Aetna Plywood and Veneer Co.

AETNA PLYWOOD AND VENEER COMPANY 329' Aetna Plywood and Veneer Company and Warehousemen and Mail Order Employees, Local No. 743, International Brother- hood of Teamsters, Chauffeurs, Warehousemen, and Helpers of America Aetna Plywood and Veneer Company and Truck Drivers, Oil Drivers, Filling Station and Platform Workers Union, Local 705, International Brotherhood of Teamsters , Chauffeurs, Warehousemen and Helpers of America. Cases Nos. 13-CA- 3261 and 13-CA-3677. February 16, 1961 DECISION AND ORDER On May 3,1960, Trial Examiner Thomas S. Wilson issued his Inter- mediate Report in Case No. 13-CA-3261, finding that the Respondent Company had engaged in and was engaging in certain unfair labor practices and recommending that the Respondent Company cease and desist therefrom and take certain affirmative action, as set forth in the copy of the Intermediate Report attached hereto. Thereafter, the Re- spondent filed exceptions to the Intermediate Report and a support- ing brief, and the General Counsel and Charging Parties also filed briefs. On June 17, 1960, the General Counsel of the National Labor Rela- tions Board by the Regional Director for the Thirteenth Region, is- sued a complaint against the Respondent Company in Case No. 13-CA-3677 alleging that the Respondent Company had engaged in and was engaging in certain unfair labor practices affecting com- merce within the meaning of Section 2(6) and (7 ) of the Act. Copies of the charge, complaint, and notice of hearing before a Trial Exami- ner were duly served upon the Respondent and the Charging Party. On. August 8, 1960, all the parties in Case No. 13-CA-3677 entered into a stipulation of facts, and on August 17, 1960, jointly requested the transfer of the case directly to the Board for findings of fact, conclusions of law, and a Decision and Order. The request stated that the parties have waived the right to a hearing before a Trial Exami- ner and issuance of an Intermediate Report. The request further stated that the charge, complaint, and stipulation of facts constituted the entire record in the case, and asked that the case be consolidated with Case No. 13-CA-3261 which was then pending before the Board. On August 22, 1960, the Board granted the parties' request to transfer Case No. 13-CA-3677 to the Board and to consolidate it with Case No. 13-CA-3261. Case No. 13-CA-3261 The Board has reviewed the rulings of the Trial Examiner made at the hearing in Case No. 13-CA-3261 and finds that no prejudicial 130 NLRB No. 18. 330 DECISIONS OF NATIONAL LABOR RELATIONS BOARD error was committed. The rulings are hereby affirmed. The Board has considered the Intermediate Report and the entire record in this case, including the exceptions and briefs, and finds merit in the excep- tions of the Respondent to the conclusions and recommendations of the Trial Examiner. The relevant findings of fact made by the Trial Examiner are adopted only insofar as consistent with our Decision herein.' 1. The Trial Examiner found that on and after November 6, 1958, the Respondent refused to bargain with the Union, thereby convert- ing an economic strike into an unfair labor practice strike and making the discharge of the strikers on March 23, 1959, violative of Section 8 (a) (1) and (3) of the Act. We do not agree. Early in 1958, the Union that represented Respondent's warehouse employees notified the Respondent of 11 changes and modifications that the Union desired to make in the existing agreement, which was due to expire on April 30, 1958. Negotiating sessions for a new contract began in April 1958 and, at the very first meeting, Respondent's comp- troller stated that the Respondent desired certain "wording changes" in the agreement to be accomplished through the deletion of some paragraphs and the addition of others. However, the Union indi- cated that it wished to discuss its 11 points before any other matters were considered. By the end of the negotiating session on July 8, 1958, the parties had reached substantial agreement on all but 4 of the original 11 demands. The issues still in dispute were: (1) a wage increase; (2) a cost-of- living clause; (3) dependent coverage on insurance; and (4) vacation policy. At this session, the Union informed the Respondent that the employees had voted to strike unless they received a better offer. As no better offer was forthcoming, the 14 warehouse employees went on strike on July 22, 1958, and were still on strike at the time of the hear- ing. All parties concede that the strike was economic at its inception. At the first negotiating session held after the strike began, the Re- spondent announced that it was withdrawing all offers it had made up to that point. Although further meetings were held on August 21 and September 25, no progress was made toward resolving the issues in dispute. At a meeting held on November 6, 1958, the Respondent for the first time brought into the negotiations certain changes in the con- tract that it wanted to make. Respondent specifically mentioned a 1 The Trial Examiner found that Respondent is an Illinois corporation since it was so alleged in paragraph numbered 2(a) of the complaint and admitted in the Respondents' answer. However, it is clear from Respondents' brief as well as from the stipulation of facts in Case No. 13-CA-3644 that Respondent Is a Delaware corporation, and we so