Cadillac Wire Corp.

1002 DECISIONS OF NATIONAL LABOR RELATIONS BOARD service of the first amended charges, and shall extend to all Respondents , including Petersen, such moneys thereafter collected until abandonment by Respondent Unions and Respondent Associations , its members, and the individual Employer Respondents herein, of the unlawful hiring practices. Upon the basis of the foregoing findings of fact, and upon the entire record in the case, the Trial Examiner makes the following: CONCLUSIONS OF LAW 1. The respective members of the Respondent Associations and the individual Employer Respondents herein are, and each of them is, engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. The Respondent Unions are labor organizations within the meaning of Section 2(5) of the Act. 3. By maintaining and enforcing a collective -bargaining contract containing an illegal hiring-hall arrangement, the Respondent Associations , their respective mem- bers, and the individual Employer Respondents herein , have engaged in and are engaging in unfair labor practices within the meaning of Section 8(a) (3) of the Act. 4. By engaging in the foregoing conduct, Respondent Associations, their respective members, and the individual Employer Respondents herein , have engaged in and are engaging in unfair labor practices within the meaning of Section 8 (a) (1) of the Act. 5. By maintaining and enforcing a collective -bargaining contract containing an illegal hiring-hall arrangement, the Respondent Unions have engaged in and are engaging in unfair labor practices within the meaning of Section 8(b) (2) of the Act. 6. By engaging in the foregoing conduct, Respondent Unions have engaged in and are engaging in unfair labor practices within the meaning of Section 8(b)(1)(A) of the Act. 7. 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.] Cadillac Wire Corp. and Epifnio Mandry and Steel, Metals, Alloys and Hardware Fabricators and Warehousemen Local 810, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America Steel, Metals, Alloys and Hardware Fabricators and Ware- housemen Local 810, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America and Epifnio Mandry and Cadillac Wire Corp., Party to the Contract Cadillac Wire Corp. and Jose A. Mandry and Steel, Metals, Alloys and Hardware Fabricators and Warehousemen Local 810, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America Steel, Metals, Alloys and Hardware Fabricators and Ware- housemen Local 810, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America and Jose A. Mandry and Cadillac Wire Corp., Party to the Contract. Cases Nos. 2-CA-6577, 2-CB-2583, 2-CA-6578, and 2-CB-2584. August 26, 1960 DECISION AND ORDER On October 27, 1959, Trial Examiner Arthur E. Reyman issued his Intermediate Report in the above-entitled proceeding, finding that the 128 NLRB No. 128. CADILLAC WIRE CORP. 1003 Respondents had not engaged in and were not engaging in the unfair labor practices alleged in the complaint and recommending that the complaint be dismissed in its entirety, as set forth in the copy of the Intermediate Report attached hereto. Thereafter, the General Coun- sel filed exceptions to the Intermediate Report, together with a sup- porting brief. The Board has reviewed the rulings of the Trial Examiner made at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Board has considered the Inter- mediate Report, the exceptions and brief, and the entire record in the case, and finds merit in certain of the General Counsel's exceptions. Accordingly, the Board adopts the findings, conclusions, and recom- mendations of the Trial Examiner only to the extent consistent here- with. Since 1957, the Respondent Company and the Respondent Union have been parties to a collective-bargaining agreement containing, inter alia, a union-security clause 1 and an exclusive hiring hall pro- vision. On or about October 10, 1958, the parties executed a modifica- tion to their agreement,2 conforming the hiring hall provisions of the contract to the requirements of the Mountain Pacific case.' Because the Company's plant, in Yonkers, New York, is not readily accessible by public transportation, the Union has been unable to refer many applicants, pursuant to the agreement, from its Manhattan hiring hall. Thus, of the 100 or so employees hired during the past 21/2 to 3 years, only two were referred to their jobs by the Union through its hiring hall.' 1 "Txinn : As a condition of employment , all employees in the bargaining unit must become members of the Union on the 30th day following the beginning of their employ- ment or the effective date of the within agreement , whichever is later, and must there- after maintain their membership in good standing as a condition of continued employment." 2 "FoonTH : The Employer will notify the Union by telephone confirmed in writing by letter to be mailed the same day, of all requirements for newGhelp . The Union agrees to furnish applicants , whenever possible , through its hiring hall , which is maintained for both members of the Union and nonmembers of the Union at its offices at 75 East 13th Street, New York 3, N.Y. The Employer retains the right to reject any job applicant referred by the Union . This provision is not to be deemed or interpreted to be a require- ment for a closed shop , as the hiring hall maintained by the Union as aforesaid is avail- able to both Union and non -union applicants for jobs, and selection of applicants for referral to jobs is on a non-discriminatory basis and is not based upon, or in any way affected by Union membership , By-laws, regulations , constitutional provisions or any other aspect or obligation of Union membership , policies or requirements. "All newly-hired help shall obtain a referral card from the Union, and such referral card . shall be issued without regard to membership or non-membership in the Union and are issued only for the purpose of appropriate record-keeping and bookkeeping by the Union. "The parties agree that a copy of this paragraph shall be posted in places where notices to employees and applicants for employment are customarily posted in the Employer's place of business , and a similar copy will be posted in the hiring hall main- tained by the Union as aforesaid." s Mountain Pacific Chapter of the Associated General Contractors, et al, 119 NLRB 883, remanded 270 F. 2d 429 (C.A. 9). * There is no evidence that any of the employees hired directly by the Company were ever required to obtain a referral card from the Union. 1004 DECISIONS OF NATIONAL LABOR RELATIONS BOARD When new help is needed, Peter Aiello, the Company's general manager, requests the employees to bring in a relative or friend who might desire employment at the plant. The hiring procedure is as follows : Aiello inquiries as to the applicant's qualifications and dis- cusses rates of pay.' He then informs the applicant of the union-shop provisions of the contract and tells him that, if he is not already a member of the Union, he will eventually have to join. He informs the applicant of the Company's regular practice, which is to deduct $6.50 in the second week from a new man's wages, $6.50 in the third week, and $12 in the fourth week, thus completing the $25 initiation fee required by the Union. In the fifth week, $8 is deducted, to pay the first and second months' dues (at $4 per month). Aiello then hands the applicant a W-2 (Federal income tax) form together with a card which constitutes both an application for union membership and a dues-checkoff authorization card, and he instructs the applicant, who by this time has been hired, to see Clem Santoro, the union steward .6 Santoro again explains the union obligations to the new employee,? including the Company's "regular practice" of deductions. He also tells the new man that he need not sign the union 'card immediately, that he has a day or two to read and understand it before he must turn it in.8 It is uncontradicted that, within the first 2 days of his employment, every new employee signs the union card and returns it, along with the W-2 forms, to Santoro, who then turns the cards over to the Company's bookkeeper. Thereafter, moneys are deducted pursuant to the Company's "regular practice" and are sent promptly to the Union. The General Counsel contends that : (1) the hiring hall provision ,does not satisfy the requirements of Mountain Pacific because the parties failed to post the required notices; s (2) the second paragraph 8 As most of the applicants are Puerto Rican , Aiello conducts many of the interviews through an interpreter. 