Electro-Mechanical Products Co.

ELECTRO-MECHANICAL PRODUCTS COMPANY 637 Electro-Mechanical Products Company and Raymond J. Mc- Mahon, William Santini, Melvin Hilliard and International Union, United Plant Guard Workers of America , and Its Amalgamated Local 114. Cases Nos. 7-CA-2174, 7-CA-1175, 7-CA-1176, and 7-CA-2376. February 15, 1960 DECISION AND ORDER On October 26, 1959, Trial Examiner Arthur Leff issued his Inter- mediate Report in the above-entitled proceeding, finding that the Respondent had engaged in and was engaging in certain unfair labor practices alleged in the complaint 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 Trial Examiner's report and a brief in support thereof. The General Counsel filed a brief in support of the Intermediate Report. The Board l 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 entire record in these cases, including the Intermediate Report and the ex- ceptions and the briefs, and hereby adopts the findings, conclusions, and recommendaitons of the Trial Examiner. ORDER Upon the entire record in these cases, and pursuant to Section 10 (c) of the National Labor Relations Act, the National Labor Relations Board hereby orders that the Respondent, Electro-Mechanical Prod- ucts Company, Garden City, Michigan, its officers, agents, successors, and assigns, shall : 1. Cease and desist from : (a) Discouraging membership in International Union, United Plant Guard Workers of America, and its Amalgamated Local 114, or any other labor organization, by discriminating in regard to hire or tenure of employment or any other term or condition of employ- ment of its employees. (b) Making promises to its employees of economic benefits where an object thereof is to dissuade them in their adherence to or activities on behalf of the aforesaid Union, or any other labor organization. (c) In any other manner interfering with, restraining, or coercing its employees in the exercise of the right to self-organization, to form a labor organization, to join or assist the aforesaid Union or any other ]Pursuant to the provisions of Section 3(b) of the Act, the Board has delegated its authority in these cases to a three-member panel [Chairman Leedom and Members Bean and Fanning] 126 NLRB No. 78. 638 DECISIONS OF NATIONAL LABOR RELATIONS BOARD labor organization, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any or all such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in Section 8(a) (3) of the Act, as modified by the Labor-Management Reporting and Disclosure Act of 1959. 2. Take the following affirmative action which the Board finds will effectuate the policies of the Act: (a) Reopen its plant protection department at its Ford Road plant and offer to Raymond J. McMahon, William Santini, and Melvin Hilliard immediate and full reinstatement to their former or sub- stantially equivalent positions without prejudice to their seniority and other rights and privileges, and make them whole for any loss of pay suffered by them in the manner set forth in the section of the Intermediate Report entitled "The Remedy." (b) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social security payment records, timecards, personnel records and reports, and all other records necessary to analyze the amounts of backpay due. (c) Post at its Ford Road, Garden City, Michigan, plant, copies of the notice attached hereto marked "Appendix."' Copies of said notice, to be furnished by the Regional Director for the Seventh Region, shall, after being duly signed by the Respondent's authorized representative, be posted by the Respondent immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken to insure that said notices are not altered, defaced, or covered by any other material. (d) Notify the Regional Director for the Seventh Region, in writ- ing, within 10 days from the date of his Order, what steps the Respondent has taken to comply herewith. 2In 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." APPENDIX 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 Labor Management Relations Act, we hereby notify our employees that : WE WILL NOT discourage membership in International Union, United Plant Guard Workers of America, and its Amalgamated ELECTRO-MECHANICAL PRODUCTS COMPANY 639 Local 114, or in any other labor organization of our employees, by discriminating in any manner in regard to their hire or tenure of employment, or any term or condition of their employment. WE WILL offer to the following employees immediate and full reinstatement to their former or substantially equivalent posi- tions, without prejudice to seniority or other rights and privi- leges previously enjoyed, and make them whole for any loss of earnings suffered as a result of our discrimination against them : Raymond J. McMahon, William Santini, and Melvin Hilliard. WE WILL NOT make promises to our employees of economic bene- fits where an object thereof is to dissuade them from adherence to or activities on behalf of the aforesaid Union or any other labor organization. WE WILL NOT in any other manner interfere with, restrain, or coerce our employees in the exercise of their right to self- organization, to form, join, or assist the above-named or any other labor organization, to bargain collectively through repre- sentatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any or all such activities, except to the extent that such right may be affected by an agree- ment requiring membership in a labor organization as authorized by Section 8(a) (3) of the Act, as modified by the Labor- Management Reporting and Disclosure Act of 1959. All our employees are free to become, remain, or refrain from becoming or remaining, members of any labor organization, except to the extent that this right may be affected by a lawful agreement requiring membership in a labor organization as a condition of employment. ELECTRO-MECHANICAL PRODUCTS COMPANY, Employer. Dated---------------- By------------------------------------- (Representat'ive) (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. INTERMEDIATE REPORT STATEMENT OF THE CASE Upon charges filed by the individuals and the Union above named against Electro-Mechaincal Products Company, herein the Respondent , the General Counsel issued a complaint, thereafter twice amended , alleging that the Respondent had en- gaged in unfair labor practices within the meaning of Sections 8(a) (1) and (3) and 2(6) and ( 7) of the National Labor Relations Act, 61 Stat . 136, herein the Act. With regard to the unfair labor practices , the second amended complaint, dated June 4, 1959, alleged in substance that the Respondent: (a) On or about October 22 , 1958, made promises of economic benefits to em- ployees in an effort to dissuade them from membership in the Union. 