find. Subsequent to the hearing a motion was made by Respondent to correct certain errors in the transcript. This motion was served on all parties to the proceeding and no objec- tion was raised . The motion is hereby granted. AETNA PLYWOOD AND VENEER COMPANY 331 desire to eliminate the contract requirements that 24 hours before an employee was to work overtime, he must be notified of this fact, and that salesmen could not pull out plywood sheets for the purpose of showing them to a customer. The Union seemed agreeable to elimina- tion of the latter requirement provided salesmen did not fill orders or load trucks, but the Union's attorney suggested that Respondent put all its suggested changes in writing and that the parties meet again the next day to consider them. On November 7, 1958, the Respondent presented four written pro- posals. These were: (1) a management prerogative clause, ( 2) a no- strike clause, (3) a clause dealing with the hiring of casual workers, and (4) a clause to the effect that salesmen and foremen might perform at any time warehouse work necessary to meet customer and service needs. The Union agreed to the no-strike clause and management clause as drafted,' but refused to accept the provision regarding casual workers. On the foremen and salesmen issue, the Union advanced two counterproposals limiting the situations under which foremen and salesmen might perform warehouse work. During the discussion at this meeting, Respondent President Davis stated that the Company had learned during the course of the strike that it was able to handle all its work with less people. Davis men- tioned that six office employees were then handling the warehouse work and were turning out a volume of work equal to that turned out by all the warehouse employees before the strike. Union President Peters testified that Davis further said that Respondent would only want six of the striking employees back. Although Davis denied mentioning any specific number, it is clear that from November 7 on, the Respondent maintained the position that it would substantially reduce its warehouse staff at the end of the strike. At the next bargaining session held on November 13, 1958, Re- spondent submitted another proposal to the Union. This proposal contained a different form of management prerogative clause from the one submitted on November 7. It also accepted the proposal on warehouse work by the salesmen which the Union had advanced on November 7, but with regard to similar work by foremen, the pro- posal stated that foremen might perform any work necessary to effi- ciently utilize their time. The November 13 proposal also contained a clause that required any warehouseman who was asked to work overtime to perform such overtime work as a condition of employment unless such warehouse- man could produce a substitute. The proposal did not contain a wage schedule, however, as the Respondent maintained that agreement 2 In section III, A, of the Intermediate Report, the Trial Examiner states only that the Union agreed to the no-strike clause, but a document prepared by the Union 's attorney on November 7, 1958, indicates union acceptance of the management clause as well. 332 DECISIONS OF NATIONAL LABOR RELATIONS BOARD would have to be reached on other points before the Company would make a wage offer. The next meeting was held on November 26, 1958. The Union said it could not accept Respondent's proposal on the foremen and sales- men issues and on compulsory overtime. Respondent refused to change its last proposal. The parties did not meet again until 1959 when three further un- successful attempts were made to resolve their differences. The last meeting was held on February 6, 1959, and shortly afterwards, Re- spondent began to hire replacements for the strikers In concluding that the Respondent refused to bargain on and after November 6, 1958, the Trial Examiner primarily relied on the "sud- den and unexpected demands" made by the Respondent on November 6, 1958, and "the very nature of those demands coupled with the threat of substantial reduction of employees in the warehouse unit...." We do not agree with the Trial Examiner's characterization of Re- spondent's proposal as "sudden and unexpected" in view of the un- contradicted testimony of one of Respondent's negotiators that the Company indicated at the first negotiation session in April 1958 that it desired certain changes in the contract. The Union, however, in- sisted that its 11 proposed changes and modifications be considered first and it was not until a virtual stalemate had been reached on 4 of these 11 proposals that Respondent advanced its suggested changes. Furthermore this is not a case where there was a constant shifting of positions by the Respondents or the introduction of new demands just as agreement seemed imminent,' for Respondent did not shift from its demands of November 6 although it was willing to modify them,, and in view of the four basic issues still in dispute on November 6 it can hardly be maintained that agreement was imminent. As further evidence of the Respondent's refusal to bargain, the Trial Examiner points to "the very nature of" the demands made on November 6, 1958, "coupled with the threat of substantial reduction of employees in the warehouse unit. . . ." However, with regard to the four changes proposed by the Respondent, we note that the Union