to good standing in the local. Again lie informed them that their jobs would be waiting for them at that time. The members of the green chain gang reported for work as usual that morning. They were informed by Miller, Jr., that they could not work as they were not in good standing with Local 2573 and were advised by him to see their union representative. When they saw Hagen, he explained the reason for their lay-off as being the fact that they had lost their seniority rights by walking off the job without good cause. Later Hagen determined that Myron Brown and Mark Kinkart had not walked off the job the day before and allowed them to return to work. None of the others were permitted to return. Following the end of the night shift at 1 a. in. March 22, the respondent closed down its night shift so that a reduction in force became necessary. It is con- ceded that this shut-down was caused solely by a lack of logs and was not due to any unfair labor practice. The retention of employees was determined on the basis of plant-wide seniority. Of the six men laid off from the green chain gang, the man with the least senior- ity had been employed in November 1944. The records prove that the respond- ent retained in its employ after the lay-off 14 men with seniority dating from November 1944 or thereafter, and that 8 men retained had seniority from December 1944 or thereafter. On March 26, 1945, Local 2573, the other A. F. L. locals involved, and all the operators with the exception of the respondent, executed the uniform area-wide agreement. On this same day, Moore telephoned Card, informed him that the CIO had just filed a petition for certification as the bargaining agent at the respondent's plant, and asked advice as to what the respondent should do. Card advised that, under the circumstances, the respondent should not sign another contract with Local 2573 until after the representation question had been settled for fear of getting "tangled up" with the Board. On this occasion, Card's ad- vice was accepted and acted upon, and the respondent did not sign any other contract with Local 2573. B. Conclusions Obviously Local 2573 requested the discharges of Max Leneve, Frank Phillips, Jack Krieschel, and C. B. Wilson because each of these men had either joined the CIO or was actively soliciting for that organization. Their activities were well known to Local 2573 as indicated by Hagen's accusations and from the state- ments which he requested them to sign. - The respondent also had "grapevine reports" and knew that the men were actively advocating on behalf of the CIO. Miller, Jr., "suspected," according to his own testimony, the reasons for the request made by Local 2573. The respondent, through Miller, Jr., had direct information that the CIO was attempt. ing to organize the plant. Miller, Jr., had but little doubt as to the individuals who were active on behalf of the CIO. The respondent knew at the time these men were discharged that they were not in good standing with Local 2573 because they were members of or active on behalf of the CIO. The respondent attempts to justify the discharge of these employees because of the terms of the union shop clause in the working agreement which it thought 584 DECISIONS OF NATIONAL LABOR RELATIONS BOARD it had with Local 2573. It is clear that, except for this agreement, the respondent would not have discharged the employees. The facts found raise the question whether or not the working agreement between the respondent and Local 2573 with its union shop clause was in full force and effect on March 21, 1945. This depends upon whether or not the agreement automatically renewed itself by its own terms upon its termination date of March 15, 1945, or was renewed in any other way. It is conceded that said agreement was in full force and effect to March 15, 1945. The termination and duration clause of the contract contains two paragraphs, the pertinent parts of which follow : When either party to this agreement desires to modify, add to or revise same, lie shall give written notice to the other party at least thirty (30) days in advance of such contemplated changes . . . . . . If neither party, sixty (60) days prior to expiration, request in writing changes or termination, this agreement to continue from year to year. The testimony is undisputed that, prior to June 27, 1944, neither the respondent nor Local 2573 had requested either changes or termination of the agreement. However, by letter dated June 27, 1944, Local 2573 gave the respondent written notice of its desire to "revise" two articles of the agreement. On July 22, 1944, the respondent, in turn, gave Local 2573 notice in writing of its desire to "revise" 15 other articles in the agreement including both the union shop clause and the termination and duration clause. By July 22, 1944, the parties had opened up all but four of the articles of the agreement for negotiation. Obviously, if changes were made in all the articles thus opened for negotiations, the parties would have had a new agreement and not merely a revision of the then existing contract. The action of E. H. Card, secretary- manager of the Oregon Coast Operators Association, in sending on behalf of the respondent the letter dated July 22, 1944, to Local 2573 requesting revisions of 15 articles in the agreement was deliberately and concededly taken after full consultation with