640 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (b) On or about November 3, 1958, closed its plant protection department, sub- contracted the work thereof, and terminated the employment of Raymond J. Mc- Mahon, William Santini, and Melvin Hilliard because of the employees' union mem- bership and activities.' The Respondent filed an answer in which it denied the com- mission of unfair labor practices and alleged affirmatively that on November 18, 1958, the individual complainants were offered but refused the opportunity of rein- statement. A hearing, with all parties represented, was held before the duly desig- nated Trial Examiner at Detroit, Michigan, on June 30 and July 1 and 2, 1959. Following the close of the hearing, the General Counsel and the Respondent filed briefs which have been considered. Upon the entire record in the case, and from my observation of the witnesses, I make the following: FINDINGS OF FACT 1. BUSINESS OF THE RESPONDENT Electro-Mechanical Products Company, a Michigan corporation , with its principal offices and plant at Garden City, Michigan, is engaged in the business of manufac- turing electrical and mechanical subassemblies for the automotive and other industries. During 1958 , the Respondent sold and delivered from its Garden City, Michigan, plant to points located outside the State of Michigan , products and materials manu- factured by it, valued in excess of $100,000 . The Respondent admits that it is engaged in commerce within the meaning of the Act. II. THE LABOR ORGANIZATION INVOLVED International Union, United Plant Guard Workers of America, and its Amal- gamated Local 114, herein called the Union, is a labor organization within the mean- ing of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. The central issues On November 3, 1958, while a representation petition was pending before the Board for certification of the Union as the bargaining agent of the Respondent's plant guards, the Respondent discharged the four guards then in its employ-all of whom had joined the Union-and substituted in their place an outside guard service. The General Counsel contends that the Respondent's action as aforesaid was sparked by the plant guards' designation of the Union; that it would not have occurred, at least at that time, but for such designation; and that it was therefore violative of the employees' statutory rights and unlawfully discriminatory within the meaning of the Act. In defense, the Respondent asserts that its action was entirely unrelated to the employees' union membership or activities, but was tied instead to legitimate economic considerations and to dissatisfaction with the manner in which the plant guards had theretofore performed their duties. According to the Respondent, its decision to transfer the guards' functions to an outside guard service had been made, and arrangements therefor completed, before the guards joined the Union or, at least, before the Respondent learned of it. What has just been said presents the central substantive issue of this case, but there is also another issue, litigated at considerable length, relating to the remedy to be ordered in the event unlawful discrimination is found. The Respondent claims, and the General Counsel and the Union dispute, that the discharged guards, about 2 weeks after their discharge, re- fused to accept an offer of substantially equivalent employment at plants of other companies affiliated in ownership with the Respondent. The Respondent contends that the alleged refusal must be reviewed as a defense to an order of reinstatement, or, in any event, as a bar to the running of backpay thereafter, on the theory of willful loss. In this section of the report, I shall consider only the facts relating specifically to the Respondent's violation of Section 8(a) (1) and (3). The remain- ing issue relating to reinstatement and backpay will be taken up where it belongs, in the section entitled "The Remedy." 'The original and the first amended complaint also alleged discrimination against a fourth employee, Saul A. Glazer, who, along with the others, had filed a charge against the Respondent on November 14, 1958. Glazer's name was dropped in the second amended complaint. It was explained at the hearing that his case had been settled and therefore withdrawn from the consolidated proceeding. ELECTRO-MECHANICAL PRODUCTS COMPANY 641 B. Chronology of events The three guards alleged to have been discriminated against-Raymond J. Mc- Mahon, William Santini , and Melvin Hilliard-along with a fourth guard , Saul A. Glazer, whose case was independently settled and withdrawn from this consolidated: proceeding-were employed at the Respondent 's Ford Road plant , and together constituted the Respondent 's entire force of plant protection employees. The Re- spondent employs at that plant some 500 or more production and maintenance em- ployees, who were represented at the time of the events here involved by the Empco^ Shop Union. The Shop Union was then an independent labor organization, but it has since become affiliated with the UAW-AFL-CIO. The guards were excluded from the unit -represented by the Empco Shop Union. At its Ford River plant, the Respondent is engaged , among other operations, in Government contract work pertaining to missiles , requiring the maintenance of certain security precautions To provide the required security, the Respondent , after first considering and apparently rejecting an outside guard service, established its own plant protection department in May 1958 , and hired as guards the four employees named above. The guards worked one at a time at fixed shifts . It was their primary duty to check the identification of all persons entering the plant and to see that all those leaving the plant with packages carried appropriate passes. In addi- tion, they were required at hourly intervals to patrol the entire plant, punching in at some nine different stations on each hourly round. At various times during their employment, the guards had complained to management that during their plant patrols, there was no adequate security protection of the entrance they were required to guard. At one time they had sought to have the employee entrance door pad- locked during the time of their patrols, but management refused to go along after the shop committee complained that this would create a fire hazard. During the year 1958 , both before and after the guards were hired there were a number of small thefts in the plant . The Respondent did not hold the guards per- sonally to blame for such thefts. It did, however, criticize the plant superintendent who, among numerous other duties , was then responsible for the operation of the plant protection department . The Superintendent , in addition to other derelictions unrelated to his supervision of the guard service , was charged with failing to open and read the guards' daily reports . In September 1958, he was demoted and sub- sequently discharged. On September 25, 1958, the Respondent hired a personnel manager, Fred Brisbois , and about the beginning of October turned over to him the supervision of its plant protection force. Not long after Brisbois took over-on the weekend of October 11 and 12, to be exact-a substantial number of small tools disappeared from one of the Respondent 's production departments, thereby disrupt- ing production in that department on October 13. At a meeting of management officials on October 13, Brisbois was instructed to take appropriate steps to tighten up on plant security. On October 17, 1958, Brisbois called a meeting of the plant guards. Brisbois announced to the guards that effective the following Monday, October 20, they were to go on a rotating shift schedule , instead of working fixed shifts as theretofore. Brisbois gave the employees a schedule of the shifts to which they would be assigned during the following 4 weeks. Although there is some conflict in the testimony on this point, I am satisfied from all the evidence that Brisbois, in the course of his remarks, made reference to the theft that had occurred the preceding weekend, and indicated that the reorganization of the shift schedule was directly related to management's desire to take added precautions to guard against a recurrence of such incidents. Brisbois, although stating that higher management had expressed