agreed at once to the no-strike and management clause. With regard to the proposal that foremen perform warehouse work, the Union sub- mitted a counterproposal that acknowledged that salesmen and fore- men might do such work but limited the circumstances under which such work might be done. The final proposal dealing with the hiring of casual workers was totally rejected by the Union. In view of the Union's response to these changes and in view of the very substance 8 Cf. J. W. Woodruff, Sr., d/b/a Atlanta Broadcasting Company, 90 NLRB 808, enfd. 193 F. 2d 641 (C.A. 5) ; L. G. Everist, Inc, 103 NLRB 308. In these cases , the new demands of shifts in position were part of a pattern which included independent viola- tions of Section 8(a) (1) or per se violations of Section 8(a) (5). No such additional evi- dence indicating lack of good faith exists in this case. AETNA PLYWOOD AND VENEER COMPANY 333 of the changes, we fail to see how these proposals evidence a lack of good faith. Furthermore, the Trial Examiner characterized Respondent's an- nouncement on November 7 that it intended to reduce substantially the size of the warehouse unit at the end of the strike its a "threat." Yet there was uncontradicted testimony by Respondent's president that the decision to reduce the number of warehousemen was made because the Company had learned during the course of the strike that it could turn out the same volume of work with substantially fewer employees. That Respondent's position was not a threat but rather a statement of intention is born out by the fact, not considered by the Trial Examiner, that at the time of the hearing Respondent had only six men working in the warehouse. The Trial Examiner further found that from November 6, 1958, until February 6, 1959, all bargaining was "centered exclusively" upon Respondent's demands. Although it is true that most of the bargain- ing after November 6 concerned changes advanced by the Respondent, the record reveals several instances where other matters were dis- cussed. Thus on January 16, 1959, Respondent agreed to raise its contribution to the pension fund and agreed to a union proposal for funeral leave. At the last meeting on February 6, 1959, the question of wages was discussed again. The Trial Examiner found that the Union's offer of February 4, 1959, amounted to a "virtual capitulation by the union." In reaching this conclusion, however, the Trial Examiner appears to have con- fused the proposal made by the Respondent on January 16 with a con- cession in response to this proposal made by the Union on February 4. The written proposal attributed to the Union by the Trial Examiner on February 4 was, in fact, that of the Respondent made on January 16. The Respondent proposed, in pertinent part, that employees in or out of the bargaining unit could be used in taking of inventory, that foremen might perform any work necessary to efficiently utilize their time, and that overtime work could be required as a condition of em- ployment. Had the Union, as found by the Trial Examiner, agreed to these proposals, it would, indeed, have been a "virtual capitulation." However, the record shows that on February 4 the Union proposed that foremen might work if this did not take over 20 percent of their time, salesmen would not be permitted to work, and employees would work on emergency overtime, but senior men would not be required to work overtime as a condition of employment. Thus it is clear, con- trary to the Trial Examiner, that no "capitulation" by the Union occurred on February 4. The final piece of evidence relied on by the Trial Examiner to prove Respondent's lack of good-faith bargaining relates to the filing of the RM petition on March 23, 1959. Since the petition stated that the 334 DECISIONS OF NATIONAL LABOR RELATIONS BOARD number of employees in the unit was "14," the Trial Examiner con- cludes that Respondent's contention that it intended to substantially reduce the number of warehouse employees after the strike was "false, unreal and fictitious." However, the Respondent's president testified that the figure 14 was chosen as a figure of convenience, even though a total of 18 employees had been hired in February and March 1959. The Trial Examiner also makes the point that in filing the RM petition with only replacements as eligible voters, the Respondent was engaging in the "well known stratagem" to rid itself of the Union. Whatever the merits of the policy of permitting only replacements of economic strikers to vote may have been (a policy changed by the recent amendments to the Act), we do not believe that an inference of lack of good faith can be drawn from an employer's utilization of a procedure that was lawful at the time. In view of the foregoing, and upon the entire record in this case, we find that the evidence fails to establish that the Respondent refused to bargain in good faith with the Union. 