Amalgamated Local 286, Etc.

AMALGAMATED LOCAL 286, ETC. 371 ment, and electrical employees, guards, gatemen , watchmen, and all supervisors as defined in the Act. RICHFIELD OIL CORPORATION, Employer. Dated---------------- By------------------------------------- (Representative ) ( Title) This notice must remain posted for 60 days from the date hereof, and must not be altered, defaced, or covered by any other material. AMALGAMATED LOCAL 286, INTERNATIONAL UNION, UNITED AUTOMO- BILE WORKERS OF AMERICA, AFL and HAROLD VLASAK AND PAUL. SCHWARTZ . Case No. 13-CB-248. October 18, 1954 Decision and Order On December 4, 1953, Trial Examiner Samuel Binder issued his Intermediate Report in the above-entitled proceeding, finding that the Respondent had not engaged in certain unfair labor practices within the meaning of Section 8 (b) (1) (A) of the Act and recom- mending that the complaint be dismissed in its entirety, as set forth in the copy of the Intermediate Report attached hereto. Thereafter, the General Counsel filed exceptions to the Intermediate Report and a supporting brief. The Respondent requested leave, and was permitted, to file a brief in reply to the General Counsel's brief. The Board has reviewed the rulings of the Trial Examiner made at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Board has considered the Inter- mediate Report, the exceptions and briefs, and the entire record in the case, and finds merit in the General Counsel's exceptions. The Trial Examiner found that the Respondent did not violate Section 8 (b) (1) (A) of the Act by threatening to deprive the com- plainants, Vlasak and Schwartz, of certain insurance benefits for fail- ing to maintain membership in good standing in its organization. He based this conclusion on his interpretation of the Respondent's then current contract with Delta Star Electric Division, H. K. Porter Co., Inc., which he found had terminated preexisting insurance bene- fits as a condition of employment and made them available to em- ployees solely as an incident of union membership. For this reason, the Trial Examiner found that the Respondent was privileged to re- quire membership in good standing as a prerequisite for the enjoy- ment of the insurance benefits in question. Because we disagree with the Trial Examiner's interpretation of the contract, we find that the Respondent violated Section 8 (b) (1) 110 NLRB No. 53. 372 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (A).' To put the issue before us in proper perspective, we recite the facts, some of which the Trial Examiner omitted from his discussion. Since 1943, the Respondent has been the collective-bargaining agent of the Company's production and maintenance employees. In its agreement with the Company negotiated sometime before 1951, and probably in November 1949,2 the Company undertook to provide at its own expense certain group insurance benefits to all employees in the bargaining unit. The Company thereupon secured an insurance policy with Connecticut General Insurance Company, to which the Respondent was not a party. The Company paid the insurance pre- miums for this policy directly to the insurance company, processed all claims arising under this policy, and collected payments on account of claims and distributed the proceeds to the interested employees. It is not disputed, and the Trial Examiner so found, that the fore- going arrangement made insurance benefits a condition of employment enjoyed by all the employees. This arrangement did not undergo any change until November 19513 At that time, the Respondent carried a group insurance policy with Continental Insurance Company cov- ering about 4,000 union members employed by other employers' Be- cause Continental Insurance Company assertedly offered greater benefits,' the Respondent persuaded the Company to transfer part of the insurance coverage it carried with Connecticut General Insurance Company 6 to the Respondent's policy with Continental Insurance Company. During these transfer negotiations, the Company com- puted its insurance cost per employee to be $5.15 per month, which it arranged to turn over to the Respondent to be used as payment of the premiums under the latter's policy. It does not appear that any change was made in the existing contract respecting the Company's obligation to furnish insurance benefits to its employees. The net effect of this arrangement was to continue insurance benefits as a condition of em- 1 In its reply brief, the Respondent which had filed no written answer to the complaint, challenges for the fist time the sufficiency of the complaint and asks for its dismissal on the ground that it does not state a cause of action Although the Trial Examiner stated in his Intermediate Report that he believed that the complaint did not state facts suffi- cient to constitute a violation of Section 8 (b) (1) (A ), the record nevertheless shows that at the hearing the Trial Examiner permitted the General Counsel , without objec- tion from the Respondent , to "clarify" the complaint so as to allege the precise cause of action ultimately litigated by the parties Under the circumstances, we find, without agreeing with the Trial Examiner 's statement , the Respondent's contention to be without merit and hereby deny its motion to dismiss the complaint. 2 According to the transcript , which is obviously incorrect in this respect , a company witness identified the date as November "59." 3 The Trial Examiner does not allude in his Intermediate Report to any change in the insurance coverage at this date. * Contrary to the Trial Examiner 's statement, it does not appear that the Respondent informed the Company that insurance benefits under its policy with the Continental Insurance Company would be available to the Respondent 's members only. a No insurance policies were put in evidence ; nor does the record otherwise show in what respects these policies differed. 6 The record is not clear as to the exact nature of the insurance retained by the Company. AMALGAMATED LOCAL 286, ETC. 373 ployment but to place the administration of the Company's insurance program in the hands of the Respondent. In the latter part of 1952, the Respondent and the Company opened negotiations for a new contract to succeed the then expiring one. At about this time,7 the Wage and Hour Division of the Labor Depart- ment notified the Company that the $5.15 insurance premium had to be included in the wage rate in computing overtime pay. As a conse- quence, the Company and the Respondent determined that 3 cents per hour was the equivalent cost of the insurance and petitioned the Wage Stabilization Board for permission "to have a change made in the insurance whereby we would add 3 cents to the hourly rate and dis- continue the $5.15. . . ." On December 12,1952,$ the Wage Stabiliza- tion Board granted the request. On December 30, 1952, the Company and the Respondent signed a new agreement. It is this agreement that the Respondent contends, and the Trial Examiner found, discontinued the Company's future obligation to furnish insurance benefits to its employees as a condi- tion of employment and granted them instead a wage increase in the amount of the cost of this insurance. Significantly, the contract con- tains no express provision terminating insurance benefits as a condi- tion of employment. The only provision purporting to have this effect, upon which the Respondent relies, is set forth in a wage sup- plement to the main agreement. It reads as follows : All of the above rates include three (3) cents per hour to cover group life and hospitalization insurance premiums which are paid for by the Company. The cost of this insurance is $5.15 per month for each employee in the bargaining unit. Insurance pre- miums are to be deducted as a portion of union dues on the first pay period of each month and rebated to the Union. In the event an employee has not worked during the first pay period of any month the insurance premium for that month will be carried over to the following month and a deduction for the previous month, plus the current month will be made. Any employee who has not worked during the first pay period of two (2) or more successive months and who does not wish his insurance to lapse will be required to contact the local office to make arrangement for the payment of insurance premiums for the period or periods he does not appear on the payroll. [Em- phasis supplied.] On January 5, 1953, the Company posted the following notice to employees : 7 The Trial E.caminer does not mention this incident in his Intermediate Report. 