Dalton Brick & Tile Corp.

DALTON BRICK & TILE, CORPORATION r 473 excluding office clerical employees, professional employees, guards, and supervisors as defined in the Act [Text of Direction of Elections omitted from publication ] MEMRERS RoDGERS and JENKINS took no part in the consideration of the above Decision and Direction of Elections I Dalton Brick & Tile Corporation and United Stone & Allied Product Workers of America, AFL-CIO, Local 113. Gases Nos 10--CA-3979 and 10-CA-3980 February 5, 1960 DECISION AND, ORDER On July 31, 1959, Trial Examiner Arthur Leff issued his Inter- mediate Report in the above-entitled proceeding, finding that Respondent Dalton Brick-& tTile Corporation 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, Respondent filed exceptions to the Intermediate Report and a brief in support thereof 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 brief, and the entire record in the case, and hereby adopts the Trial Examiner's findings, conclusions, and recommendations i ORDER Upon the entire record in this case, and pursuant to Section 10(c) of the National Labor Relations Act, the National Labor Relations Board hereby orders that Respondent Dalton Brick &' Tile Corpora -1 tion, Dalton, Georgia, its officers, agents, successors, and assigns, shall : i Respondent, on December 7, 1959, filed with the Board a motion to reopen the record to receive additional evidence which was not available at the time of the hearing The General Counsel and Local 113 submitted briefs in response thereto The additional evi deuce in question relates to further findings and a decision upon appeal of the Georgia Employment Security Agency with respect to applications for unemployment compensa- tion made by certain of Respondent's employees subsequent to Respondent's suspension of operations In affirming the Trial Examiner's conclusions that the Respondent, by its actions, violated Section 8 (a) (1), (3), and (5) of the Act we note that the Trial Examiner did not, in any manner, give weight to the findings or decision of the State ' agency, but rather, utilized the relevant circumstances to illustrate the inconsistent reasons for the suspension of operations given by the Respondent during the course of the proceedings before such State agency and before this Board The Intermediate Report correctly finds that the reason given to the Georgia Employment Security Agency for such suspension constitutes a definite admission against interest, so far as the instant proceeding is con- cerned Inasmuch as the additional evidence which the Respondent seeks to introduce in no way refutes this patent inconsistency, Respondent's motion is hereby denied 126 NLRB No X61 474 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 1. Cease and desist from : (a) Discouraging membership in United Stone & Allied Product Workers of America, AFL-CIO, Local 113, or any other labor organi- zation of its employees, by discriminatorily locking out or laying off any of its employees, or discriminating in any other manner in regard to their hire and tenure of employment or any term or condition of employment. (b) Refusing to bargain collectively in good faith with the afore- said labor organization, as the exclusive representative of all produc- tion and maintenance employees employed by Dalton Brick & Tile Corporation at its Dalton, Georgia, plant, with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment, by engaging in or threatening to engage in lockouts, lay- offs, or other measures adversely affecting the earnings of its employ- ees, for the purpose of forcing the aforesaid labor organization or the employees in the appropriate bargaining unit represented by it to abandon bargaining demands made by the Union and to accept instead bargaining demands made by the Respondent, or by engaging in any like or related conduct in derogation of its statutory duty to bargain. (c) Threatening its employees with plant shutdown or layoff, or a continuation thereof, in order to force them to give up their bar- gaining demands and accept the Respondent's contract proposals instead without further bargaining. (d) In any like or related manner, interfering with, restraining, or coercing its employees in the exercise of the right to self-organization, to form labor organizations, to join or assist the above-named or any other labor organization, to bargain collectively through representa- tives of their own choosing, to engage in other concerted activities for the purposes of collective bargaining or other mutual aid or pro- tection, or to refrain from any or all of such activities. 2. Take the following affirmative action which the Board finds will effectuate the policies of the Act: (a) Make whole all employees listed in Appendix A attached hereto for any loss of pay they may have suffered by reason of the discrimi- nation against them, in the manner set forth in the section of the Inter- mediate Report entitled "The Remedy." (b) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, timecards, personnel records and reports, and all other records necessary to analyze the amount of backpay due under the terms of this Order. (c) Post at its plant at Dalton, Georgia, copies of the notice attached hereto marked "Appendix B." 2 Copies of such notice, to 21n the event that this Order is enforced by a 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." DALTON BRICK & TILE CORPORATION 475 be furnished by the Regional Director for the Tenth Region, shall, after being duly signed by an authorized representative of the Respondent, be posted by the Respondent immediately upon receipt thereof, and be maintained by it for a period of 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to insure that said notices are not altered, defaced, or covered by any other material. (d) Notify the Regional Director for the Tenth Region, in writing, within 10 days from the date of this Order, what steps the Respondent has taken to comply herewith. MEMBERS RODGERS and JENKINS took no part in the consideration of the above Decision and Order. APPENDIX A W. J. Bailey Hoyt Whaley, Jr. George Prince, Jr. Will Saylors Earl Rogers John Brackett James Cleary George Bell Forest Callahan Roscoe Edwards Clinton L. Brock Charles E. Prince Eugene Martin Claude Jackson, Jr. George J. Lowery John W. Wyatt J. William Cleary Fred E. Harris Raymond Mullins Sam McCaJley J. Tom Busby Robert Martin John Laster J. L. Ashe Wallace Bell Charles Mullins Bill Camp Donald Cleary Roscoe Brock Willard Busby C. Cleo Bailey Woodrow Jackson Dillon Ponders Lester Rogers Buford Wheat Claudie Jones APPENDIX B NOTICE TO ALL EMPLOYEES 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 discourage membership in United Stone & Allied Product Workers of America, AFL-CIO, Local 113, or any other labor organization of our employees, by discriminatorily locking out or laying off our employees, or by discriminating in any other manner in regard to their hire or tenure of employ- ment or any term or condition of employment. WE WILL NOT refuse to bargain collectively in good faith with United Stone & Allied Product Workers of America, AFL-CIO, Local 113, as the exclusive representative of all production and maintenance employees at our Dalton, Georgia, plant, with re- spect to rates of pay, wages, hours of employment, and other 476 DECISIONS OF NATIONAL LABOR RELATIONS BOARD terms and conditions of employment, by engaging in or threaten- ing to engage in lockouts, layoffs, or other measures adversely affecting the earnings of our employees, for the purpose of forc- ing the aforesaid labor organization and/or the employees in the appropriate bargaining unit represented by it to abandon bar- gaining demands made by the Union and to accept instead our bargaining demands; nor will we engage in any like or related conduct in derogation of our statutory duty to bargain. WE WILL NOT threaten our employees with plant shutdown or layoff, or continuation thereof, in order to force them to give up their bargaining demands and accept our contract proposals instead without further bargaining. WE WILL NOT in any like or related manner interfere with, re- strain, or coerce our employees in the exercise of the right to self-organization, to form labor organizations, to join or assist the above-named or any other