Philip Morris & Co., Ltd., Inc.

In the Matter Of PHILIP MORRIS & COMPANY, LTD., INC., EMPLOYER and LODGE No. 10, INTERNATIONAL ASSOCIATION OF MACHINISTS, PETITIONER Case No. 5-R,9328.-Decided August '23, 1946 Messrs. R. W. Norris and L. Carlton Crump, of Richmond, Va., for the Employer. Mr. Claude W. Fairfield, of Baltimore, Md., and Mr. A. A. Thomp- son, of Richmond, Va., for the Petitioner. Mr. S. E. Blane, of Durham, N.. C., and Mr. George Benjamin, of Richmond, Va., for the Intervenor. Mr. Bernard Dunau, of counsel to the Board. DECISION AND ORDER r Upon a petition duly filed, hearing in this case was held at Richmond, Virginia; on June 4,1946, before George L. Weasler, Trial Examiner. The Trial Examiner's rulings made at the hearing are free from preju- dicial error and are hereby affirmed. Upon the entire record in the case, the National Labor Relations Board makes the following : FINDINGS OF FACT I. THE BUSINESS OF THE EMPLOYER Philip Morris & Company, Ltd., Inc., a Virginia corporation with .executive offices in New York City, is engaged in the business of manu- facturing tobacco products at its five plants in Richmond, Virginia. During the year 1945, the Employer purchased materials consisting principally of tobacco, cellophane, cartons, cigaret -paper, and other products, valued in excess of $100,000,000, of which about 75 percent was shipped to the Employer's plants from points outside the Common- wealth of Virginia. During the same period of time, the Employer .sold finished products manufactured at its Richmond plants, valued at about $200,000,000, of which about 90 percent was shipped to points outside the Commonwealth. 70 N. L. R. B., No. 28. 274 PHILIP MORRIS & COMPANY, LTD., INC. 275 The Employer admits and we find that it is engaged in commerce within the meaning of the National Labor Relations Act. II. THE ORGANIZATIONS INVOLVED The Petitioner is a labor organization claiming to represent em- ployees of the Employer. Tobacco Workers International Union, Local Unions #209 and #203, herein called the Intervenor, is a labor organization affiliated with the American Federation of Labor claiming to represent em- ployees of the Employer. III. THE ALLEGED APPROPRIATE UNIT The question presented is the propriety of severing a group of about 50 machine fixers and machine adjusters from a unit composed of the production and maintenance workers of the Employer's 5 tobacco processing plants at Richmond, Virginia. The Petitioner seeks a unit composed of these employees, or, in the alternative, a unit in which they are merged with the Employer's machinists currently represented by the Petitioner. The Intervenor opposes this unit, predicating its opposition on 2 grounds, an existing collective bar- gaining agreement with the Employer which it contends bars the present proceedinand the inappropriateness of severing these em- Z_, ees fro n the existing unit of production and maintenance workers which the Intervenor has represented for 9 years. The Employer maintains a neutral position. The Employer employs about 2,400 workers distributed through its 5 plants at Richmond, Virginia. The plants are designated (1) the Twentieth Street cigaret plant, (2) the Twentieth Street stem- mery, (3) the Stockton Street cigaret plant, (4) the Stockton Street stemmery, and (5) the smoking tobacco plant. Each of the cigaret plants has a making and packing department in each of which are employed about 20 machine fixers. The 2 stemmeries employ 3 or 4 machine adjusters each. The smoking tobacco plant employes 2 ma- chine fixers. The Employer also maintains 2 machine shops. The ma- chinists employed in these shops tool parts to be inserted in the ma- chines as distinguished from the machine fixers and machine ad- justers who maintain, repair, and adjust the machines.' The fixers are responsible for maintaining, repairing, and adjust- ing a line of automatic machines, usually 10, used in the manufac- ture of tobacco products. Their rates of pay range from 28 cents 'The terms adjuster and fixer are used interchangeably , although the term adjuster is generally applied to those employees who maintain the machines in the stemmeries, and the term fixer is generally applied to those employees who maintain machines in the cigaret and smoking-tobacco plants . Hereafter the term fixer will be used to describe both categories 712344-47-vol 70 19 276 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to 66 cents per hour more than those of the production worker. The rates of pay of the fixers are equivalent to those of the machinists, admittedly skilled craftsmen. The machine fixers serve a 21-month period of apprenticeship before they earn the maximum rate. The machine adjusters serve a 3-year period of apprenticeship before they attain the maximum rate. The difference is clue to a bargain- ing advantage obtained for the fixers 'which was not similarly ob- tained for the adjusters. The Employer states that 3'years is the