8 The transcript is apparently in error in indicating that approval was granted on December 12, "53." 374 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Effective with the January deduction Group Life and Hospi- talization Insurance for all employees covered by the bargaining units of the UAW-AFL Amalgamated Local 286 will be deducted as a portion of union dues. Starting Monday, January 5, 1953, the Delta Star Electric Division of H. K. Porter Company, Inc. will increase the rates of all employees covered by this bargaining unit 3 cents per hour. This will supersede the procedure of adding $5.15 per month to employees' earnings and deducting the same amount for insurance which will be discontinued. In the event there should be any questions regarding the above, please contact your Foreman. [Emphasis supplied.] A few days before the execution of the agreement mentioned above, the Respondent informed the Company that as of January 5, 1953, $8.15 was to be deducted by the Company as union dues under check- off authorizations and turned over to the Respondent. This sum evidently represented $3 for the regular dues that were previously paid, plus $5.15 for insurance benefits under the Respondent's policy. In accordance with the Respondent's request, the Company has been deducting from the earnings of each employee in the bargaining unit, including the Charging Parties, Vlasak and Schwartz, the sum of $8.15 which it remits to the Respondents However, because Vlasak and Schwartz were in default in the payment of certain fines and assess- ments which the Respondent had imposed upon them, the Respondent on March 31, 1953, sent Vlasak and Schwartz letters,1° advising them that they were in bad standing and that, if they did not pay the speci- fied fine and assessment sums within 5 days, they would no longer "be entitled to any future insurance benefits." It is settled law that a union restrains and coerces employees in the exercise of their statutory right to refrain from joining or main- taining membership in a labor organization where it threatens to deprive them of a term or condition of employment unless they main- tain their membership in good standing by payment of fines or assess- ments.ll This prohibition however, does not apply to a union's threatened action with respect to purely internal union status not involving deprivation of terms or conditions of employment.12 The critical question thus presented here is whether the insurance benefits which the Respondent threatened to deny Vlasak and Schwartz if they did not regain their membership in good standing were a condi- tion of employment. 9 The authorization cards do not specify the amount to be deducted. 10 Similar letters were sent to the approximately 100 other employees who had failed to pay the assessment. n Cf Jamidel Furs, 100 NLRB 1390, 1392-1393, 1439-1440 ; Local 140, Bedding, Curtain & Drapery Workers Union, et al , 109 NLRB 326; N. L. R. B. v. Gaynor News Company, Inc , 347 U. S. 17 12 International Typographical Union, 86 NLRB 951, 955-957. AMALGAMATED LOCAL 286, ETC. 375 As indicated previously, the Trial Examiner found no violation because, as he interpreted the relevant paragraphs of the wage supple- ment to the December 30, 1952, contract, quoted above, the parties had thereby discontinued insurance benefits as a condition of employment and converted the cost of this insurance into a wage increase. We do not agree with this interpretation of the contract. It seems to us that where, as here, insurance benefits have been an established condition of employment enjoyed by employees, an agree- ment which purports to deprive them of these employment benefits should at least be clear and unequivocal.13 Plainly, this is not the case here. Indeed, the Trial Examiner correctly observed that the contract was ambiguous in this respect and, accordingly resorted to extrinsic evidence to ascertain the intent of the parties. We do like- wise; but, contrary to the Trial Examiner, are forced to the con- clusion that a more reasonable interpretation of the relevant para- graphs of the wage supplement discloses that the parties did not intend to discontinue insurance benefits as a condition of employment. It is not denied that before the execution of the December 30, 1952, agreement the Company was under contractual obligation to furnish its employees group insurance, as a condition of employment.14 With- out being relieved of this obligation, the Company in November 1951 was persuaded to transfer the function of handling the Company's group insurance policy to the Respondent by the latter's representa- tion that it could secure better coverage for the Company's employees under the Respondent's master policy. Accordingly, the Company computed the cost of insurance under its cancelled group policy and agreed to remit to the Respondent $5.15 monthly for each employee to pay the premiums under the Respondent's policy. Against this background, it could readily be seen that when, during negotiations of the December 30, 1952, contract, the $5.15 premium was converted into a 3-cent per hour wage increase after the Wage and Hour Division notified the Company that $5.15 had to be considered as additional wages for computing overtime, the Respondent and the Company made the conversion simply as a bookkeeping convenience and not to terminate a fringe benefit. This is borne out by the fact that it does not appear that the employees were actually given the 3-cent wage >s Cf. Tide Water Associated Oil Company, 85 NLRB 1096 , 1098, where the Board found that a "Management Functions " clause was ambiguous and declined to interpret the clause as a waiver of the Union's right to bargain on a retirement plan. In so doing, the Board stated • "We are reluctant to deprive employees of any of the rights guaran- teed them by the Act in the absence of a clear and unmistakable showing of waiver of such rights." 11 In its brief to the Trial Examiner , the Respondent admitted that insurance benefits were a condition of employment before November 1951 but it took no position as to the status of benefits between that date and the execution of the December 30, 1952, agree- ment. In its reply to the General Counsel's exceptions , the Respondent admitted that "formally the insurance program for the employees of the Company was a condition of employment." 