6 The General Counsel has excepted to the Trial Examiner 's finding that Santoro is not a supervisor. Santoro, as union steward , is an agent of the Union . Further the entire procedure , from the hiring of the employee by Aiello to the employee's execution of the union card at Santoro's urging, results from a common plan between the Company and -the Union. Accordingly, we find that a determination of Santoro 's alleged supervisory status is unnecessary to our decision herein. 7 Like Aiello , Santoro often speaks to the new employees through an interpreter 8 Santoro testified that he told the new employees , "You can hold it [the union membership -dues checkoff authorization card] for the next day. Try to make sure you understand the card you sign." 9 "we believe , however, that the inherent and unlawful encouragement of union mem- bership that stems from unfettered union control over the hiring process would be negated, and we would find an agreement to be nondiscriminatory on its face , only if the agree- ment explicitly provided that : `(2) . . . "(3) The parties to the agreement post in places where notices to employees and applicants for employment are customarily posted, all provisions relating to the func- tioning of the hiring arrangement, including the safeguards that we deem essential to the legality of an exclusive hiring arrangement " Mountain Pacific Chapter of the Associated General Contractors, et al., 119 NLRB -883, 897. CADILLAC WIRE CORP. 1005, of the hiring hall modification essentially gives the Union a "veto power" over the employment of employees already hired by the Com- pany, in violation of Pacific Intermountain Express Company; to and (3) the oral arrangement between the Company and the Union constitutes illegal assistance and coercion because new employees are forced to join the Union within 30 days of starting work. The Trial Examiner found against the General Counsel on all points and recommended that the complaint be dismissed in its entirety. The. General Counsel has excepted. (1) Mountain Pacific requires that the hiring hall provisions of a collective-bargaining contract be posted as a condition precedent to. its validity." The General Counsel contends that there is no probative evidence that the parties ever posted the required notices. Both Joseph Russo, the Company's president, and Milton Silverman,, former president of the Union, testified that the parties had posted copies of the modification set forth in footnote 2, supra. In the absence of contradictory evidence, we find, contrary to the General Counsel's contention, that the parties to the exclusive hiring agree- ment posted the required notices. (2) We further find, contrary to the General Counsel's contention, that the referral clause of the exclusive hiring hall agreement 12 does not, of itself,13 constitute an unlawful delegation of hiring control to. the Union. The clause explicitly requires the Union to furnish a referral card to newly hired help without regard to union member-- ship. We find that it does not, by its terms, place the employment status of employees already hired by the Company under the control of the Union.14 (3) We find, contrary to the Trial Examiner, that Aiello's conduct in informing each newly hired employee of the union-shop provisions of the contract, explaining the Company's regular practice of deduc- tions, furnishing him with a union membership-dues-checkoff author- ization card, and then sending him to Santoro for a further discussion of "Union obligations," all as a routine part of the hiring process,. constituted assistance to the Union in violation of Section 8(a) (2) and (1) of the Act.15 We further find that all the participants in the- hiring process, particularly the applicants, understood that the sub- 10 Pacific Intermountain Express Company , 107 NLRB 837, enfd. as modified sub nom. N.L.R B. v. International Brotherhood of Teamsters, et al., 225 F. 2d 343 (C.A. 8). 11 See footnote 9, supra 12 "All newly-hired help shall obtain a referral card from the Union , and such referral card shall be issued without regard to membership or non-membership in the Union and- are issued only for the purpose of appropriate record-keeping and bookkeeping by the- Union." 13 No evidence was presented of any practice deviating from the requirements of this- clause. 14 Cf Pacific Intermountain Express Company, supra; Imparato Stevedoring Corporation,_ 113 NLRB 883 , enfd. 250 F. 2d 297 (C.A. 3). 15 See Alaska Salmon Industry, Inc., at al., 122 NLRB 1552. 1006 DECISIONS OF NATIONAL LABOR RELATIONS BOARD stantially immediate execution of a union card was one of the condi- tions of employment. In so finding, we are cognizant not only of the complete success achieved by the parties in obtaining signatures almost immediately from the unsophisticated employees, many of whom spoke little or no English, but also of Union Steward Santoro's admission that he told the new employees that they had a day or two following their hire to sign the union card. Such a practice negates any inference of voluntariness on the part of the employees. As the hiring arrangement in practice required new employees to join the Union prior to the expiration of the 30-day statutory period, we find that the Respondents, parties to the practice, thereby violated Section 8(a) (3), (2), and (1) and 8(b) (2) and (1) (A) of the Act, respectively.16 THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondents set forth above, occurring in connection with the operations of the Respondent Company, have a close, intimate, and substantial relation to trade, traffic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. THE REMEDY Having found that the Respondents have engaged in and are engag- ing in certain unfair labor practices, we shall require them to cease and desist therefrom and to take certain affirmative action designed to effectuate the policies of the Act. We have found that the Respondent Company unlawfully assisted the Respondent Union in obtaining employee signatures to union membership-dues-checkoff authoriza- tions, and that the Respondent Company and Respondent Union are engaging in an unlawful practice whereby employees have been and are being required to join the Union and pay dues sooner than they may lawfully be required to do. As the unlawful assistance rendered by the Company is not tantamount to domination'17 and as the extent of the discrimination against employees is the amount that they were forced to pay in dues for the first month of their employment, we shall only order the Respondents, jointly and severally, to reimburse the first month's dues to all employees hired from 6 months prior to the filing of the charges herein. We shall also direct that any membership- dues-checkoff authorizations unlawfully obtained from employees prior to the 30-day statutory period are not to be honored in the future. The record also shows that, during the first month of each employee's employment, the Respondent Company deducted, in three install- ments, the $25 initiation fee required by the Respondent Union, and 19 See Midwest Transfer Company of Illinois, 125 NLRB 84. 