Louis Hornick & Co., Inc.

In the Matter of Louis HORNICK & COMPANY, INC. and TEXTILE TRIMMING WORKERS UNION, LOCAL 2440, UNITED TEXTILE WORKERS OF AMERICA Case No. C-111.Decided June 1., 1937 Curtain Manufacturing Industry-Interference, Restraint or Coercion: attempts to persuade employees to resign from union ; expressed opposition to union, threats of retaliatory action-Unit Appropriate for Collective Bar- gaining: production employees-Representatives: proof of choice: membership in union-Collective Bargaining: breach of collective agreement; employer's duty as affected by strike; refusal to negotiate with representatives-Dis- crimination: lockout-Strike: provoked by employer's lockout of union em- ployees and refusal to bargain-Employee Status: during lockout; during strike-Reinstatement Ordered, Strikers: strike provoked by employer's viola- tions of Act ; displacement of employees hired during or following strike- Reinstatement Ordered, Non-Strikers: employees locked out-Back Pay: awarded. Mr. David A. Moscovitz for the Board. Mr. Samuel Tullman, of New York City, for respondent. Mr. Sidney E. Cohn and Mr. Samuel Cohen, of New York City, for the Union. Mr. Howard Lichtenstein, of counsel to the Board. DECISION STATEMENT OF CASE Upon charges duly filed by Textile Trimming Workers Union, Local 2440, United Textile Workers of America, hereinafter called the Union, the National Labor Relations Board, hereinafter called the Board, by Elinore Morehouse Herrick, Regional Director for the Second Region, issued and duly served its complaint dated April 6, 1936, against Louis Hornick & Co., Inc., the respondent herein, alleging that the respondent had engaged in and was engaging in unfair labor practices affecting commerce within the meaning of Section 8, subdivisions (1), (3), and (5), and Section 2, subdivisions (6) and (7) of the National Labor Relations Act (49 Stat. 449), hereinafter referred to as the Act. In respect to the unfair labor practices, the complaint, as amended, in substance alleged : 1. That since November 1, 1935, the respondent has continuously urged and warned its employees to refrain from remaining members 983 984 NATIONAL LABOR RELATIONS BOARD of the Union, and has interfered with the activities of its employees in connection therewith. 2. That on December 9, 1935, the respondent locked out 12 of its knitters who are members of the Union, and refused to reinstate them unless they would drop their membership therein. 3. That as a result of said interference and lockout by the respond- ent, approximately 106 Union employees in the plant went out on strike on December 10, 1935; that the strike still continues and the respondent has at all times since December 10, 1935, refused and still refuses to reinstate the employees so locked out. 4. That all of the production workers of the respondent excluding those employees engaged in supervisory capacities constitute a unit at the plant of the respondent appropriate for the purposes of col- lective bargaining within the meaning of Section 9 (b) of the Act; that on or before October 17, 1935, a majority of the employees in said unit had designated the Union as their representative for the purposes of collective bargaining with the respondent, and that at all times since October 17, 1935, said Union has been the exclusive representative for collective bargaining of all the employees of said unit. 5. That on or about December- 10, 1935, the Union requested the respondent to bargain collectively in respect to rates of pay, wages, hours of employment, and other conditions of employment with the Union as the exclusive representative of all the employees in-said unit; that on said date and at all times thereafter the respondent refused and has refused to so, bargain collectively. 6. That the aforesaid acts of the respondent constitute unfair labor practices affecting commerce within the meaning of Section 8, sub- divisions (1), (3), and (5), and Section 2, subdivisions (6) and (7) of the Act. On April 17, 1936, the respondent filed its answer to the complaint, denying the allegations of unfair labor practices but admitting the interstate character of its business, the appropriateness of the unit for the purposes of collective bargaining, and the authority of the Union as the exclusive representative of all the employees of said unit for the purposes of collective bargaining. As a further defense, it alleged the breach of an existing collective agreement between the respondent and the Union as a result of the refusal of the Union to furnish the respondent with workers as provided therein. Pursuant to notice, Robert M. Gates, duly designated by the Board as Trial Examiner, conducted a hearing commencing on April 16, 1936, in New York, N. Y. Full opportunity to be heard, to examine and to cross-examine witnesses, and to introduce evidence bearing upon the issues was afforded to all partied. The respondent also filed a brief. At the close of the hearing the respondent made DECISIONS AND ORDERS 985 various motions to dismiss the complaint, such motions being based upon the constitutional invalidity of the Act , lack of jurisdiction, insufficiency of the complaint, and failure of proof. The Trial Ex- aminer reserved decision on these motions, later denying them in his Intermediate Report. On June 16, 1936, the Trial Examiner filed his Intermediate Report, finding and concluding , in substance, that the respondent had engaged in unfair labor practices affecting commerce in violation of Section 8, subdivisions (1), (3), and (5), and Section 