376 DECISIONS OF NATIONAL LABOR RELATIONS BOARD increase in lieu of insurance benefits or even the opportunity to decide whether they desired the increase or the insurance coverage. More- over, the contract itself specifically states that the 3-cent hourly in- crease was designed "to cover group life and hospitalization premiums which are paid for by the Company." Nor do we believe that the provision in the contract, strongly relied upon by the Trial Examiner, that "insurance premiums are to be deducted as a portion of union dues," necessarily reflects an intention to discontinue insurance. benefits as a condition of employment and to make them an incident of membership. In our opinion, this clause accomplished nothing more than a change in the form of remitting premiums to the Respondent, which was then administering the in- surance program for the Company under their earlier arrangement. Indeed, the Company's notice to its employees, which it posted on January 5, 1953, indicates that a change in "procedure" only was intended. Further confirming our view that the December 30 agreement did not contemplate the withdrawal of the then existing insurance bene- fits as one of the employees' terms of employment is the fact that, not only is there no such provision in the contract, but the contract itself reveals a continuing interest by the Company that the employees enjoy these benefits. Thus, the contract provides in detail for the method of paying premiums and preventing a lapse of the insurance. matters which normally would not be found in a collective-bargaining agreement if they did not relate to a term or condition of employment. We regard the inclusion of this clause as an indication of the Com- pany's intent to continue existing insurance benefits as a term of employment and at the same time to permit the Union to continue to administer the program for it with minor modifications. In these circumstances, the testimony of Company Personnel Director Schultz, to which the Trial Examiner refers in his Intermediate Report, that the Company had no control over the insurance fund and assumed no responsibility for the disposition of the money it remitted to the Re- spondent, could be reasonably understood as meaning that the Com- pany had nothing to do with administering the insurance program and not that the Company had relieved itself of the obligation to fur- nish group insurance to its employees. We therefore conclude, contrary to the Trial Examiner, that the December 30, 1952, contract did not terminate insurance benefits as a condition of employment enjoyed by employees. As it is clear that the Respondent threatened the Charging Parties and other employees with the deprivation of these benefits unless they regained membership in good standing, we find that the Respondent violated Section 8 (b) (1) (A) of the Act. AMALGAMATED LOCAL 286, ETC. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE 377 The activities of the Respondent, set forth above, which have been found to constitute unfair labor practices occurring in connection with the operations of the Company, described in the Intermediate Report, have a close, intimate, and substantial relation to trade, traffic, and commerce among the several States, and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. THE REMEDY Having found that the Respondent has engaged in certain unfair labor practices, we shall order it to cease and desist from this and like and related conduct, and to take certain affirmative action designed to effectuate the policies of the Act. CONCLUSIONS OF LAW 1. Delta Star Electric Division, H. K. Porter Co., Inc., a Pennsyl- vania corporation, is engaged in commerce within the meaning of the Act. 2. Amalgamated Local 286, International Union, United Automo- bile Workers of America, AFL, is a labor organization within the meaning of Section 2 (5) of the Act. 3. By restraining and coercing employees of the Company in the exercise of rights guaranteed by Section 7 of the Act, the Respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (b) (1) (A) of the Act. 4. The aforesaid unfair labor practices affect commerce within the meaning of Section 2 (6) and (7) of the Act. Order Upon the entire record in this case, and pursuant to Section 10 (c) of the National Labor Relations Act, as amended , the National Labor Relations Board hereby orders that the Respondent , Amalgamated Local 286, International Union, United Automobile Workers of kmerica, AFL, Chicago, Illinois, and its officers, representatives, agents, successors, and assigns, shall : 1. Cease and desist from : (a) Threatening employees of Delta Star Electric Division, H. K. Porter Co., Inc., with the loss of insurance or other benefits enjoyed by them as a condition of employment for failing to maintain mem- bership in good standing in its organization. 378 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (b) In any like or related manner, restraining or coercing employ- ees of the above named Company, its successors or assigns, in the exer- cise of the rights guaranteed in Section 7 of the Act, except to the extent that such rights may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in Section 8 (a) (3) of the Act. 2. Take the following affirmative action which the Board finds will effectuate the policies of the Act. (a) Notify in writing Harold Vlasak and Paul Schwartz and all other employees who received similar letters threatening them with the loss of insurance benefits enjoyed by them as a condition of em- ployment that it has no objection to their full participation in insur- ance or other benefits to which they are entitled as employees of the above-named Company, and that it will not in the future threaten them with the loss of such benefits for failing to maintain membership in good standing in its organization. (b) Post at its business office in Chicago, Illinois, copies of the no- tice attached hereto marked "Appendix." 15 Copies of said notice, to be furnished by the Regional Director for the Thirteenth Region, shall, after being duly signed by an official representative of the Re- spondent, be posted by the Respondent immediately upon receipt thereof and maintained by it for it period of at least (60) consecutive days thereafter in conspicuous places, including all places where no- tices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to insure that said notices are not altered, defaced, or covered by any other material. (c) Mail to the Regional Director for the Thirteenth Region signed copies of the notice attached hereto marked "Appendix" for posting, the above-named Company willing, at the Company's Chicago, Illi- nois, plant, in places where notices to employees are customarily posted. Copies of said notice, to be furnished by the Regional Direc- tor for the Thirteenth Region, shall, after being duly signed as pro- vided in the paragraph just above, be forthwith returned to the Regional Director for said posting. (d) Notify the Regional Director for the Thirteenth Region, in writing, within ten (10) days from the date of this Order, as to what steps it has taken to comply herewith. MEMBER PETERSON took no part in the consideration of the above Decision and Order. 