17 Cf. Vsrginia Electric and Power Company v. N.L.R.B., 319 U.S. 533. CADILLAC WIRE CORP. 1007 forwarded such moneys to the Union. As all employees- would have to have paid such fees pursuant to the lawful union-security clause, we shall not order the Respondents to reimburse the aforementioned employees for such initiation fees. However, if there be any em- ployees who, during the applicable period, paid these initiation fees but worked less than 30 days; the Respondents shall jointly and severally reimburse such employees for the initiation fees so deducted. CONCLUSIONS OF LAw 1. Cadillac Wire Corp. is engaged in commerce within the meaning ,of Section 2 (6) and (7) of the Act. 2. Steel, Metals, Alloys and Hardware Fabricators and Warehouse- men Local 810, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America is a labor organization within the meaning of Section 2 (5) of the Act. 3. By its practice of informing newly hired employees of the union- shop provisions of the contract, explaining the Company's regular practice of deductions, furnishing new employees with union cards, and then sending these employees to the union representative, thereby assisting the Union, the Respondent Company has engaged in and is -engaging in unfair labor practices within the meaning of Section 8(a) (2) and (1) of the Act. 4. By jointly engaging in a practice whereby new employees were required to execute union membership-dues-checkoff authorization cards prior to the expiration of the statutory 30-day period, the Respondent Company and the Respondent Union have engaged in and are engaging in unfair labor practices within the meaning of ,Section 8(a) (3), (2), and (1) and 8(b) (2) and (1) (A), respectively. ORDER Upon the entire record in this case, and pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that : A. The Respondent, Cadillac Wire Corp., Yonkers, New York, its officers, agents, successors, and assigns, shall : 1. Cease and desist from : (a) Contributing support to Steel, Metals, Alloys and Hardware Fabricators and Warehousemen Local 810, International Brotherhood ,of Teamsters, Chauffeurs, Warehousemen and Helpers of America, ^or any other labor organization, by its practice of informing newly hired employees of the union-shop provisions of the contract, explain- ing the Company's regular practice of deductions, furnishing new 1008 DECISIONS OF NATIONAL LABOR RELATIONS BOARD employees with union cards, and then sending them to see the union representative. (b) Requiring newly hired employees to execute membership-dues- checkoff authorization cards for the aforementioned Union, or any other labor organization, prior to the expiration of the 30-day grace period provided for in Section 8 (a) (3) of the Act. (c) Checking off union dues for employees pursuant to member- ship-dues-checkoff authorizations unlawfully obtained from employees prior to the 30-day statutory period. (d) In any like or related manner interfering with, restraining, or coercing its employees in the exercise of the right to self-organiza- tion, to form labor organizations, to join or assist the aforesaid Union, or any other labor organization, to bargain collectively through rep- resentatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other 'mutual aid or protection as guaranteed in Section 7 of the Act, and to refrain from any and 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) Jointly and severally with the Respondent Union, reimburse all employees for moneys illegally exacted from them, in the manner and to the extent set forth in the section of this Decision entitled "The Remedy." (b) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social se- curity payment records, time cards, personnel records and reports, and all other records necessary to determine the amount of the moneys illegally exacted from the employees involved. (c) Post at its plant in Yonkers, New York, copies of the notice attached hereto marked "Appendix A."'$ Copies of such notice, to be furnished by the Regional Director for the Second Region, shall, after being duly signed by its authorized representative, be posted by the Respondent Company immediately upon receipt thereof, and be main- tained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to its employees are customarily posted. Reasonable steps shall be taken to insure that such notices are not altered, defaced, or covered by any other material. 18 In 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." CADILLAC WIRE CORP. 1009 (d) Post at the same places and under the same conditions as set forth in (c), above, and a's soon as they are forwarded by the Regional Director, copies of the Respondent Union's notice herein marked "Appendix B." (e) Notify the Regional Director for the Second Region, in writing, within 10 days from the date of this Order, what steps the Respond- ent Company has taken to comply therewith. B. The Respondent, Steel, Metals, Alloys and Hardware Fabri- cators and Warehousemen Local 810, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, its officers, representatives, agents, successors, and assigns, shall: 1. Cease and desist from : (a) Causing or attempting to cause the Respondent Company to discriminate against newly hired employees by requiring them to execute membership-dues-checkoff authorizations cards for the above- named Union, or any other labor organization, prior to the expiration of the 30-day grace period provided for in Section 8 (a) (3) of the Act. (b) In any like or related manner restraining or coercing employees in the exercise of the rights guaranteed in Section 7 of the Act, except to the extent that such rights may be affected by an agreement re- quiring membership in a labor organization as a condition of employ- ment 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) Jointly and severally with the Respondent Company, reimburse all employees for moneys illegally exacted from them, in the manner and to the extent set forth in the section of this Decision entitled "The Remedy." (b) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all membership, dues, and other records necessary to compute the moneys illegally exacted from the employees involved. (c) Post at its offices, in conspicuous places, including all places where notices to members and applicants for employment are custo- marily posted, copies of the notice attached hereto marked "Appendix B." 19 Copies of said notice, to be furnished by the Regional Director for the Second Region, shall, after being duly signed by Respondent Union's respresentative, be posted immediately upon receipt thereof and be maintained by Respondent Union for 60 consecutive days there- after. Reasonable steps shall be taken by Respondent Union to insure 19 See footnote 18. 