2, subdi- visions (6) and (7) of the Act. The Trial Examiner accordingly recommended that the respondent bargain collectively with the Union as the exclusive representative of all its production employees, dis- charge all employees now employed , replace them with members of the Union, and hire any additional employees which may be needed through the Union. On June 24, 1936, the respondent duly filed exceptions to the Intermediate Report. We find that the evidence in the record supports the Trial Exam- iner's rulings, findings, and conclusions. We find nothing in the respondent's exceptions to the Intermediate Report which requires any material alteration of such findings and conclusions . In sub- stance, the material findings of fact and conclusions of law herein made embody those made by the Trial Examiner. Upon the entire record ' in the case , the Board makes the following : FINDINGS OF FACT I. THE RESPONDENT AND ITS BUSINESS The respondent, Louis Hornick & ,Company, Inc., is a corporation organized on December 27, 1927, under and by virtue of the laws of the State of New York. It is a closed corporation of which Louis Hornick is the president, and its office and place of business is located at 22 West Twenty-first Street, New York, New York. The respondent is engaged in the manufacture of curtains and trimmings for lamp shades, dresses, millinery , and upholstery. It is a member of the Passementerie and Trimming Manufacturers Asso- ciation and is approximately the tenth largest of some 250 manu- facturers engaged in this business in the State of New York. The physical plant consisting of a shipping department and a production department occupies two floors at the above mentioned address and utilizes 53 knitting machines of various types . The industry is sea- sonal, the season extending from August through December of each year. On December 10, 1935, the time of the dispute, the respondent employed 98 production employees , and during April, 1936, the time of the hearing, approximately 25 persons . In 1935 monthly payrolls varied from $4,841.95 in July to $13,048.35 in October. 986 NATIONAL LABOR RELATIONS BOARD Seventy-five per cent of the materials used by the respondent con- sist of cotton and rayon in the form of yarn, purchased from com- mission agents in New York City and shipped almost entirely from warehouses located in that city. The testimony indicates that 90 per cent of the cotton and rayon so purchased is shipped to New York warehouses from mills located in the New England and South- ern States. The remaining 25 per cent of the materials used by the respondent consist of wire, moulds, hooks, and tinsel. In 1935, 78 per cent of the respondent's raw materials, amounting to $123,136.86, were secured from factories and warehouses located within the State of New York, whereas the remaining 22 per cent, amounting to $33,- 315.93, were shipped directly from the States of Georgia, Illinois, New Jersey, Pennsylvania, and Connecticut. The greater portion of material shipped to the respondent from within the State-cotton and rayon ,yarn-was processed in and delivered from mills located in other States to the commission merchants supplying the respondent. The respondent's customers are retailers, jobbers, wholesalers, de- partment stores, and chain stores. It employs six salesmen who solicit business throughout the entire United States. In 1935 the respondent's gross sales amounted to $315,140.64, the greater percent- age of sales being "on order". The respondent maintains little stock on its shelves and manufactures to fill orders as they are received. Hornick testified that from 65 to 70 per cent of the products manu- factured in the plant, by dollar volume, are shipped to points outside the State of New York. Most of the shipments are made by freight, the products being transported to freight terminals in Hornick's private automobile, although on occasion the services of a truck are utilized. In addition some shipments are made by parcel post. II. THE UNFAIR LABOR PRACTICES The Textile Trimming Workers Union, Local 2440, a labor organi- zation, was organized in March, 1932, and became affiliated with the United Textile Workers of America in May, 1935. Since its organi- zation in 1932 and to the 1934-1935 season, the Union has had closed shop agreements covering hours, wages, and other conditions of em- ployment, with the respondent and other members of the Passemen- terie and Trimming Manufacturers Association.' At the time of the hearing Union officials testified that 28 manufacturers comprising 50 per cent of all the manufacturers in New York City engaged in the manufacture of products the same or similar to those manufac- 1 Although the testimony is not clear, it would appear that prior to the 1934-1935 season, these agreements were signed by the Association on behalf of its members ; thereafter, the agreements were signed directly by the members. DECISIONS AND ORDERS 987 tured by the respondent were then operating under such agreements with the Union. In August, 1934, the first written agreement be- tween the Union and the respondent was executed which expired on August 30, 1935. The last agreement between the respondent and the Union was signed on October 17, 1935. Shortly before the ex- piration of the previous agreement Hornick left on his vacation. Al- though no formal arrangement was made at that time, it was under- stood between Hornick and David Rosen, shop chairman for the Union in the respondent's plant, that the terms of the old agreement would continue until Hornick returned and