labor organization, to bargain collectively through representatives of their own choosing, to engage in other concerted activities for the purposes of collective bargaining or other mutual aid or protection, or to refrain from any or all of such activities. WE WILL make whole the following named employees for any loss of pay suffered by them as a result of our discrimination against them : W. J. Bailey Hoyt Whaley, Jr. George Prince, Jr. Will Saylors Earl Rogers John Brackett James Cleary George Bell Forest Callahan Roscoe Edwards Clinton L. Brock Charles E. Prince Eugene Martin Claude Jackson, Jr. George J. Lowery John W. Wyatt J. William Cleary Fred E. Harris Raymond Mullins Sam McCalley J. Tom Busby Robert Martin John Laster J. L. Ashe Wallace Bell Charles Mullins Bill Camp Donald Cleary Roscoe Brock Willard Busby C. Cleo Bailey Woodrow Jackson Dillon Ponders Lester Rogers Buford Wheat Claudie Jones All our employees are free to become, remain or to refrain from becoming or remaining members of the above-named labor organiza- tion, or any other labor organization. DALTON BRICK & TILE 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. DALTON BRICK & TILE, CORPORATION 477 INTERMEDIATE REPORT STATEMENT OF THE CASE Upon charges filed by United Stone & Allied Product Workers of America, AFL-CIO, Local 113, herein called the Union, against Dalton Brick & Tile Corpora- tion, herein called the Respondent, the General Counsel issued a complaint in the above-entitled duly consolidated proceeding alleging that the Respondent had en- gaged in unfair labor practices within the meaning of Section 8(a)(1), (3), and (5) and Section 2(6) and (7) of the National Labor Relations Act, 61 Stat. 136, herein called the Act. The Respondent filed an answer in which it denied the com- mission of the alleged unfair labor practices. On May 26 and 27, 1959, a hearing was held at Dalton, Georgia, before Arthur Leff, the duly designated Trial Examiner. At the opening of the hearing and again at the close of the General Counsel's case, the Respondent moved to dismiss the 8(a)(5) allegations of the complaint upon the asserted ground that such allegations were rendered moot by virtue of a collective- bargaining agreement entered into after the alleged violation. The Respondent's motions were denied. During the hearing, the General Counsel amended the com- plaint by deleting the names of two employees-J. B. Callahan and Claude Jackson, Sr.-from the list of employees alleged to have been unlawfully discriminated against. All parties waived oral argument. Briefs were submitted by the parties on July 7, 1959. 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 RESPONDENT Dalton Brick & Tile Corporation, a Georgia corporation with its principal office and place of business at Dalton, Georgia, is engaged in the manufacture of shale brick. During the 12-month period preceding the issuance of the complaint, a representative period, the Respondent sold and shipped brick valued in excess of $50,000 directly to customers located outside the State of Georgia. The Respondent does not dispute that it is engaged in commerce within the meaning of the Act. II. THE LABOR ORGANIZATION INVOLVED United Stone & Allied Product Workers of America, AFL-CIO, Local 113 is a labor organization admitting to membership employees of the Respondent. III. THE UNFAIR LABOR PRACTICES A. The issues Ori December 22, 1958, while negotiations were pending between the Respondent and Union for a new collective-bargaining contract to supersede a recently expired one, the Respondent shut down its production operations and laid off its employees in the union-represented production and maintenance unit. Except for occasional miscellaneous work assigned in the interim to some employees, in some instances at rates below their regular rates of pay, the Respondent maintained the shutdown in effect until on or about February 24, 1959, when it finally reached full accord with the Union on the terms and conditions of a new contract. Characterizing the shut- down and accompanying layoff as a "lockout," the complaint alleges that the purpose of the lockout was to force the employees and the Union to abandon their bargaining demands to the extent opposed by the Respondent and to accept instead the Respond- ent's contract proposals precisely as submitted. The lockout, along with certain alleged statements of management officials to employees that continued operations and consequent employment were to be conditioned upon acceptance of the Re- spondent's proposed contract terms,,are alleged to have constituted conduct that was at once coercive of the exercise of employees' Section 7 rights, discriminatory in the statutory sense, and in derogation of the Respondent's good-faith bargaining obligations, all in violation of Section 8(a)(1), (3), and (5) of the Act. The Respondent does not dispute that the shutdown and layoff-which it concedes may in a loose sense be characterized as a "lockout"-was related to some extent to the pending contract negotiations. But it contends the lockout was reas- onably justified by virtue of economic and operative considerations in order to protect its legitimate employer interests, and, in the absence of specific antiunion motivation, must therefore be viewed as lawful and privileged. More specifically, the Respondent claims that it was led to shut down its operations by the combina- 478 DECISIONS OF NATIONAL LABOR RELATIONS BOARD tion of the following interrelated considerations: (1) The fact that it was then operating with a shortage of working capital, and was, moreover, in its off-season with a high inventory and few orders; (2) its reluctance to continue production without a contract fixing future labor costs and thereby eliminating uncertainties as to price quotations on new business; (3) its desire to avert a possible strike and picketing by the Union that might have a harmful impact on its customer relations; and (4) the economic advantage to it of forcing a resolution of the contract dispute at a time when it could afford a shutdown, and thus countering a union objective of delaying negotiations until the busy season and then, by strike or threat of strike, imposing pressure on the Respondent for acceptance of the Union's demands. The Respondent contends additionally that a good-faith bargaining impasse had been reached prior to the lockout, and that even in the absence of other special circum- stances it was therefore then free to lock out its employees in support of its bargaining position. B. The history of the controversy 1. Background At the times material herein, the Respondent employed some 36 production and maintenance employees who were grouped in an appropriate collective-bargaining unit represented by the Union.' The Respondent and the Union have enjoyed con- tractual bargaining relations since 1946. Their relationship prior to the events here involved has been singularly free from industrial strife. In all that time there has never been a union-authorized strike against the Respondent. Contracts have normally covered annual periods running from December 1 to November 30. It has been more usual than not for the parties to delay their final negotiations for a new contract until after the termination date of the old one. The time lag in some years has been substantial. Thus, for example, no new contract was executed in 1955 until August of that year. During the hiatus periods, the employees have always continued working without a contract, but with the tacit understanding that their terms and conditions of employment would remain governed by the expired contract until a superseding one was executed. The November 30 contract expiration date falls within the Respondent's slack season, there being little demand for bricks during the period of winter weather running from late November until late February or early March. It is customary, however, for the Respondent to maintain its production operation during the winter season, although perhaps on a somewhat curtailed basis, utilizing that period to build up an inventory of staple bricks for the busy season lying ahead. There have been instances in past years when the Respondent has closed down its operations around Christmas time, but only for periods of about a week or two, and then only after about 5 days' posted notice to the employees. 