1010 DECISIONS OF NATIONAL LABOR RELATIONS BOARD that said notices are not altered, defaced, or covered by any other material. (d) Mail to the Regional Director signed copies of Appendix B for posting by Respondent Company, at its Yonkers, New York, plant, as provided above. Copies of said notice, to be furnished by the said Regional Director, shall, after being signed by Respondent Union's representative, be forthwith returned to the Regional Director for disposition by him. (e) Notify the Regional Director for the Second Region, in writing, within 10 days from the date of this Order, what steps it has taken to comply herewith. MEMBERS RODGERS and FANNING took no part in the consideration of the above Decision and Order. APPENDIX A 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 contribute support to Steels, Metals, Alloys and Hardware Fabricators and Warehousemen Local 810, Interna- tional Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, or to any other labor organization, by our practice of informing newly hired employees of the union-shop provisions of our contract with the Union, explaining our regular practice of deductions, furnishing new employees with union cards, and then sending them to see the union representative. WE WILL NOT require newly hired employees to execute member- ship-dues-checkoff authorization cards for the aforementioned Union, or any other labor organization, prior to the expiration of the 30-day grace period provided for in Section 8(a) (3) of the Act. WE WILL NOT check off union dues for employees pursuant to membership-dues-checkoff authorizations unlawfully obtained from employees prior to the 30-day statutory period. 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 aforementioned Union, or any other labor organization, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collec- CADILLAC WIRE CORP. 1011 tive bargaining or other mutual aid or protection, as guaranteed in Section 7 of the Act, and to refrain from any and 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. WE WILL jointly and severally with the aforementioned Union reimburse our employees for moneys illegally exacted from them. All our employees are free to become, to remain, or to refrain from becoming or remaining members of the above-named labor organiza- tion or any other labor organization. CADILLAC WIRE CORP., 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. APPENDIX B NOTICE TO ALL MEMBERS OF STEEL, METALS, ALLOYS AND HARDWARE FABRICATORS AND WAREHOUSEMEN LOCAL 810, INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS OF AMERICA, AND TO ALL EMPLOYEES OF CADILLAC WIRE CORP., YONKERS, NEW YORK 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 you that : WE WILL NOT cause or attempt to cause Cadillac Wire Corp., its officers, agents, successors, and assigns, to discriminate against newly hired employees by requiring them to execute membership- dues-checkoff authorization cards for us, or for any other labor organization, prior to the expiration of the 30-day grace period provided for in Section 8 (a) (3) of the Act. WE WILL NOT in any like or related manner restrain or coerce employees in the exercise of the rights guaranteed in Section 7 of the Act, except to the extent that such rights may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in Section 8(a) (3) of the Act, as modified by the Labor-Management Reporting and Disclosure Act of 1959. 1012 DECISIONS OF NATIONAL LABOR RELATIONS BOARD WE WILL jointly and severally with the above-named Company reimburse the employees of Cadillac Wire Corp. for moneys il- legally exacted from them. STEEL, METALS, ALLOTS AND HARDWARE FABRI- CATORS AND WAREHOUSEMEN LOCAL 810, IN- TERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS OF AMERICA, Labor Organization. Dated---------------- By------------------------------------- (Representative ) (Title) This notice must remain posted for 60 days from the date hereof, and must not be altered , defaced, or covered by any other material. INTERMEDIATE REPORT AND RECOMMENDED ORDER STATEMENT OF THE CASE On August 21, 1959, the General Counsel of the Board, on behalf of the Board, by the Regional Director for the Second Region, pursuant to Section 10(b) of the National Labor Relations Act, as amended, 61 Stat. 136, 29 U.S.C. Section 151, et seq. (herein called the Act), issued an amended consolidated complaint and notice of hearing. The amended consolidated complaint was based upon charges filed by Epifnio Mandry in Cases Nos. 2-CA-6577 and 2-CB-2583; and charges filed by Jose A. Mandry, in Cases Nos. 2-CA-6578 and 2-CB-2584.1 The amended consolidated complaint (hereinafter referred to as the complaint), alleges that Respondent Union, Local 810, by certain acts and agreements violated Section 8(a)(1)(A) and 8(b)(2) and the Respondent Company violated Section 8(a)(1), (2), and (3) of the Act. Briefly the alleged violations as alleged are these: Since 6 months prior to the filing of service of the charges, the Respondent Com- pany, Cadillac Wire Corp., hereinafter sometimes called the Company, and the Respondent Union, hereinafter sometimes called Local 810 or the Union, have maintained in effect and in force a written collective-bargaining agreement relating to the hire, tenure, and terms of conditions of employment of the Company's em- ployees; that under that agreement the Company is required to secure its employees exclusively from and through a referral system operated solely by the Union, and that employees newly engaged by the Company are required to obtain a work card and clearance from the Union prior to commencement of work; that this agreement fails to incorporate, and the Company and the Union have failed to put into effect, lawful standards or criteria for preference in referrals in employ- ment, and that the agreement fails to incorporate explicit provisions respecting the right of the Company to reject individuals referred pursuant to such agreement, or provisions respecting the posting of notices relating to the functioning of the referral provisions. The complaint alleges further that in addition to the written agreement referred to above, the Company and the Union have engaged in a practice with each other relating to hire, tenure, and terms and conditions of employment by the Company of employees, under which newly hired employees, at the time of their hire, have been required as a condition of employment to execute written applications for membership in the Union and authorizations to the Com- pany to deduct from the employees' wages, dues, initiation fees, and assessments to be paid to the Union; that newly hired employees had been required as a con- dition of employment to pay initiation fees and dues commencing within the second week of employment with the Company, and that pursuant to this agreement, arrange- ment, understanding, and practice the Union has required the Company to check off initiation fees and dues from the wages of its employees, and transmit the same to the Union, and the Company has done so. 1 The charge in Case No. 6578 and the charge in Case No. 6577 were filed May 1, 1959, and served the same day. The charge in Case No. 2583 was filed June 9 and the charge in Case No. 2584 was filed the same day. Each was served on June 11, 1959. CADILLAC WIRE CORP. 10 13 The Union and the Company, by counsel, each filed timely answer to the com- plaint, the answer effectively denying the substantive violations of the Act as alleged in the complaint. On the issues raised by the complaint and answers and pursuant to notice, a hearing was held before the duly designated Trial Examiner at New York, New York, sessions being held on September 8, 9, 10, and 15, 1959. At the hearing, all parties appeared and each was represented by counsel. Full opportunity to be heard, to examine and cross-examine witnesses and introduce evidence bearing on the issues, to argue orally upon the record, and to file proposed findings of fact and conclusions of law and briefs, was afforded each party. Motions to dismiss the complaint are disposed of by the findings set forth below. Upon the entire record in the case, from his observation of the witnesses, and after careful consideration, the Trial Examiner makes the following: FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT COMPANY Cadillac Wire Corp. has been and now is a corporation with its principal office and place of business at 131 Saw Mill River Road, in the city of Yonkers, State of New York, and is now and has been continuously engaged in at its plant and place of business in Yonkers in the manufacture, sale, and distribution of wire products and related products. During the year 1958, the Company, in the course and conduct of its business operation, caused to be manufactured at its Yonkers plant and to be shipped from that plant in interstate commerce directly to States of the United States other than the State of New York, products valued at in excess of $50,000. The Respondent Company is engaged in commerce within the meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED Steel, Metals, Alloys and Hardware Fabricators and warehousemen of Local 810, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America is, and has been at all times material herein, a labor organization within the meaning of Section 2(5) of the Act. III. THE ALLEGED UNLAWFUL LABOR PRACTICES A. Hiring of new employees New employees generally are interviewed and hired by Peter Joseph Aiello, general manager. At the interview, Aiello inquires as to their qualifications, dis- cusses rates of pay, and informs them that the Union is the representative of the employees in the bargaining unit and that there is a requirement that new employees, if not already a member of the Union, must eventually pay an initiation fee. During the times material hereto, it has been the regular practice of the Company for it for the second, third, and fourth weeks of employment to deduct partial amounts to make up a sum equal to the $25 initiation fee. The customary practice of the Company has been as follows: to take off $6.50 from the wages of a new man the second week, $6.50 the third week, and $12 the fourth week, thus completing the initiation fee, and $8 the next week in order to take care of the first month's dues and the second and the current month's dues. It has been the practice of Aiello at the time of hiring to discuss the payment of union dues. At the time of the interview, a new employee is handed a card which constitutes an application for membership in the Union. According to Aiello: When I interview them, I give them a card, I don't pick up the card. The shop steward picks up the card , I think, the same day they sign it voluntarily. That makes it automatically that they want to join the Union. At the time of this first interview, according to Aiello, he also hands new em- ployees a Federal tax deduction form W-2, and at the same time instructs the man to see the shop steward. Upon direct examination , Aiello said in response to a ques- tion as to whether an employee had not signed a union application card on the first day or so of employment: To my knowledge, they all sign it. I want to bring out a point here. When I hire sometimes I can't get them through the Union , I usually go around the 577684-61-vol. 128-65 1014 DECISIONS OF NATIONAL LABOR RELATIONS BOARD shop asking who has anybody to bring in. Usually a union member brings in his cousin, a relative, or a friend . In this case, I don't know, it might be a relative or a friend. It is explained to them it is a union shop, and when I interview them they sign the card. From the testimony of Aiello, it appears that during the past 21/z to 3 years some 100 employees have been employed from time to time, although the normal com- plement of help is somewhere in excess of 40; that very few of the new employees hired were hired through the Union, but that most of them were hired directly from the outside and not through requests made by or from the Union. It appears therefore that the Company checks off the first month's dues, the first day of his employment up until the next month's dues become due. The procedure with respect to the hiring of new men is substantially supported by the testimony of Clem Santoro, the union steward. According to him, after either Aiello or Russo had talked to new employees, he was called in and introduced to the new men, after which time he instructed the men according to their union obligations; that there was a trial period of 30 days; that they would have their union dues deducted out of their pay in three parts and that their initiation fee would also be deducted within the first month of employment. It seems clear enough from his testimony that the new men were instructed by him that dues and initiation fees all would be deducted from their pay during the second, third, and fourth weeks of their employment-$6.50 the second week, $6.50 the third week, and $12 the fourth week. The Company concedes that the funds checked off for initiation fees and dues were transmitted by the Company to the Union within a very short time after being received-counsel for Local 810 did not so concede. Santoro, to whom Aiello was accustomed to deliver union authorization cards, W-2 forms, and the like, works in the shipping room under the direct super- vision of President Russo. Santoro has not supervised anyone else in connection with the loading, packing, or shipping of material except that a group of men may be assigned to him by Russo for packing. Another leadman, according to Russo, also works upstairs and Russo may, at times, assign a group of men to him. This leadman, San Geistenstach, and Santoro each receives direct instructions from Russo and does not have the right to hire, fire, or effectively recommend such hiring and firing. It would appear, therefore, contrary to the contention of the General Counsel, that Santoro, the union steward, is not, nor during the times material hereto, was a supervisor within the meaning of the Act. Santoro testified that he worked with varying groups of men, various sized groups of men-from 6 to 12- that he has recommended promotions, that he has issued reprimands, that his pay is $92 a week as against $69, $70, and $72 paid to other men working in the groups referred to; and that he can arrange for overtime work without the consent of Russo. B. The collective-bargaining agreement, the modification thereto, and the notice The Union and the Company entered into a collective-bargaining agreement on or about October 1, 1957, to run for a period of 2 years from that date through September 30, 1959. This contract comprehensively covered hours, wages, working conditions, and other terms and conditions of employment. This agreement pro- vided in part: FouRTH: The Employer will notify the Union by telephone confirmed in writing by,a letter to be mailed the same day, of all requirements for new help, and the Union agrees to furnish such help whenever possible, through its hiring hall, which is maintained for both members of the Union and non-members of the Union, at its offices at 75 East 13th Street, New York, N.Y., if the Union fails to supply the required help within two working days after the request is made, the Employer may hire such help from any source it may deem ap- propriate. If such hiring is made through an agency which charges a fee for its services, a new employee shall not be required to pay more than $10 for the agency's services. Any fee in excess of $10 is to be paid by the Employer All newly hired help shall obtain a work card from the Union before com- mencing work, and work cards shall be issued without regard to membership or non-membership in the Union At least once each week the Employer will forward to the Union the names, classifications and rates of all newly hired employees. This provision shall not be deemed or interpreted to be a require- ment for a closed shop, as the hiring hall