an agreement for the ensuing year signed. The record indicates that the agreement for the year 1935-1936 is the same as the agreement in force during the previous year, including the amendments made with pen and ink. The agreement between the respondent and the Union is a mimeo- graphed form contract and, among other things, provides that the respondent shall employ only members of the Union for productive work, that such employees shall be hired through the Union, and that the Union shall supply competent help for all operations of the respondent. It further provides that wage rates and other work- ing conditions may be revised during the life of the agreement, and that all disputes and grievances shall be settled by representatives of the Union and the Passementerie and Trimming Manufacturers Association. Pursuant to the agreement and according to the custom of the business, work during the slack season is divided among the produc- tion employees by the shop chairman and shop committee, the em- ployer having no choice regarding the individuals who actually work. It is customary for the employer or his manager to inform the shop chairman of the number of employees required from time to time, it being the obligation of the Union to divide the work equally among all of the workers of the particular type employed in the plant. Exception to the division of work arrangement is made in the case of "extras" who, though Union members and hired in accordance with the system outlined above, are employed only during the busy seasons and are not entitled to share work when the employer's business slackens. The respondent contends that the agreement was not to be effective unless the Union obtained similar agreements from the respondent's competitors. This contention is denied by the Union and is not borne out by the record. The agreement contains no such stipulation, nor can Hornick's testimony thereon be taken seriously. He testified that he had refused to sign the new agreement until October 17, 1935, although the previous one had expired on August 30, 1935, because he felt that he could not compete with non-union shops. However, he later testified that, suffering from hay fever, he was compelled 988 NATIONAL LABOR RELATIONS BOARD to leave New York City during the months of August and September with the informal understanding that the terms of the old agreement would be extended until a new one could be negotiated. Further, he both pleaded and offered testimony in an attempt to prove that the Union breached the agreement by failing to supply workers and by calling a strike. We find that the agreement of October 17, 1935, was in effect at the time of the dispute under consideration in this proceeding. The complaint herein alleged, and from the foregoing facts we find, that in order to insure to them the full benefit of their right to self-organization and to collective bargaining, and otherwise to effectuate the policies of the Act, the production employees employed by the respondent constitute the unit appropriate for the purposes of collective bargaining. We further find that a majority of such employees had designated the Union as their representative and that, by virtue of Section 9 (a) of the Act, the Union has been, at all times since December 5, 1935, the exclusive representative of the production employees for the purposes of collective bargaining in respect to rates of pay, wages, hours of employment, or other con- ditions of employment.2 It should be noted that these facts were not controverted by the respondent. The respondent's lay-off of employees on December 4, 1935, and its conduct thereafter during the dispute which is the primary basis for this proceeding gain significance and are revealed in their true meaning in the light of two controversies that arose during the 1935-1936 season. Julius Kessler, at one time employed by the re- spondent as a knitter, perfected a device that increased the pro- duction of certain types of knitting machines operated in the re- spondent's plant. So far as the record discloses, the respondent was the first to install this device on a production basis. The ma- chines equipped with this device are known as fast machines, and the others not so equipped are known as slow machines. It had been customary for knitters to operate three slow machines. The first installation of a fast machine was made early in August, 1935, and as the number of machines converted to fast machines increased, the knitters operated only two fast machines apiece. The Union offered testimony to show that the fast machines run almost twice as fast as the slow machines, thereby increasing production as well as increasing the effort and energy required to tend the machines, and lowering production costs. Although the respondent contends that production is increased by only 15 per cent and is small com- pared to the claims of the Union, the testimony in support of this contention is not convincing in view of all the circumstances. 