period of time necessary for a fixer to reach optimum efficiency. The machinists are required to undergo a 4-year apprenticeship. A nma-- chine operator, on the other hand, undergoes 'a 4- to 5-week training period, but he does not attain maximum efficiency until about 2 years thereafter. The fixers are drawn from the most efficient machine operators who demonstrate mechanical skill, and in the event of reduction in fixer personnel, the fixer may return to the job of- an operator. There is generally no interchange between fixers and machinists, and un- like the machinists, the fixers are not confined to a particular area in the plant separate from the production workers. Despite this dis- . persal, the fixers are a cohesive group. The fixer's skill is adaptable to the maintenance of like automatic tobacco machines only. Neither the fixer nor the machinist can do the other's work, and each is regarded as equally skilled in his own sphere of activity. The fixers work un- der the supervision of the foremen of the production workers, but for technical assistance they will apply to the foreman fixer. The ma- chinists work under the supervision of the foremen of the machine shops, who in turn are responsible to a general engineer. The fixers may make some use of the,tools in the machine shop, but generally any adjustments on the parts to be' inserted into the machines are made by the machinists. The constitutions of both the Intervenor and the Petitioner assert jurisdiction over the fixers. The working' conditions of the machine operators and the fixers are alike. The Intervenor has maintained contractual relations with the Em- ployer since 1937 during which time it has always bargained.on behalf of the fixers. It has apparently succeeded in obtaining substantial economic benefits for them during this period, and they have uniformly utilized the grievance machinery provided by the contracts. As a result of the most recent negotiations, the Intervenor succeeded in pro- curing for some of the fixers a reduction from 3 years to 21 months in the period of time necessary to reach the maximum rates prescribed for journeymen fixers. The" Petitioner has bargained on behalf of the machinists since April 25, 1941, but had not until a few weeks before October 25, 1945 evinced any interest in representing the fixers. Some evidence was adduced to show that one of the members of the com- PHILIP MORRIS & COMPANY, LTD., INC. 277 mittee negotiating the first contract for the Petitioner was a fixer. It appears however that he was also a machinist. There does not seem to have been any substantial defection of fixers from the Intervenor until the latter part of 1945. The Intervenor has stated that in the event the fixers transfer their allegiance to the Petitioner they will not there- after be permitted to return to an operator's job. A contract between the Intervenor and the Employer covering the Employer's production and maintenance workers, with the exception of specified crafts,, was to expire on January 31, 1946. Negotiations looking toward the consummation of a new agreement were undertaken in Richmond, Virginia, on November 6, 1945. These negotiations were recessed, and were thereafter resumed in Washington, D. C., on November 20, 1945, with the assistance of the Conciliation Service of the Department of Labor. At an undisclosed date in November 1945, an agreement was entered into between the parties retroactive to November 5, 1945, to continue in effect until January 31, 1949, and to be annually renewable thereafter. The fixers were, inter alia, covered by this agreement. Prior to these negotiations, the Petitioner, on October 25, 1945, had written to the Employer claiming to represent the fixers and request- ing recognition as their bargaining agent. The Employer in its reply stated that the fixers were covered by an agreement with the Intervenor, that it maintained a neutral position in the controversy concerning representation, and that it was willing to abide by any agreement be- tween the two unions which would be satisfactory to them. On No- vember 14, 1945, the Petitioner addressed another letter to the Em- ployer averring that it understood that the contract between the Inter- venor and the Employer had been opened and that new terms were being negotiated. It asserted that it represented 90 percent of the fixers,' and requested a conference to discuss its representation interest. Under date of November 16, 1945, for the purpose of temporary set- tlement of the jurisdictional dispute, the Petitioner and the Intervenor entered into an agreement as follows : It is agreed between the International Tobacco Workers' Local Union #203 (Philip-Morris) and Machinists' Lodge #10, I. A. of M., that, on condition the machinists withdraw their letters to the company as of October 25th and November 14th, 1945, to allow the Tobacco . Workers' #203 to proceed' with their negotiations they will turn over to Lodge #10, I. A. of