some criticism of the manner in which plant protection was being handled, told the guards it was his view that they were doing the best they could; considering that only one guard was available at a time to guard so large an area. There was also some discussion , initiated by the guards, about differential pay for the night shift and uniforms to be supplied by the Company. Brisbois made a note of the guards' requests and promised to take them up with higher management. During that same week, all four guards signed application cards for membership, in the Union. At the hearing the Respondent went to great pains in an effort to, establish-though the point is not critical to decision here-that the cards were not signed until after Brisbois' meeting with the guards on October 17. The docu- mentary evidence, supported by the oral testimony of the witnesses , shows, however, that all but Glazer signed their cards prior to that meeting. Hilliard's and Santini's cards are dated October 14 , and McMahon's, October 15, although it appears that they did not actually pay their initiation fees until October 20. Glazer's application 55 4461-60-vol. 126-42 642 DECISIONS OF NATIONAL LABOR RELATIONS BOARD card is dated October 17, and his testimony reflects that he signed it after the meeting with Brisbois that day. By letter, dated October 21, 1958, the Union advised the Respondent that it represented a majority of the Respondent's plant protection employees and requested a meeting for the purpose of collective bargaining. On the following day, the Union filed with the Board a petition seeking certification as the bargaining representative in a unit of the Respondent's plant protection employees. The Respondent received the Union's bargaining request on October 22. That same day, or perhaps a day later, Frank Beauchamp, the Respondent's executive vice president, approached Santini and Glazer in the plant.2 As appears from Santini's credited testimony, substantially corroborated by Glazer, and not contra- dicted by Frank Beauchamp, the following occurred: Mr. Beauchamp came right over and came to Saul and I and put his arms around our shoulder and says, "Well, I understand that you have joined the Union," and I said, "Yes, we did, Mr. Beauchamp," and he said, "What seems to be the trouble'?" "Well," I says, "for security reasons." He says, "What do you mean?" and I says, "Well, Mr. Beauchamp, honestly now, could you live on a dollar seventy cents an hour" . .. He says, "I will have that changed. I won't give you no nickels and dimes. I will give you a substantial raise." He says, "I will get you in to see Mr. Stanski to get you into the Empco Shop union," and he also said that he would see that we would get in there, and I said, "Well, I am sure sorry. We have already joined the Union," and I said, "We need the uniforms . . . I have been wearing out my good clothes". . . and he said, "Well, I am going out of town over the weekend. Would you make a figure of what you want, and you and your guards get together and let me know what it is when I come back," and I says, "I will talk to them, but I don't know if it's going to do any good or not." 3 As further appears from Glazer's credited testimony, Beauchamp, when mentioning that he would try to get the men into the Shop Union, also declared that he did not believe in having two unions in the plant. There is evidence that Frank Beau- champ did in fact make an effort to have the guards admitted into the Shop Union. Aloise Stanski, the then president of the Shop Union, recalled, while testifying, that Frank Beauchamp had approached him about that time to inquire if the guards could join the Shop Union, explaining that he "would rather have everybody in one union under one roof instead of numerous unions." Stanski, however, advised Beauchamp that his union was precluded from representing the guards. On Monday, October 27, several events of significance occurred: (1) The Re- spondent received formal notice from the Board's Regional Office of the filing of the Union's representation petition. (2) Frank Beauchamp, following up his earlier request of Santini, came to Santini's work station, and asked, "Did you boys come to an agreement yet on the figures," drawing from Santini the response, "No, we haven't . we joined the Union, and we are letting the Union take care of our bargaining."4 (3) Frank Beauchamp conferred with Lewis Luchow, a sales repre- sentative of Pinkerton's National Detective Agency, Inc , about the use of Pinkerton's guard service. As appears from Luchow's credited and undenied testimony, Beau- champ mentioned in the course of the conference that the Respondent's guards were then being organized. That same day-October 27-Luchow, at Frank Beauchamp's request, sent a letter of service to the Respondent, outlining the nature and costs of the guard service Pinkerton was prepared to furnish. The letter, which is in evidence, recites that it was being submitted "as per your conversations with our Mr. Wolf on Febru- ary 5, 1958, Mr. Morgan on March 12, 1958, May 15, 1958, and May 27, 1958, and Mr Luchow on October 27, 1958." Within the next few days thereafter, I find, although the evidence on that point is disputed, the Respondent contracted out its guard work to Pinkerton whose guards at that time were unorganized. The 2 At that time Santini was finishing his shift and Glazer was there to take over the following shift. 3 McMahon also testified to a conversation with Frank Beauchamp at about the same time of somewhat similar purport However, McMahon's testimony in this respect im- r pressed me as the product of a confused recollection It appears that Santini shortly after the event reported to McMahon the conversation he had had with Frank Beauchamp, and I am satisfied that by the time of the hearing McMahon was unable to separate in his own mind what he had heard from Santini from what he had heard himself. Although not directly contradicted, McMahon's testimony in this respect is not relied upon. 4 This finding is based upon Santini's uncontradicted testimony credited in this respect. ELECTRO-MECHANICAL PRODUCTS COMPANY 643 following Monday, November 3, 1958, Pinkerton began to provide guard services under its contract with the Respondent , and on that same day the Respondent termi- nated the services of the four guards in its employ. The only reason stated on the guards' termination notices was "reduction in force." C. Analysis and concluding findings Perhaps the key factual issue in this case concerns the date when the Respondent decided to and did contract out its guard services to Pinkerton . Contrary to the finding made above, the Respondent contends that it finalized its arrangements with Pinkerton before and not after it received the Union's bargaining demand. For reasons elaborated below, I reject that contention. The finding adverted to is fully supported both by Pinkerton 's letter of service earlier referred to and by the testimony of Pinkerton Salesman Luchow, a wholly disinterested witness. It is corroborated , moreover, by Pinkerton's office records- consisting of a sales report , a journal index book, and a work order , all of which were duly authenticated and received in evidence . The entries on such records, along with supporting testimony of Pinkerton witnesses , show that the Respondent's order for guard services was received sometime between October 28, 1958, at the earliest, and October 30, at the latest , probably on October 29 . To support its claim that the guard work was actually contracted