Speidel Corp.

SPEIDEL CORPORATION 733 by discouraging membership in a labor organization , the Company has engaged in unfair labor practices within the meaning of Section 8 (a) (1) and (3) of the Act. 5. By causing the Company to discriminate against employees in violation of Section 8 (a) (3) of the Act, the Paper Makers has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (b) (2) of the Act. 6. By restraining and coercing employees in the exercise of the rights guaran- teed in Section 7 of the Act, the Paper Makers has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (b) (1) (A) of the Act. 7. By interfering with, restraining, and coercing employees in the exercise of rights guaranteed by Section 7 of the Act, the Company has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (a) (1) of the Act. 8. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2 (6) and (7) of the Act. [Recommendations omitted from publication.] Speidel Corporation and Lodge 129 of District 64 International Association of Machinists, AFL-CIO. Case No. 1-CA-2104. May 1, 1958 DECISION AND ORDER On January 31, 1957, Trial Examiner Thomas S. Wilson issued his Intermediate Report in the above-entitled proceeding finding that the Respondent had engaged in and was engaging in certain unfair labor practices, and recommending that it cease and desist therefrom and take certain affirmative action, as set forth in the copy of the Intermediate Report attached hereto. Thereafter the Respondent filed exceptions to the intermediate Report, and a supporting brief. The Board has reviewed the rulings made by the Trial Examiner 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 supporting brief, and the entire record in the case, and adopts the Trial Examiner's findings and con- clusions only to the extent that they are consistent with the findings and conclusions set forth below.' The Respondent, a Rhode Island corporation, is engaged in the manufacture, sale, and distribution of jewelry and related products at its plant in Providence, Rhode Island. The Respondent employs approximately 675 employees at the Providence plant, of whom approximately 55, herein called the toolmakers or represented em- ployees, are represented by Lodge 129 of District 64, International Association of Machinists, AFL-CIO, herein called the Union 2 The remaining employees have been for many years, and are now, unor- ganized and unrepresented by any labor organization. I The Respondent's request for oral argument is hereby denied as the record, the ex- ceptions, and the brief, in our opinion , adequately present the issues and positions of the parties. 2 Included in this group are all skilled employees and employees classified as toolmakers. 120 NLRB No. 97. 734 DECISIONS OF NATIONAL LABOR RELATIONS BOARD For many years, beginning sometime in,the 1930's, the Respondent has paid an annual Christmas bonus, and since the early forties has paid an annual Easter bonus, to all its employees. Each time a bonus was paid the Respondent reminded its employees that the bonus was voluntary and was not to be construed-as establishing a precedent. In November 1955 the Respondent- and the Union signed a new contract. This contract, like those before it, was silent on the subject of bonuses. It provided a retroactive 20-cent increase in wages for the toolmakers. On December 15, 1955, the Respondent paid approximately $11,000 in retroactive pay to the toolmakers. Although the Respondent on December 19, 1955, gave serious consideration to the withholding of :a Christmas bonus to toolmakers, because the gap in salary structure ,between them 'and the unrepresented employees was "getting out of proportion," it nevertheless paid them an additional $11,000 as their portion of a 1955 Christmas bonus. - The payment was made in "the spirit of the season." In March 1956, after carefully studying and evaluating certain figures relating to a contemplated Easter bonus, Levinger, the Re- spondent's vice president, concluded that its payment to the tool- makers would further widen the gap in the Respondent's wage struc- ture. He therefore decided not to pay an Easter bonus to the tool- makers. On March 23 the Respondent met with the Union, announced its decision, explained the reasons for it, and on March 26, pursuant to a request by the Union, the Respondent met with the Union to discuss the Respondent's decision not to pay the toolmakers an Easter bonus. On March 30, 1956, the Respondent paid an Easter bonus to its unrepresented employees, but did not pay a bonus to the toolmakers. The Union filed a formal grievance about the matter, but it was not processed. Instead, the instant action was begun. The Trial Examiner concluded that, as a result of its nonpayment of the Easter bonus to the toolmakers, the Respondent violated Sec- tion 8 (a) (1), (3), and (5) of the Act. We do not agree with the Trial Examiner. 1. The Trial Examiner predicated his 8 (a) (3) and (1) findings principally upon his construction and application of the Radio 0 goers' cases s About Radio Officers', he said : Since the'Radio 0 icers' cases, 347 U. S. 17, it has been established that where 'an employer treats his union and nonunion employees in a disparate fashion based upon that membership or nonmem- 8 The Radio _ Officers' Union of the Commercial Telegraphers' Union, AFL (A. H. Bull Steamship Company) v. 'N. L. R •B ; N L R B V International Brotherhood of Team- sters, Chauffeurs, Warehousemen & Helpers of America, et al. Local Union No. 41, A. F. L. (Byers Transportation Co.) ; Gaynor News Company, Inc. v. N. L' R. B., 347 U. S. 17 (1954). SPEIDEL CORPORATION 735 bership which inherently tends to encourage or discourage such membership, then it is reasonable for the Board to infer the dis- criminatory motivation of the employer from the disparate con- duct itself so that the conduct thereupon becomes discriminatory within the meaning of Section 8 (a) (1) and (3) of the Act. Applying this construction of Radio Ogcers' to the facts of the case, the Trial Examiner found that the Respondent's conduct in withhold- ing the bonus "based as it was upon membership or nonmembership in the Union must inherently and necessarily have had the natural and normal tendency to discourage the principle of collective bar- gaining, and, thus, union membership among those so suddenly de- prived of this customary and established source of income." Accord- ingly, although the Trial Examiner found specifically that the Respondent had no union animus, he held that : "the Respondent's conduct • in withholding the Easter bonus from its represented em- ployees constituted a violation of Section 8 (a) (1) and (3)-regardless of the presence or absence of any specific intent on the part of Respond- ent'to encourage or discourage union membership or activity." In Radio Officers' the Court, it is true, pointed out: ... it is also clear that specific evidence of intent to encourage or discourage is not an indispensable element of proof of violation of § 8 (a) (3). . . . Both the Board and the courts have recog- nized that proof of certain types of discrimination satisfies the intent requirement. This recognition that specific proof of intent is unnecessary where employer conduct inherently encourages or discourages union membership is but an application of the common-law rule that a man is held to intend the foreseeable consequences of his conduct' And, addressing itself to the matter of disparate wage treatment of employees based solely on union membership status, the Court also said : No more striking example of discrimination so foreseeably caus- ing employee response as to obviate the need for any other proof of intent is apparent than the payment of different wages to union employees doing a job than to nonunion employees doing the same job.' [Emphasis supplisd.] The Court utterances, although supplying a colorable basis for the Trial Examiner's position , do not.m fact justify either his sweeping generalization about Radio Officers' or his application of it to the facts of this case. For in Radio 0 goers', the Court carefully limited the 347 U. S. at 44-45. 347 U. S. 46. 