M., all fixers, who are journeymen fixers, and certain maintenance men who desire to be represented by Machinists' Lodge #10, I. A. of M. 2 In addition to its contractual relations with the Petitioner and the Intervenor , the Em- ployer has bargained with the International Brotherhood of Electrical workers represent- ing the electricians and helpers for about 2 years, and with a craft union representing the firemen and helpers for about 4 years. In none of these instances had the offices of the Board been previously invoked. - 278 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The aforementioned employees will be released from all finan- cial obligations to Tobacco Workers' #203. "Journeymen fixers" is intended to mean those who have had 3 or more years' experience.3 The agreement was presented to the Employer by' representatives of the Petitioner and the Intervenor. The Employer agreed to negotiate with the Intervenor concerning the fixers, with the specific understand- ing that any contract arrived at would be subject to a later definitive settlement of the jurisdictional question between the Intervenor and the Petitioner. In uncontroverted testimony a representative of the Intervenor stated that its agreement with the Petitioner was motivated- by an urgent need to be free from harassment, in order to prevent a breakdown in negotiations with the Employer which were then in a critical state. On this basis, the Intervenor contends that its agree- ment with the Petitioner was induced under duress. Under the terms of an "Agency Deduction Clause" in the contract between the Intervenor and the Employer, the latter is required at the Intervenor's request to deduct a sum not to exceed 25 cents per week from the wages of each employee in the appropriate unit in compensa- tion for services rendered as exclusive bargaining representative. Protracted controversy arose between the Intervenor and the Peti- tioner concerning the applicability of this clause to the fixers during the pendency of the unsettled jurisdictional dispute in view of the provisions of their November 16, 1945, agreement. The Intervenor charged the Petitioner with breaching this agreement in failing to meet with it to discuss plans to be submitted to the Employer relating to collection of fees from fixers, and advised the Employer not to bar- gain with the Petitioner concerning any employees who had not-been released from membership with the Intervenor. Later, the Inter- venors International Union asserted jurisdiction over the fixers, and insisted that the Local Unions were without authority to relinquish such jurisdiction.4 The assistance of a Commissioner of Conciliation of the Department of Labor was unsuccessfully invoked. Repeated efforts to arrive at a settlement of the dispute were unavailing. On April 12, 1946, the petition was docketed. The Petitioner relies in part upon the afore-mentioned November 16 agreement to support its contention that the fixers should now be set apart in a craft unit, despite the history of collective bargaining on sit is not clear from a reading of the agreement whether all fixers, regardless of their wishes, were to be released to the Petitioner, or whether only those who desired to ti ans- fer their membership would be released The ambiguity is resolved in the Petitioner's brief where the Intervenor s obligation to release is taken to be confined to those fixers who wish to join the Petitioner 4 The representatives of the Intervenor who signed the November 16, 1945, agreement were among those who signed the Intervenor 's collective bargaining contract with the Em- plover, and in each instance the same representative of the International Union signed both documents on behalf of that organization. . PHILIP MORRIS & COMPANY, LTD., INC. 279 a more comprehensive basis and the current contract between the Intervenor and the Employer. The Intervenor, asserting its current collective bargaining agreement as a bar to this proceeding, argues that the agreement of November 16 was vitiated by duress and lack of authority. It also denies that the unit sought by the Petitioner is appropriate, contending that the fixers are simply highly paid produc- tion workers tivhose interests have been served in the production unit in which they have been represented for 9 years. The Employer maintains a neutral position. In view of our decision in this case, it is unnecessary to consider the contention that the present proceeding is barred by the collective agreement. Apart from a consideration of the agreement between the Petitioner and the Intervenor, the disposition of this case falls essentially within the principle of Matter of American Can Company, 13 N. L. R. B. 1252, and related cases.5 The fixers have a sufficient degree of skill and cohesiveness to constitute a separate unit along craft lines. How- ever, the fixer is in origin a machine operator and may revert to that status. There is no showing of a