2. The events leading to the shutdown of plant operations and layoff of December 22, 1958 The contract for the year 1958 expired on November 30, 1958. On October 15, 1958, the Union served on the Respondent a 60-day notice of its intention and desire to negotiate a new contract, and 3 days later the Respondent served a cross notice on the Union. On November 18, 1958, the Union gave the 30-day notice required by Section 8 (d) (3) of the Act. The first negotiating meeting was held on December 5, 1958. The Union was represented by International Representative Marvin Blaylock, who normally acted for the Union in contract negotiations, and by the local shop committee; the Re- spondent, by its president and general manager, William I. Haymaker, and its vice president and plant manager, William E. Hankins. At this meeting, the Union presented for the first time its written proposals for contract changes. Included were demands for (1) a general 12-cent an hour wage increase which would have raised the hourly rates from a range of $1-$1.19 per hour to a range of $1.12-$1.31 per hour; (2) premium pay for work in excess of 8 hours in any day and for all work on Saturday and Sunday; (3) added group life and health insurance benefits, and (4) various changes in the contract's work task provisions. Taking the position 'It was stipulated, and it is found, that all production and maintenance employees at the Respondent's plant, excluding office clerical employees, guards, professional employees, and supervisors as defined in the Act, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act, and that the Union at all times material herein was, within the meaning of Section 9(a) of the Act, the exclusive bargaining representative of all employees in the aforesaid unit. DALTON BRICK & TILE CORPORATION 479 that it could not because of its financial condition do anything that would cost it money, the Respondent requested the Union to renew its previous contract without change 2 Haymaker stated that if the Union agreed to do so he would either con- tinue, or attempt to continue , the plant in full operation , closing it down only for Christmas Day .3 The clear implication was that rejection of the Respondent's pro- posal would be met by a suspension of operations and a consequent loss of earnings by employees. Nothing was settled at the December 5 meeting. The meeting ended with a statement by Blaylock that he would have to discuss the situation with the men. The Union expressed no strike threat at the December 5 meeting, or, for that matter, at any other time during the entire period of negotiations. Nor did the Respondent voice a fear of strike. The Respondent did not ask for any no-strike assurance, and the Union did not suggest it-the word "strike," or its possibility, never having been mentioned. Haymaker testified that he saw no advantage to a no-strike assurance that might postpone possible strike action to a time within or close to the Respondent's busy season. After the bargaining meeting of December 5, a further meeting was arranged for December 22, 1958. In the meantime, the Respondent continued to maintain its production operations at a virtually full or at least at a substantial level-and this, although according to its witnesses, it was then suffering from a shortage of working capital and had a large inventory on hand. Under the provisions of the 1958 con- tract, the Respondent was required to give its employees a paid vacation of from 1 to 2 weeks, depending upon length of service, the vacation period to start sometime between December 15 and 22; but the right was reserved to the Respondent to keep the employees at work during the vacation period by paying them a bonus equal to their vacation pay in lieu of the vacation. Notwithstanding the Respondent's as- serted financial straits and large inventory, the Respondent in 1958 gave no notice of a vacation shutdown, but elected instead to continue production and to pay the employees a vacation bonus on top of their regular pay. Except as related to the contract negotiations, the Respondent gave no indication that it planned a substantial shutdown of its operations during its off-season. Joe Cleary, Sr., a department supervisor, testified without contradiction that on December 15, 1958, he asked Plant Manager Hankins how long the men would be off for Christmas, drawing from Hankins the reply, "If they went along with the contract, only Christmas Day." Shortly before the meeting on December 22, 1958, at about noon, Hankins laid off employee Hoyt Whaley, Jr., president of the local, as well as the other members of Whaley's working crew, some of whom were also members of the shop commit- tee. When Whaley inquired whether the men were to return to work after the meeting, Hankins said he did not know. Later, however, while on their way to the meeting, Hankins told Whaley, in the presence of other employees, that an agree- ment between the Union and Company to renew the old contract would mean work for the employees every day except Christmas Day. At the bargaining meeting of December 22, Hankins alone appeared for the Re- spondent, President Haymaker being out of town at the time. Hankins submitted the Respondent's counterproposal to the Union's bargaining demands. It provided for a renewal of the earlier contract with the following additions: (1) Certain im- provements in insurance benefits that would give the employees somewhat increased hospitalization benefits and provide them with a $5,000 polio policy; and (2) a re- duction in the work task requirements as to 2 of the approximately 25 types of bricks manufactured by the Company. The Union thereupon announced that it was pre- pared to settle for a 5-cent hourly increase instead of the 12 cents originally de- manded, but Hankins rejected the Union's offer, reiterating that the Company was financially unable to pay out more money. Later, after a recess and caucus by Blaylock and the shop committee, the union representatives returned to the meeting room and indicated that they would be willing to recommend to the employees a settlement on the basis of the Company's proposal plus the Union's overtime de- mands, dropping everything else including the request for a wage increase. The i When the past two contracts had come up for negotiation the Respondent had also pleaded financial inability to make economic concessions, and the Union had then acceded to the Respondent's request that it go along on new annual contracts without any wage increase. Three witnesses for the General Counsel testified that Haymaker flatly promised to continue the plant in full operation if the old contract was renewed Haymaker's version was that he said he would "attempt" to maintain full employment during the slow period under those circumstances. 480 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Respondent, however, declined to go beyond its own counterproposal. At the urg- ing of Hankins, the union representatives agreed to submit the Respondent's offer to a vote by the employees. The meeting was thereupon adjourned and plant operations suspended so that the employees might consider and vote on the Respondent's contract offer. All em- ployees in the unit were allowed to vote, whether members of the Union or not. The overwhelming majority chose to reject the Respondent's contract proposal. The question of whether strike action was favored was not submitted and was not involved. When the bargaining meeting reconvened immediately after the voting, Hankins asked, "Well, where do we go from here?" Blaylock replied, "Well, if you cannot make any other concessions, why, it appears to me that we are deadlocked, and we should call in the Federal Mediation and Conciliation and see if they can start negotiations to moving." Hankins expressed the hope that the Union would recon- sider its rejection of the Company's contract proposal so that the plant might con- tinue to operate. The meeting was then adjourned with the understanding that Blaylock would communicate with the Federal Mediation and Conciliation Service and that a further meeting between the Union and Company would later be arranged. Several days before the December 22 meeting, Haymaker and Hankins, according to their testimony, had