2The respondent's operation of a closed shop since 1932 pursuant to its agreements with the Union clearly requires this finding DECISION'S AND ORDERS 989 During the latter part of October, 1935, and subsequent to the signing of the agreement of October 17, 1935, Hornick requested that the knitters operate two and a half fast machines, meaning that two knitters be responsible for the output of five machines. The shop chairman, Rosen, transmitted this request to the knitters who at first were unwilling to accept this additional burden of work. The dispute continued for approximately two weeks during which the knitters held several meetings after executive committee conferences with Hornick. The Union contends that in order to induce the knitters to accede to this request, Hornick finally proposed to guarantee employment until Christmas, and in the event that he was not able to keep all of the knitters employed until then, the knitters could return to the basis of two fast machines per knitter. After some discussion the knitters accepted this proposal, the agreement being reached on or about October 25, 1935. The respondent and others still in its employ denied that any agreement was made with respect to the operation of two and a half fast machines per knitter other than that the knitters agreed to so operate them. This denial, however, is not sufficiently convincing to overcome the testimony of Union witnesses, nor is it of sufficient weight to overcome the presumptioli that the knitters would not agree to do more work without receiv- ing something in compensation. The operation of fast machines, by increasing the burden of work on the individual knitter, and increasing production, necessarily would have the effect of curtail- ing the period of employment during the already short season of the industry. It may fairly be inferred that the knitters would not have submitted to Hornick's request without receiving some concession from him in order to protect their own welfare. The second controversy involved the performance of paragraph 12 of the agreement of October 17, 1935, which provided that the respondent's employees should be paid for certain holidays, includ- ing Thanksgiving Day. Several weeks prior to this holiday Hor- nick and Weinrub, another manufacturer who was bound by a simi- lar provision, communicated with the Union in an effort to secure a waiver of this provision by the Union, but their request was not granted. That the respondent expected a breach with the Union as a result of these disputes and took steps to prepare for it is unquestionably revealed in the record. Four knitters testified that they had been approached and offered inducements to drop their membership in the Union. Joseph Hershkowitz, a knitter and a member of the shop committee and the executive board, testified that three weeks before Thanksgiving Day Hornick told him that he would not pay for Thanksgiving; that "he (Hornick) fought the Union before and 990 NATIONAL LABOR RELATIONS BOARD he is prepared to fight them again". Hornick further told the witness to work for him and he (the witness) would be better off. "He said either it is I work with him or stay with the Union." Morris Stern and Jack Golden, both "extra" knitters, were likewise approached by Hornick during November, 1935, and offered steady employment if they would drop out of the Union. Golden, first approached by Mr. Arthur Martin, his foreman, about one week before Thanksgiving Day, testified as follows : "Q. What conversation did you have with him (Martin) ? "A. Well, lie came over to my machines and told me that, `well, there was a lot of talk about Thanksgiving, that Mr. Hor- nick would not pay for that holiday'. It was stipulated in the contract that he would pay for that holiday but there was a lot of talk going on that he wouldn't pay and Arthur Martin told me, he said, `Mr. Hornick is not going to pay for Thanks- giving. Now, the Union might call a strike. In case the Union calls a strike', he said, `the best thing being that I am an extra was for me to remain at work and I would get steady em- ployment.' "Q. After that did you have any discussion with Mr. Hornick about the same thing? "A. Well, the following day Mr. Hornick came over and said, `Did Arthur speak to you yesterday?' I said, `yes'. He said, `Well, what do you say?' I said, `I don't think it is the right thing for me to do."' It is significant that both Stern and Golden, as well as Samuel Biller, who was later solicited to work after the lay-off of December 4, 1935, were "extra" knitters and as such would presumably have been amenable to suggestions that would secure steady employment for them. On Tuesday, December 3, 1935, the first pay-day after Thanks- giving, the respondent paid its employees for the preceding week excluding Thanksgiving Day. Other employers, likewise members of the Passementerie and Trimming Manufacturers Association, also failed to pay for the holiday. The Union immediately informed Samuel Tullman, counsel for the Association, and a conference was arranged for the following day. On December 4 representatives of the Union and the employers met, the employers agreed to pay for the holiday, and the respondent made such payments to its em- ployees at noon on that day. On the evening of the same day Rosen, the shop chairman who was then working on the night shift, was informed by the respondent's manager that the night shift would be laid off, as well as some of the DECISIONS AND ORDERS 991 employees on the regular day shift-a total of 35 workers. Twenty- six knitters had been employed on December 4, and the order for the following day called for only 12. At that time both the re- spondent's and the Union records show that the total number of production employees was 98. The lay-off amounted to over one- third of the production force. Coming in the midst of a busy season, especially since a night shift had been added only a short time before, the lay-off appeared to be peculiarly drastic. Coming im- mediately after the Union had compelled the respondent to comply with the terms of the agreement, it indicated that the