15 In the event that this order is enfoi`ced by decree of a United States Court of Appeals. there shall be substituted for the words "Pursuant to a Decision and Order " the words "Pursuant to a Decree of the United States Court of Appeals, Enforcing an Order " AMALGAMATED LOCAL 2 8 6, ETC. 379 Appendix NOTICE TO ALL MEMBERS OF AMALGAMATED LOCAL 286, INTERNATIONAL UNION, UNITED AUTOMOBILE WORKERS OF AMERICA, AFL, AND ALL EMPLOYEES OF DELTA STAR ELECTRIC DIVISION, H. K. PORTER CO., INC. Pursuant to a Decision and Order of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Relations Act, as amended, we hereby notify our employees that : WE WILL NOT threaten employees of Delta Star Electric Divi- sion, H. K. Porter Co., Inc., with the loss of insurance or other benefits enjoyed by them as a condition of employment for failing to maintain membership in good standing in Amalgamated Lo- cal 286, International Union, United Automobile Workers of America, AFL. WE WILL NOT, by means of the foregoing, or in any like or re- lated manner, restrain or coerce employees of the above-named Company in the exercise of the rights guaranteed in Section 7 of the Act, except to the extent such rights may be affected by an agreement requiring membership in a labor organization as a con- dition of employment as authorized in Section 8 (a) (3) of the Act. WE WILL notify in writing Harold Vlasak and Paul Schwartz and all other employees who received similar letters threatening them with loss of insurance benefits enjoyed by them as a condi- tion of employment that we have no objection to their full partici- pation in insurance or other benefits to which they are entitled as employees of the above-named Company and that we will not in the future threaten them with the loss of such benefits for fail- ing to maintain membership in good standing in Amalgamated Local 286, International Union, United Automobile Workers of America, AFL. AMALGAMATED LOCAL 286, INTERNATIONAL UNION, UNITED AUTOMOBILE WORKERS OF AMERICA, AFL, Labor Organization. Dated---------------- By------------------------------------- (Representative) (Title) This notice must remain posted for 60 days from the date hereof, and must not be altered, defaced, or covered by any other material. 380 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Intermediate Report STATEMENT OF THE CASE Upon charges filed by Harold Vlasak and Paul Schwartz, individuals, the General Counsel of the National Labor Relations Board 1 by the Regional Director for the Thirteenth Region (Chicago, Illinois) issued a complaint dated June 22, 1953, against Amalgamated Local 286, International Union, United Automobile Workers of America, AFL, herein called the Respondent or the Union, alleging that the Union had engaged in unfair labor practices within the meaning of Section 8 (b) (1) (A) and Section 2 (6) and (7) of the National Labor Relations Act, as amended, 61 Stat. 136, herein called the Act. The Respondent failed to file an answer but appeared at the hearing and con- troverted the allegations made in the complaint. Pursuant to notice, a hearing was held at Chicago, Illinois, on October 12, 1953, before Trial Examiner Samuel Binder, duly designated by the Chief Trial Examiner. The General Counsel was represented by counsel and the Union by its International secretary-treasurer. The parties were afforded full opportunity to introduce relevant evidence, to examine and cross-examine witnesses, to argue the issues orally upon the record, and to file briefs, proposed findings of fact, and conclusions of law or both with the Trial Examiner. The General Counsel and the Respondent argued orally, and their arguments are included in the transcript. Briefs were thereafter submitted by the General Counsel and the Respondent and have been carefully considered. In substance the complaint alleges that (1) Delta Star Electric Division, H. K. Porter Company, Inc. (hereinafter sometimes called the Employer or the Company), and the Union entered into a labor agreement on December 30, 1952, which provided in part that certain insurance premiums were "to be deducted from each employee's wages as a portion of union dues . . . and rebated to the Union. (2) The Union, in turn, agreed to provide its members with group and hospitaliza- tion insurance, in return for these premiums." [Emphasis supplied.] (3) On March 31, 1953, the Union threatened to withhold and deprive the Charging Parties (members of the Union) of the benefits of the said insurance policies because they refused to pay assessments and fines imposed on them by the Union. (4) This con- duct on the part of the Union is asserted to constitute a violation of Section 8 (b) (1) (A) of the Act. The complaint, it will be observed, made no claim that "insurance" was a "condi- tion of employment." At the beginning of the hearing, however, the General Counsel stated that the group insurance referred to above was a "condition of employment" of the Charging Parties and the Union threatened to deprive them of such condi- tion of employment and thereby violated Section 8 (a) (1) (A) of the Act. In this connection, it will be noted that the complaint does not allege that the labor agreement referred to contained provisions requiring the Employer to furnish group insurance coverage to its employees in the bargaining unit as part of their wages or as a condition of employment and that the Union threatened or attempted to take away from the Charging Parties something which the Employer agreed to furnish as a condition of employment in the aforesaid labor contract. It will also be ob- served that the complaint contains no paragraph alleging that the Union was ap- pointed the agent for the Employer or acted as an agent of the Employer for the purpose of furnishing group insurance coverage to the Company's employees as a part of their compensation or as an emolument stemming from their employment. The complaint alleges that the premiums were deducted from employees' wages as a portion of union dues. It may also be noted that the complaint contains no alle- gation to the effect that any part of the monies deducted from wages was not a portion of union dues (i. e., the complaint contains no statement to the effect that some part of the deductions made from wages did not constitute union dues but was in fact a deduction of a sum of money in addition to union dues made by the Em- ployer pursuant to its agreement with the Union, to be turned over to the latter ear- marked for the purpose of obtaining group insurance coverage for all employees in the bargaining unit, as a condition of employment irrespective of union membership). It is also noted that no motion was made to amend the complaint to set forth such claim. In my opinion, the facts asserted in the complaint, would not support a conclusion that Section 8 (b) (1) (A) of the Act was violated. 1 The General Counsel and his representative at the hearing are referred to as the General Counsel The National Labor Relations Board is herein called the Board. AMALGAMATED LOCAL 286, ETC. 381 The evidence offered at the hearing to support the General Counsel's contentions made at the hearing and the evidence bearing on the Respondent 's position in the matter has been considered and will be discussed hereinafter. The motion to dismiss the complaint made at the hearing will be disposed of in the following findings and conclusions and recommendations. Upon the entire record in the case, and from my observation of the witnesses, I make the following: FINDINGS OF FACT 1. THE BUSINESS OF THE EMPLOYER The parties stipulated that the Company had sales in excess of $10,000,000 a year in merchandise, of which at least half is sold outside the State of Illinois in States of the United States, and that the Company is engaged in commerce within the meaning of the Act. I find that the Employer, a Pennsylvania corporation engaged in the manufacture of electrical equipment with a plant in Illinois, is engaged in com- merce within the meaning of the Act. II. THE LABOR ORGANIZATION INVOLVED The parties stipulated and I find that the Union is a labor organization within the meaning of the Act. III. THE UNFAIR LABOR PRACTICES The Union had over a period of several years negotiated a number of labor con- tracts with the Employer. Prior to December 30, 1952, the Employer and the Union were operating under a labor contract in which the Employer had agreed, among other things, to obtain group insurance coverage for all employees in its Delta Star plant in the bargaining unit represented by the Union. In this connection, the Employer pur- suant to its obligation under such contract added $5.15 per month to the wages of employees who had worked a specified number of hours and thereafter deducted said $5.15 from the wages of such employees and paid it over directly as a premium to the Connecticut General