out prior to the bargaining demand, the Respondent introduced into evidence a Pinkerton confirmation notice, bearing date of October 20. As appears, however, from the credited testimony of Joseph Spicer, Pinkerton's office manager, the confirmation must have followed , it could not possibly have preceded , Pinkerton's work order containing an October 30 business receipt date, since it is Pinkerton's standard procedure to prepare its confirmation notices from information already transcr .bed on its work order . Just how the October 20 date got on the confirmation letter-a date clearly in conflict with Pinkerton 's other office records, as well as with the letter of service which the Respondent does not dispute it received after October 27-was not explained . But on the basis of the other overwhelming evidence from clearly reliable sources recited above, I have no doubt that the best that can be said of it is that it was a result of a typographical error. Nor do I credit the Respondent's assertion that, prior to the bargaining demand, it had already reached a decision and initiated steps to substitute an outside guard service for its own plant protection force. To support that assertion , the Respondent relied entirely upon the testimony of Frank Shirley , assistant to the company president. Shirley testified that about the middle of October , as a result of the recent theft in the plant, he recommended to Jack Beauchamp , the Respondent's president, that a bonded guard service be retained to perform the Respondent 's plant protection work and that Jack Beauchamp approved his recommendation , that the two there- upon checked the classified telephone directory to determine what companies offered that type of service ; that Pinkerton was selected because it had the largest ad; and that thereupon Jack Beauchamp in his presence telephoned Pinkerton 's office and- either inquired about the availability of such services , as Shirley testified at one point, or actually requested such services , as he testified at another . Shirley fixed the date of the call as about October 15 or 16 , pegging the date to the Respondent's receipt of Pinkerton's confirmation letter , which he testified he first saw on October 21, although , as found above , it could not possibly have been received before October 30. Shirley's overall testimony was not such as to invite confidence , and his testimony as to the Jack Beauchamp call to Pinkerton impressed me as contrived. As to detail, Shirley's version at the hearing was at variance with what he had stated in a prehearing affidavit and also incons,stent in at least one important respect with testimony he gave on cross-examination.5 Significantly, Jack Beauchamp, al- though present in the hearing room, was not called upon to corroborate Shirley's testimony as to the telephone conversation he is supposed to have had with Pinkerton on or about October 15 . It is to be noted, too, that Pinkerton's service letter of October 27 , although it specifically adverts to Pinkerton 's previous contacts with the Respondent, makes no reference to any contact between May 27 and October 27, R In his affidavit, Shirley had stated that negotiations for an outside guard service had been proceeding for some time and that "Jack Beauchamp advised me on or about October 15, that he had concluded a verbal arrangement with Pinkerton 's and that our guards would be replaced " Compare this with Shirley's embroidery at the hearing about searching the classified directory . Also compare this with Shirley's testimony at one point of his cross -examination, that he first learned the guards were to be discharged sometime during the week before they were discharged. 644 DECISIONS OF NATIONAL LABOR RELATIONS BOARD and says nothing at all of any contact with Jack Beauchamp. Moreover, it seems to me wholly improbable that the Respondent would have gone to the trouble of reorganizing the guards' shift schedules on October 20, if by then it was already committed to a decision to replace its guards with an outside guard service. Certainly, the promise of a wage increase made to the guards on October 23, a promise the Respondent has not denied making, is irreconcilable with the Respond- ent's present assertion To sum up: Although perhaps not entirely satisfied with the quality of the services performed by its plant protection force, the Respondent, prior to the advent of the Union, took no steps and overtly indicated no intent to replace them with an outside guard service. As soon as it learned that the guards had designated the Union as their bargaining representative, the Respondent, through a responsible officer, expressed its opposition to their joining a union other than Empco Shop Union, and, by means of promises of economic benefits, sought to dissuade them from continued adherence to the union of their choice. Upon definitely ascertaining several days later that the guards were unwilling to accept its promise of added benefits in exchange for their renunciation of the Union, the Respondent, now also faced with a representation petition, moved at once to destroy the proposed plant guard bargaining unit, by entering into negotiations, which it soon completed, for an outside guard service to take over the work theretofore performed by its own plant protection force. The sequence and timing of the events recited above lead to solid inference that the Respondent would not, at least at that time, have taken the action it did, but for the guards' designation of the Union; in other words, to an inference that the Respondent's action was discriminatorily motivated. That inference the Respondent has failed to rebut. The Respondent's principal defense, that its decision to contract out the guard work preceded its knowledge of the guards' union interest, has been discredited. Its assertion, made through its counsel at the opening of the hearing, that the action taken was motivated, at least in part, by "economic considerations" was thereafter not implemented by evidence.6 There is, to be sure, evidence that the Respondent was concerned about the efficient operation of its plant protection force, and was particularly disturbed by the theft of a substantial number of small tools during the weekend of October 11 and 12. But it is immaterial that the Respondent might have been justified in discharging the guards for that reason, if in fact that was not the reason that impelled its action. Contrary to the Respondent's assertion, I do not believe the Respondent was led to the action it took by the theft on the weekend of October 11 and 12. At the hearing the Respondent made no claim that any of the guards were personally responsible for that theft. Its only immediate response to the discovery of the theft was the reorganization of the guards' shift schedules, and it was not until after the interven- tion of the guards' union activities that the Respondent decided to discontinue its own plant protection department in favor of an outside guard service. If there were nothing else, the offer of a wage increase and other benefits made by Frank Beau- champ to the guards on or about October 23 would be enough to refute the claim that the earlier theft or dissatisfaction with their work was a moving reason for the discharge action. Nor is the inference of discrimination rebutted, as the Respondent further urges, by the evidence showing that the Respondent had no aversion to union organization as such, having recognized and dealt with unions at that plant and at plants of affiliated companies. The