respondent was attempting to discipline the Union for forcing the payment of wages for Thanksgiving. Rosen left the plant, went to Union headquarters, consulted with the workers, and arranged that 12 knitters report to the respondent's plant on the morning of December 5. There was some testimony indicating that the knitters were instructed to go back to the previous. quota of two fast machines per man as provided by the agreement with the knitters in the event that all of them were not employed until Christmas. On the morning of December 5, 1935, six of the 12 knitters reported lo work at eight o'clock, the hour when work in the plant begins. Although the testimony regarding the events of the morning is conflicting, it is agreed that only six men reported on time, that those knitters who were n orking on fast machines were determined to operate only two apiece, and that Hornick conversed with some of the men. Hornick contends that he asked the men to stay and operate two and a half machines until he could get in touch with Samuel Stember, a Union official, and adjust the dispute. The Union claims that Hornick ordered the knitters out of the plant. It is also agreed that the six men left the plant at about 8:15 or 8:20. As they were leaving the building they met the other six knitters who were coming to work; all then proceeded to Union headquarters, arriving between 8: 30 and 9: 00 A. M., and informed Stember of what had occurred. Stember immediately telephoned Tullman and told him that the respondent had broken its agreement; that it had laid off the workers during the period when it had promised to keep them in work. Stember also tried to reach Hornick over the tele- phone but was unsuccessful. At about noon he saw Hornick at the latter's office and asked him why the 35 employees, especially the knitters, were laid off. According to Stember, Hornick replied that he wanted the knitters to operate two and a half machines, and when he was reminded of his agreement to permit them to return to two machines in the event of a lay-off before Christmas, he responded, "I have nothing to say-I am through. I don't want, to bother any more." 992 NATIONAL LABOR RELATIONS BOARD That afternoon the executive board of the Union received the fol- lowing letter from Tullman : "GENTLEMEN : "I have this day been informed by Louis Horuick & Co. Inc. that on December 4th, 1935, he ordered your shop-chairman to send in 12 knitters for December 5t11, 1935. That on the morn- ing of December 5th, 1935, only six out of the 12 came in, and they refused to start work and walked out. Since none of the 12 men came in all day, and your union has refused to supply other knitters although your Mr. Zinberg was up to see Mr. Hornick at 12 M. and knew the circumstances, Mr. Hornick was obliged to apply for similar lie] I) elsewhere. "As Counsel for the Association of Manufacturers of which Mr. Horuick is a member, I am giving you notice by this regis- tered mail that having refused to supply help as provided by your contract, Mr. Hornick declares your contract as having been broken on your part, and will seek his help from other sources." The implications of the respondent's course of action on this day are obvious and lead unquestionably to the conclusion that the re- spondent was attempting to avoid its contractual obligations with the Union. Assuming that Hormel: asked the knitters to continue working until he could communicate with the Union and that they left of their own accord, such action on the part of the knitters would reasonably have made more imperative the necessity for the respondent to communicate with the Union. Admittedly, however, the respondent made no effort to reach Union officials, but authorized the sending of the letter couched in uncompromising language. The respondent lays stress upon the fact that only six knitters reported for work at eight o'clock, yet in view of evidence introduced to show that employees often arrived late to work, buttressed by the fact that lateness was so usual as to require a specific provision in the collective agreement for deduction of wages of late employees, the respondent's justification for its conduct is too thin for serious consideration. This is particularly true in view of the anti-Union intention of the December 4th lay-off. Furthermore, the respond- ent's letter leaves no room for doubt that it was desirous of breaking off completely with the Union. Tullman wrote that the respondent was obliged to apply for help elsewhere, and expressed the respond- ent's intention to seek help from other sources in the future. The respondent's actions admit of but one interpretation, and give cre- dence to Stember's testimony regarding Hornick's statement : "I have nothing to say-I am through. I don't want to bother any more." On Friday, December 6, 1935, Stember replied to Tullman's letter, asserted that the statements in Tullman's letter were not correct and DECISTON S AND ORDERS 993 that 12 knitters would again be sent to the respondent's plant on Monday, December 9. In addition, Stember telephoned Tullman and arranged to meet him that morning at the respondent's office in order to adjust the dispute. Stember, with another Union organ- izer, Zinberg, again conferred with Hornick, Tullman having failed to appear for the conference. The discussion on this day was as unsatisfactory as the one on the 5th, Hornick repeating that he wanted the knitters to operate two and a half machines apiece; that if the Union would not agree, he did not want to have anything to do with the Union. On