2. The Union contends that even if no refusal to bargain is found, the strikers are entitled to reinstatement since they were never perma- nently replaced. There is no merit to this contention. When the negotiations finally broke down completely in February 1959, the Employer began hiring replacements. A total of 18 ware- house employees were hired from the beginning of February to March 23, 1959. On March 23, 1959, the Respondent sent a letter to all strikers informing them that the Company had hired permanent replacements and that their employment with the Company therefore was terminated. Since we have found that the strikers were economic strikers at all times, the Respondent was entitled to replace them with permanent employees. The record indicates that the employees hired in February and March 1960 were hired with the intention of performing all warehouse work then available even though it is also clear that the Employer intended to reduce the size of the warehouse unit as soon as possible. In our opinion, there is sufficient evidence to support the position that the strikers had been permanently replaced before the Employer sent the termination notices. Accordingly, we find that the failure to reinstate the 14 strikers was not discriminatory. Case No. 13-CA-3766 With respect to the unfair labor practices in Case No. 13-CA-3677, the complaint alleges, in substance, that on or about March 15, 1960, and at all times thereafter, the Respondent has discriminated against its drivers who were represented by Truck Drivers, Oil Drivers, Fill- ing Station and Platform Workers Union, Local 705, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America (herein called Local 705), by refusing to reinstate or re- AETNA PLYWOOD AND VENEER COMPANY 335 employ such drivers after their unconditional offer to return to work. The complaint further alleges that such discrimination has discouraged and is discouraging membership in Local 705. The conduct of the Respondent in refusing to reinstate or reemploy its drivers is alleged to be an unfair labor practice violative of Section 8(a) (1) and (3) of the Act. Upon the basis of the parties' stipulation of facts, the briefs, and the entire record in the case, the Board makes the following : FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT The Respondent is, and at all times material herein has been, a Delaware corporation with principal offices and place of business lo- cated at Chicago, Illinois, where it is now and at all times material herein has been engaged in the sale and distribution of plywood and related wood products. During the 12 months' period ending Octo- ber 1, 1959, a representative period, the Respondent purchased mate- rial outside the State of Illinois valued in excess of $100,000, and caused such material to be shipped directly to its place of business located at Chicago, Illinois. Upon the above-admitted facts, we find that the Respondent Com- pany is engaged in commerce within the meaning of the Act and that it will effectuate the purposes of the Act to assert jurisdiction in this case. IL THE LABOR ORGANIZATION INVOLVED Truck Drivers, Oil Drivers, Filling Station and Platform Workers Union, Local 705, International Brotherhood of Teamsters, Chauf- feurs, Warehousemen and Helpers of America, is a labor organization as defined in Section 2 (5) of the Act. III. THE UNFAIR LABOR PRACTICES The facts as stipulated show that in 1958 the Respondent was a party to a collective-bargaining agreement with Local 705 covering all of the Respondent's drivers. In the summer of 1958, the Respond- ent had in its employ five drivers, one of whom normally worked in the warehouse unit and who was driving temporarily. When the warehouse employees of the Respondent went out on strike on July 22, 1958, all of the Respondent's drivers refused to cross the picket line set up by the warehouse employees. In October and December 1959 the Respondent replaced the drivers who were engaged in the sym- pathy strike with three individuals who have been employed as drivers by the Respondent since their respective dates of hire. The refusal of the drivers represented by Local 705 to cross the picket line set up by Local 743 continued until March 15, 1960, when the business agent 336 DECISIONS OF NATIONAL LABOR RELATIONS BOARD of Local 705 made an unconditional offer to return to work on behalf ,of the drivers. The Respondent has refused and continues to refuse to reinstate the drivers for whom an unconditional offer to return to work was made on the ground that they have been permanently replaced. In Case No. 13-CA-3261, the Board found that the Respondent did not refuse to bargain with Local 743 and that the strike which began on July 22, 1958, was not an unfair labor practice strike. Therefore, the employees in the drivers unit represented by Local 705 stand in no better position than the employees in the warehouse unit represented by Local 743. Both groups of employees were always economic strikers. It is well settled that economic strikers can be replaced at ,any time prior to their unconditional application for reinstatement.' As it is admitted that the employees represented by Local 705 were replaced, we conclude that the Respondent's refusal to reinstate or reemploy these employees was not discrimination in violation of the Act. CONCLUSIONS OF LAW 1. The Respondent is engaged in commerce within the meaning of 'Section 2(6) and (7) of the Act. 2. Local 705 is a labor organization within the meaning of Section 2(5) of the Act. 3. The record does not establish that Respondent has violated Sec- tion 8(a) (1) and (3) of the Act. [The Board dismissed the complaints in Cases Nos. 13-CA-3261 and 13-CA-3677.] • United Grvndting Service, Inc., 118 NLRB 67. INTERMEDIATE REPORT STATEMENT OF THE CASE Upon a charge filed April 27 , 1959, by Warehousemen and Mail Order Em- ployees, Local No . 