discussed whether the Respondent's operations ought to be shut down. The question of closing was concededly considered by them in rela- tionship to the Union's contract demands. Haymaker testified that he then told Hankins that if "the [Union's] demands were going to be heavy and we had no assurance of a contract, with all the uncertainties, that we would have to cease opera- tions after we found out what [the Union's] attitude was going to be." However, final decision was deferred. It was left "more or less dependent," according to Hankins, on what the "general atmosphere of the negotiations" on December 22 would be. Immediately following the meeting on the 22d, Hankins called Haymaker and posted him on what had occurred. Haymaker thereupon instructed Hankins to dis- continue regular plant operations until-in the words of Hankins-"we could work out something." That same day the Respondent laid off all of its hourly paid production and maintenance employees except one, Charles Mullins, its fireman oldest in seniority. Apart from Mullins, the Respondent retained only its salaried, nonunit employees, who were assigned to fire the kilns, replacing hourly paid fire- men who normally performed such work. Mullins was continued at his regular rate of pay ($1.31 an hour) until the fire in the kiln went out, and then was as- signed to do watchman's work for the remainder of the shutdown period at the $1 common laborer's rate applicable to the watchman's job. The salaried employees continued to perform work at their regular pay for the duration of the shutdown. The Respondent did not resume general operations until about February 24, 1959, when a new contract was finally negotiated, under circumstances to be related below, and all laid-off employees were recalled to work. In the interim, however. the Respondent continued to accept at least some orders and to make deliveries of its product out of accumulated inventory. During the shutdown some of the laid- off employees, among them shop committeemen, were called in on occasions as needed by the Company to perform services in connection with the shipment of small orders, guard work, and custodial work. The employees given such occasional temporary work were paid the regular rate applicable to the work assigned, usually the common laborers rate, which in many instances was lower than the rates at which they normally would have worked but for the shutdown. The names of the employees whose earnings were adversely affected by the layoff, and who are alleged in the complaint to have been discriminated against by reason thereof, are set out in Appendix A. When Supervisor Joe Cleary, Sr., asked Hankins on December 23 why the plant had been shut down, Hankins explained that the Company and the Union could not get together on a new contract, and added that operations would not be resumed until a new contract was signed. Similar explanations were given to rank-and-file employees. Thus, on one occasion during the shutdown Haymaker told employee James Cleary that if the boys had agreed to the old contract they would not have been off but Christmas Day. On January 9, 1959, Hankins told employee Robert Martin that the employees would not go back to work until a new contract was signed. DALTON BRICK & TILE CORPORATION 481 3. Subsequent events; the denial to employees of unemployment compensation; negotiations leading to the final resolution of the dispute and resumption of work On January 5, 1959-2 weeks after the shutdown-a further negotiating meeting was held. There was no change in the respective positions of the parties with regard to contract terms. Whaley for the Union asked Hankins when the men would be recalled. Replying that he did not know, Hankins went on to add that if the Union signed a contract in accordance with the proposals the Company made at the previous bargaining meeting, the men could return to work the following day. The Union, however, again rejected the Company's proposal, explaining that it saw no point in resubmitting to the employees a proposal they had already voted down, and were therefore unlikely to accept. Nothing was accomplished at this meeting. Thereafter, no further negotiating meetin* was held until the meeting about a month later at the Federal Mediation and Conciliation Service, to be reported in due course. In the meantime, certain other events of interest occurred. Several days after the January 5 meeting, Hankins, according to his testimony, became convinced on the basis of hearsay reports he had received that many of the employees, perhaps a majority, would be content to accept the Respondent's contract proposal in order that they might be able to return to work. Hankins conceived the idea of calling a meeting of all the employees so that they might vote by secret ballot on whether they favored acceptance of the Respondent's contract proposals. (The voting on December 22 had been by a show of hands.) Accompanied by Foreman Cleary, Hankins called upon several of the shop committeemen to broach that idea and endeavor to obtain union consent. Although Blaylock could not be reached, and at least one of the committeemen, Sam McCalley, the local's secretary-treasurer, expressed strong opposition to that procedure, Hankins nevertheless went ahead without official union consent and called the employees in for a "meeting" on Jan- uary 12. Any impropriety in the Respondent's procedure was, however, cured on January 12, prior to the balloting, when Blaylock, who was present at the plant that day, expressly consented to the vote being taken; the General Counsel so concedes. At the meeting that day, the assembled employees were given ballots prepared by the Respondent calling for a vote on the question of whether they desired to accept or reject the Respondent's contract proposal as presented on December 22. Again a large majority of the employees voted for rejection. When the result of the secret balloting was announced, Hankins expressed his annoyance in the presence of employees. "It doesn't look like the men want to go back to work as they said they did," he declared-and this, though the question of a return to work had not been presented in the balloting. Indeed, as the record shows, President Whaley of the local, prior to the balloting, had assured Hankins that the employees were willing to resume work at any time. Of more than passing interest is the position taken by the Respondent at this time with regard to employees' claims for unemployment compensation. Shortly after the shutdown of December 22, the employees had filed claims for unemploy- ment compensation with the Georgia Employment Security Agency, stating as the reason for their separation, "Lack of work." Under the applicable State laws, employees are entitled to compensation if their loss of employment is for that reason, but apparently not if they have been separated because of a labor dispute. When the Respondent received notice from the State agency of the filing of the claims, it advised that agency on a form provided for that purpose, as follows: We feel that a clarification should be made as to the present status of the un- employment at the plant. We have been recently negotiating toward a new contract with representatives of Local 113, of the U.S. & A.P.W.A. Our pro- posal to extend our 1958 contract for another year was voted by the men and rejected by them. For this reason, we felt it necessary to cease operation. [Emphasis supplied.] As a result of the Respondent's advice, the regional division of the State agency disallowed the employees' compensation claims. Thereafter an appeal was taken and a hearing held. At that hearing, Hankins, inconsistently with the Respondent's position in the instant proceeding, made no reference in his testimony to lack of work as a contributing consideration for the shutdown.4 4 Following the hearing, the appeals referee of the State agency sustained the decision from which the appeal was taken A further appeal filed on behalf of the employees was pending undetermined before the board of review of the State agency when the hearing in this case was held 554461-60-vol. 126-32 482 DECISIONS OF NATIONAL LABOR RELATIONS BOARD On February 6, 1959, a negotiating meeting was held in Atlanta at the Federal Mediation and Conciliation Service, with