Saturday, December 7, in accordance with a request from Tullman, Rosen went to the respondent's plant to learn whether any knitters were required for Monday, the 9th, and was informed that none would be required. Nevertheless, on Monday, 12 knitters did report for work. They were met by Hornick, who told them that no knitters were needed and that he wanted no more Union knitters. Although Hornick denied that he said anything about the Union, his denial is hardly plausible after his statements to Union repre- sentatives and the statements contained in the letter written by Tull- man. The Union contends that later in the day, Monday, the re- spondent was employing four knitters, previously employed as "extra" knitters, who were members of the Union and who were working without the consent of the' Union. The Union also intro- duced evidence indicating that the respondent had arranged on Sat- urday, the 7th, to secure these men for the following week. Al- though Hornick and other witnesses for the respondent denied that such arrangements had been made, or that these knitters were work- ing on Monday, it was admitted that the men in question did work on Tuesday, December 10, and, were still working at the. time of the hearing. In the light of this admission, the testimony that the respondent had attempted in November to induce knitters to ' drop their Union membership, and the testimony,of Union representatives that Hornick was adamant in his refusal to discuss the dispute take on greater weight, and leave little doubt as to the reason why the respondent refused employment to Union knitters. On Monday, December 9, a preliminary strike vote of the em- ployees of the respondent was taken, and the executive committee was authorized to call a strike if necessary to secure the reinstate- ment of the union knitters. On Tuesday, December 10, members of the Union who were working for the respondent but who were not employed as knitters, saw the four "extra" knitters operating the knitting machines. This was reported to the Union, and at a meet- ing called at noon the workers voted to strike, after which all of the production employees, with the exception of the four "extra" knit- ters, went out on strike. Immediately after the strike vote a com- 994 NATIONAL LABOR RELATIONS BOARD mittee of the Union again conferred with Hornick and was rebuffed, being told that he would have nothing to do with Union knitters. Subsequently approximately 15 members of the Union returned to work, although the strike was still in progress. At the date of the hearing the respondent had approximately 40 workers employed, of which from 25 to 30 were old employees who had gone out on strike but had returned. The respondent lays great stress on the fact that Union members were returned to work, and that none of the members so employed were asked whether they were then members of the Union. This was offered as proof that the respondent did not discriminate against Union members and is predicated upon Horn- ick's statement that he did not know that persons so returning to work would be dropped from the Union. It is difficult, however, to give credence to such a statement from a man who has been in the same business for 18 years, and has had dealings with labor organizations over a period of at least four years. We cannot believe that he was unaware of the Union custom of dropping members who. return to work during a strike. In the days following the strike and until January 20, 1936, the Union made a number of attempts to settle the dispute, but to no, avail. On January 20, 1936, a conference was arranged between Rosenberg, the general representative of the United Textile Work- ers of America, and Tullman, at which time Tullman, speaking for the respondent, stated that he had nothing about which to confer. Consideration of all the evidence leads unquestionably to the con- clusion, and we so find, that the respondent, by its lockout of Union knitters on December 10, 1935, by its refusal to employ knitters sent by the Union and by giving work to men independently hired, dis- criminated in regard to hire and tenure of employment to discourage membership in the Union. After having made an agreement with- the knitters, the respondent deliberately refused to abide by it, as the respondent had previously attempted to do with respect to the Thanksgiving Day pay. Having thus refused, it further refused to enter into any negotiations in order to effect a change in the agree- ment which would be satisfactory both to the respondent and the knitters. Instead an arbitrary stand was taken, requiring the Union to meet the demand that the knitters operate two and a half ma- chines per man, as indicated by the testimony of Union witnesses and Tullman's letter of December 5. We find that the Union attempted, on December 5, 6, 9, and 10, 1935, to bargain collectively with the respondent, as representative of the respondent's production em- ployees, in respect to rates of pay, wages, hours of employment, and other conditions of employment. We further find that the respond- ent refused so to bargain collectively with the Union. DECISIONS AND ORDERS 995 By its refusal to bargain collectively , its discrimination against Union knitters as above set forth, and its solicitation of Union em- ployees to drop their membership in the Union, the respondent has interfered with, restrained , and coerced its employees in the exercise of their right to self-organization , to form, join , or assist labor or- ganizations, 