736 DECISIONS OF NATIONAL LABOR RELATIONS BOARD scope of its holding. Thus, in language which the Trial Examiner apparently overlooked, the Court said : 6 We express no opinion as to the legality of disparate payments where the union is not exclusive bargaining agent since that case is not before us. We do hold that in the circumstances of this case, the union being exclusive bargaining agent for both its mem- bers and nonmember employees, the employer could not, with- out violating Section 8 (a) (3), discriminate in wages solely on the basis of such membership even though it had executed a contract with the union prescribing such action. [Emphasis supplied.] This limitation upon the scope of the Radio Officers' holding was expressly pointed out by the Board majority in the Anheuser-Busch case, 112 NLRB 686 ( 1955), a case to which the Trial Examiner did not advert .7 - We regard the view of the Board majority in Anheuser-Busch. as to the scope of Radio Officers' as the correct one, and we now expressly affirm it. Accordingly, we also reject the Trial Examiner's view that the Board in this case-involving as it does a situation where the union is not the exclusive bargaining agent of all the employees- may, without reference to the Respondent's actual motivation, properly infer discriminatory intent "from the disparate conduct itself." 2. As, in the circumstances, we do not construe Radio Officers' to require a finding that the Respondent's disparate treatment of its employees was inherently unlawful, and as in fact we do not so find it 6 347 U. S. at 47. 4 Thus the Board majority said in Anheuser-Busch We note particularly that the Supreme Court took cognizance of the fact that the disparate treatment of employees in the . . [Radio Officers'] case "was based solely on union membership status " It was this, according to the Court, that made the disparate treatment "inherently conducive to increased union membership," i e., encouraged membership in the union (112 NLRB at 689 the [Supreme] Court, it seems plain, was mindful of factual circumstances where disparity of treatment luheiently encourages or discourages union member- ship. In . . . [Radio Officers'] for example, the payment of different wages to union employees doing a job than to nonunion employees doing the same job obvi- ously had that reasonably foreseeable effect. Where, however, the employer's conduct does not "inherently" encourage of discourage union membership, it seems clear to us that the necessity for independent evidence of diemiminatory motivation is not obviated, and in the light of this, the Court's statement that "Congress intended the employer's purpose in discriminating to be controlling" becomes significantly mean- ingful (Id, at 690). In the Intermountain case, 114 NLRB 1371, Chairman Leedom dissenting, expressly noted the limited scope of Radio Officers', and the Circuit Court of Appeals, in the same case, distinguished Radio Officers' on the ground that it "involved discrimination among employees doing exactly the same work for exactly the same pay solely on the basis of union membership" Intermountain Equipment Company v ?1- L R B, 239 F. 2d 480, 482 (C. A 9). SPEIDEL CORPORATION 737 to be, the Respondent's conduct must be evaluated in the light of all the circumstances. In short, as there was here no inherently unlawful intent, if we are to infer that the Respondent was discriminatorily motivated, we must do so on the basis of evidence other than the disparate treatment of its employees. The disparate treatment here in question aside, a review of the evidence shows in the first place no conduct on Respondent's part, either by overt act or verbal utterance, which can be construed as antiunion. Rather, the evidence shows that since the late 1930's the Respondent has recognized the Union as the bargaining -representa- tive of its toolmakers, and has, without strike or other incident, negoti- ated, and lived under, a series of bargaining contracts. Indeed, as the Trial Examiner himself found, "there is no evidence in this record tending to prove that the Respondent here held any animus toward the Union. In fact the history of the relationship between the Respondent and the Union indicates the contrary." In the second place, the evidence does in fact show that in the spring of 1956 there existed a wide differential between the earnings of Respondent's toolmakers and the earnings of its other employees-a differential which had been accentuated by the Respondent's recent payments to the toolmakers in December 1955. Thus, as a result of their 1955 bargaining, the toolmakers were granted a 20-cent increase in wages, bringing their average hourly rate to $2.97. This was in marked contrast with the average hourly rate of $1.26 then paid the production employees. In addition, the evidence shows that the tool- makers worked an average of 47.34 hours per week as against an average of 39.97 hours for the unrepresented employees. The evi- dence further shows that in December 1955, the toolmakers were paid $11,000 in retroactive pay, and also received an average payment of $226.95 as their share of the 1955 Christmas bonus. By contrast, the production employees received no back pay in December 1955 and the average Christmas bonus paid to them was $34.06. In view of these facts there is no doubt that there was a substantial difference between the pay received by the Respondent's toolmakers and that received by its unrepresented employees., In the third place, the evidence shows that the Respondent was seriously concerned about the "unbalance," or "gap," in the wage structure of its employees; and there is no evidence whatever to show that the Respondent withheld the Easter bonus from the toolmakers for any other purpose than to lessen the "gap" and correct its wage structure. In this connection it is most significant, we believe, that the Respondent, in December 1955, seriously considered withholding the Christmas bonus from the toolmakers, and ultimately paid it "in the spirit of the season." 4831 4?-59-vol. 120-48 738 DECISIONS OF NATIONAL LABOR RELATIONS BOARD And finally, it appears that the Respondent had a reasonable basis for believing that its employees, and the Union as well, concurred in the position it had taken in the past that the payment of bonuses was a matter within its own prerogative, and was not a matter con- cerning which the Union, or any one else, claimed dominion. In this respect the evidence shows that over the years, since it began paying bonuses sometime in the 1930's, the Respondent had repeatedly announced that bonus payments were "voluntary" on its part, and were not to be deemed to have the effect of "precedents." Moreover, it does not appear that the Respondent's announced attitude in this respect had ever been challenged either by the Union or by any employee. Indeed, the evidence shows recent, express, concurrence with it on the Union's part. For, as described more fully below, during the parties' contract negotiations in the fall of 1955, which were the most recent negotiations preceding the Respondent's with- holding of the Easter bonus, the Respondent had rejected a proposed "Maintenance of Privileges" clause on the ground that it would make the payment of bonuses a contractual obligation. The Union had not dissented from this view, and the contract which was thereafter signed, and which was in force when the alleged violation occurred, contained neither the "Maintenance of Privileges" clause, nor any other provision requiring the payment of bonuses to toolmakers. Under these circumstances, and based on the entire record, we are unable to find that the Respondent was motivated by unlawful rea- sons in withholding the Easter bonus from the toolmakers. Accord- ingly, we find further that the Respondent's action was not violative of Section 8 (a) (1) and (3) of the Act. Our conclusion in this respect is supported by the decisions of the United States Courts of Appeals for the Eighth and Ninth Circuits in the Nash-Finch and Intermountain cases 8 which the Trial Exam- iner sought to distinguish, and therefore found not controlling. The factual situations and issues in those cases, however, were similar to those involved herein. In both cases, like this, the employer discon- tinued, after signing a collective-bargaining agreement, certain bene- fits, including a bonus, given to the employees before the advent of the Union. Like this case the benefits were continued for employees not within the bargaining unit, and like this case, the union sought during contract negotiations, and the employer rejected, provisions requiring the continuance of these benefits. In the Nash-Finch case, the Court of Appeals for the Eighth Cir- cuit rejected findings by the Board that the employer therein had violated Section 8 (a) (1), (3), and (5) of the Act. It rested its 9N L. IL B. v Nash-Finch Company, 211 F 2d 622 (C. A 8), denying enforcement of 103 NLRB 1695; Intermountain Equipment Company v. 