uncontradicted evidence in this case shows that. though the Respondent was not opposed to the union organization of its guards, it was opposed to their representation by a union other than the Shop Union, assertedly because it did not want to deal with more than one union in the plant. But under- the Act the choice of what union was to represent them was one for the employees and not the Respondent to make. It is concluded and found that by closing its plant protection department on November 3, 1958, subcontracting the work thereof, and terminating the employ- ment of Raymond J. McMahon, William Santini, and Melvin Hilliard, the Respond- ent unlawfully discriminated against the aforesaid employees within the meaning of Section 8(a)(3) of the Act and also engaged in conduct violative of Section 8(a) (1) of the Act. It is further found that the Respondent independently violated "Frank Beauchamp, who, according to Shirley's testimony-at one place, was the one who made the final decision on behalf of the Respondent to discharge the guards, and who was therefore in the best position to testify as to the underlying .motivation, was not called as a witness. Shirley upon whom alone the Respondent relied at the hearing to defend its discharge action, testified that he did not participate in any discussion with management officials in which "economic considerations" were mentioned. ELECTRO-MECHANICAL PRODUCTS COMPANY 645 :Section 8 (a) (1) of the Act by Frank Beauchamp's conduct on or about October 23, 1958, in making promises of economic benefits to the guards in an effort to dissuade them from adherence to the Union. 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 tend to lead to labor disputes burdening and obstructing com- merce and the free flow of commerce. V. THE REMEDY Having found that the Respondent engaged in certain unfair labor practices, I shall recommend that the Respondent be ordered to cease and desist therefrom. Because the Respondent's conduct was such as to impinge upon fundamental em- ployee rights guaranteed by the Act, the commission of other unfair labor practices may reasonably be anticipated. A broad 8(a)(1) cease and desist order will consequently be recommended. An issue has been raised as to the affirmative relief. The Respondent contends that reinstatement is precluded, or, in any event, backpay should be abated, by reason of an alleged unjustified refusal by the complainants to accept an offer of substantially equivalent employment some 2 weeks after their discharge. I am aware that the Board, under its usual practice, does not undertake to determine at this stage of an unfair labor practice proceeding possible questions relating to rein- statement or willful losses. But as the specific issue stated above was, with the ,consent of all parties, fully and extensively litigated at the hearing-indeed, at far greater length than the unfair labor practices issues-I believe that it may properly be considered and disposed of now. To obtain a full picture of what occurred, it is necessary to begin where the account of the unfair labor practices left off. Shortly after the discharges, the Union at two meetings with the Respondent protested both the discharge action and the Respondent's selection of an unorgan- ized guard service to replace the discharged employees. The Union threatened to picket the Respondent's plant unless the situation were corrected. Although de- fending its action as justified by legitimate considerations, the Respondent indicated that to avoid trouble it would be willing to replace Pinkerton with an organized guard service. But it flatly refused to reinstate the discharged guards. The Union declared that it would not be satisfied with anything short of full reinstatement of the guards to their former positions. On November 11, 1958, the Union placed a picket line at the Respondent's plant. The picketing effectively closed down all plant operations. In an effort to restore production, the Respondent met with the Union on the second day of the picketing, November 12, and entered into a written agreement with it for the removal of the picket line. The agreement provided in substance that, in consideration of the Union withdrawing its picket line, the Respondent, pending a ruling by the Board on the unfair labor practice charges, would "reemploy in salary only the 4 plant guards that were laid off on November 3, in order that an agency could be employed to perform their duties subject to the NLRB decision"; but that the guards were not to be reinstated unless and until the Board ruled in their favor. In compliance with the agreement the Union removed its picket line that day. On the same day, the Respondent replaced Pinkerton with another guard service-Bonded Guard Service, Inc. ("Bonded") -whose employees were then represented by the Union and cov- ered by a collective-bargaining contract. When the agreement was made, the Respondent, through no fault of the Union, was under the mistaken impression that a Board ruling disposing of the unfair labor practice charges could quickly be obtained, perhaps in a matter of days. It soon learned otherwise. The Respondent apparently then came to the conclusion that the agreement it had made was, from its point of view, an improvident one. At a meeting of management, it was decided that the Respondent ought not to pay the discharged guards for doing nothing, even if the alternative was to create jobs for which there was no real need. The guard services at the Respondent's plant were now being performed by Bonded, but the Respondent had two affiliated com- panies, one located in Garden City at the same location as its Ford Road plant, and the other at Romulus, which is located some 35 miles from Detroit, less from the Ford Road plant. No guards had been employed at the plants of the affiliated companies before, nor have any been employed since. The Respondent did not want the discharged guards at its Ford Road plant, but, rather than pay them for 646 DECISIONS OF NATIONAL LABOR RELATIONS BOARD not working, it decided to "make" jobs for them at the affiliated company plants, on the theory, stated by Shirley, that even "if we had a watchdog at the station or something there at this remote place, it was better than nothing." On November 18, 1958, Shirley for the Respondent sent by registered mail the following letter to each of the four discharged plant guards: This is to inform you that in line with our discussions with various interested parties, and our agreement, we feel that you are obligated to perform services for the compensation agreed upon. We feel it is also in our interest to maintain a Bonded Guard for the security of our plant and facilities. Therefore, we are requesting that you contact Mr. Zack of Bonded Guard Service, Inc., 441 Grand Blvd., Phone Lorain 8-4150, at once so that you may be assigned responsibilities. Your work will not be at our Ford Road Plant, however it will be with affiliated companies. Mr. Zack has been informed of this communication and he will be looking forward to hearing from you not later than Thursday, November 20, 1958. Notwithstanding the opening paragraph of the letter, it appears that the Re- spondent had had no prior discussions with the Union or with the discharged guards about the subject matter of the letter. In earlier conversations with Bonded's general manager, Thomas J. Zack, however, Shirley had inquired about the possi- bility of Bonded placing the discharged guards on its payroll for assignment at other places. Zack had indicated