maintained by the Union is available to both union and non-union applicants for jobs and is operated in a non- discriminatory manner. CADILLAC WIRE CORP. 1015 Prior to the expiration of that agreement the parties, on October 10, 1958, modified in writing the paragraph "Fourth," quoted immediately above, as follows: Paragraph "Fourth" is deleted and in its place there is substituted the follow- ing provision: "FOURTH: The Employer will notify the Union by telephone confirmed in writing by letter to be mailed on the same day, of all require- ments for new help. The Union agrees to furnish applicants, whenever pos- sible, through its hiring hall which is maintained for both members of the Union and non-members of the Union at its offices at 75 East 13th Street, New York 3, N.Y. The Employer retains the right to reject any job applicant referred by the Union. This provision is not to be deemed or interpreted to be a requirement for a closed shop, as the hiring hall maintained by the Union as aforesaid is available to both union and non-union applicants for jobs, and selection of applicants for referral to jobs is on a non-discriminatory basis and is not based upon, or in any way affected by union membership, By-Laws, regulations, constitutional provisions or any other aspects or obligation of union membership, policies or requirements. All newly hired help shall obtain a referral card from the Union, and such referral cards shall be issued without regard to membership or non-membership in the Union and are issued only for the purpose of appropriate record-keeping and bookkeeping by the Union. The parties agree that a copy of this paragraph shall be posted in places where notices to employees and applicants for employment are customarily posted in the Employer's place of business, and a similar copy will be posted in the hiring hall maintained by the Union as aforesaid." A copy of the modification of paragraph "Fourth" was posted on a bulletin board at the Company's place of business and at the union hall, the notice itself being written on the letterhead of Local 810. The notice so posted is headed "NOTICE" and on the second line is the heading "Union Hiring Hall Provisions." After the body of the notice appears the words "Please post and keep posted at all times." 2 According to the testimony of Joseph Anthony Russo, president of the Company, the modification was handed to him at his office by Milton Leonard, a union repre- sentative; Russo said he discussed it with one or more of his associates and a day or two later delivered the Company's signed modification of the agreement to Milton Silverman, a representative and former president of Local 810. The General Counsel contends that by the very provisions of the collective agreement of 1957-September 1959 and the modification of October 10, 1958, both the Company and the Union were in violation of the Act. In other words, General Counsel contends that each one of those documents shows an illegal hiring hall arrangement. Further, that because a new employee is placed in the position of having to obtain a referral card, and if he says he doesn't want to, the Union has the right to tell the employer not to hire such a person because he has no referral card. The Company takes the position that there has been a total failure of proof in support of the Government's case to show that any such compulsion as charged by the General Counsel with respect to employees being required as a condition of employment to execute or sign anything or being required as a condition of employ- ment to pay fees and dues commencing with the second week of employment, or that the Company has been required by the Union to check off fees and dues during any particular time. It is argued on behalf of the Company that if a new employee decided to join the Union, and despite the fact that fees and dues were checked off after such decision, no inference can be drawn as to any compulsion by the Company or by the Union; that mere fact in itself could not be the basis of an inference of compulsion, but that it would be pure assumption, guesswork, and speculation. In connection with the element of compulsion, as argued by the General Counsel, he says that new employees, according to the testimony given by the Company's general manager and by the Union's shop steward, were given no chance to refuse to join the Union at the time they were employed and for over a period of 3 years without exception, some 100 employees are shown to have gone through a routine which gave them no way out to refuse to join the Union at once, or to sign a union application card in order to get the job; it is argued further that there was no way of escape within the statutory 30-day period for a new employee to avoid payment of the initiation fee and 2 months' dues (including the first 30 days of employment), At the hearing, counsel for the General Counsel claimed surprise upon the produc- tion of the modification of paragraph "Fourth" dated, as noted above, October 10, 1958. He did not concede the posting of the notice. 1016 DECISIONS OF NATIONAL LABOR RELATIONS BOARD without indicating his desire to join the Union. It further is argued that although the agreement provides that, under safeguards, the employer turned first to the Union for referrals, nevertheless, as a practical proposition, according to the testimony, in- stead of the Union furnishing the men in the first place, the man came first and under the contract he had to get to the referral card-ergo, that is where the element of compulsion comes in. Counsel for each party has argued as to whether or not an inference can be drawn either way as to the failure of the General Counsel to call the two Charging Parties, Epifnio and Jose Mandry. It was argued on behalf of the General Counsel that no inference damaging to his case can be drawn since the record as a whole adequately demonstrates that both the Union and the Company were in violation of the Act by virtue of the very existence of the contract, and further on the basis of the testimony regarding the compulsion placed upon new employees to pay initiation fees and dues. On the other side, it is pointed out that the charges were filed by one Charging Party on May 1, 1959, and by the other on June 9, the basis of the charges being that from on or about March 12, 1959, to on or about April 23, the above-named Employer deducted union initiation fees and union dues from their pay in the amounts of $25 and $8, respectively, and notwithstanding the fact that the Charging Parties had been employed less than 30 days when the initial sum of $12.50 was withheld from their pay, and notwithstanding the fact that the Charging Parties at no time signed checkoff cards authorizing the Employer to deduct union and initiation fees and dues from their wages; that in fact one of the Charging Parties had executed an application for membership in the Union on March 3 and the other on March 13.3 It is argued therefore that these men were voluntary members of the Union at the time each of them signed the charges and that although they were in the courtroom at the time of the hearing herein, they were deliberately not called to testify because it was apparent on the record itself that their credibility would be impaired and the facts against them would disclose that they had authorized their dues and initiation fees to be checked off at or within a short time after they signed the applications for union membership; that the inference is that had they testified that they were compelled to sign application-for-membership cards and that they were forced into it and that they could not get a job until they did so and the