the respondent and other members of the Association for the purpose of "forcing" Local 2573 into negotiating a uniform area-wide agreement with the operators and other locals in the district. Similar letters were sent by Card on behalf of other op- erators in the Association for the same purpose. The area-wide agreement was intended to replace the agreements then existing at the individual operations. It is obvious from the undisputed testimony of Card that the operators, including the respondent, intended their notice to "revise" as notices to terminate or, at the very least, to change the then existing agreements. Card also testified from his considerable experience with contracts in the lumber field that in his opinion the termination clause in the agreement under considera- tion, as interpreted by the lumber industry in the area, itself required a definite written notice of intent to terminate in order that the agreement would not auto- matically renew itself by its own terms. The undersigned is unconvinced by such testimony. In any event, such an interpretation does violence to the phraseology of the agreement itself and would require the elimination of the word "changes" from the second paragraph of the clause above quoted. Card himself had recog- nized the language difficulties involved in the present termination clause when he attempted to clarify that phraseology in the area-wide agreement which he as- sisted in drafting. He also candidly acknowledged that the interpretation of the industry as to the legal meaning of similar termination clauses had not been adopted by others outside the industry itself, such as individual arbitrators, the War Labor Board, and even this Board when they were called upon to determine the legal meaning of such clauses. CAPE ARAGO LUMBER COMPANY 585. In view of the above, the undersigned believes, and therefore finds, that the request for revisions of articles in the agreement made by Local 2573 on June 27, 1944, and by the respondent on July 22, 1944, were requests in writing to the other party to the contract for termination of or changes in the agreement, made sixty days prior to the termination date and by the terms of the termination clause such action prevented the agreement from automatically renewing itself. Local 2573 argues further in its brief that, assuming the fact that the contract did not automatically renew itself, the respondent and Local 2573 nevertheless agreed to be bound by the agreement and hence the union shop clause was in effect after March 15, 1945. The undisputed facts prove that the expressed desire of the plant committee not of Local 2573 8-to continue under the old contract made on March 9, 1945, to Miller, Jr., who had no authority to negotiate agreements and who only agreed to submit the offer to respondent's management with the statement that he was "positive" that it would be agreeable, was not transmitted to respondent's manage- ment until March 19, 1945, or thereafter. The facts further prove that respond- ent's assent thereto was never transmitted to Local 2573 but, at best, only to the plant committee. Hence, at the very least, the requirement of communicated assent required in the making of a contract is here lacking. As far as Local 2573, the holder of the contract, is concerned, that organization did not act in regard to the contract at the respondent's plant until March 16, 1945, when the local voted to allow the Cape Arago operation to continue "as it is." At this point, the con- tract had already expired. Further, there is no showing of any communication between the respondent and Local 2573 of this action. No contract by mutual assent came into being between these parties. Local 2573 further argues that the parties indicated their assent to the con- tinuation of the contract by their acts after March 15. The first act upon which Local 2573 or the respondent can rely as indicating this assent is the act of dis- charging employees Leneve, Phillips, Krieschel, and Wilson based upon the sup- posed existence of the union shop clause. This line of argument, however, places Local 2573 and the respondent in the peculiar position of creating an agreement by one act and then attempting to justify that very same act by the agreement which the act is alleged to have created. Even the discharge of the employees on March 21 is not conclusive evidence of the respondent's, intention to be bound by the old agreement. For the undisputed evidence discloses that as late as March 26 the respondent felt free to execute the area-wide agreement with Local 2573 except for Card's advice that respondent should execute no new contract with Local 2573 until the representation question raised by the CIO had been disposed of. It is therefore found that the agreement between the respondent and Local 2573 containing the union shop clause under which the respondent attempted to justify the discharges of Leneve, Phillips, Krieschel, and Wilson terminated as of March 15, 1945, and that the respondent discriminated in regard to the tenure and the terms and conditions of their employment by discharging them on March 21, 1945, thereby discouraging membership in the CIO.