Insurance Company of Hartford, Connecticut (hereinafter sometimes called Connecticut General), an insurance company from which the Employer had obtained a group insurance policy covering all said employees. The Union was not a party to the aforesaid insurance agreement with Connecticut General. No copy of the policy issued by Connecticut General was offered and the record contains no evidence showing what the benefits were. In 1951, the Union assessed all its members $2 for a building fund. The Charging Parties who were members of the Union and about 100 others failed and refused to pay such assessment. Thereupon the Union excluded from its meetings those mem- bers who failed and refused to pay such assessment and in addition fined each one of such members $2 for each meeting at which he was not in attendance. During 1951 and 1952, union dues were $3 a month, which the Employer deducted pursuant to authorization of the employees and turned over to the Union. In the latter part of 1952 the Union and the Employer began to negotiate a new labor contract. During the negotiations the Employer agreed at one point to increase the wages of the employees in the bargaining unit 15 cents per hour. The negotiators for the Union at some time before December 30, 1952, called the Employer's atten- tion to the fact that there were only about 400 persons in the bargaining unit and that the Respondent had a membership of about 4,000. The union negotiators repre- sented to the Employer that by reason of its comparatively large membership it could obtain more advantageous group insurance coverage for its members than was available to the Employer for the 400 persons in the bargaining unit in the latter's employ. It appeared that during the negotiations leading up to the execution of the December 30, 1952, labor contract a representative of Continental Insurance Com- pany was present and the insurance coverage and benefits which it would be willing to contract to give to members of the Union was discussed. It was estimated that the $5.15 per month which the Employer had been paying to Connecticut General for each employee in the unit amounted in money wages to about 3 cents per hour. The Employer agreed to pay an additional 3 cents per hour in wages, i. e., it agreed to an 18-cent per hour increase in wages instead of 15 cents per hour and was relieved of continuing with the insurance policy under which it paid $5.15 per month in premi- ums for each employee to Connecticut General The 1952 labor contract contains no language requiring the Employer to make an agreement with any insurance company for group coverage. The Union informed the Company that group insurance coverage would be available to its members through a policy obtained by the Union from Continental Insurance Company. In this con- 382 DECISIONS OF NATIONAL LABOR RELATIONS BOARD nection, the Union advised the Employer by letter dated December 23, 1952, that "officially as of January 5, 1953, upon signed authorization by the employees covered by the bargaining unit, the sum of . . . $8.15 for monthly dues [was] to be deducted and submitted to the Union office in accordance with the Union agreement." The Union obtained a group insurance policy from Continental Insurance Com- pany. The representative of the Union stated to the Trial Examiner at the hearing that this policy covered only members of the Union in good standing. The state- ment was not controverted by the General Counsel. The policy, however, was never offered in evidence and ho evidence was presented to show what the benefits under this policy were or what the terms of such policy actually were. The relevant provisions of the labor contract, signed December 30, 1952, are found in article VII, section 1 of the contract and wage supplement A attached to the contract. The supplement established rate ranges for various job classifications which were listed therein. The pertinent language contained in the aforesaid wage supplement is comparatively short and reads as follows: All of the above rates include three (3) cents per hour to cover group life and hospitalization insurance premiums which are paid for by the Company. The cost of this insurance is $5.15 per month for each employee in the bargain- ing unit. Insurance premiums are to be deducted as a portion of union dues on the first pay period of each month and rebated to the Union. In the event an employee has not worked during the first pay period of any month the insurance premium for that month will be carried over to the follow- ing month and a deduction for the previous month, plus the current month will be made. Any employee who has not worked during the first pay period of two (2) or more successive months and who does not wish his insurance to lapse will be required to contact the local union office to make arrangements for the pay- ment of insurance premiums for the period or periods he does not appear on the payroll. On January 5, 1953, the Employer posted a shop notice reading, in pertinent part, as follows: Effective with the January deduction Group Life and Hospitalization Insur- ance for all employees covered by the bargaining units of the UAW-AFL Amalgamated Local 286 will be deducted as a portion of union dues. Starting Monday, January 5, 1953, the Delta Star Electric Division of H. K. Porter Company, Inc. will increase the rates of all employees covered by this bargaining unit 3 cents per hour. This will supersede the procedure of adding $5.15 per month to employees' earnings and deducting the same amount for insurance which will be discontinued. The labor contract under consideration here contains union-security provisions and union dues are deducted and turned over to the Respondent pursuant to checkoff authorization cards signed by the employees. Since the effective date of the labor contract the Employer has been deducting $8.15 monthly from the wages of the employees (with possible exceptions not pertinent here) and has been turning these sums over to the Union and the Union has been paying premiums to Continental Insurance Company for the benefit of the Charging Parties and other members of the Union. On March 31, the Union sent letters to each of the Charging Parties. Similar let- ters were sent to other members of the Union. The letters advised Vlasak and Schwartz that they were in bad standing with the Union because they owed a $2 assessment plus fines in specified amounts and that unless these sums were paid within 5 days they would "not be entitled to any future insurance benefits." A. The issue No claim was made here that the Union approached the Employer in connection with either one of the Charging Parties or in regard to any other employee. The General Counsel stated in his brief that because the Union had made no demand on the Employer to take any action in regard to the Charging Parties "there is no allega- tion that the Respondent Union herein violated Section 8 (b) (2)." At the hearing, it appeared that the basic premises on which the General Counsel rested his contention that the Union violated Section 8 (b) (1) (A) are- (1) The Union and the Employer entered into a labor contract executed on December 30, 1952, which provided for group insurance benefits as part of the wages or compensa- tion of the Charging Parties, i e., as a condition of their employment; and (2) the mailing of the Union's March 31, 1953, letter, restrained or coerced the Charging AMALGAMATED LOCAL 286, ETC. 383 Parties in the exercise of the rights guaranteed them under Section 7 and thus con- stituted a violation of Section 8 (b) (1) (A) of the Act. In the latter connection the General Counsel also contended that the proviso to Section 8 (b) (1) (A) was not applicable to the facts of this case. - It