to Shirley that perhaps such an arrangement might be worked out if the Respondent were willing to create specific jobs to which the guards might be assigned, and if the guards, after investigation , were found quali- fied to meet Bonded's employment standards? The discussions in that regard had been no more than exploratory, however. When the November 18 letter was sent, no definite arrangement had been reached by the Respondent with Bonded for the placement of the discharged guards.8 It appears, further, that prior to November 18, Zack sounded out the Union as to what its attitude would be if Bonded were asked to absorb the Respondent's discharged guards. The Union pointed out this might give rise to problems under the Union's collective-bargaining contract with Bonded, in part because of the seniority provisions giving preference in employment placement and retention to employees who had worked for Bonded in the past, and in part because there was a differential between the amount the guards were then being paid and Bonded's lower pay scale. McMahon received the Respondent's registered letter at 9 a.m, on November 19, and Hilliard, later that morning. The remaining two discharged guards, Santini and Glazer, did not receive theirs until the following day. McMahon, shortly after receiving the letter called Zack, who said he knew nothing about the Respondent's letter or of any job that Bonded might offer him.9 McMahon communicated to the other guards what Zack had told him. Believing that the situation as to them would be the same, the others-with the possible exception of Glazer, who is not now concerned with this proceeding-made no attempt to contact Zack directly.1° In- stead, the guards-including McMahon-referred the matter to the attention of the Union. They were counseled by union representatives to "sit tight" while the Union looked into the situation. The guards appeared content thereafter to have the Union act for them in a representative capacity and to be guided by its advice. During the forenoon of November 19, 1958, James C. McGahey, the Union's International president, and William F. Garey, administrative assistant to the Inter- national president, telephoned Zack to find out what he knew of the letter and the jobs to which it referred. Zack told them he knew nothing of the letter and had received no intsructions from the Respondent about the placement of its former guards. The union representatives also spoke to Shirley that morning, charging him with chicanery and an attempt to violate the November 12 agreement. Shirley 4 At that time, Shirley mentioned that one of the guards (unidentified) had had a prison record, and Zack expressed the opinion that lie would not get by the bonding company 8 The findings as to the absence of a prior arrangement is based upon the testimony of Zack, 'a witness called by the Respondent Shirley's contrary testimony is not credited 'This finding is based upon McMahon's positive testimony, credited in this respect. Zack testified that to the "best of [his] knowledge" he could not "recall" receiving a call from any of the guards, but added that as to that he would not consider his memory as "infallible " 10 Glazer testified that he sought to reach Zack by telephone on November 20, but was told by the girl answering the telephone that Zack was not in and that she knew nothing about a job for him. Zack, on the other hand, testified that the only call from a job applicant reported to him that day was an anonymous one. ELECTRO-MECHANICAL PRODUCTS COMPANY 647 stated that he was acting on the advice of counsel, and insisted, moreover, that he had previously completed arrangements with Zack for the hiring and placement of the men. He also stated, in response to one of the Union's objections, that the Respondent would stand responsible for the pay differential between the guards' compensation under the agreement and Bonded's lower pay scale. Later that same day, Zack received in the mail copies of the Respondent's Novem- ber 18 letter. Zack also spoke to Shirley, ascertaining from him where Shirley wanted the guards placed and details of the proposed arrangement. Thereafter- during the afternoon of November 19-Zack telephoned Garey of the Union to advise him that since their earlier talk that morning he had received copies of Shirley's letter and had also been informed of the locations at which Shirley was furnishing jobs for the men. Zack also pointed out that Shirley's offer to provide jobs was conditioned upon the men meeting the reporting deadline of the letter and being found qualified for placement on Bonded's payroll as bonded guards. There was some further discussion as to whether Bonded's hiring of the guards under the sug- gested arrangement might not create problems for Bonded under the seniority pro- visions of its contract with the Union. Zack stated he could see no obstacle to Bonded hiring the guards if they otherwise met the conditions set out above. But, as Zack conceded at one point of his testimony, he did not tell Garey that Bonded had as yet made a definite arrangement with the Respondent for the employment of the four guards or that the men were definitely assured of employment if they reported. And, as he further conceded in substance, he did not then, or at any other time, make a concrete offer on behalf of Bonded to employ the men. It would appear, however, that he left it clear, at least by implication, that he was prepared, if the Union were to go along and instruct the guards to report, to process their applications for assignment to jobs at the Respondent's affiliated companies, subject, however, to the conditions stated above.ti The Union at that time did not counsel the guards to follow up on Shirley's offer. The Union considered-so its officials testified-that the offer was a departure from the terms of the strike settlement agreement, and if the agreement was to be altered it ought to be renegotiated with the Union first so as to assure protection of the rights of the affected employees. The Union also felt that Shirley had no right to offer the men jobs with another company, and particularly so when the Respondent had no definite agreement with that other company for it to hire the men. On November 21, 1958, the guards called at the Respondent's office to receive their paychecks. While there, they saw Shirley, who told them they would regret not having gone down to see Zack. When McMahon mentioned that he had con- tacted Zack, only to be told that Zack had no knowledge of the letter, Shirley stated that Zack had probably not yet received a copy of the letter at the time, and he also informed the guards where the jobs referred to in the letter were to be located. However, he did not at that time expressly offer to extend the reporting deadline fixed in the letter. One or more of the guards indicated to Shirley that the entire matter had been left by them for the Union to handle on their behalf and that any further talks on the subject would have to be with the Union. That same day, three of the guards-Santini, Hilliard, and Glazer-had a meeting with Garey at the union office. Garey told them that as far as he knew there were no jobs for them at Bonded, even though Shirley had stated otherwise. On November 21, 1958, the Respondent wrote the Union that because of the guards' failure to contact Bonded or the Respondent in reply to its letter of November 18, the Respondent would no longer honor its obligation for payments under the November 12 agreement. Are the facts found above such as to preclude an order or reinstatement and backpay, as the Respondent contends? On the issue of reinstatement, no real problem is posed. The remedy normally provided for a discriminatory discharge is an unconditional offer of reinstatement to the discharged employee's "former or substantially equivalent position." The quoted phrase is intended to mean "former position wherever possible, but if such position is no longer in existence, then a substantially equivalent position." 