'N. L. R. B., 239 F. 2d 480 (C A 9), reversing 114 NLRB 1371. SPEIDEL CORPORATION 739 position on the fact that the parties' bargaining contract did not require the employer to continue the previously paid benefits, point= ing out that a "Maintenance of Standards" provision had been dis- cussed and rejected during contract negotiations. The court said: Where parties to a contract have deliberately and voluntarily put their engagement in writing in such terms as import a legal obligation without uncertainty as to the object or extent of such engagement, it is conclusively presumed that the entire engage- ment of the parties and the extent and manner of their undertak- ing have been reduced to writing.9 The respondent, we think, may not be convicted, of an unfair labor practice for doing no more and no less for its union employees than its collective bargaining agreement with them called for. * * * * * * It seems to us what the Board has done, under the guise of remedying unfair labor practices, is to attempt to bestow upon the respondent's union employees the benefits which it believes the Union should have obtained but failed to obtain for them as a result of its collective bargaining with the respondent on their behalf.lo - This language of the Nash-Finch, case was quoted with approval by the Court of Appeals for the Ninth Circuit in the Intermountain case, where the court likewise rejected Board findings that the employer's action had violated Section 8 (a) (1) and (3) of the Act." In the Intermountain case, the court specifically probed the question of whether discriminatory motivation had been shown by the 'evidence. 12 It concluded that such motivation had not been shown stating that the denial of the benefits which the Union had failed to obtain by bargaining was not, in the circumstances, enough to show discrimination having the purpose or effect of discouraging union membership. In this connection, the court placed particular stress on the fact that the employer had not acted because of antiunion motivation. 3. The Examiner concluded that the Respondent, in violation of Section 8 (a) (5) of the Act, did not bargain in good faith with the Union concerning the payment of the Easter bonus to the toolmakers. This conclusion is predicated on the Trial Examiner's subsidiary find- 211 F 2d 622 at 626. 1o Id. at 627. 11 In Intermountain, the Board majority found that the parties had agreed "that the Respondent would not need to propose changes in bonuses or sick leave for bargaining before acting unilaterally." It therefore dismissed as allegation that the employer's conduct violated Section 8 (a) (5) of the Act. (114 NLRB 1371, 1384.) U 239 F. 2d at 483. - 740 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ing that : (1) the Union had not, during the course of 1955-56 contract negotiations, waived or "bargained away" its interest in the matter of bonuses; and (2) the Respondent did not bargain at its meetings with the Union on March 23 and 26, 1956, but instead announced to the Union merely a predetermined decision not to pay an Easter bonus to the toolmakers. With respect to the 1955 contract negotiations, it appears that in July of that year the Respondent and the Union began negotiations for a new agreement to succeed their existing contract which was due to expire on August 25, 1955. The Respondent was 1 of some 20 jewelry manufacturers in the Providence area who bargained jointly with the Union. In the course of the negotiations the Union proposed an article entitled "Maintenance of Privileges," which read as follows : It is agreed that any and all privileges enjoyed by employees prior to the date of this agreement will not be denied to them because of the signing of this agreement. Such privileges shall be con- tinued to be enjoyed by them during the term of this agreement. The manufacturers were fearful that the terms of the proposed "Main- tenance of Privileges" clause were broad enough to include Christmas and Easter bonuses and Blue Cross "insurance, and would, if accepted, make these matters contractual obligations. Accordingly, they de- cided to reject the proposed "Maintenance of Privileges" clause. The spokesman for the manufacturers, Frankovich, credibly testified that during the course of the negotiations he explained to the Union that the manufacturers had rejected the proposed clause so as to avoid mak- ing contractual obligations of the bonuses and insurance. He thereby ,in effect reiterated the Respondent's past position that these subjects were matters of "management prerogative." The record shows that thereafter the Union did not comment upon the manufacturers' inter- pretation of the proposed "Maintenance of Privileges" clause or upon their "management prerogative" position, nor did the Union offer to explain what subjects it considered the clause covered or how it was limited. The record shows further that after the manufacturers re- jected the clause the Union did not thereafter press for its acceptance or seek a counterproposal from the manufacturers. As already in- dicated the new contract, executed in November 1955, did not contain a "Maintenance of Privileges" clause in any form. Stressing the fact that "the Union never made any mention of bonuses in regard to its proposed `Maintenance of Privileges' " clause, and referring to the Respondent's stand as a "self-imposed fear," the Trial Examiner attached no weight to the Respondent's rejection of the Union's proposal during the 1955 negotiations or the Union's ap- parent acquiescence therein. We see the matter differently. For whether or not the Union under- stood the "Maintenance of Privileges" clause to cover bonuses when it SPEIDEL CORPORATION 741 first proposed the clause to the Respondent, and whether or not the Respondent had a "self-imposed fear," the Respondent, during the course of subsequent negotiations, made it clear to the Union that it understood that the proposed "Maintenance of Privileges" clause covered bonuses, and that it was adhering to its past position that bonuses were matters of "management prerogative." In the face of the Respondent's bargaining position, the Union's complete silence, and its failure at any time thereafter to contradict the Respondent's interpretation of the clause, must be taken to mean that the Union acquiesced in the Respondent's understanding. Thus, by contrast with the course of the 1955 negotiations, we note that in the following year, in the course of the 1956 contract negotiations, the Union again pro- posed a "Maintenance of Privileges" clause. The Respondent, this time, requested the Union to "spell out" the meaning of its proposal; and, in answer the Union submitted a written document which clearly indicated that the clause then proposed was not intended to cover the subject of bonuses. To us it appears, therefore, that had the Union, in 1955, actually understood and intended that its proposal did not em- brace the matter of bonus payments, it could have so advised the Re- spondent as in fact it did the following year. The Union's action in 1956 also indicates a continued acquiescence in the Respondent's "man- agement prerogative" position on bonuses. Accordingly, we think it highly significant that the 1955 contract, as eventually signed, did not contain the Union's proposed "Main- tenance of Privileges" clause. Although we will not readily infer a waiver of statutory bargaining rights, we find here, based on the en- tire record, that there was a clear understanding between the parties that the subject of bonuses would remain a "management preroga- tive." In the circumstances, we therefore find that in the course of the 1955 contract negotiations, the Union "bargained away" or waived, its interest in the matter of bonuses." Accordingly, we conclude, on all the evidence, that the Respondent did not violate Section 8 (a) (5) of the Act. [The Board dismissed the complaint.] Is Intermountain Egnapment Company v N L R B., and N L R B. v Nash-Finch, supra; International News Service. Division of the Hearst Corporation, 113 NLRB 1067; ilvco Manufactii'ring Company, 111 NLRB 729. INTERMEDIATE REPORT STATEMENT OF THE CASE Upon a charge duly filed on April 13, 1956, and thereafter amended, by Lodge 129 of District 64, International Association of Machinists , AFL-CIO, herein called the Union , the General Counsel of the National Labor Relations Board, herein called the General Counsel i and the Board respectively, by the Regional Director for the i This term specifically includes the counsel appearing for the General Counsel at the hearing. 