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. III. EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE As indicated above, the greater majority of the respondent's pur- chases are received from States other than New York, and over 60 per cent of its products are shipped to points outside the State. Since the respondent manufactures to fill orders as they are received, and maintains but small storage facilities and stock on hand, its business is particularly susceptible to the effects of -labor contro- versies, especially those occurring during the busy season. The respondent's employees have been effectively organized since 1932, and within the period of two and a half to three years prior to the hearing in this case the respondent has been subject to approximately ten strikes, ranging in length from two to six weeks. Hornick testi- fied that during these strikes the plant was not operating , that ship- ments were curtailed , and business fell off as much as 30 and 40 per cent. The causes of these various strikes are not fully indicated, although in one instance a strike was called because the respondent did not increase wages as it had agreed. In its answer the respondent alleges that the Union , by breaching its agreement, is "impairing and disrupting the markets for goods flowing into the channels of commerce". The activities of the respondent set forth in Section II above, occurring in connection with the operations of the respondent de- scribed in Section I above, have a close, intimate , and substantial relation to trade, traffic, and commerce among the several States, and have led and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. THE REMEDY Under Section 2, subdivision (3) of the Act, an employee whose work has ceased as a consequence of or in connection with a labor dispute, or because of any unfair labor practice, retains his employee status as long as such labor dispute remains current and as long as he has not obtained regular and substantially equivalent employment. It cannot be questioned that the strike which began on December 5727-37-vol. u-64 996 NATIONAL LABOR RELATIONS BOARD 10, 1935, and which is still in progress, constituted a, current labor dispute, nor can it be questioned that the refusal of the respondent to bargain collectively constituted an unfair labor practice. Conse- quently, it follows that all of the striking production employees retain their employee status. In addition, the lockout of knitters on December 10, 1935, being an unfair labor practice, could not have had the effect of terminating their status as employees. The strike in this case was called not only in protest against' the respondent's discrimination against Union members by its lockout of Union knitters, but also in protest against the refusal of the re- spondent to bargain collectively with the Union. This wrongful conduct accordingly took the form of an unlawful practice directed against all of the employees who were members of the Union. In order to restore the status quo as it existed prior to December 10, 1935, the time the respondent locked out the knitters who were mem- bers of the Union, and in order to enable the processes of collective bargaining to operate, it is necessary that all of the strikers be re- instated. Persons employed for the first time since December 10, 1935, must be dismissed, and any "extra" knitters who had worked for the respondent theretofore and who replaced the regular knitters after the lockout must be restored to their previous status, if that is necessary to enable the respondent and the Union to reestablish the custom prevailing between them prior to December 10, 1935. Since the knitters were discharged, they are also entitled to receive back pay from the date of the lockout, December 10, 1935, until the respondent offers to reinstate them." Although the lockout affected 12 knitters on that day, their identities for the purposes of receiving back pay are not controlling since prior to the lockout and until De- cember 4, 1935, employment was shared by a larger group then em- ployed by the respondent.4 Accordingly, the amount of the respond- ent's payroll budgeted to knitters from December 10, 1935, until the respondent offers reinstatement to Union knitters should be appor- tioned among those knitters employed by the respondent on December 4, 1935, less any amount they may have earned within such period in lieu of the earnings they would have received from employment by the respondent.5 See Matter of Sunshine Hosie, y Mills and Branch No. 55, American Federation of Hosiery Workers, I N. L. R. B. 664. The exact number of knitters who shared the work is not shown by the record. 'The group of 26 mentioned in the record includes a number of "extra" knitters who did not share in the employment. (See p. 987, supra) 5 Owing to seasonal variations in the industry and the sharing of employment by workers, many of the respondent 's employees may have had employment in other plants both during the period they worked for the respondent and subsequent to the lockout It is not intended that amounts so earned, which would have been earned even had the lockout not taken place, be deducted from the sum due to the knitters from the respondent. DECISIONS AND ORDERS 997 CONCLUSIONS OF LAW Upon the basis of the foregoing findings of fact, and upon the en- tire record in the proceeding, the Board makes the following con- clusions of law : 1. Textile Trimming Workers Union, Local 2440, United Textile Workers of America is a labor organization, within the meaning of Section 2, subdivision (5) of the Act. 2. The production employees employed by the respondent consti- tute a unit appropriate for the purpose of collective bargaining, within the meaning of Section 9 (b) of the Act. 3. By virtue of Section 9 (a) of the Act, the Textile Trimming Workers Union, Local 2440, United Textile Workers of America, having been designated as their representative by a majority of the employees in an appropriate unit, was on October 17, 1935, and at all times thereafter has been, the exclusive representative of all em- ployees in such unit for the purpose of collective bargaining. 