743, International Brotherhood of Teamsters, Chauffeurs, Ware- housemen, and Helpers of America , hereinafter called the Union , the General Counsel of the National Labor Relations Board , hereinafter called the General Counsel I and the Board , respectively, by the Regional Director for the Thirteenth Region (Chicago, Illinois ), issued its complaint dated October 15, 1959, against Aetna Plywood and Veneer Company, hereinafter referred to as the Respondent. The complaint alleged, in substance, that on or about March 23, 1959, the Respondent discharged 11 named employees who had gone on strike against the Respondent on or about July 22, 1958, which strike Respondent controverted into an unfair labor practice strike by refusing to bargain with the Union on and after November 6, 1958. Copies of the complaint , the charge, and notice of hearing thereon were duly served upon the Respondent and the Union. Respondent duly filed its answer admitting certain allegations of the complaint 'but denying the commission of any unfair labor practices. Pursuant to notice, a hearing was held on January 25, 1960, at Chicago, Illinois, before the duly designated Trial Examiner . All parties were represented at the i This term specifically includes the attorneys appearing for the General Counsel at the hearing. AETNA PLYWOOD AND VENEER COMPANY 337 hearing and were afforded full opportunity to be heard, to examine and cross- examine witnesses, to introduce evidence, and to present oral argument at the close of the hearing and thereafter to file briefs as well as proposed findings of fact and conclusions of law. Oral argument at the conclusion of the hearing was waived by all parties. Briefs were received from each of the parties on or before March 8, 1960. Upon the entire record in the case, and from the Trial Examiner's observation of the witnesses the Trial Examiner makes the following: FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT Aetna Plywood and Veneer Company is, and at all times material herein has been, an Illinois corporation with its principal office and place of business located at Chicago, Illinois, where it is now, and at all times material herein has been, en- gaged in the sale and distribution of plywood and related wood products. During the 12-month period ending October 1, 1959, a representative period, the Respondent purchased material outside the State of Illinois, valued in the excess of $100,000, and caused such materials to be shipped directly to its place of business located at Chicago, Illinois. Respondent admits, and the Trial Examiner finds, that at all times material herein Respondent has been engaged in commerce within the meaning of the Act. II. THE LABOR ORGANIZATION INVOLVED Warehousemen and Mail Order Employees, Local No. 743, International Brother- hood of Teamsters, Chauffeurs, Warehousemen, and Helpers of America, is a labor organization admitting to membership employees of the Respondent. III. THE UNFAIR LABOR PRACTICES A. The facts In 1955 the Respondent and the Union entered into a collective-bargaining con- tract covering the Respondent's warehouse employees who comprised a unit of 14 employees. By its terms this contract was to run until April 30, 1958, when it would renew itself for an additional year unless notice was given by either party of its desire to amend or terminate the agreement. By letter dated March 13, 1958, the Union gave notice to Respondent of 11 "changes and modifications" which it wished to have incorporated in a new contract with Respondent. Respondent gave no notice of its desire for changes or modifica- tions except that in one of the early negotiation meetings one of its representatives did state that the Respondent had some "wording changes" it wanted. Donald L. Davis, Jr., became Respondent's president on July 1, 1958, succeeding his father in that position. By the conclusion of the negotiating meeting on July 8 the parties had reached substantial agreement on all but 4 of the Union's original 11 demands: (1) wages; (2) cost-of-living clause; (3) dependent medical coverage; and (4) vacation policy. During this meeting Donald Peters, union president, informed the Respondent's negotiator that the warehouse employees had voted to go on strike unless agreement was reached on these remaining four demands. As no satisfactory agreement was reached on these 4 demands at subsequent negotiations, the 14 employees in the appropriate unit went on strike on or about July 22, 1958. General Counsel and the Union both concede that this strike was economic at its inception. At the following negotiation meeting of July 25, 1958, the Respondent announced that it was withdrawing all previous offers made to the Union during the negotia- tions. However, the parties met thereafter on August 21 and September 25 during which they were still unable to reach agreement. Up to this point the negotiations had dealt exclusively with the Union's 11-point program. The next negotiating session was held on November 6. It was at this meeting that the Respondent for the first time announced that it had certain changes it desired made in the contract and agreed to submit these proposed changes in writing the following day. On November 7 the Respondent submitted the following pro- posed changes: 1. During the period of this Agreement, the Union will not authorize or condone any strikes, sitdowns, slowdowns, or stoppages of work or any boy- 597254-61-vol 130-23 338 DECISIONS OF NATIONAL- LABOR RELATIONS BOARD colts or picketing at the employer's plants. During the period of this Agree- ment the employer shall not engage in any lockout. Any employee initiating, encouraging, or engaging in any strike, sitdown, slowdown, or stoppage of work, or boycott or picketing at the employer's plant, shall be subject to discharge or disciplinary action at the direction of the Employer. 