742 DECISIONS OF NATIONAL LABOR RELATIONS BOARD First Region (Boston, Massachusetts ), issued its complaint dated July 7, 1956, against Speidel Corporation , herein called the Respondent or Employer , alleging in sub- stance that the Respondent had violated Section 8 (a) (1), (3), and (5) of the Act by withholding its 1956 annual Easter bonus from all those employees in the ap- propriate unit duly represented by the Union in collective bargaining with the Re- spondent because of such representation , because of such membership , or because said employees had engaged in concerted activities while continuing to pay said bonus to all of Respondent's other employees who were unorganized and unrepresented by any labor organization , thereby engaging in unfair labor practices affecting commerce within the meaning of Section 8 (a) (1), (3), and (5) and Section 2 (6) and (7) of the Labor Management Relations Act, 1947, 61 Stat. 136, herein called the Act. Copies of the complaint, the charge and amended charge, and the notice of hearing were duly served upon the Respondent and the Union. The Respondent duly filed its answer wherein it denied the commission of any unfair labor practices but admitted withholding said Easter bonus from the repre- sented employees "for the purpose and with the intention of seeking to achieve a more equitable balance between the wage structure, earnings and benefits of" said represented employees "and the wage structure, earnings and benefits of the other employees of the Respondent." Pursuant to notice a hearing was held on November 20, 21, and 29, 1956, at Providence, Rhode Island, before the duly designated Trial Examiner. The General Counsel and the Respondent were represented at the hearing by counsel . Full op- portunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing upon the issues was afforded all parties . The parties argued orally at the conclusion of the hearing and Respondent duly filed a brief on January 4, 1957. Since the close of the hearing both General Counsel and the attorney for Re- spondent have filed motions to correct the transcript which have been marked Trial Examiner's Exhibits Nos. 1 and 2 respectively, are hereby admitted in evidence and allowed. Upon the entire record in the case, and from his observation of the witnesses, the Trial Examiner makes the following: FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT Speidel Corporation, a corporation duly organized under and existing by virtue of the laws of the State of Rhode Island, has maintained its principal office and place of business at 70 Ship Street, Providence, Rhode Island, hereinafter called the plant, and is now and continuously has been engaged at said plant in the manufacture, sale, and distribution of jewelry and related products. In the course and conduct of its business, the Respondent annually produces and ships jewelry and related products valued at more than $100,000 directly to points outside of the State of Rhode Island. The Respondent concedes, and the Trial Examiner finds, that the Respondent is engaged in commerce within the meaning of the Act. II. THE ORGANIZATION INVOLVED Lodge 129 of District 64, International Association of Machinists , AFL-CIO, is a labor organization admitting to membership employees of the Respondent. III. THE UNFAIR LABOR PRACTICES A. The facts In 1955 the Respondent employed approximately 700 employees at its Providence plant. Of these approximately 55 were toolmakers or toolmaker apprentices, the most skilled of all craftmen. The remainder were production employees, semiskilled or unskilled. Since the later 1930's the toolmakers and apprentices had been represented in collective bargaining with Respondent by Lodge 129 of District 64 of International Association of Machinists. Since that time the Respondent had recognized the Union as the duly authorized bargaining agent for the toolmakers and apprentices in the appropriate unit, which in this record has been referred to as the "toolmakers unit," and had negotiated labor agreements with IAM covering said toolmakers. The 1955 contract covering the toolmakers expired by its terms on August 25, 1955. It con- tained a maintenance-of-membership clause but had no checkoff provision. On the other hand the remainder of Respondent's employees for many years had been unorganized and, therefore, unrepresented by any labor organization. SPEIDEL CORPORATION 743 Beginning sometime in the 1930 's Respondent had annually paid all its employees a Christmas bonus. Although over the years the method of computation of that bonus had been changed from time to time, for a number of years prior to and in- cluding 1955 such bonus had been based upon employee's individual wage rate and length of service so that it was possible for the bonus to vary in amount from $5 for service under 6 months to as much as 3 weeks' wages for 10 years of service. In addition to the Christmas bonus the Respondent has also annually since the early 1940's paid all its employees, both represented and unrepresented, an Easter bonus which, although its method of computation had also been changed by unilateral action of the Respondent from time to time, had for some years prior to 1956 amounted to 1 week's wages for the individual employee. Each year when the Respondent posted the notice of the payment of these bonuses, the notice always contained a final sentence reading in substance: "We wish to remind all employees that this bonus is voluntary and is not to be construed as a precedent." About July 15, 1955, negotiations for the 1955-56 contract for the toolmakers, hereinafter referred to as the 1956 contract, began between the Union and a group of 20-odd jewelry manufacturers in the Providence area of which Respondent was one. The spokesman in these negotiations for the industry group was George Frankovich who was assisted by a committee composed of various employer rep- resentatives of whom Paul Levinger, Respondent's executive vice president and general manager, was one during these particular negotiations. At the beginning of the negotiations the Union proposed a very comprehensive agreement. Article 10 thereof labeled "Maintenance of Privileges" read as follows: It is agreed that any and all privileges enjoyed by employees prior to the date of this agreement will not be denied to them because of the signing of this agreement such privileges shall be continued to be enjoyed by them during the term of this agreement. [Sic.] In private meeting the industry group, fearful that this clause would make such matters as bonuses and Blue Cross insurance into contractual obligations, decided to reject article 10 which it did in the negotiations with little, if any, discussion thereof. This impression as to the scope of the clause was self-imposed and not induced by the Union which never mentioned the word "bonus" in connection with article 10 during the negotiations of the 1956 agreement. The parties reached agreement on the 1956 contract about November 1, 1955. This contract provided for a 20-cent-per-hour increase in wages for the toolmakers of which 15 cents was retroactive to May 2, 1955, and the remaining 5 cents to August 25, 1955, the anniversary date of the contract. During the negotiations of wages nothing was mentioned about bonuses.2 Levinger testified that, when the wage increase was negotiated, he considered this 20-cent-per-hour