a conciliator present, and a followup meeting, not attended by the conciliator, was held at the same place 2 days later. At the second meeting the negotiating parties reached agreement on all provisions of the new contract, except the expiration date. In sum, the parties agreed upon a 3-year contract, containing a 10-cent hourly across-the-board wage increase (pay- able 3 cents during the first year, with 3i cents to be added in each of the succeed- ing years), and a provision for Sunday premium pay, along with the improvements offered by the Respondent on December 22. The only issue left unsettled was whether the 3-year contract term should run from the date when agreement was actually reached, as the Union demanded, or should carry a December 1 execution date and a November 30 expiration date in line with past contracts, as the Respondent insisted upon. Although the understanding reached on February 8 was such as to resolve the Respondent's uncertainties as to its future labor costs and the Respondent was nearing its busy season with its inventory gradually being diminished by the deliver- ies made during the shutdown, the Respondent nevertheless continued to maintain the layoff in effect. On February 12, 1959, Morgan C. Stanford, the Union's attorney, called Haymaker to request him to return the employees to work while negotiations continued on the only open issue. Haymaker refused to do so, referring Stanford to the Respondent's counsel, Erle Phillips. Stanford and Phillips were unable to get together until February 23, 1959. At their meeting that day, they reached a compromise as to the contract's expiration date, fixing it at January 1, 1962. The very next day-February 24, 1959-the Respondent resumed operations, recalling all its laid-off employees to work, although the contract was not actually ratified by the employees and signed until some days later. C. Analysis of the applicable law; consideration of the Respondent's defenses; concluding findings The applicable principles of law guiding decision in this case are these: An employer is always free-whether or not bargaining is in progress at the time- to suspend operations for business or other reasons that are wholly unrelated to the exercise by his employees. of their statutory rights.5 But the situation is different where a lockout or layoff is prompted by a purpose to defeat or impair the free exercise of such employee rights. This, of course, is clearly true, where the action is prompted by a specific motive to defeat union organizations But the presence of union bias or hostility-an element concededly absent in the instant case-is not essential to a showing of a violation where there has been an actual infringement of Section 7 rights.7 Section 7 safeguards employees not only in their right to self- organization, but also in their right to bargain collectively and to engage in concerted action for that purpose or other mutual aid and protection. Embraced therein is the right to demand through their union representative in collective-bargaining nego- tiations, and to press for better contract terms than those offered by their employers. To lay off (lock out) employees, or otherwise to reduce their earnings because they have done so, operates as a restraint upon the free exercise of that right, and hence constitutes, at the very least, a prima facie violation of Section 8(a)(1); that violation is an unquestionable one where no basis appears for the lockout other than a coercive purpose to force, while negotiations are still in progress, abandonment of the Union's demands and acceptance instead of the contract terms proposed by the employer. And, as discouragement of union membership is a "natural consequence of discrimination" based on "protected concerted activity," 8 such employer conduct also falls within the proscription of Section 8(a)(3). More- over, since the free functioning of the collective-bargaining process contemplated by the statute is impeded when in the course thereof the employer subjects the union and the employees it represents to "unwarranted and illegal pressure, [creating] an atmosphere in which the free opportunity for negotiations does not exist," such 6 See N.L.R.B. v. The Houston Chronicle Publishing Company, 211 F. 2d 848 (CA. 5) ; N.L R.B v Goodyear Footwear Corporation, 186 F. 2d 913, 918 (C A. 7). e See. e g., N.L.R.B. v Wallick & Schwalm Company, et at., 198 F. 2d 477 (C.A. 3) ; N.L R R v. Somerset Classics, Inc., et at ., 193 F. 2d 613 (C A. 2), cert. denied 344 U.S 816. 7 Republic Aviation Corporation v. N.L.R.B., 924 U.S. 793, 797; N.L.R.B. v. Illinois Tool Workq. 153 F 2d 811 (CA 7). 8 The Radio Officers' Union of the Commercial Telegraphers Union, AFL (A. H. Bull Steamship Company ) v N.L R B., 347 U S. 17, 45-46 DALTON BRICK & TILE CORPORATION 483 conduct also runs afoul of Section 8(a) (5). See, Quaker State Oil Refining Corpora tion, 121 NLRB 334, enfd. 270 F. 2d 40 (C.A. 3); Great Falls Employers' Council, Inc., et al., 123 NLRB 974. See, also, American Brake Shoe Company, et al., 116 NLRB 820, set aside 244 F. 2d 489 (C.A. 7) ), the court finding special extenuating circumstances, contrary to the Board's determination. But, though the Board views lockouts in the context of contract negotiations as presumptively violative of the Act, it also recognizes that the employees' statutory right to bargain collectively and to strike in support of their demands is not absolute; that at times situations may arise where such rights collide with legitimate employer interests; and that the special circumstances of a given case may be such as to compel the employee rights to give way to what in the circumstances are found to be para- mount rights of the employer. Thus, the Board has held that an employer is privi- leged to counter by lockout threatened or imminent strikes or interferences with plant production, where the lockout is used as a defensive measure, reasonably necessary in the circumstances, to ward off operational problems, plant hazards, or economic loss of an unusual character that would flow from the threatened union action.9 Thus, too, the Board has held a lockout privileged where it was designed to counter a union's strike tactic aimed at atomization of a multiemployer system of bargaining.10 To justify infringement of employee statutory rights, however, the burden is on the employer to come forward with evidence that the legitimate inter- ests he seeks to protect are of such a compelling nature as to outweigh in the cir- cumstances of the particular case the employee rights that are being trenched upon. The Board has made it plain that an employer may not lock out or threaten to lock out his employees in aid of his bargaining position, absent special circumstances, clearly justifying the need for and use of the lockout as a defensive measure to protect his business, property, or other proper interests from loss or damage which is threatened by an imminent strike, reasonably apprehended." In this case there is an abundance of evidence pointing to the conclusion that the Respondent's lockout action was conceived and carried out in aid of the Respondent's bargaining position as a coercive device to force the Union and the employees to their knees. This is apparent alone from the sequence and timing of events as set out above. Thus, the Respondent at the very first negotiating meeting impliedly threatened to suspend operations unless the old contract was renewed; it in effect repeated that implied threat immediately before the second meeting at which it formally proposed continuance of the old contract with relatively minor revisions; it suspended regular operations and laid off those in the bargaining unit, but not others, directly after the employees had voted rejection of its contract offer, and at a time, moreover, when it was not faced with any imminent danger of strike; it made clear in oral statements to employees and at a negotiating meeting thereafter that acceptance of its contract proposals was the only obstacle to resumed operations; and it ended the layoff simultaneously with the end of the contract controversy. But that is not all. The position taken by the Respondent as to payment of unemploy- ment compensation benefits to its employees provides potent evidence confirming the coercive and retaliatory motivation for the lockout action.12 No clearer admis- sion of motive can be expected than is to be found in the Respondent's advice to the Georgia Employment Security Agency that "we felt it necessary to cease opera- tion" because "our proposal to extend our 1958 contract for another year was voted by the men and rejected by them." All of this adds up to a powerful prima facie case, to say the least. The Respondent seeks, nevertheless, to justify its conduct as lawfully privileged on other grounds. The Respondent's contentions in this regard have been outlined in 9 See, e.g, Duluth Bottling Association, 48 NLRB 1335, 1359-1360 (where necessary to avoid spoilage of materials) ; International Shoe Company. 