12 The "As to the second conversation between Garey and Zack on November 19, there is considerable conflict between the testimony of the two, and also some contradiction and no little confusion with'm the testimony of each of them To resolving the conflicts and making the findings set out above, I have given weight to Zack's disinterested position, and in most instances of direct conflict betwene him and Garey have accepted his testsmoni' 11 The Chase National Bank of the City of New York, San Juan, Puerto Rico, Branch, 65 NLRB 837 '648 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ""offer" of February 18 scarcely meets that test for a number of reasons . It was, to begin with, not unconditional , for it was made dependent upon the employees being cleared for employment by Bonded ; moreover, it was for a limited period to apply -only during the interim period covered by the November 12 agreement. Nor was it an offer of "reinstatement," a term which normally implies reemployment in the same position with the same employer; for here the employment was not to be by the Respondent , but by another employer . The Respondent argues that the offer -must be viewed as one of substantial reinstatement , since the jobs formerly held by the employees had been abolished with the contracting out of the guard work to an outside agency, leaving employment in a similar capacity by the outside agency as the nearest equivalent to the jobs the guards had formerly held. In the circum- stances of this case, I reject that argument . As has been found, it was not only the discharge of the employees that was discriminatorily motivated, but also the Respondent's concurrent decision to abolish its own plant protection department and to contract out the work formerly done by that department. Moreover, work of the same kind remains to be done , and is now being done, at the plant where the discharged employees were formerly employed. In order to effectuate the policies of the Act, it is necessary to undo the Respondent's unlawful conduct and restore the discharged employees to where they would have been but for it. That can only be done in this case by requiring the Respondent to reopen its own plant protection department and to offer the employees thereof herein found to have been discrimi- nated against immediate and full reinstatement to the positions they held at the time of their discharge at the Ford Road plant.13 A somewhat more difficult question is presented by the Respondent 's alternative contention, that its letter of November 18, even if not an offer of reinstatement, was at least a bona fide offer of employment, and that the guards' failure to comply with the request contained in that letter was an unjustifiable refusal to take desirable new employment, and hence a willful loss within the Phelps Dodge doctrine,14 pre- cluding any order for backpay for the period after November 20, 1958. As to that contention there is, to begin with, an issue of fact. The General Counsel disputes that the offer was a bona fide one, and disputes also that at the time it was made Bonded had jobs available for the men, even if they were able to meet the condition precedent of qualifying for employment by Bonded under its standards. To support his position, the General Counsel relies mainly on the record showing that the Respondent at the time the offer was made had not as yet effected any final arrangement with Bonded for the hiring and placement of the guards, and -that Zack of Bonded knew nothing of any jobs for the men when McMahon, the first of the guards to receive the letter, contacted Zack on the morning of November 19. On the basis of all the record evidence, I am persuaded, however, that, whatever the situation may have been on the morning of November 19, the Union was on notice by the afternoon of that day that the Respondent, subject to the conditions ,of the offer as found above, intended in good faith to make jobs available for the guards at their former wages at the plants of its affiliated companies , and that Bonded, though it had as yet closed no definite arrangement with the Respondent, would have been agreeable, the Union willing, to go along with the Respondent's request. Whether or not reported to the guards, the Union's knowledge must, I find, be imputed to the guards, since the Union at their express request was then acting on their behalf and in effect as their agent. But the resolution of fact made above merely reaches, it does not dispose of the issue of whether, by failing to report to Bonded as requested , the guards must be adjusted to have incurred a willful loss . For purposes of decision here, I find it unnecessary to consider the points made by the General Counsel that the asserted offer may not be considered a valid one in any event because of its conditional aspect 15 and because the employees were not given under all the circumstances reasonable time within which to accept. For, I am satisfied, the Respondent's back- pay contention must in any event be rejected upon another ground. The Phelps Dodge doctrine that "a clearly unjustifiable refusal to accept new employment" provides ground for the abatement of backpay, is normally applied to situations where the offer refused has been made by an employer other than 13 See R. C. Mahon Company , 118 NLRB 1537, 1544 enforcement denied on other grounds 269 F 2d 44 (CA 6). '4 Phelps Dodge Corp. v. N L R.13 , 313 U.S 177. 1i As noted above, there is evidence in the record that both Zack and Shirley were 'aware at the time that at least one of the employees could not have qualified for employment by Bonded. ELECTRO-MECHANICAL PRODUCTS COMPANY 649 the one found guilty of the unfair labor practice. The obligation of the offending employer is to grant to an employee against whom he has unlawfully discriminatedi no less than full reinstatement to his former, if available, otherwise to a substantially equivalent position. The employee has a right to insist upon his due from such an,, employer. And the right to so insist would be an empty one if a refusal to accept less than full reinstatement could only be at the risk of forfeiture of the backpay to which he normally would be entitled. Board and court authority supports the- proposition that where an offer of new employment by a discriminating employer does not measure up to the standard of reinstatement, a failure or refusal to accept it may not be viewed as "clearly unjustifiable." Thus, in Corning Glass Works v. NL.R.B., 129 F. 2d 967 (on contempt), the Second Circuit Court of Appeals held that it was not a willful loss for an employee to refuse a position offered by a discriminating employee, where the offer made, though otherwise calling for the restoration of the employee's former position, did not also call for restoration of his seniority rights. In Budd Wheel Company, 49 NLRB 1350, 1351, the Board held that an employee's rejection of an offer of another and higher paying job made by an employer who had discriminated against him was not under the circumstances of that case "a clearly