increase to be "very, very inequitable from a general point of view" in respect to the plant wage structure. On December 15, 1955, Respondent paid to the employees of the toolmakers unit approximately $11,000 as retroactive back pay in accordance with the terms of the existing contract. Four days later the Respondent paid out the sum of approximately $37,000 in Christmas bonuses to all of its employees of which almost $11,000 was paid to the employees in the toolmakers unit. Sometime prior to the above payments but after the figures thereof had been computed and shown to him, Levinger testified that he was surprised by this size of the sums paid to the toolmakers which he referred to as "fortunes." At that time he spoke to one of his attorneys, who happened to be in the plant on other matters, about the possibility of not paying either the Christmas or the Easter bonus to the toolmakers. Levinger finally decided not to withhold the Christmas bonus from the toolmakers because of "the spirit of the season." Figures submitted by the Respondent at the hearing showed that the average rate per hour for the employees in the toolmakers unit as of March 1956 was $2 977 while that for the remaining 625 production employees was $1.264. These records also indicate that the toolmakers worked an average of 47.34 hours per week as against an average of 39.97 hours for the remaining production workers. The facts further showed that the Respondent's toolmakers as a group enjoyed a considerable amount of seniority over the other employees due to their greater length of service with the Respondent. Thus, as the Christmas bonus was computed on both the 2 A check made at the time of the hearing of all but 1 of the firms engaged in these negotiations showed that some 17 of them paid Christmas bonuses in 1955 while the Respondent was the only firm paying an Easter bonus. 744 DECISIONS OF NATIONAL LABOR RELATIONS BOARD individual's rate of pay and his length of service, the toolmakers averaged $226.95 as against an average of $45 .06 for the production workers on the Christmas bonus. The testimony also shows that in discussing the Company 's financial matters in- cluding the reserve setup for the payment of the Easter bonus early in February 1956 Levinger indicated that he was still considering withholding the Easter bonus from the toolmakers but that he had arrived at no actual decision on that matter at the time. On February 27, 1956, Lodge 129 commenced an attempt to organize the un- organized production workers at the Respondent's plant by passing out leaflets to them at the plant gates. One of these leaflets was passed to Levinger on that occasion. On March 10 Levinger left Providence for a vacation in Miami. On March 13 a second distribution of leaflets by the Union took place at the plant gates .3 Prior to March 23, 1956, while still in Miami, Levinger received from the Re- spondent's payroll department the figures of the proposed Easter bonus payments broken down as between those to be made to the toolmakers and those to be made to the production employees . After inquiring from his attorneys as to whether it would be legal to withhold the Easter bonus from the toolmakers on this occasion and receiving an affirmative answer, Levinger gave orders to the payroll department to pay the Easter bonus to the unrepresented production employees but not to pay the bonus to the represented toolmakers . The personnel director was ordered to explain the decision to the Union. On March 23 at the request of the Respondent's personnel director the union plant shop steward and shop committee 4 met with the director and the Respondent's attorney who announced the Respondent's decision to withhold the Easter bonus from the toolmakers stating the Respondent's reasons therefor and offering to discuss the form of the notice regarding the payment of this bonus so as to avoid "em- barrassment" to the Union therefrom . The shop steward was requested to post pre- pared notices of the decision withholding Easter bonus payments from the toolmakers in the toolroom and to notify the individual employees which he did in the next 2 days. On March 26 the shop steward requested and secured another meeting with the personnel director and another of Respondent 's attorneys so that the director of District 64 and the business representative of Lodge 129 could be present. Again much the same explanation of the Respondent's decision was given . The union representatives announced that they intended to protest the decision either as a grievance or as an unfair labor practice charge.5 On March 30 the Respondent paid the usual and customary Easter bonus to all its unrepresented employees but on orders from Levinger the bonus was withheld from the represented employees of the toolroom unit. B. Conclusions From this multitude of facts the sole problem in this case is readily discernible and easily stated as follows: Does an employer commit unfair labor practices in violation of Section 8 (a) (1), (3), and (5) of the Act, or any of them, by withholding from those of his employees who were represented in collective bargaining with the employer by a recognized bargaining agent the payment of a long, well established , annual bonus while paying that same bonus as usual to his remaining but unrepresented employees? The mere reading of the problem posed proves that the Respondent treated its represented employees differently or disparately from the manner in which it treated its unrepresented employees . There is, and can be, no dispute that there was disparate treatment as between the two groups. But disparate treatment is. not necessarily discriminatory treatment within the meaning of the Act, i. e., tending to encourage or discourage union membership or to interfere with employees' guaranteed rights to bargain through representatives of their own choosing or to engage in concerted activities. 8 Levinger testified at the hearing that his first knowledge of this second distribution occurred when he heard the testimony at the hearing. 6 As explained at the meeting the Respondent had attempted unsuccessfully to have the business representative of Lodge 129 and the business director of District 64 present at this meeting but each was unavailable being in New York City IIt was agreed that the meeting could be considered as a grievance meeting and that a formal grievance could be filed thereafter . The grievance was subsequently filed but no further action was taken on processing it. SPEIDEL CORPORATION 745 Section 7 of the Act guarantees employees the rights "to self-organization, to, form, join or assist labor organizations, to bargain through representatives of their own choosing, and to engage in other concerted activities for the purposes of collec- tive bargaining or other mutual aid or protection" or to refrain therefrom. Section 8 (a) (1) makes it an unfair labor practice for an employer to "interfere with, restrain, or coerce employees in the exercise of their rights" guaranteed above in Section 7. Section 8 (a) (3) makes it an unfair labor practice for an employer "by dis- crimination in regard to hire or tenure of employment or any term or- condition of employment to encourage or discourage membership in any labor organization." Section 8 (a) (5) makes it an unfair labor practice for an employer "to refuse to bargain collectively" with the authorized representatives of the employees. Hence for disparate treatment between union and nonunion employees by an employer to become an unfair labor practice , it must tend to encourage or dis- courage union membership or to interfere with , restrain, or coerce the employees in their guaranteed rights to form, join or assist labor organizations , to bargain collectively through representatives of their own choosing, or to engage in concerted activities for their own mutual aid or protection. Thus the question becomes whether this acknowledged disparate treatment between the represented and unrepresented employees in the payment of the usual and customary Easter bonus in 1956 tended to interfere, restrain, or coerce Respondent's employees in the exercise of their rights guaranteed in Section 7 or tended to encourage or discourage union membership among its employees. At the very