4. By discriminating in regard to the hire and tenure of employ- ment of its knitters, thereby discouraging membership in the labor organization known as the Textile Trimming Workers Union, Local 2440, United Textile Workers of America, the respondent has engaged in and is engaging in unfair labor practices, within the meaning of Section 8, subdivision (3) of the Act. 5. By refusing and continuing to refuse to bargain collectively with the Textile Trimming Workers Union, Local 2440, United Tex- tile Workers of America, as the representative of its production em- ployees, the respondent has engaged in and is engaging in unfair labor proctices, within the meaning of Section 8, subdivision (5) of the Act. 6. By interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act, the respondent has engaged in and is engaging in unfair labor practices, within the meaning of Section 8, subdivision (1) of the Act. 7. The strike of the employees of the respondent is a labor dispute, within the meaning of Section 2, subdivision (9) of the Act. 8. The persons employed by the respondent in the unit described above were on December 10, 1935, and continued thereafter to be employees of the respondent except in so far as they obtained regular and substantially equivalent employment elsewhere, in lieu of em- ployment by the respondent, within the meaning of Section 2, sub- division (3) of the Act.' 9. The aforesaid unfair labor practices are unfair labor practices affecting commerce, within the meaning of Section 2, subdivisions (6) and (7) of the Act. 6 See footnote 5, supra. 998 NATIONAL LABOR RELATIONS BOARD ORDER On the basis of the findings of fact and conclusions of law, anct pursuant to Section 10, subdivision (c) of the National Labor Rela- tions Act, the National Labor Relations Board hereby orders that the respondent, Louis Hornick & Co., Inc., and its officers, agents, successors, and assigns, shall: 1. Cease and desist : (a) From discouraging membership in the Textile Trimming Workers Union, Local 2440, United Textile Workers of America, or any other labor organization of its employees, by discharging, refus- ing to reinstate, or otherwise discriminating against its employees in regard to hire or tenure of employment or any term or condition of employment ; (b) From in any other manner interfering with, restraining or coercing its employees in the exercise of their rights to self-organiza- tion, to form, join or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in con- certed activities for the purpose of collective bargaining and other mutual aid or protection; (c) From refusing to bargain collectively with the Textile Trim- ming Workers Union, Local 2440, United Textile Workers of America as the exclusive representative of its production employees. 2. Take the following affirmative action which the Board finds will effectuate the policies of the Act : (a) Offer to those of its employees who were employed on Decem- ber 4, 1935, who struck on December 10, 1935, and who have not since received regular and substantially equivalent employment else- where in lieu of the employment received from the respondent, where the positions held by such employees on December 4, 1935, are now filled by persons who were hired for the first time after the strike was called, reinstatement in their positions in accordance with the custom prevailing between the respondent and the union prior to December 10, 1935.8 The detailed execution of this paragraph of the Order shall be in accordance with the conditions prescribed in the section of the decision entitled "The Remedy" ; (b) Make whole the persons employed as knitters on December 4, 1935, and each of them, for any losses of pay they have suffered by reason of their lockout on December 10, 1935, by payment to them, respectively, of a sum of money equal to that which each of them would normally have earned as wages during the period from the date of their lockout to the date of such offer of reinstatement, less the amounts, if any, which each earned during such periods in lieu of the amounts which each would have earned had such lockout not been effected. The detailed execution of this paragraph of the Order DECISIONS AND ORDERS 999 shall be in accordance with the conditions prescribed in the section of the decision entitled "The Remedy"; (c) Upon request , bargain collectively with the Textile Trimming Workers Union, Local 2440, United Textile Workers of America, as the exclusive representative of its production employees , with re- spect to rates of pay, wages, hours of employment, and other con- ditions of employment; (d) Post notices in conspicuous places in its plant stating (1) that the respondent will cease and desist as aforesaid, and (2) that such notices will remain posted for a period of thirty (30) con- secutive days from the date of posting; (e) Notify the Regional Director for the Second Region, in writ- ing, within ten (10) days from the date of this Order what steps the respondent has taken to comply herewith.