unjustifiable refusal" to, take desirable new employment, disentitling him from backpay. In Quest-Shon Mark Brassiere Co., Inc., 80 NLRB 1149, 1154, enfd. 185 F. 2d 285, 295 (C.A. 2), the Respondent offered employees entitled to reinstatement their former jobs at the plants they had worked only on condition that they were acceptable to their cowork- ers, and, if that condition could not be met, offered them jobs at a new and different nearby plant in the same city. It was held that the offer did not fulfill the Respond- ent's reinstatement obligation, so as to terminate the Respondent's reinstatement or backpay liability.is It has already been found, contrary to the Respondent's assertion, that the Re- spondent's offer in this case did not fulfill its reinstatement obligations to the em- ployees. It is true that the offer contemplated that the employees would be placed' on the payroll of another employer, Bonded But the offer emanated solely from the Respondent, not from Bonded. The employment being offered was not regular employment by Bonded, but employment of limited duration restricted to jobs which the Respondent was creating for the employees, which it could abolish at any time, and over which it would therefore continue to retain final control. In these circumstances, I am persuaded, the rule of the cases cited above ought to apply in determining whether there was a willful loss, rather than the rule applicable to situa- tions where there has been a refusal to accept desirable new employment offered by one not a party to the discrimination. The validity of what has just been said may be proved in another way. In this case, as has been found, the Respondent, motivated by a purpose to nullify the efforts of its guards to obtain separate recognition of a bargaining representation of their own choosing, discriminatorily abolished its plant protection department and dis- charged the employees in it, substituting an outside agency to perform its required' plant protection work. If prior to discharging the guards, the Respondent, motivated by the same discriminatory purpose, had offered as an alternative to discharge to transfer the guards to new jobs elsewhere or with other companies, and the guards. had refused, as would have been their right, to acquiesce in such discriminatory transfer, the Respondent would have been in no position to claim that the employees sustained a willful loss because of an unjustifiable refusal to take the proffered new employment. See, N.L.R.B. V. Armour & Co., 154 F. 2d 570, 577 (C.A. 10). Yet, so far as willful loss is concerned, no practical difference appears between the hypo- thetical situation just posed and the actual situation present here. To hold that 10 In the case last cited, the Board noted that even if the jobs at the new plant were substantially equivalent to the jobs from which the employees had been separated, the offer would still be uneffective unless their former jobs were no longer In existence. The same view was expressed by the court which considered the offer "in practical effect" as one for reinstatement to the new plant. Tennessee-Carolina Trams fort, Inc., 108 NLRB 1369, upon which the Respondent relies to support its position that rejection of an offer of an equivalent job at another plant operates to relieve an employer of further backpay obligations, is clearly distinguishable In that case, unlike the instant one, it appears that work of the kind the employees had done had been wholly discontinued at the location where the employees formerly worked, and the Board concluded under all the circumstances there present, that the Company's offer was "consistent with the Board's remedial precedent" and the very "kind of offer the Board would normally direct the Respondent to make to the employees." That is not true, however, in the Instant case. See R. C. Mahon Co., supra. 650 DECISIONS OF NATIONAL LABOR RELATIONS BOARD employees wronged by an employer's unlawful discrimination must, under pain of sustaining willful losses, thus cooperate with a wrongdoing employer by accepting less than the full reinstatement which is their due, while the effects of that em- ployer's unlawful conduct continue to remain unremedied, is to provide employers, desirous of engaging in discriminatory conduct, with a ready device by which they may be assured of the continuing benefits of their unlawfulness while being insured against its costs. Such a rule could only tend to encourage, not discourage, the com- mission of unfair labor practices; it would not be such as to effectuate the policies of the Act. For the reasons indicated, I conclude that the guards' failure to comply with the request contained in the Respondent's letter of November 18, 1958, was not a clearly unjustifiable refusal on their part to take desirable new employment so as alone to preclude the further running of backpay, as contended by the Respondent. The holding in this case with regard to willful losses is, of course, limited to the precise issue which was litigated at the hearing. It is not intended to prevent the Respondent from showing, if it can, at the compliance stage of this proceeding that the affected employees are otherwise chargeable with willful losses of earnings, in ac- cordance with established law-see, Southern Silk Mills, Inc., 116 NLRB 769, and cases there cited. Accordingly, it is recommended that the Respondent be affirmatively ordered, in accordance with usual Board policy in cases such as this, to reopen its plant protec- tion department at the Ford Road plant and offer to the employees involved in this proceeding who were discharged on November 3, 1958, immediate and full rein- statement to their former or substantially equivalent positions without prejudice to seniority or other rights and privileges. See The Chase National Bank of the City of New York, San Juan, Puerto Rico, Branch, 65 NLRB 827. It is further recom- mended that the Respondent be ordered to make such employees whole for any loss of pay suffered by reason of the discrimination against them. Loss of pay shall be based upon earnings which they normally would have earned from the date of the discrimination against them to the dates of offer of reinstatement, less net earnings, and shall be computed on a quarterly basis in the manner established by ,the Board in F. W Woolworth Company, 90 NLRB 289. 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. The Respondent is engaged in commerce within the meaning of Section 2(6) and (7) of the Act 2. The Union is a labor organization within the meaning of Section 2(5) of the Act. 3. By discriminating with respect to the hire and tenure of employment of Ray- mond J. McMahon, William Santini. and Melvin Hilliard, thereby discouraging membership in the Union, the Respondent has engagde in and is engaging in unfair labor practices withi the meaning of Section 8(a) (3) of the Act. 4. By interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act, the Respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8(a) (1) of the Act. 5. The aforesaid unfair labor practices are unfair labor practices affecting com- merce within the meaning of Section 2(6) and (7) of the Act. [Recommendations omitted from publication.] Chauffeurs, Teamsters and Helpers "General" Local No. 200' and Milwaukee Plywood Company. Case No. 13-CC-183. Feb- ruary 15, 1960 DECISION AND ORDER On June 9, 1959, Trial Examiner William R. Ringer issued his Intermediate Report in the above-entitled proceeding, finding that I Herein called Local 200. 126 NLRB No. 80