` As to the discharges of the members of the green chain gang, the evidence is clear that these six employees walked off their jobs in concerted action protest- ing the unfair labor practice of discharging the men named above. These men therefore were entitled to reinstatement upon their application therefor on March 6 The membership of Local 2573, the holder of the contract, is not limited to the re- spondent's employees, but includes employees of other operations. 6 See Boeckler Associates, et al., 60 N. L. R. B. 1208 ; Fischer Lumber Co., 62 N. L. it. B. 543. 586 DECISIONS OF NATIONAL LAI3OR RELATIONS BOARD 22, 1944, unless their positions had been eliminated by the shut-down of that same day. Admittedly this shut-down was caused not by any unfair labor practice by the respondent but by a lack of logs. The facts conclusively show that Local 2573 dictated which of these green chain gang employees were en- titled to reinstatement and that the respondent abided by the decision of Local 2573. As to the other employees in the plant, the evidence shows that the men were retained in accordance with plant-wide seniority. The facts show that of the six men laid off from the green chain gang the man with the least seniority had been employed by the respondent since No- vember 1944. The records of respondent also prove that the respondent re- tained in its employ after the lay-off 14 men with seniority dating only from November 1944 or thereafter. Of these 14 men, 8 enjoyed seniority from De- cember 1944 or thereafter. It is therefore obvious that acting at the request of Local 2573 the respondent discriminated against the six men on the green chain gang by refusing to reinstate them upon application on March 22, 1945. Local 2573 attempted to justify these refusals to reinstate on the ground that the men had walked off the job without cause and thereby had lost all seniority rights in accordance with a decision to that effect made by Local 2573. As it has been found heretofore, there was no contract in effect at this time. It is clear that Local 2573 had no justification for interfering with the reinstate- ment of these individuals. The rule as promulgated by Local 2573 and applied in these cases by it would in effect penalize employees for engaging in concerted activity, a right guaranteed by the Act. The undersigned therefore finds that by refusing to reinstate Marshall Rybin, Clyde Kuhn, Hawley Catfish, Marion Nicholas, Ray A. Muetchler, and Wilfred D. Horton upon their request on March 22, 1945, the respondent discriminated in regard to their hire and tenure and the terms and conditions of their em- ployment, thereby discouraging membership in the CIO.1° IV. THE EFFECT OF THELNFAIR LABOR PRACTICES UPON COMMERCE The activities of the respondent set forth in Section III, above, occurring 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 ob- structing commerce and the free flow of commerce. V. THE REMEDY Having found that the respondent has engaged in unfair labor practices, it will be recommended that it cease and desist therefrom and take certain action necessary to effectuate the policies of the Act. It has been found above, that the respondent's discharge of Max Leneve, Frank Phillips, Jack Krieschel, and C. B. Wilson on March 21, 1945, and the refusal to reinstate Marshall Rybin, Clyde Kuhn, Hawley Catfish, Marion Nicholas, Ray A. Muetchler, and Wilfred D. Horton upon their application for reinstatement on March 22 constituted unfair labor practices under the Act. It will therefore be recommended that the respondent reinstate them to their former or substantially equivalent posi- tions, without prejudice to their seniority and other rights and privileges, if 101n view of the basis for the finding that the ten men were illegally discriminated against, it is unnecessary to consider whether the discharges and refusals to reinstate would have been illegal for other reasons though the contract be considered as having been in effect at the time of such discharges and refusals. See Wallace Corp., 323 U. S. 248 ; Rutland Court Owners, Inc., 46 N. L. It. B. 1040 ; Portland Lumber Mills, 64 N. L. It. B. 159; Diamond T Motor Car Company, 64 N. L. R. B. 1225. CAPE ARAGO LUMBER COMPANY 587 necessary dismissing other persons hired since the date of their discharge. It will also be recommended that the respondent pay to each of them an amount equal to that which he would normally have earned as wages from the date of his discharge or refusal to reinstate to the date of the offer of reinstatement" less his net earnings ' during such period. Upon the basis of the foregoing findings of fact and upon the entire record in the case, the undersigned makes the following: CONCLUSIONS OF LAW 1. International Woodworkers of America , Local 116, CIO, and Local 2573, Lumber and Sawmill Workers , A. F. of L., are labor organizations within the meaning of Section 2 (5) of the Act. 2. By discriminating in regard to the hire and tenure of employment of Max Leneve, Frank Phillips, Jack Krieschel , C. B. Wilson , Marshall Rybin, Clyde Kuhn, Hawley Catfish , Marion Nicholas, Ray A. Muetchler , and Wilfred D. Horton, thereby discouraging membership in International Woodworkers of America, Local 116, CIO, the respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8 ( 3) of the Act. 3. By said acts the respondent has interfered with, restrained , and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act and has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (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. RECOMMENDATIONS Upon the basis