2. The Employer has the exclusive right and power, subject to the provisions of this Agreement, to manage its plant and direct its working forces. These rights and powers shall not be used for the purpose of discriminating against any member of the union, or against any employee because of bona fide activities on behalf of the Union which do not interfere with production in the plant or other business of the Employer. 3. The Company shall have the right to hire casual workers at any time to handle unusual work loads or peak loads beyond the capacity of the work crew current at that time. 4. The foremen or salesmen may perform at any time warehouse work necessary to meet the customer and service needs. After consultation the Union agreed to the strike clause as drafted but refused to accept the provision regarding casual workers. As for the other two proposals, the Union submitted the following counterproposals: 1. Salesmen may perform work in the warehouse when it is in connection with the selling activity or for purposes of selling merchandise to the customer. 2. Foremen may perform work in the warehouse when warehouse employees are absent or not available or when practical business operation so require. During the discussion at this meeting Davis announced that from the Respondent's experience in the warehouse during the strike, the Respondent had determined that it had been paying for too many man hours of work in the warehouse as 6 inex- perienced office employees assisted by the foremen and salesmen had done an amount of work "equal" to that done prior to the strike by the 14 warehouse employees. Therefore, according to Davis, the Respondent had determined that it would sub- stantially reduce its warehouse staff at the end of the strike. Peters answered that, if the staff was to be reduced to six in the warehouse unit, as indicated it would be impossible for him to secure ratification of any contract with the Respondent be- cause, in order to secure such ratification, more than 50 percent of the then em- ployees in the unit would have to vote themselves out of jobs. Peters also objected to the provisions regarding casual workers, foremen, and salesmen on the grounds that that would also have an adverse influence upon the number of employees in the unit for which he was bargaining and tend to eliminate such unit .2 Following the Union's counterproposals as noted above, the November 7 meeting was adjourned until November 13 because of illness of Davis' mother without further agreement. At the meeting of November 13 Respondent submitted another counterproposal which included for the first time a management prerogative clause as follows: It is recognized that, unless specifically restricted in this Contract, the manage- ment of the operation, the direction of working force including , but not limited to, the right to hire, suspend, promote or demote, discharge or transfer from job-to-job, and the right to lay off employees for lack of work or materials, the methods, processes, materials, and methods of operating the Company, and the right to schedule production, shall be vested exclusively with the Employer and shall be considered exclusive functions of the management of the Company, provided that this shall not be used in any way for the purpose of discrimination against any union employee. The proposal accepted the Union 's suggestion regarding the working of salesmen in the warehouse but added the following regarding the foremen: "The foremen may perform any work necessary to efficiently utilize their time." Respondent's counterproposal retained the same clause regarding the hiring of casual workers and some new phraseology regarding strikes as well as deleting 2 The one real conflict of testimony in this record grows out of the fact that Peters testified that Davis had fixed the complement of warehouse workers after the strike at six, whereas Davis denied that any specific number had been mentioned. The Trial Examiner considers this conflict immaterial because Davis' testimony shows that he recog- nized that Peters had received the definite impression that the warehouse staff was to be reduced to six and yet did nothing to correct that impression if it were erroneous. AETNA PLYWOOD AND VENEER COMPANY 339 certain provisions agreed to theretofore . Under "overtime," on which previously the parties had been in accord , the Respondent added a new clause as follows: Any warehouseman or crew of warehousemen who are asked to work overtime will be expected as a condition of employment to do such overtime work unless they are able to get another warehouseman employee or a crew of employees who are willing to substitute . [Emphasis supplied.] The Union continued to object to the use of foremen and of casual workers in the warehouse unit on the ground that it would result in the diminution of the unit for which the Union was