93 NLRB 907 (where eco- nomical operations were being impeded by recurrent employee work stoppage) ; Betts Cadillac Olds, Inc., 96 NLRB 268 (where, because of union's refusal to give reasonably required advance notice of a threatened strike, employers had no assurance and were left uncertain that new repair work could be finished and automobiles returned to customers). io Buffalo Linen Supply Company, et at., 109 NLRB 447, affd 335 U S. 87. n See, Quaker State Oil Refining Corporation, supra, where, though a sudden strike without notice would have resulted in damages to plant property, the Board found that the employer had no reasonable basis to fear such a strike at the time of the lockout, and the Board was satisfied that the real purpose of the lockout was to force acceptance of the employer's contract terms See, also, Great Falls Employers' Council, Inc., et al, supra; American Brake Shoe Company, at at., supra. 12 Cf. Great Falls Employers' Council, Inc., et al., supra. 484 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the statement of the issues appearing earlier in this report. They will be considered below in the order there set forth. 1. I consider first the Respondent's contention that its shutdown decision was influenced by financial and business considerations unrelated to the pending contract negotiations. In support of that contention, the Respondent adduced testimony to show that at the time of the shutdown it was operating with a serious shortage of working capital; that its inventory was high and orders few; that it could expect little new business during the normally slow winter months; and that it was uncertain as to its business prospects for the busy season lying ahead. At the hearing, the- Respondent did not contend that its business and financial condition was the primary consideration in its decision to suspend operations, only that it was a contributing factor. In response to a direct question on that point, Haymaker testified that he did not know whether the Respondent would have shut down the plant for that reason were it not for the concurrent labor dispute. In its brief, however, the Respondent goes further. It argues that it is a "fair inference" that the Respondent "would have been compelled, in any event, to shut down production," and therefore requests dismissal of the complaint "for the reason that the lockout resulted from economic necessity." With that, I am unable to go along. The issue here is not whether the Respondent might have in the exercise of sound business judgment suspended operations for the reason stated, but whether it did. I have no reason to doubt that the Respondent in assessing the costs against advan- tages to it of a shutdown at that particular time, did take into account at least some of the business considerations to which it alludes. But, on all the record, I am convinced that the Respondent was not prompted initially by such considerations to, shut down the plant, and that but for the contract dispute it would not have done so. Thus, as has been shown, when the question of a possible shutdown was first con- sidered by Haymaker and Hankins several days prior to December 22, it was dis- cussed in the context of the pending contract negotiations, and final decision was made dependent on the Union's "attitude" in such negotiations. The shutdown was_ put into effect on a Monday afternoon-timing that has significance only in relation to the employees' rejection that day of the Respondent's contract terms The claim that a shortage of working capital, a high inventory, and an absence of orders made closing necessary is scarcely consistent with the Respondent's election to forgo a_ vacation shutdown and keep the men at work at bonus rates during the normal vacation period immediately preceding the shutdown. Nor does it square with the reiterated statements to employees that the shutdown would be terminated at once upon acceptance of the company proposals, or with the Respondent's indication on the unemployment compensation forms that "lack of work" was not the reason for the layoff. 2. The Respondent asserts, by way of further attempted justification, that its shutdown decision was motivated in part by its reluctance to continue production in the face of uncertainty as to its future labor costs and consequent pricing policies on new business. I do not believe, however, that such uncertainty was a significant factor impelling the shutdown. In past years the Respondent had not considered the absence of a contract settling future labor costs an impediment to continued operations. Moreover, the bulk of the Respondent's production during the off- season was normally directed to the building up of an inventory of staple products against anticipated future orders; and, as to such work, the Respondent could not have been confronted with pricing problems related to labor costs; for, as the record shows, the applicable wage rates pending the execution of a new contract continued to be those provided for in the old contract. It is significant also, that even after labor costs were settled at the February 8 meeting, the Respondent continued to maintain the lockout in force for an additional 2 weeks, for no other reason than to force acceptance of its contract proposal exactly as submitted. In any event, even assuming the Respondent's lockout decision was motivated in part by the element of uncertainty as to future wages and prices, that alone would not qualify as a "special circumstance" within the economic hardship rule. That is an element almost always present in any business enterprise whenever a new collective-bargaining contract comes up for negotiation. And the Respondent has not shown that it had any extraordinary problems in that respect. To hold that uncertainty of the kind here involved is enough to satisfy the "special circumstances" exception, would have the practical effect of broadening the exception into a rule allowing the use of the lockout as an economic weapon in virtually every case. 3. Another consideration motivating the lockout decision, according to the Respondent, was a desire to protect its customer relations. Haymaker testified that he was anxious to avert a strike and picketing which would prevent the Respondent from fulfilling its contractual commitments, with resultant inconvenience to cus-- DALTON BRICK & TILE CORPORATION 485 Comers and risk that some of them might thereafter be reluctant to buy from a company known to have "union troubles." I am unimpressed by that assertion, and consider it one contrived as an afterthought. To begin with , the record does not show that the Respondent had any reasonable basis to fear an imminent strike at the time the lockout was imposed . Moreover, the action the Respondent claims it took as a preventive measure was of a kind likely to produce the very condition the Respondent says it wanted to avoid. As it happened , the Union in this case re- frained from picketing the Respondent 's plant to advertise the lockout as a labor dispute, but the Respondent could not have known this when the lockout was imposed. Besides, even if the Respondent's assertions were accepted as true, it would not justify a "special circumstance " finding. The possibility of a strike with accompanying customer inconvenience prevails whenever parties are engaged in collective bargaining . It may scarcely be viewed as an unusual circumstance of such overriding character as to warrant an inroad on protected employee activity. 