further fact that they were not called, imposes a clear presumption that they could not have so testified had they assumed the stand. It is argued on behalf of Local 810 that the collective-agreement entered into October 1, 1947, as modified on October 10, 1958, at all times was proper and not violative of the law in the light of the decision of the Board in Mountain Pacific Chapter of the Associated General Contractors, Inc., et al., 119 NLRB 883. It is said on behalf of the Union that subsequent to the time this case was decided in 1958, the General Counsel deferred enforcement in particular cases, and extended the time in which all unions and employers were given to comply with the criteria laid down in that case, such moratorium extending from February to June and then to November 1958.4 Further, it is argued that the modification of the collective agreement between the Union and the Company of October 10, 1958, during this amnesty period, was proper and corrected any inherent infirmity contained in paragraph "Fourth" of the original agreement. Thus, it is said, the General Counsel, on the facts adduced at hearing, has wholly failed to prove a prima facie case. C. The written agreement and its validity The complaint herein, referring to the agreement entered into October 1, 1947, alleges in substance that it fails to incorporate and Respondent Company and Re- spondent Union have failed to put into effect, lawful standards or criteria for pref- erence in referrals for employment, and fails to incorporate explicit provisions respecting the right of the Company to reject individuals referred pursuant to such agreement, and respecting the posting of notices containing all provisions relating to the functioning of the exclusive referral provisions. However, as shown above, the parties did enter into an agreement dated October 10, 1958, amending paragraph "Fourth" of the original agreement which, the Trial Examiner finds, was violative of Section 8(b)(1)(A) and (2) and 8(a)(3) of the Act, until so amended. The decision and order of the Board in Mountain Pacific Chapter of the Associated General Contractors, Inc., supra, remanded N.L.R.B. v. Mountain Pacific Chapter etc. (C.A. 9) for further consideration 270 F. 2d 425, is definitive here on the ques- 8 The union application card signed by each of these men authorized the checkoff of union dues and initiation fees. A Statements of the General Counsel, 43 LRRM 40, 43 LRRM 63, 66. CADILLAC WIRE CORP. 1017 tion of whether or not, notwithstanding the illegality of the provisions of the October 1, 1957, contract, the Respondents were in conformance with the Mountain Pacific standards after October 10, 1958. The Mountain Pacific decision stated that an arrangement under which an employer agrees to hire all of its employees through a union violates the Act, unless the arrangement includes certain provisions (safeguards) which obviate the unlawful encouragement of union membership otherwise inherent therein. The Board did not in Mountain Pacific change the principle that an exclusive hiring arrangement constitutes discrimination which unlawfully encourages union membership within the meaning of the Act. The Board there adhered to its prior holding that an em- ployer engaged in discrimination which encourages union membership, within the meaning of Section 8(a) (3), by entering into an exclusive hiring arrangement binding the employer to hire only men referred by the union and prohibiting him from hiring men not preferred by the union; that such a provision is illegal on its face, without regard to the practices under it because by its terms it causes the employer to discriminate in hiring between employees with union work permits and those who do not have such permits and that this dicrimination encourages union member- ship. The Board further affirmed the principle that a union which is a party to such an agreement violates Section 8(b)(1)(A) and (2). E.g., N.L.R.B. v. United Brotherhood of Carpenters and Joiners of America, AFL-CIO, Local No. 517, AFL (Gil Wyner Construction Co.), 230 F. 2d 256-258 (C.A. 1); N.L.RB. v. Gottfried Baking Co., Inc., et al., 210 F. 2d 772, 777-780 (C.A. 2). The provisions constituting an arrangement which would it is thought negate the unlawful encour- agement of union membership, as intended in Mountain Pacific, is summarized in the concurring opinion of Member Jenkins in Local 363, affiliated with the Interna- tional Brotherhood of Boilermakers, etc. (Anchor Welding & Manufacturing Com- pany et al.), 123 NLRB 1877: First, the selection of applicants for referral to jobs must be on a nondis- criminatory basis, and not based upon, or affected by, union membership, bylaws, rules, regulations, constitutional provisions, or any other aspect of obligation of membership, policies, or requirements. Second, the employer retains the right to reject any applicant referred by the Union. And third, the parties to the agreement must post at customary places all provisions relating to the functioning of the hiring arrangement, including the safeguards deemed essential to the legality of an exclusive hiring arrangement. Following this summary, in his concurring opinion, Member Jenkins goes on to explain what is required by each one of the three safeguards he summarized. The Board issued its order, together with a dissenting opinion by Member Murdock, in Mountain Pacific, on September 14, 1957. Thereafter the Board issued its decision in that case. Almost immediately after the Board's Decision and Order (March 27, 1958), the General Counsel of the National Labor Relations Board announced or suggested that suitable time should be given unions and employers to conform to the principle enunciated and be given a reasonable time to correct any agreement or arrangement which did not conform to the safeguards set out in Mountain Pacific. Thereafter, the General Counsel announced a moratorium until September 30, 1958, in pending cases wherein it might have been charged that employers and unions that engaged in unfair labor practices by virtue of illegal hiring hall arrangements con- tained in collective agreements; subsequently, he announced an extension of that policy to November 1, provided, however, that parties to such illegal contracts on or about September 30 were engaged in negotiations looking forward to putting into effect the safeguards laid down in Mountain Pacific. Footnote 4, supra. The Respondents herein contend, and the Trial Examiner agrees, that the amend- ment to the collective-bargaining agreement made October 10, 1958, met the require- ments laid down in Mountain Pacific. Consequently, the Trial Examiner finds that the Respondents, insofar as the "hiring-hall" provisions between them is concerned, were in compliance after the date of the amendment to the original collective agree- ment. The first charge hearing on this issue, having been filed on May 1, 1959, the 6 months' limitation of Section 10(b) of the Act is applicable, so that, notwithstand- ing settled law to the effect that the existence of an unlawful contract is sufficient in and of itself to establish the element of coercion in the payment of moneys pursuant to the requirements of such a contract, no violation herein can be found within the 6-month period prior to the filing of the first or any other charge. D. The oral agreement, arrangement, or understanding with respect to hiring practices; wage deductions It was customary, after the formation of the Respondent Company some 3 years ago, and after the making of the collective agreement by the Union and the Company 1018 DECISIONS OF NATIONAL LABOR RELATIONS BOARD on October 1, 1957, for either General Manager