will be noted the General Counsel did not urge that the execution of the Decem- ber 30, 1952, labor contract and its effective operation violated Section 8 (b) (2) of the Act. It will also be observed, in this connection, that the General Counsel has not made the Employer a party.2 The position taken by the Union at the hearing may be summarized as follows: The labor contract executed on December 30, 1952, does not require the Union to furnish group insurance coverage to anyone in the bargaining unit merely because such person is an employee of the Company; that what the Union obtained as a result of the 1952 contract with the Employer for the benefit of all the persons in the bargaining unit was an increase in hourly wages, not group insurance for all employees, and further, part of such increase in wages was in substitution for group insurance theretofore furnished by the Employer as part of employee compensation; that the language in the contract referring to group insurance shows on its face that group insurance coverage was dependent on union membership, not on employment with the Company; that, among other things, reference to insurance in the 1952 con- tract was made to explain the change effected by the instant contract from the labor contract which preceded it in which the Employer had agreed to furnish group in- surance coverage as part of the compensation paid the employees in the bargaining unit. In its brief the Union also stated that language referring to insurance was inserted because under prior Board decisions it was important and necessary "to reduce the agreed areas bargained upon to writing." In substance, the Union claimed that group insurance coverage was dependent on union membership and available not only to members of the Union employed by the Company, but to other members of the Union not employed by the Company; that its letter to Vlasak and Schwartz advising them that they would not be entitled to insurance benefits unless they paid the assessment and fines was sent because the insurance policy obtained by the Union provided coverage only for members in good standing; that the Union intended to expel them if the fines and assessments were not paid; and that since the benefits of insurance were dependent on union membership the mailing of the letter was not un- lawful and further that the mailing of the letter did not restrain or coerce the Charg- ing Parties in the exercise of the rights guaranteed in Section 7; and in any event the Respondent's action was protected by the proviso to Section 8 (b) (1) (A) of the Act. B. The labor contract The language of the labor contract quoted above appears ambiguous in certain respects. It will be noted, in this connection that the General Counsel called Schultz, the personnel manager of the Employer, who had participated in the negotiations leading to the execution of the instant labor contract with the Union, to testify in regard to the matter. Schriltz' tesimony will be considered in connection with the following discussion of the language employed in the contract. The first two sentences of the wage supplement read as follows: All of the above rates include three (3) cents per hour to cover group life hospitalization insurance premiums which are paid for by the Company. The cost of this insurance is $5.15 for each employee in the bargaining unit. These sentences, had they not been modified by the third sentence in the same para- graph, might fairly have been held to constitute an earmarking of specific sums of money to be used for the special purpose of obtaining group insurance for each employee in the bargaining unit and thus to have constituted the furnishing of group insurance as •a "condition of employment." However, the third sentence of the same paragraph reads. Insurance premiums are to be deducted as a portion of union dues on the first pay period of each month and rebated to the Union. This sentence specifically declares that the sums deducted from the employees' wages in order to pay for insurance coverage are to be considered earmarked as part of union dues. Since payment of union dues normally connotes union membeiship, 2 The charge made by Vlasak and Schwartz (General Counsel's Exhibit No 1A) sets foith that "The respondent union caused [the employer] to discriminate against Paul Schwartz and Harold Vlasak because of their refusal to pay the union special fines and assessments 384 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the sentence is indicative of an intention of the parties that such membership was a prerequisite to obtaining group insurance benefits. This declaration of the intention of the parties in the contract concerning the nature of the deductions to be made and turned over to the Union would appear to be inconsistent with the contention that group insurance benefits were a condition of employment rather than of union mem- bership. The fair inference to be drawn from the sentence is that the insurance premiums referred to and the insurance coverage to be obtained with such premiums have a relation only to a policy to be obtained through payments made by the Union to an insurance company. It could not fairly be inferred from this sentence that in- surance coverage was to be made available to employees who never became mem- bers of or to persons who were expelled from the Union. If an employee were expelled from the Union because he refused to pay fines or an assessment, such expulsion could not lawfully be grounds for discharge from employment. Nevertheless could it be said that the Employer , in the light of the quoted sentence, would be required to rebate $5.15 to the Union each month for in- surance coverage for an employee expelled from the Union and the Union was re- quired to pay premiums for such expelled employee when rebated by the Employer or when tendered by the expelled employee? I do not believe the contract could fairly be so interpreted. Suppose further that the Employer engaged a new employee and that for any reason the Union decided not to accept him as a member , is the Union under the language of this contract required to accept a sum of money from such employee or the Employer on the latter 's behalf and furnish insurance coverage to him? If so, what is the character and amount of the insurance coverage required to be fur- nished? If insurance were a condition of employment the answer would have to be in the affirmative. In this connection, it may be observed that there is nothing in the record to show that the Employer and the Union ever entered into an agree- ment for any specific amount of insurance coverage for each employee or that any other material aspect of insurance coverage was agreed upon. If insurance coverage were a "condition of employment" the contract which obligated an employer to fur- nish it would normally spell out among other things the kind of insurance coverage and the amount to be provided . There is no such provision in the contract under consideration. The penultimate paragraph of appendix A of the labor contract reads: Any employee who has not worked during the first pay period of two (2) or more successive months and who does not wish his insurance to lapse will be required to contact the local union office to make arrangements for the payment of insurance premiums for the period or periods he does not appear on the pay- roll. [Emphasis supplied.] It appears reasonable to infer from this paragraph that it was the intention of the parties that the Employer was to have no responsibility whatever in regard to furnishing insurance to employees ; and further that insurance coverage was wholly a union matter and thus not a "condition of employment," unless the Union was acting as an agent of the Employer