persistent, aggressive refusal to merge with the production unit. Indeed, -until recently, it is a fair inference that the fixer psychologically identified himself with the operator. Collective bargaining on a, comprehensive multi-plant basis antedated the appearance of craft organization of any type by about 4 years. The Petitioner did not attempt to organize the fixers as a craft unit until October 1945, although it had actively bargained on behalf of the machinists since April 1941. There is no suggestion that the Intervenor has not been an effective advocate of the interests of all component elements of the production and maintenance unit -with- out discrimination or partiality. It would serve no useful purpose to impair the integrity of the production unit by affording the oppor- tunity of severance to what may well be a merely temporary dissident faction, and thereby disrupt a satisfactory and fruitful relationship which through years of collective bargaining experience on a com- prehensive basis has been successful in conciliating diverse and con- flicting interests with a minimum of friction s 5 See, e. g., Matter of Harnischfeger Corporation, 55 N. L. R. B. 909, and Matter of Mil- ton Bradley Company, 15 N. L. R. B. 938. 9 The dissenting opinion relies on a dictum in Matter of General Electric Company (Lynn River Works and Everett Plant ), 58 N. L. R. B. 57, 59, to the effect that severance is war- ranted where "there has been no previous consideration of the merits of a separate unit." Neither before nor after the General Electric Company case has a majority of the Board deemed this supposed principle to be a sufficient basis for separating a craft group from a production unit. See, for example, Matter of Pressed Steel Car Company, Inc ., 69 N. L R. B 629; Matter of Evinrude Motors Division of Outboard Marine and Manufacturing Company, 66 N. L. R. B. 1142 ; Matter of Radio Corporation of America, 66 N. L. R B. 162 ; Matter of Memphis Hardwood Flooring Company, 63 N. L. R. B. 1188; Matter of Interna- tional Minerals and Chemical Corporation, 62 N. L. R. B. 655; Matter of American Hard- ware Corporation, 61 N. L. it. B. 1242; Matter of The Billings & Spencer Company, 61 N. L it. B. 1213; Matter of International Harvester Company, 61 N. L. R. B . 1199; Mat- ter of Spokane United Railways, 60 N. L. it. B. 14; Matter of The American Swiss Com- 280 DECISIONS OF NATIONAL LABOR RELATIONS BOARD There remains for consideration the weight to be given to the agree- ment between the Petitioner and the Intervenor. • Commitments by labor organizations concerning the disposition of craft groups are not, of course, decisive of issues regarding appropriate unit, but are facts to be considered within the framework of other facts relevant to craft severance problems, and-are accorded varying emphasis de- pending on the surrounding circumstances.7 The November 16 agree- ment is an acknowledgment by experienced trade unionists of the feasibility of separate bargaining, but it does not outweigh the other factors which indicate the dubious wisdom of that solution. To accord decisive effect to this single factor in the circumstances of this case would be, by indirection, to ,rant specific performance of the agreement, and would, by the same token, deprive the employees of their right to have the Board determine the unit question on its merits. Moreover, the persuasiveness of this agreement is much diminished in-that it was exacted from the Intervenor under the practical necessity of seeking a respite from harassment in order to proceed with the main business of negotiating a contract, and it does not, therefore, represent a deliberate exercise of judgment. It has fostered, not a settlement of issues , but an aggravation of rancor and dispute, and it has been marked with charges of breach of contract, unauthorized conduct, and coercive acts. To base a unit determination on this vexed agreement, and to ignore a long, amicable, and effective history of collective bargaining, is to build a bargaining relationship on an insubstantial foundation. We are not persuaded that the poli- cies of the Act would be thus effectuated, and we shall therefore dis- miss the petition on the ground of the inappropriateness of the re- quested unit. panj, 59 N L R. -B. 790, in all of which Mr Reilly participated without dissent .- An ex- animation of the cases relied on in the General Electric Company case to support the dic- tum, and in the context of which it derives its significance , indicates that it is directed to a single situation only. Where a craft seeks the opportunity for severance in a representa- tion proceeding , the merit of its contention is not foreclosed by the mere fact that in earlier proceedings , in which the craft did not participate and affirmatively present its case for consideration on the merits, the Board had found a more comprehensive grouping to be appropriate . Indeed, no greater application is possible without completely overruling the American Can principle , thus effacing the doctrine that a craft can be assimilated to a pro- duction unit by a persuasive history of collective bargaining whether or not the bargaining relationship is voluntary in its inception or was initiated under Board auspices without participation by the craft in the proceeding. 