of the foregoing findings of fact and conclusions of law the undersigned recommends that the respondent, Cape Arago Lumber Company, Empire, Oregon, its officers, agents, successors, and assigns shall : 1. Cease and desist from : (a) Discouraging membership in International Woodworkers of America, Local 116, CIO, or any other labor organization of its employees, by discharging or in any other manner discriminating in regard to the hire and tenure of em- ployment or any term or condition of employment of any of its employees ; (b) In any like or related manner interfering with, restraining, or coercing its employees in the exercise of their right to self-organization, to form labor organizations, to join or assist International Woodworkers of America, Local 116, CIO, or any other labor organization, to bargain collectively through repre- sentatives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection. 11 There is some testimony in the record tending to indicate that after the original refusal on March 22, 1945, to reinstate the men on the green chain gang, the respondent thereafter offered to reinstate certain of them, and that the offer was rejected on the ground that the offerees had other jobs. The testimony on the subject is, however, not of sufficient clarity to justify the undersigned in making a definitive finding thereon. If, in fact, certain of the men did receive and reject such offers, they would be entitled to back pay only to the date such offers were made. This question , if it arises , may be disposed of at the time the matter of compliance with the recommendations is handled. 12 By "net earnings" is meant earnings less expenses, such as for transportation, room, and hoard, incurred by an employee in connection with obtaining work and working else- where than for the respondent, which would not have been incurred but for his unlawful discharge and the consequent necessity of his seeking employment elsewhere. See Matter of Crossett Lumber Company, 8 N, L. R . B. 440 . Monies received for work performed upon Federal, State, county, municipal, or other work-relief projects shall be considered as earn- ings. See Republic Steel Corporation v. N. L. R. B., 311 U. S. 7. 588 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 2. Take the following affirmative action which the undersigned finds will effectuate the policies of the Act : (a) Offer to Max Leneve, Frank Phillips, Jack Krieschel, C. B. Wilson, and Marshall Rybin, Clyde Kuhn, Hawley Catfish, Marion Nicholas, Ray A. Muetchler, and Wilfred D. Horton, immediate and full reinstatement to their former or substantially equivalent positions without prejudice to their seniority and other rights and privileges ; (b) Make Max Leneve, Frank Phillips, Jack Krieschel, C. B. Wilson, Marshall Rybin, Clyde Kuhn, Hawley Catfish, Marion Nicholas, Ray A. Muetchler, and Wilfred D. Horton, whole for any loss of pay each of them may have suffered by reason of the discrimination against him by payment to him of a sum of money equal to an amount determined in the manner set forth in the section above en- titled the Remedy ; (c) Post at its plant at Empire, Oregon, copies of the notice attached hereto, marked "Appendix A." Copies of said notice, to be furnished by the Regional Director for the Nineteenth Region, shall, after being duly signed by Cape Arago Lumber Company's representative, be posted by it immediately upon receipt thereof, and maintained by it for sixty (60) consecutive days thereafter, in con- spicuous 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 other material. (d) Notify the Regional Director for the Nineteenth Region in writing, within ten (10) days from the date of the receipt of this Intermediate Report, what steps the respondent has taken to comply therewith. It is further recommended that unless on or before ten (10) days from the receipt of this Intermediate Report, the respondent notifies said Regional Di- rector in writing that it will comply with the foregoing recommendations, the National Labor Relations Board issue an order requiring the respondent to take action aforesaid. As provided in Section 33 of Article of the Rules and Regulations of the Na- tional Labor Relations Board, Series 3, as amended, effective November 27, 1945, any party or counsel for the Board may, within fifteen (15) days from the date of the entry of the order transferring the case to the Board, pursuant to Section 32 of Article II of said Rules and Regulations, file with the Board, Rachambeau Building, Washington 25, D. C., an original and four copies of a statement in writing, setting forth such exceptions to the Intermediate Report or to any other part of the record or proceeding (including rulings upon all motions or objec- tions) as he relies upon, together with the original and four copies of a brief in support thereof. Immediately upon the filing of such statement of exceptions and/or brief, the party or counsel for the Board filing the same shall. serve a copy thereof upon each of the other parties and shall file a copy with the Region- al Director. As further provided in said Section 33, should any party desire permission to argue orally before the Board, request therefor must be made in writing to the Board within ten (10) days from the date of the order transfer- ring the case to the Board. THOMAS S. WILSON, Trial Examiner. Dated December 12, 1945.