in providing such insurance. Was it the intention of the parties that the Union act as agent for the Employer to obtain for employees group insurance as a condition of employment? In answer to an inquiry by the Trial Examiner whether he was contending that some kind of agency relationship between the Employer and the Union was intended or created by the labor contract the General Counsel replied in the affirmative. However, no evidence whatever , except such as may be inferred from the language of the contract, was produced to support such a conclusion . Moreover no such con- tention appears in General Counsel's brief. It will be observed that the Union in its December 23, 1952, letter to the Em- ployer (Respondent's Exhibit No. 1) advised the Employer that as of January 5, 1953, upon signed authorization by employees covered by the bargaining unit, "the sum of . $8.15 for monthly dues [was] to be deducted." There is no indication from this letter that the Union considered that any part of the $8.15 it was receiving was something other than union dues, or that it was receiving any part of such sums as an agent for the Employer. The shop notice prepared by the Employer (General Counsel 's Exhibit No. 8) dated January 5 , 1953, furnishes no ground for concluding that the Union was acting as agent for the Employer to obtain group insurance coverage . In fact, if any infer- ence may be drawn from this document as a reflection of the Company 's understand- ing of the contract it is that insurance as a condition of employment was withdrawn and instead the employees insofar as to their employment relationship was concerned were to obtain 3 cents more per hour. AMALGAMATED LOCAL 286, ETC. 385 The'sedond paragraph of the notice reads as follows: Starting Monday, January 5, 1953, the Delta Star Electric Division of H. K. Porter Company, Inc. will increase the rates of all employees covered by this bargaining unit 3¢ per hour. This will supersede the procedure of adding $5.15 per month to employee earnings and deducting the same amount for insurance which will be discontinued. [Emphasis supplied.] Insofar as the action taken by the Employer in preparing and posting the above notice could be said to reflect its understanding of the labor contract it would seem more consistent with the view that group insurance was an attribute of union mem- bership than it would with the contention of the General Counsel that group insur- ance was a condition of employment. It will also be noted that the first sentence of the aforesaid notice to the effect that ". . . Group Life and Hospitalization Insur- ance for all employees covered by the bargaining units of the UAW-AFL Amalga- mated Local 286 will be deducted as a portion of union dues" lends no support to General Counsel's position in this case. General Counsel's Exhibit No. 4, a statement of earnings and payroll deductions furnished Schwartz by the Employer shows that in December 1952, the Employer was making a deduction of $5.15 for group insurance and $3 for union dues. In January 1953 after the labor contract under consideration here became effective the statement furnished Schwartz reflects no deduction for group insurance but reflects only an $8.15 deduction for union dues. (See General Counsel's Exhibit No. 5.) These exhibits do not tend to show that insurance coverage was a condition of employment. Schultz, the personnel manager of the Employer, was called as a witness by the General Counsel. His testimony may be summarized as follows- The Company in connection with the 1952 contract agreed initially to a 15-cent per hour increase in wages. Thereafter an additional 3 cents per hour was negotiated. The additional 3 cents per hour is not segregated in.any manner in the payroll and for all purposes is part of the wages of the employees. Prior to January 1953, $3 was deducted as union dues and $5.15 was deducted for insurance but in January the entire sure of $8.15 became union dues. The Employer has no control over the "insurance fund." The Employer assumed no responsibility whatever for the disposition of the money which it turned over to the Union. The plan by which the Company itself obtained insurance was discontinued. The Company is not a party to the insurance agreement under which Vlasak and Schwartz and other persons in its employ were covered, the master policy having been issued to the Union by Continental Insurance Company. The insurance plan under which the Company obtained a master policy was discon- tinued because Doria, an official of the Union, explained "that with the Union hav- ing the master policy, naturally, it had a greater number of individuals in the cover- age and the benefits could be greater." There was no possibility that any employee could ever become covered under the union policy prior to the time he became a member of the Union. It could not reasonably be said that Schultz' testimony served to support the Gen- eral Counsel's claim that the Union was acting as an agent to obtain group insurance coverage for the Company's employees in the bargaining unit. Moreover, his state- ments are more consistent with the Union's claim that the group insurance benefits under consideration here were appurtenant to union membership rather than that such insurance was a "condition of employment." Neither Schultz' testimony nor the language of the contract supports the claim that the Union agreed to act as a kind of agent for the Employer in regard to the pay- ments the Union was making to Continental out of the sums it was receiving in union dues.3 Taken as a whole the language of Appendix A would appear to be consistent with the Respondent's position that the reference to insurance in the contract should be viewed as explanatory of the past practices between the contracting parties and a reflection of the intention that group insurance referred to would be available to persons in the bargaining unit but only under union auspices rather than as an attempt to make group insurance coverage a condition of employment. On the record as a whole, I conclude that the General Counsel has not established by a preponderance of the evidence that group insurance was granted under the 1952 labor contract as a "condition of employment." 3 It may be noted that Section 302 of the Act would make it unlawful for the Employer to pay over to the Union anything but union dues pursuant to authorization. 338207-55-vol. 110-26 386 DECISIONS OF NATIONAL LABOR RELATIONS BOARD C. The Union's March 31, 1953, letter The Respondent has stated that it intends to expel the Charging Parties from mem- bership if they do not pay the fines and assessments. The letter states, on its face, that the Charging Parties are in "bad standing" with the Union and advises that unless they pay the fines and assessments they "will not be entitled to future benefits." It is clear that if the Union expels the Charging Parties from membership they will lose the benefits of group insurance coverage. It is also clear that expulsion of the Charging Parties from membership for refusing to pay the assessment and the fines would not be unlawful. The effect of expulsion from the Union would be, however, that the Charging Parties would not be entitled to future benefits since such benefits are not made available to nonmembers of the Union. If it is not unlawful for the Respondent to deprive the Charging Parties of the benefits of insurance coverage by expelling them from the Union it would not appear unlawful to threaten to do so. While the Union's letter does not state on its face that the Union intends to expel the Charging Parties it asserts that they are in "bad standing" with the Union and it is not unreasonable to conclude particularly in view of the position taken