7 Compare, on the one hand, Matter of Wilson-Hurd Manufacturing Company, Inc., 68 N. L R B 853, and Matter of Spokane United Railways, 60 N L R. B 14 , and, on the other hand, Matter of Sioux City Brewing Company, 63 N. L. R. B. 964, and Matter of Luther Manufacturing Company, 61 N L. R B. 858 , 58 N. L R B. 1307 . The additional cases cited in the dissenting opinion yield to the same generalization . See also Matter of Talon, Inc, 69 N L. R B 1134 , and Matter of The Crosley Corporation, 66 N. L It. B. 349 PHILIP MORRIS & COMPANY, LTD., INC. 281 ORDER Upon the basis of the above findings of fact, and the entire record in the case, the National Labor Relations Board hereby orders that the petition for an investigation and certification of representatives of employees of Philip Morris & Company, Ltd., Inc., Richmond, Virginia, filed by Lodge No. 10, International Association of Machin- ists, be, and it hereby is, dimissed. MR. GERARD D. REILLY, dissenting : It is clear that the machine fixers are a skilled, readily identifiable group whose desire to bargain within a unit devoted exclusively to their needs can be fulfilled within the framework of existing prin- ciples. As a matter of original impression, the Board would have deferred a finding of the appropriate unit pending the results of a self-determination election among the fixers, and would thereupon have been governed by their freely expressed choice. The majority denies to them the option of inclusion within the established produc- tion unit or separate representation because of a history of collective bargaining on the more comprehensive basis. Yet in a deliberate statement of policy in the General Electric case,' reconciling divergent trends in earlier cases,' the Board set forth alternative means of overcoming the pervasive effect of a- collective bargaining history, and placed a lack of opportunity to express craft desires on the same plane with resistance to merger in the comprehensive unit. As this case amply demonstrates, any other view can easily frustrate the legitimate aspirations to craft bargaining by the fortuitous circum- stance of the non-availability of a labor organization to champion the craft cause during the time of bargaining on a more comprehensive basis. Moreover, there, is here an unequivocal cession of jurisdiction by the Intervenor in the form of its collateral agreement, and the Board has frequently given effective weight to the desires of labor organiza- tions to set their own houses in order 10 It must be assumed that ma- e58N.L.R.B 57. Matter of Goodyear Tire & Rubber Company, 55 N. L. R. B 918; Matter of Tampa Flor- ida Brewery, Inc, 42 N L R B. 642 ; Matter of Bethlehem Steel Company (Shipbuilding Division ), 40 N. L. R B. 923, Matter of Sullivan Machinery Company, 31 N. L R. B. 749. Compare my concurring opinion in Matter of Allied Laboratories, Inc., 60 N. L R. B. 1196. 10 Matter of Sioux City Brewing Company, 63 N. L R B 964 ; Matter of Luther Manufae- tui ing Company, 61 N. L. R. B. 858, 58 N. L R. B. 1307 ; Matter of The Riverside and Fort Lee Ferry Company, 23 N. L R. B 493; Matter of B. F. Goodrich Company, 16 N. L R. B. 165, Matter of Illinois Knitting Company, 11 N. L. R. B. 48, Matter of Century Biscuit Company, 9 N. L R B 1257, Matter of General Electric Company, Newark Ramp Ware- house, 9 N. L R B. 1213. 282 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ture men are not' easily stampeded by the first sign of opposition, and that the Intervenor's cession of jurisdiction is a considered ex- pression of the greater propriety of craft bargaining on behalf of the fixers. The Intervenor's contention that its agreement is vitiated by duress is frivolous, inasmuch as the very acts complained-of as coercive are those which the Board requires in order to perfect a claim to representation. In fact, the Petitioner's forbearance in pursuing its legal rights is the consideration which supports the counter-promise. Equally without merit is the Intervenor's protesta- tions that its agreement was unauthorized. Its contention is dissipated by the hard fact that the same individuals who entered into the collective bargaining contract with the Employer, an admittedly au- thorized act, are those who entered into the collateral agreement. After having achieved the objectives of its agreement, the Intervenor now lightly repudiates its correlative obligations, and has successfully in- voked the processes of the Act to effect its avoidance. A correct application of our own rules would have' obviated this result, and would have been not only legally sound, but equitably desirable.