threshold of this discussion it must be recognized that there is no, evidence in this record tending to prove that the Respondent here held any animus toward the Union. In fact the history of the relationship between the Respondent and the Union indicates the contrary. Since the Radio Officers' cases, 347 U. S. 17, it has been established that where an employer treats his union and nonunion employees in a disparate fashion based upon that membership or nonmembership which inherently tends to encourage or discourage such membership, then it is reasonable for the Board to infer the dis- criminatory motivation of the employer from the disparate conduct itself so that the conduct thereupon becomes discriminatory within the meaning of Section 8 (a) (1) and (3) of the Act. In the above-cited cases Mr. Justice Frankfurter appeared to feel that there might well be cases where such inference could be rebutted by other facts. The General Counsel relies upon the drawing of this inference in the present matter. This reliance appears justified under the facts here where a customary annual bonus of long standing is suddenly withheld exclusively from those employees who had engaged in successful concerted action for the purposes of collective bar- gaining and whose authorized representative had been successful in such collective bargaining with the employer while the same bonus is continued as to those em- ployees who had neither engaged in concerted activity nor were represented by a labor organization. Surely this sudden and unexpected unilateral act of the em- ployer in withholding an average payment of $119.10 from each toolmaker based as it was upon membership or nonmembership in the Union must inherently and necessarily have had the natural and normal tendency to discourage the principle of collective bargaining and, thus, union membership among those so suddenly deprived of this customary and established source of income.6 Such a loss of $119.10 of compensation is bound to dampen one's enthusiasm for collective bargaining and union membership especially where nonunion employees continue to receive the bonus as usual. The respondent itself recognized the reasonableness of drawing the above infer- ence when on March 23 it called in the Union and offered to negotiate with it the form of the notice regarding the withholding of the bonus from the represented employees in order to save the Union "embarrassment." The Respondent's willing- ness to negotiate the phraseology of the notices was in an effort to disguise the fact that the toolroom employees, the only represented employees in the plant, had lost the bonus. This effort to disguise the fact proves that the Respondent recognized the inherent and probable discouragement to union membership and concerted activ- 6In making the above finding the Trial Examiner is not considering the effect of the Respondent's conduct on its unrepresented employees due to the Respondent's technically, those hardly realistically, correct objection that there is in this record no direct evi- dence that the unrepresented employees ever knew that the bonus had been withdrawn from the represented employees 746 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ity, of Respondent's conduct if or when that action, became known as it was bound to do. - - - Unless, therefore, the Respondent has introduced facts 'sufficient to rebut' the above inference, it would seem that the Respondent's conduct here was discriminatory within the meaning of Section 8 (a) (1) and (3)', of the Act. Thus it becomes necessary to consider the defenses. ,raised,, and the evidence produced by the Respondent. The Respondent in its answer pleaded three separate defenses as,follows: 1. - "Respondent was under no contractual or other -legal obligation to pay an Easter bonus to the. toolmakers." , This is a question of law which will be discussed hereinafter. 2. "Respondent did not-pay a. 1956 Easter bonus only, after notification to, con- sultation with and collective bargaining with the Union" representing the toolmakers. The facts relating to this defense will also be discussed later. 3. "Respondent did not,pay the 1956 Easter bonus to the" toolmakers "for the purpose and with the intention of seeking to achieve a more equitable balance between the wage structure, earnings and benefits of the" toolmakers, "and the wage structure, earnings and benefits of other employees 'of Respondent." Let us discuss this third defense first. The facts show that the toolmakers, a most highly skilled craft, was being paid as of March 17, 1956, an average hourly rate of $2.97 whereas the production worker, unskilled or at best semiskilled workers, averaged $1.26 per hour. For the past year the toolmakers had averaged 47.34 hours per week as against 39.97 hours per week for the production employees. In the Christmas bonus of 1955 the toolmakers received an average bonus of $226.95 as against an average bonus of $45.06 for the 595 production employees.? On the other hand the Easter bonus was a straight payment of 1 week's wages so that, if it had been paid, the toolmakers would each have averaged $119.10 as against an average payment of $43.80 per production employee as actually paid. The average hourly rate for toolmakers had increased through collective bargain- ing from $2.39 per hour in 1951 to $2.97 per hour in March of 1956 which included the 20-cent-per-hour increase negotiated in the 1956 contract. During the same period of time the average hourly rate for production workers had risen $1.06 per hour to $1.26. For the toolmakers this increase of approximately 65 cents per hour resulted from successful collective bargaining by the Union with the Respondent. On the other hand during this same period the Respondent had given the production workers no general increase so that the 12-cent-per-hour increase in average hourly rate of the production workers from October 1, 1955, to March 17, 1956, resulted from individual merit increases and the new minimum wage law passed by Congress. There was thus a decided differential between the wages paid to the toolmakers and those paid to the production workers. There was also a decided difference between the skills of these two groups. The toolmakers' negotiated hourly increases in turn affected the amounts of the payment of both the Christmas and the Easter bonuses. In Levinger's words the "unbalance" or the "gap" between the payments to the toolmakers and to the production workers was increasing . But the increase was due to successful representation of the toolmakers by the Union. Levinger testified that in an effort to decrease this "unbalance " or this "gap," he first thought of withholding both the Christmas and the Easter bonuses from the toolmakers but finally decided to pay the toolmakers the usual Christmas bonus because of the spirit of the season . He further testified that subsequently in March 1956, after receiving advice from his attorneys, he decided to withhold the 1956 Easter bonus from the toolmakers in order to lessen this "unbalance" or this "gap." By withholding the payment of this bonus to the represented toolmakers for the purpose of rectifying or straightening out the wage structure of the plant, Levinger recognized the Easter bonus as an integral part of the compensation system of the Respondent. The Easter bonus thus was shown to be no longer a gift, a gratuity, or a privilege to be dispensed or not at the will of the Respondent, but a part and parcel of the Respondent's wage structure and recognized as such by the Respondent. Nor, in fact, was this the first recognition of the fact by the Respondent. In 1949 Respondent published and distributed to all its employees a card labeled "Speidel Quiz" where in question and answer form Respondent noted various terms 4 As noted heretofore the Christmas bonus was computed upon the individual's rate of pay and length of service. This bonus was graduated from $5 for employees with under 6 months ' service to 3 weeks' wages for those with 10 or more years' service. Respondent recognized the fact that, as a group , the toolmakers enjoyed much greater length of service than did the production workers. SPEIDEL -CORPORATION- 747, and conditions of employment such as the plant's nine paid