by the Union at the hearing that the Union intended, at the time it wrote its letter, to expel them if they did not pay the assessment and fines. D. The proviso to Section 8 (b) (1) (A) and other considerations It may be observed that the complaint does not allege nor was it contended during the course of the hearing that the Union in negotiating the contract under considera- tion did not act in good faith on behalf of all employees in the bargaining unit. It was not claimed, for example, that the Union in negotiating the agreement sought to obtain special benefits for members of the Union in good standing which would not be available to other employees. Nor was it alleged that the Employer granted or was induced by the Union to grant such special benefits and that thereby the Act was violated.4 Accordingly such issue was not presented for determination and is not before me. In connection with the claim of agency it may be pointed out that if the Union were an agent of the Employer, the latter would be responsible for the conduct of the former, Yet, the Employer was not made a party to this proceeding pursuant to a charge of discrimination under Section 8 (b) (2) of the Act, nor is there any other charge made against the Company. It may be observed, generally speaking, that it would not constitute a violation of the Act for a union to contract with an insurance company to obtain group coverage for its members and to raise union dues to effect such action. In a situation such as the present one, where a union has negotiated insurance cov- erage as a condition of employment in one contract, a question may be raised whether in negotiating a second contract with the same employer, in which it agrees to sub- stitute money wages for group insurance coverage, the Union was acting in good faith since it is possible that the group insurance coverage represented something more valuable to the employees than the increase in money wages obtained in sub- stitution for the group insurance. As I have noted, however, no attack was made on the ground that the Union was acting in bad faith in obtaining the 1952 labor contract. In this connection it may be observed that when a union undertakes to obtain group insurance coverage, perhaps having a similarity in the benefits obtain- able to that in an earlier contract with the Employer, it is possible that employees who are or become members of the Union (some possibly only because of a union- security clause) may become subjected to the hazard that the group insurance cov- erage may be taken away from them by expulsion from membership because of the refusal to pay fines, perhaps arbitrarily imposed upon them, or for other cause which may or may not be reasonable. In this case, however, no claim was made in the complaint or during the hearing that the execution of the 1952 contract and the ef- fective operation of its provisions constituted a violation of the Act. Accordingly no issue of this character was before me. While the record is barren in regard to the amount or precise character of the group insurance coverage obtained in the earlier contract with the Employer, in regard to the character of the coverage obtained through the Union's insurance policy in 1952, and in regard to whether equivalent insurance coverage could be obtained elsewhere by the Charging Parties as individuals for the same payments they were making to the Union, it may well be true, as the General Counsel as- serts, that expulsion from membership in the Union would deprive them of economic 4 Cf N L. R B v Gaynor News Co, 197 F 2d 719 (C. A 2) WESTINGHOUSE ELECTRIC CORPORATION 387 benefits incidental to membership, and that the threat of such deprivation would or- dinarily constitute a restraint upon an employee's right to refrain from joining in concerted activities. Nonetheless a threat by a union to deprive a member of eco- nomic advantages by expelling him from its membership is not violative of Sec- tion 8 (b) (1) (A) and neither is a "threat," which may be said to constitute a first step towards expulsion, violative of the section. The proviso to Section 8 (b) (1) (A) unambiguously declares that "this paragraph shall not impair the right of a labor organization to prescribe its own rules with respect to the acquisition or re- tention of membership therein." Congress could not have been clearer in expressing .its intent that the restraint and coercion proscribed by Section 8 (b) (1) (A) did not include threats or actual expulsion of employees from union membership. As stated on the floor of the Senate by Senator Ball, who introduced Section 8 (b) (1) (A) "[The Union] can expel [an employee] from the union at any time it wishes to do so, and for any reason." [Emphasis supplied.] 5 The inapplicability of Section 8 (b) (1) (A) to expulsion from union member- ship is made even clearer by the conference report, in which representatives of the House and the Senate agreed on the final form that the amendments to the Act should assume. There' Section 8 (c) (6) of the House bill,6 which made it an unfair labor practice for a labor organization "to expel or suspend any member with- out affording him an opportunity to be heard" except on specified grounds was de- leted, and the provisions of the Senate bill were accepted instead.? Thus Section 8 (b) (1) (A) as it was enacted by Congress constituted a clear declaration that ,the prescription and application of intraunion rules pertaining to membership shall not be unfair labor practices, regardless of the reasons for their invocation. Cf. Colgate-Palmolive-Peet Co. v. N. L. R. B., 338 U. S. 355. In American Newspaper Publishers Association v. N. L. R. B., 193 F. 2d 782, 800, ,the court held that: .. . the coercion of employees by a labor organization is illegal only to the extent that it is declared so by Congress. In this section of the Act [i. e. 8 (b) (1) (A)] Congress has said that only such action was illegal which would "not impair the right of a labor organization to prescribe its own rules with respect to the acquisition or retention of membership." Under this limitation Congress left labor organizations free to adopt any rules they desired gov- erning membership in their organizations. Members could be expelled for any reason and in any manner prescribed by the organization's rules, so far as § 8 (b) (1) (A) is concerned. [Emphasis supplied.] IV. CONCLUSIONS It is my conclusion that insurance coverage was not a condition of employment in the 1952 contract but was obtainable only as a condition of union membership. No basis, other than that the Union threatened to deprive the Charging Parties of one of their conditions of employment, viz., insurance benefits, has been urged and the record contains no claim and, in my opinion, no evidence of any other act or threat by the Respondent upon which a finding could be made that the Respondent restrained or coerced employees in the exercise of the rights guaranteed them under Section 7 of the Act and thus violated Section 8 (b) (1) (A) of the Act. Accordingly I shall recommend that the complaint be dismissed in its entirety. 5 93 Cong. Rec. 4272, Leg. Hist. 1142; see also 93 Cong. Rec. 4271, Leg. Hist. 1139, 1141. e H. It. 3020, 80th Cong., 1st Sess., Leg. Hist. 181. 7H. Conf. Rep. No. 510, 90th Cong., 1st Sess . (1947), p. 46, Leg. Hist. 550. WESTINGHOUSE ELECTRIC CORPORATION and AMERICAN FEDERATION OF TECHNICAL ENGINEERS, AFL, PETITIONER. Case No. 4-RC-9331. October 18, 1954 Decision and Order Upon a petition duly filed under Section 9 (c) of the National Labor Relations Act, a hearing was held before Julius Topol, hearing officer. The hearing officer's rulings made at the hearing are free from preju- dicial error and are hereby affirmed. 110 NLRB No. 43.