Aiello or President Russo to hire new employees after an interview. It appears that only two or three new employees during these terms were referred by the Union to the Company, and that company representatives generally hired new employees at the plant. The record shows fur- ther that most of the employees were Spanish-speaking persons and many of them traveled to and from work in automobile pools, because the plant is situated in a rather remote part of Yonkers, New York. One question to be determined here is whether, upon hiring, when a new employee signed a union application or authorization card and agreed to the deduction of dues prior to the 30-day statutory union shop, he did so as a volunteer and that he knew what he was doing, or whether there was an implied compulsion in the sense that he was instructed that he must join the Union and pay initiation fees and dues before the expiration of the 30-day period provided by Section 8(a) (3) of the Act. The General Counsel takes the position that the collective agreement as amended does not meet the requirements of the Act or the principles set out in Mountain Pacific, supra, and Pacific Intermountain Express Co., 107 NLRB 837, and therefore the mere existence of the contract itself and particularly its requirement for the new employee to obtain a referral card is enough to show that the oral agreement, arrangement, or understanding-the hiring practices at the plant-and the practice or custom engaged in in hiring, must necessarily result in a finding of unfair labor practices in this respect.5 That the mere existence of these provisions in the agreement as amended on October 10, 1958, is sufficient to show illegal hiring practices is not correct if, as found above, the collective agreement was valid on its face after October 10. It is the view of the Trial Examiner that something more must be shown to prove that the Employer, acting in concert with the Union, engaged in unlawful practices in that possibly the Employer instructed, solicited, or told new employees they must join the Union at the time of their employment. No inference can be drawn, assum- ing the validity of the collective agreement after October 10, that there was a per se violation merely because of the existence of the amended agreement. A more serious question arises with respect as to actually what did occur at the time a new employee was hired. The Trial Examiner has set out at some length above what Aiello told these people at the time he hired them and also what Santoro, the shop steward, told new employees after they had been turned over to him. Whether an inference may be drawn that employees at the time of their hiring were misled, or were compelled or instructed to join the Union, on the factual record, is doubtful. Not a single employee was called to testify in this respect: whether he or she voluntarily signed a union application card at the time of his or her employment, what instruc- tions were given by Aiello or Russo regarding his or her obligation to join the Union, or any other element which might provide a basis for a finding of fact in this respect. Obviously if a finding were made on the basis of real fact or a right of correct inference, then the question would naturally arise regarding the legality of the method of payment of initiation fees and dues by new employees in the manner set forth above; that is, payroll deductions during the second, third, fourth, and fifth weeks of their employment-to cover the payment of the dues for the first month of their employment together with initiation fees. Upon the basis of the facts related above, the Trial Examiner expressly finds first, that the collective-bargaining agreement entered into between the Union and the Company on October 1, 1947, as amended October 10, 1958, was valid after the date of the amendment and consequently in view of the 6-month limitation contained in Section 10(b) of the Act, the unfair labor practices alleged in the complaint growing out of the existence of that collective agreement as modified must be dis- missed; and second, that in the absence of a showing by the preponderance of testi- mony and on the whole record that the practice or custom of hiring new employees under the oral agreement, arrangement, or understanding between the Union and the Employer was illegal, the complaint should be dismissed for lack of proof that new employees were compelled to join the Union at the time of their employment and to consent to the deduction of initiation fees and dues. Upon the basis of the findings of fact, and upon the entire record in the case, the Trial Examiner makes the following: s There is no testimony in the record regarding whether any new employee ever was refused or applied for a referral card The practice or custom referred to in effect would make such a referral card unnecessary, since invariably the new employee signed a card applying for membership in the Union at or about the time he was accepted for employment. CRUIS ALONG BOATS, INC. 1019 CONCLUSIONS OF LAW 1. The operations of Cadillac Wire Corp. constitute trade, traffic , and commerce among the several States, within the meaning of Section 2(6) of the Act. 2. Steel, Metals, Alloys and Hardware Fabricators and Warehousemen Local 810, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America is a labor organization within the meaning of Section 2(5) of the Act. 3. Respondents have not engaged in unfair labor practices as alleged in the complaint. [Recommendations omitted from publication.] Cruis Along Boats, Inc. and District 50, United Mine Workers of America, Petitioner. Case No. 5-RC-2940. August 26, 1960 SUPPLEMENTAL DECISION AND DIRECTION Pursuant to a Decision and Direction of Election issued by the Board,' an election by secret ballot was conducted on January 29, 1960, in the above-entitled proceeding under the direction and the supervision of the Regional Director for the Fifth Region among the employees in the appropriate unit. Upon completion of the election, the parties were furnished a tally of ballots which showed that of approximately 98 eligible voters, 93 were cast, of which 44 were for, and 38 against, the Petitioner, and 11 ballots were challenged. The challenged ballots were sufficient in number to affect the results of the election. No objections to the election were filed by the parties. In accordance with the Board's Rule's and Regulations, the Regional Director conducted an investigation of the challenged ballots and on April 15, 1960, issued and served upon the parties his report on challenges, in which he found that two of the individuals whose ballots were challenged properly belonged in the unit, and the remaining nine were supervisors within the meaning of the Act. As all 11 of the above individuals had been specifically included within the unit by the Board's Decision and Direction of Election, pursuant to a stipulation of the parties at the hearing, the Regional Director made no recom- mendation as to the disposition of the challenges, pending a Board ruling as to the effect of the stipulation. The Employer filed timely exceptions and a supporting brief as to the Regional Director's find- ings that the above nine individuals were supervisors. The Regional Director in his report raises the issue of whether the Board should honor the stipulation entered into by the parties at the hearing to include the above 11 individuals in the unit in light of his 'investigation. At the original hearing the parties, pursuant to an off-the-record discussion, agreed that the 11 individuals in question "do not have the authority to hire or fire, effectively recommend such 1 Unpublished. 128 NLRB No. 115.