holidays, paid vaca- tions, paid Blue Cross, life insurance, the annual outing, and also the following: 1. What Speidel bonus will soon be paid? Easter bonus 40 hours paid just when you need it most. 4. Does Speidel give a-Christmas bonus? If so, what does it offer? CHRISTMAS BONUS 20 hours to 3 weeks paid depending on seniority. (There really is a Santa Klaus.) The longevity of these bonuses (the Christmas bonus since the 1930's and the Easter bonus since the early 1940's) and this-publicity had transformed both these bonuses into terms or conditions of employment, an integral part of the remunera- tion to be received, and a part of the wage structure rather than a gift or a gratuity despite the annual statement that the bonus was "voluntary and not a precedent." As a term or condition of employment the Respondent was no longer entitled' to give or withhold the payment at its-discretion where that discretion was exer- cised upon a basis of union membership or union activity as the Respondent has attempted to do in this case. Even assuming the bonus to have remained a gratuity or a gift, the Respondent would not be permitted under the Act to grant or with- hold the same if its determination was based upon union membership or activity and if that action would inherently tend to encourage or discourage union activity among its employees. Thus Levinger's testimony serves not as a defense but instead to strengthen the General Counsel's case by showing that the decision to withhold the Easter bonus was based upon gains made by the represented toolmakers through their collective- bargaining agent and, therefore, even more clearly that the decision was based exclusively on union membership and concerted activity. The Respondent's brief emphasizes this point when it states: "The toolmakers had received preferential treatment in rates of pay, hour, wage increases, earnings and size of bonuses." All of the matters mentioned relate directly back to the represented employees' concerted activity in collective bargaining except for the hours which, of course, were exclusively dependent upon the Respondent's need. It was this "preferential treatment" so-called which Levinger was attempting to rectify by withholding the Easter bonus from the represented employees. On December 15 the Respondent paid to the 55 toolmakers approximately $11,000 in retroactive back pay due them under the terms of the 1956 contract. On December 19 the Respondent paid to these same 55 toolmakers another sum of approximately $11,000 as their share of the Christmas bonus and at the same time paid the other approximately 600 employees a sum of $26,000 as their share of the Christmas bonus. Both these payments to the toolmakers were in whole or in part computed on rates which the toolmakers had gained through collective bargaining and collective action. The size of the payments to the toolmakers had surprised Levinger who testified in regard thereto as follows: I felt very strongly that my feeling that I had previously, in Christmas and in February, and when I talked to Mr. Ambrozino [the auditor] of not paying this [Easter bonus] to toolmakers was fully justified in view of the fact that we had paid out these fortunes to them in the previous months. "These fortunes" refer to the December 15 and December 19 payments to the toolmakers of retroactive back pay and the Christmas bonus, both of which, as noted above, were computed in whole or in part upon the results of collective bar- gaining. Thus again we have proof that the decision to withhold the Easter bonus from the represented toolmakers was dictated because of their successful con- certed activity and successful collective bargaining. Thus there is nothing in the Respondent's third defense which would in any way rebut or change the inherent tendency of the Respondent's conduct to dis- courage union membership and activity. Hence the Trial Examiner is constrained to hold that the Respondent's conduct in withholding the Easter bonus from its represented employees constituted a violation of Section 8 (a) (1) and (3) re- gardless of the presence or absence of any specific intent on the part of Respondent to encourage or discourage union membership or activity.8 Although, in arriving at the above finding the Trial Examiner has been influenced little, if any, by the undisputed testimony relating to the Union's attempted cam- paign to organize the unrepresented production workers which began February 27, 8 Radio Officers' cases, 347 U. S. 17. 748 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 1956, and was continuing as of March 13, it is too clear for argument that the Respondent's action of March 26 would likewise have tended to interfere therewith and to discourage said unrepresented employees from seeking such membership. Nor is the Trial Examiner in making the above finding unmindful of either the Board's decisions or the court's reversals thereof in the Nash-Finch 9 and the very recent Intermountain Equipment Co.10 cases. Both these cases are very similar to the case at issue but in each instance the court based its reversal of the Board decision on elements missing from the instant case, to wit, the fact. that the Union had bargained away its interest in the payment of such bonuses prior to-the em- ployer's actual withholding thereof. Which brings this discussion to Respondent's first defense which is that the Respondent was under no legal or moral obligation to pay the bonuses to the toolmakers. As a matter of law this constitutes no defense to the complaint for the reason that the Act proscribes an employer from exercising his discretion regarding the granting or withholding of a privilege where the exercise of that discretion is based on considerations of union membership or activities and its exercise tends to en- courage or discourage union membership. The law is well established to this effect in numerous cases where privileges such as the use of company houses, vending machines, small loans, and other similar privileges have been withdrawn by an employer and were found by the Board and the courts to constitute unfair labor practices where the employers' exercise of this discretion was based on considerations of union membership, etc., and his action tended to encourage or discourage such membership. Thus it is in this regard totally immaterial whether these bonuses are considered as a noncontractual privilege of the employer, a contractual obligation or, as was the case here, an established term or condition of employment. In any of these instances the decision to withhold here was based upon union considera- tions and tended inherently to discourage union membership and activities and as such was violative of the Act. We now come to the Respondent's last defense in which the Respondent says, in effect, that regardless of the fact that it was under no obligation to bargain with the Union regarding the Easter bonus because there was no contractual obligation on its part to do so and because it were merely correcting the wage structure between the represented and unrepresented employees, nevertheless the Respondent did in fact notify, meet, and negotiate with the Union regarding the bonus. The basis for this contention is the fact that in the Union's original proposed contract at the outset of the negotiations in 1955 there was an article 10 entitled "Maintenance of Privileges" reading as follows: It is agreed that any and all privileges enjoyed by employees prior to the date of this agreement will not be denied to them because of the signing of this agreement such privileges shall be continued to be enjoyed by them during the term of this agreement. [Sic.] Fearing, without exploring the subject with the Union, that the phraseology of article 10 would include bonuses at the level of the last year, Blue Cross insurance as well as other matters now commonly referred to as privileges such as smoking, rest periods, etc., and transform them all into contractual obligations, the employer group in private caucus determined to reject article 10 which their spokesman, Frankovich, did in the negotiations with vigor and in about so many words. Ad- mittedly at the 1955 negotiations the Union never made any mention of bonuses in regard to article 10 so that the fear of the employer group was self-imposed." Premised on this contract proposal and its rejection by the employer group, the Respondent contends that the Union in effect agreed that the paying or withholding 0 103 NLRB 1695, 211 F 2d 622 (C A. 8) lu 114 NLRB 1371, 239 F 2d 240 (C. A. 9). 