4 The Respondent would further justify its lockout action as a proper defensive countermeasure to what it asserts to have been a union objective of delaying nego- tiations until the Respondent 's busy season and then coercing the Respondent into acceptance of the Union's demands by strike or threat of strike. The Respondent argues that under the circumstances its action in shutting down production at a time when it could afford a shutdown in order to forestall union pressure at a time when a shutdown would have been "economic suicide" must be viewed as a reasonable and lawful measure demanded by good business judgment in ,the protec- tion of its legitimate employer interests . Significantly, Haymaker, in testifying as to the considerations which he says motivated his lockout decision , made no refer- ence to any purpose of warding off any union objective such as stated above. That reason was , however, mentioned in the opening statement of the Respondent's counsel. And it now appears to be the principal "justification" urged by the Re- spondent in its brief. The initial difficulty with this contention is that it rests on an unsupported factual premise. The record contains not one word of evidence, and no basis for fair inference, that the Union was acting with the objective the Respondent ascribes to it, or that the Respondent had any reason to believe so at the time of the lockout. On the contrary, the evidence is such as to leave no doubt that the Union was bargaining in entire good faith and with a sincere desire to reach agreement expe- ditiously and without resort to strike sanctions . This is clear alone from the Union's conduct at the December 22 meeting, at which it sharply reduced its demands, agreed to the Respondent's request that the Respondent's counterproposal be submitted to a vote by the employees , and, when agreement failed, urged con- ciliation as an avenue through which differences might be resolved. It is, of course, unnecessary to consider whether the lockout action would have been privileged as a proper defensive measure if the Respondent 's factual premise were correct. On the facts found here , I am satisfied clearly it was not. I do not doubt, of course , that the Respondent considered it to be to its best business in- terests-from the standpoint of obtaining a more favorable labor contract-to accelerate what in practical effect was a strike situation to a time when it was strong and the Union weak, rather than chance even the possibility that such a situation might develop at a time when the contrary became true . But from this it does not follow that its lockout action was privileged . Implied in the right to strike is the right to refrain from striking, and to determine when, if at all, 'a strike should be timed . A lockout which, as in this case, has both the aim and effect of lessening, if not destroying entirely, future strike impact, blunts the strike weapon , deprives the Union of the element of control, and thus interferes with, impedes , and diminishes the right to strike. Where as here, an employer takes the offensive to gain through lockout an economic advantage that is brought about only by infringement of em- ployee rights, he is scarcely in a position to point to the economic advantage so gained to justify the lockout as one undertaken in the promotion of his "legitimate" employer interests To interpret the Act as allowing an employer to "beat a union to the punch" with lockout action where his only interest is to avoid a contingent possibility of greater impact on his operation if bargaining should fail and if the Union should elect to strike, is not only to ignore the statutory admonition of Section 13, but also to pay scant heed to the Act's policy to encourage the peaceful settlement of disputes. Moreover, in balancing out the respective interests of an employer and a union in a situation such as the one here, it must not be overlooked that impairment of employee rights by lockout is not essential to an employer to counter- balance a union's power to strike. For, unlike a union, which has only the strike weapon at its disposal if bargaining fails, an employer has it within his right and 486 DECISIONS OF NATIONAL LABOR RELATIONS BOARD power unilaterally to establish the employment terms and conditions he desires and to meet a strike by replacing strikers. 5. Finally, the Respondent, asserting that a bargaining impasse had been reached prior to the lockout, and relying upon language to be found in Morand Brothers Beverage Co. V. N.L.R.B., 190 F. 2d 576, 582 (C.A. 7); and Albert Leonard, et al. d/b/a Davis Furniture Co., et al. v. N.L.R.B., 197 F. 2d 435, 441 (C.A. 9), appears to argue that, because of that asserted impasse, its lockout was justified in law regardless of the presence or absence of other special circumstances. Even if the Respondent's factual premise could be accepted as correct, I would doubt the validity of the conclusion the Respondent would draw therefrom. Neither of the cited cases may be viewed as square authority covering the situation here presented-where a single employer uses the lockout not as a defensive weapon but solely as an offensive measure, resorting to it before threat of imminent strike and purely to advance his bargaining position.13 The Board, to date, has never acquiesced in the view that the mere existence of a bargaining impasse, without more, warrants the use by an employer of lockout action in aid of his bargaining position.14 I have great difficulty in seeing why infringement of employee statutory rights by lockout, under circum- stances otherwise violative of Section 8(a)(1) and (3), should achieve immunity under the law simply on the basis of an impasse and nothing else.15 For purposes of decision in this case, however, that is a question that need not be faced, for I am satisfied that the record in this case fails to substantiate the Respondent's factual claim that there was a genuine bargaining impasse at the time it shut down opera- tions on December 22. The Respondent would predicate an impasse finding largely upon Blaylock's dec- laration to Hankins near the end of the December 22 meeting that the parties were seemingly "deadlocked." Up to that point the parties had met only twice. Little had occurred at the first meeting besides the presentation of the Union's demands. At the second meeting, at which the Respondent first submitted its counterproposal, the Union, far from displaying a frozen attitude, had made substantial concessions and had otherwise indicated that its bargaining position was still in a fluid state. In context, Blaylock's declaration to Hankins cannot be read as an admission that negotiations had come to a hopeless stalemate. It will be recalled that Blaylock's full statement was, "Well, if you cannot make any other concessions, why, it appears to me that we are deadlocked, and we should call in the Federal Mediation and Conciliation Service and see if we can start negotiations to moving." This is not the expression of one who feels that the negotiating parties have exhausted the 1H Both of the cited 'cases involved situations where the employers were not merely advancing their bargaining positions but were protecting their multiemployer bargaining unit against destruction-and interest which the Supreme Court in N.L.R.B v. Truck Drivers Local Union No 449, et al (Buffalo Linen Supply Co ), 363 U S 87 in line with the Board's holding in that case, recognized was entitled to special consideration. The courts in both Morand and Davis emphasized the defensive nature of the lockout action there taken. See, particularly, the second opinion in Morand, 204 F. 2d 529, at 533, and the second opinion in Davis, 205 F 2d 355, at 356 11 In both Morand and Davis, the Board, subsequent to the initial court decisions, re- jected the view that a lockout occurring after a bargaining impasse is privileged as a corollary of the emplovees' statutory right to strike a anection that was thereafter ex- pressly left open by the Supreme Court in the Bufal'o Linen Supply Co. (Truck Drivers Local Union No. 449, et al) case, supra See, Morand Brothers Beverage Co., et at., 99 NLRB 1448, 1460; Albert Ldonard, et al, d/b/a Davis Furniture Co , et al, 100 NLRB 1016, 1018 In the more recent American Brake Shoe and Quaker State Refining Corpora- tion cases, supra, the Board had no occasion to