bargaining and the undermining of the Union as the bargaining agent of the employees. Peters also objected to making the working of overtime a "condition of employment." At the next meeting on January 16, 1959 , the Respondent submitted a written pro- posal consisting of the same four points in almost the exact same language. Again the issues in the dispute were the same: the use of foremen , salesmen, and casual workers to perform the warehouse work. The fact that only six union employees would be recalled and also compulsory overtime. The parties met on February 4 in separate rooms with conciliators from the Federal Mediation and Conciliation Service. After the conciliators reported that the parties each refused to move, Peters for the Union submitted in writing to the con- ciliator a proposal permitting the use of any employee in taking inventory, permitting foremen to perform work, allowing the working of overtime to become a condition of employment, and agreeing to the Respondent's contention on a new change it had suggested. This offer amounted to a virtual capitulation by the Union. The con- ciliator left the room but subsequently reported back that the Company would have to consult its other officers regarding the offer. The last meeting between the parties was held February 6 when the Respondent submitted another contract, in which the only change on the disputed issues was a clause stating: No foreman or salesman will be utilized for work in the bargaining unit on a f ull- time basis without giving an opportunity to work to one of the fourteen (14) men who were a part of the regular working crew at the time of the strike, and who are not working because of being laid off. [Emphasis supplied.] In this contract the Respondent made seniority on layoffs, recalls, and reduction in working force subject to the "ability" of the employee to perform the work available. This meeting ended with the parties in exactly the same positions they held before the meeting. By letter dated March 23 , 1959, over the signature of Don L . Davis, Jr., the Re- spondent notified the Union as follows: We have hired permanent replacements for our striking employees since your rejection of our offer of February 6, 1959. This raises the question as to whether your organization now represents our employees . We have petitioned the National Labor Relations Board to hold an election to determine this issue. The Union having rejected the Company's proposal of February 6, 1959, the Company is hereby withdrawing any and all offers made to your organization in the course of our collective bargaining negotiations. On this same March 23, 1959 , the Respondent sent letters to each of the 14 former warehouse employees reading as follows: You are hereby notified that the Company has hired a permanent replacement for your job and that your employment with the Company has been terminated. On the same day the Respondent filed an RM petition covering "all warehouse employees employed at the Company's warehouse at 1731 Elston Avenue, Chicago,. Illinois," and giving the number of employees in the unit as "14." On March 25 the Respondent submitted a list of the permanent replacements for the striking em- ployees and the eligibility list for the election . This list contained a total of 18 names, none of whom was a striking employee. B. Conclusions Admittedly the Union was the recognized bargaining representative of a unit con- sisting of Respondent's 14 warehouse employees, at least, until March 23, 1959, when Respondent "terminated" the 14 striking warehouse employees and thereupon expressed a "doubt" for the first time concerning the Union's representative capacity. Also admittedly the strike of July 22, 1958, was in origin an economic strike so that the strikers risked the loss of their employment if and when Respondent chose 340 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to permanently replace them. Further it is admitted that Respondent did not choose' to hire replacements, permanent or otherwise , at least until after February 6, 1959. As it is also admitted that no unconditional request for remstatement has yet been made by the strikers, the question at issue here is whether this strike has been converted into an unfair labor practice strike so that Respondent discriminated against the strikers by purporting to terminate them on March 23, 1959, on the grounds that they had been "permanently replaced." Unfair labor practice strikers do not lose their rights to reinstatement upon being replaced . The conversion of the strike in this case could only occur if it is found that the Respondent refused to bargain and thereby extended the strike. The lengthy bargaining in this case, which began in March 1958 and ended Febru- ary 6, 1959, had two distinct phases. The first phase which extended from March 1958 to November 6, 1958, was characterized by what the Board refers to as "hard bargaining" exclusively over the 11 demands made by the Union in its letter opening the contract. During this period the only demands at issue were those raised by the Union as Respondent had given no notice of proposed changes in the contract despite one tentative oral suggestion that Respondent might want some unspecified "wording changes" made. Even after the Union decided to use its economic weapon, the strike, on July 22, 1958, this hard bargaining continued . Progress