11 During the negotiations for the succeeding contract in August 1956 the Union was requested to "spell out" the privileges intended to be coveted in this maintenance-of- privileges clause In answer thereto the Union handed the employees the following document The intormal privileges which, as a matter of shop custom, have been enjoyed by the employees prior to this agreement (such as the use of vending machines, coffee time, smoking privileges or any other informal privilege which are mutually recognized to have been a privilege) shall be continued to be enjoyed during the life of this agreement Frankovich for the employers again rejected article 10. SPEIDEL CORPORATION 749 of the Easter bonus was to remain a matter exclusively within the Respondent's discretion and thereby lost its right to bargain about that matter during the con- tract term . This contention stretches the imagination to the breaking point on several scores. It is more than questionable as to whether under any recognized definition of the terms Respondent's Easter bonus could be classified as a "privilege." Furthermore during the 1955 negotiations the employer group alone even mentioned bonuses in connection with article 10 and then only casually while neither party men- tioned bonuses during the wage discussions . Such evidence does not justify a finding that thereby the Union "bargained away" any rights it had regarding the bonus payments. The employer here is on much less firm ground on this point than were the employers in either the Nash-Finch or the Intermountain Equipment cases, supra. Especially is this so in the instant case where for 15 years more or less Respondent had considered the payment of such bonuses to be a term of employment at its plant. Note both the length and regularity of these payments , the fact that at least as far back as 1949 Respondent itself had publicized the payment of both the Christmas and Easter bonus as a term of employment at its plant in the "Speidel Quiz" and the fact that annually Respondent set up on its books a reserve fund exclusively for payment of the Easter bonus to all its employees which, inci- dentally, was done as usual for the 1956 Easter bonus. All in all the payment of an Easter bonus to all its employees had long since become a term of employment even without its ever having been mentioned in the toolmakers contract. Under these conditions in order to sustain the claim that the Union had bargained away its rights to the payment of the Easter bonus as a term of employment , the evidence must be much stronger than was presented here where the ultimate fact would have to be inferred from equivocal facts at best . This the Trial Examiner cannot do. Respondent further contends that it complied with its duty to bargain over this term or condition of employment by meeting with the Union on March 23 and 26, 1956. However, the facts show that the decision to withhold the bonus from the toolmakers had been unilaterally determined prior to such meetings which were held solely for the purpose of announcing that decision and conferring with the Union as to the form of the notice announcing such decision in an effort to avoid "embarrassment" to the Union . There was in fact no bargaining in regard to the withholding of the bonus-only as to the form in which that change was to be announced to the unrepresented employees . Such does not comply with the require- ments of the Act. Therefore, the Trial Examiner must hold that the Respondent failed to bargain collectively in good faith with the Union regarding the 1956 Easter bonus in violation of Section 8 (a) (5) of the Act. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondent set forth in section III, above , occurring in connection with the operations of the Respondent described in section I, above, have a close, intimate, and substantial relation to trade, traffic, and commerce among the several States and tends to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY It having been found that the Respondent has engaged in certain unfair labor practices, it will be recommended that it cease and desist therefrom and that it take certain affirmative action designed to effectuate the policies of the Act. It having been found that the Respondent failed and refused to bargain collectively with Lodge 129 of District 64, International Association of Machinists , AFL-CIO, in regard to the Easter bonus payment of March 30, 1956 , it will be recommended that the Respondent pay such bonus to the employees in the appropriate unit, herein called the toolmakers unit , and, upon request, bargain collectively on such matter with the Union. Upon the basis of the foregoing findings of fact and upon the entire record, the Trial Examiner makes the following: CONCLUSIONS OF LAW 1. Lodge 129 of District 64, International Association of Machinists , AFL-CIO, is a labor organization within the meaning of Section 2 (5) of the Act. 2. All employees of the Respondent working in the toolmaking , dye cutting, chain machine, mold making, heat treating, hub cutting, and forcer making and machinists departments, excluding guards and supervisors as defined in Section 2 750 DECISIONS OF - NATIONAL LABOR • RELATIONS BOARD (11) of the Act constitute a unit appropriate for the purposes of collective bar- gaining within the meaning of Section 9 (b) of the Act. 3. At all times material herein the Union has been , and now is, the exclusive representative of all the employees in the aforesaid appropriate unit for the pur- poses of collective bargaining within the meaning of Section 9 (a) of the Act. 4. By withholding the payment of the Easter bonus on March 30 , 1956, from the employees of the aforedescribed appropriate unit and by failing and refusing to bargain collectively with Lodge 129 of District 64, International Association of Machinists, AFL-CIO, in regard to said payment of the Easter bonus , the Re- spondent has engaged in, and is engaging in, unfair labor practices within the meaning of` Section 8 (a) (1), (3 ), and (5 ) of the Act. 5. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2 (6) and (7) of the Act. [Recommendations omitted from publication.] Sharnay Hosiery Mills, Inc. and Textile Workers Union of Amer- ica, AFL-CIO, Petitioner. Case No. 11-RC-1000. May 1, 1958 SUPPLEMENTAL DECISION AND CERTIFICATION OF RESULTS OF ELECTION Pursuant to a Decision and Direction of Election issued by the Board on October 16, 1957,' an election by secret ballot was con- ducted on November 8, 1957, under the direction and supervision of the Regional Director for the Eleventh Region of the National Labor Relations Board among the employees in the unit found appropriate by the Board. The parties were furnished a tally of ballots which shows that there were approximately 48 eligible voters and that 40 cast ballots against the Petitioner and 8 cast ballots for the Petitioner. Thereafter the Petitioner filed an objection to conduct affecting the results of the election. In accordance with the Rules and Regulations of the Board, the Regional Director caused an investigation of the objection to be made and on January 21, 1958, issued and served on the parties his report on objections, in which he found the objection without merit and recommended that it be overruled and the results of the election certified. Thereafter the Petitioner filed a timely ex- ception to the Regional Director's report. On October 25, 1957, some 2 weeks before the election in this case, the Employer mailed to its employees an 8-page letter, which among other matters, discussed the Petitioner's position on the issue of racial integration. The substance of the letter, in this respect, is that the Petitioner is strongly prointegration, has submitted a prointegra- tion brief in the Supreme Court, is striving to eliminate segregation from every phase of American life, and is a member of AFL-CIO, which at its last convention contributed $75,000 to NAACP. i Not published 120 NLRB No. 102.