consider that question since it found as a fact in both cases that the 1^ckurt was not unreceded by a bargaining impasse. However, it is to be noted that in the Board's most recent lockout case, Great Falls Employers' Council, Inc, et at.. supra, the Board, without expressly discussing the effect of a bargaiining impasse on the principles it normally applies, found a partial lockout to be unlawful under Section S(a) (1) and (3), although, as 'appears from the Board 's decision in that case, there was a bargaining 'impasse at the time of the conduct there found unlawful is On that specific point, it seems to me that the reasoning of the Board in Morand Brothers Beverage Co , et al., '99 NLRB 11448, 1462, and in Albert Leonard, et at d/b/a Davis Furniture, at at., 100 NLRB 1016, 1018, is sound. I confess, however, to difficulty in finding an 8(a) (5) violation where it appears that prior to a lockout the parties have already exhausted the possibilities of good-faith collective bargaining. (Cf. N.L.R B. v. Crompton Highland Mills, Inc., 337 U S 217.) But, see, Prudential Insurance Company of America, 119 NLRB 7618, set aside 260 F. 2d 736 (CA, D C ), cert granted 35'8 U.S 944. DALTON BRICK & TILE CORPORATION 487 possibilities of collective bargaining, leaving no recourse open for resolution of their differences but a trial by battle. In suggesting conciliation, the Union was only carrying out a duty the law imposes on labor unions and employers alike to use, when necessary, the avenue of conciliator-aided negotiations in an effort to work out peaceful settlement of contract disputes at the bargaining table.ls The Union, thus, was not breaking off bargaining, but rather expressing a positive desire for the continuation of negotiations. Moreover, as has been found, the December 22 meeting was adjourned on the express understanding that a further meeting would be arranged. This alone is clear evidence that both parties understood that bargain- ing, although having perhaps temporarily stalled on December 22, had not yet reached the point of actual impasse where continued negotiations would be futile. In point of fact, the parties did continue to bargain while the lockout was in prog- ress-one of the meetings, on January 5, being held before the conciliator was actually called in. The "give and take" character of the meetings that eventually led to agreement tends to confirm that the parties had not yet actually reached the end of their bargaining rope on December 22. Under all the circumstances, I am persuaded and find that no genuine impasse had in fact been reached when the Respondent shut down its operation and laid off its employees on December 22, and that the Respondent had no justifiable basis for believing otherwise. Upon all the record, I conclude and find that during the period from December 22, 1958, to February 24, 1959, the Respondent, without justifiable basis therefor, locked out and laid off and/or assigned to lower-paying jobs, the employees in its produc- tion and maintenance unit whose names are listed in Appendix A, for the purpose of forcing such employees and the Union to abandon the Union's contract demands and to accept instead contract terms proposed by the Respondent. I find that by such conduct, as well as by statements to various employees, prior to the lockout, threatening to close plant operations if the Union and the employees did not agree to the Respondent's proposed contract terms, and by statements to employees, during the lockout, conditioning the resumption of plant operations upon the acceptance by the Union and the employees of the Respondent's proposed contract terms, the Respondent interfered with, restrained, and coerced its employees in the exercise of their Section 7 rights in violation of Section 8(a)(1), unlawfully discriminated against the employees listed in Appendix A within the meaning of Section 8 (a) (3), and engaged in activity impeding and impairing the bargaining process in violation of Section 8(a)(5). IV THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of Respondent set forth in section III, above, occurring in connec- tion with the operations of Respondent set forth in section I, above, have a close, intimate, and substantial relation to trade, traffic, and commerce among the several States, and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that Respondent has engaged in and is engaging in certain unfair labor practices, I shall recommend that it cease and desist therefrom and take certain affirmative action which I find necessary to effectuate the policies of the Act. Having found that the Respondent has unlawfully discriminated against the em- ployees listed in Appendix A during the period from December 22, 1958, to February 24, 1959, I shall recommend that the Respondent make whole each employee listed in said Appendix A for any loss of pay he may have suffered by reason of such un- lawful discrimination during the aforestated period by payment to him of a sum of money equal to that which he would normally have earned as wages during that period, less his net earnings during that period, such sums to be computed in accord- ance with the formula set forth in F. W. Woolworth Company, 90 NLRB 289, 291-294. I shall further recommend that the Respondent, upon request, make available to the Board or its agents, for examination and copying, all payroll and other records necessary to enable the Board to analyze and compute the amounts of backpay due. Upon the basis of the foregoing findings of fact, and upon the entire record in the case, I make the following: CONCLUSIONS OF LAW 1. United Stone & Allied Product Workers of America, AFL-CIO, Local 113, is a labor organization within the meaning of Section 2(5) of the Act. ie See Section 204, LMRA, 1947. 488 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 2. All production and maintenance employees of the Respondent's Dalton, Georgia, plant, excluding office clerical employees, guards, professional employees, and supervisors as defined in the Act, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 3. The aforesaid labor organization is and has been at all material times the ex- clusive representative of the employees in the aforesaid unit for the purposes of collective bargaining within the meaning of Section 9(a) of the Act. 4. By discriminating in regard to the hire and tenure of employment of its em- ployees, and thereby discouraging membership in the aforesaid labor organization, the Respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8(a) (3) of the Act. 5. By locking out and laying off its employees in the aforesaid bargaining unit during the course of collective bargaining for the purpose of forcing the aforesaid labor organization and the employees in the aforesaid bargaining unit to abandon bargaining demands made by them and to accept instead contract terms proposed by the Respondent, the Respondent has impeded and impaired collective bargaining with the Union and has acted in a manner inconsistent with good-faith bargaining, and by reason thereof has failed to bargain in good faith with the Union, thereby engaging in unfair labor practices within the meaning of Section 8(a)(5) of the Act. 6. By interfering with, restraining, and coercing its employees in the exercise of rights guaranteed by Section 7 of the Act, the Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(1) of the Act. 7. The aforesaid unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. [Recommendations omitted from publication.] International Hod Carriers, Building and Common Laborers' Union of America, Local No. 1140, AFL-CIO and Economy Forms Corporation International Hod Carriers, Building and Common Laborers' Union of America, Local No. 1140, AFL-CIO and Peter Kiewit Sons' Company International Hod Carriers, Building and Common Laborers' Union of America, Local No. 1140, AFL-CIO and Miller Exca- vating Company International Hod Carriers, Building and Common Laborers' Union of America , Local No. 1140, AFL-CIO and Natkin & Co. Cases Nos. 17-CC-91,17-CC-92,17-CC-93, and 17-CC-94. Feb- ruary 5, 1960 DECISION AND ORDER On October 2, 1959, Trial Examiner C. W. Whittemore 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 and the General Counsel filed exceptions and supporting briefs. ,126 NLRB No. 66.