was in fact made as evidenced by the fact that only 4 of the 11 issues remained unsolved on No- vember 6, 1958. The second phase of the bargaining began on November 6, 1958, when, without notice and for the first time, Respondent suddenly announced four major, sub- stantive changes it wanted made in the contract : ( 1) a no-strike clause; (2) a man- agement prerogative clause; ( 3) the right to hire casual workmen at any time in the warehouse unit; and (4) the right for foremen and salesmen to do warehouse work. These sudden new demands were accompanied by, and tailored to , Respondent's simultaneous oral announcement that, after the strike , Respondent was going to sub- stantially reduce the number of warehousemen ( as the Respondent testified ) or that the Respondent stated: "We are not going to use any warehousemen anymore. We will be able to do without them because we are going to have to use foremen and these salesmen to do the work [warehouse], and we will only want six of the"men back to work" (as the Union testified) .3 Respondent also demanded the right to select the men to be reinstated after .the strike and only after a long debate agreed to return the men according to seniority . All the bargaining from that time on until February 6, 1959, centered exclusively upon these demands of the Respondent, plus a management prerogative clause which Respondent subsequently added. The Union pointed out that, if agreed to , these demands would permit Respondent to eliminate the unit and to completely undermine the Union 's position as the bargaining representative for the employees still in that unit . Respondent's final offer of February 6, 1959, proves that, despite a practical capitulation by the Union on February 4, Respondent remained not only adamant on these changes ,but, in fact, had improved them in order to make the elimination of the unit and the undermining of the Union's representative capacity even easier. In a strikingly similar situation the Board has recently (March 4, 1960) expounded the law on this point in Lewin-Mathes Company, Division of Cerro de Pasco Corpora- tion, 126 NLRB 936. The Respondent, however, insisted on its own proposed recognition clause which varied from the unit description in the certification in that it recognized the Union as the representative only of employees "classified" as maintenance electricians rather than of employees performing electrical maintenance work which is implicit in the certification . The Respondent's purpose for thus nar- rowing the Union's representative status is revealed by another provision in the Respondent's proposed recognition clause wherein the Respondent reserved to itself the right to "assign [ing] work normally done by the employees in the unit to employees normally employed outside this bargaining unit. The Union objected to these clauses because they undermined its bargaining status and could serve as a convenient vehicle for destroying the certified unit. Ob- viously, there was justification for such apprehension . Although the Respond- ent utimately agreed to accept the Union's certified unit description, it neverthe- less adamantly insisted on retaining this right to assign electrical maintenance work to employees outside the unit and this position , as the Trial Examiner found, constituted a continuing stumbling block to agreement. Consistent with its foregoing position , the Respondent also demanded a man- agement prerogative clause which recognized its absolute right to assign work 8 This conflict need not be resolved AETNA PLYWOOD AND VENEER COMPANY 3411 of maintenance electricians to employees outside the certified unit . Because this clause also undercut its representative status, the Union opposed it. It is clear that acceptance of this clause , as well as the recognition clauses discussed above, would completely remove the question of work assignments from the grievance procedure and would leave the Union in the impotent position of witnessing work "normally" performed by members of the unit being given to employees "outside" the unit . As the Trial Examiner found, the Respondent's insistence on the management clause with respect to the absolute right to assign work was an additional deterrent to the parties' reaching an agreement. Based upon this evidence the Board reversed the Trial Examiner and found that the company had refused to bargain . The evidence in the instant requires the same finding by this Trial Examiner. In addition, on March 23, 1959, Respondent "terminated" the employment of the strikers on the grounds that they had been "replaced" permanently and on that same day filed an RM petition with the Board stating the number of employees in the unit as being "14 ." Thereafter Respondent filed an eligibility list for the proposed elec- tion containing the names of 18 employees , none of whom were strikers . This de- scription of 14 employees in the unit indicates that Respondent had deliberately stalled the negotiations with the Union for a period of many months on the false, unreal, and fictitious contention that Respondent intended to substantially reduce the number of employees in the unit after the strike. Such is another indication that the Re- spondent was not bargaining in good faith on and after November 6, 1958. Either that or the Respondent by filing this RM petition with only replacements as eligible voters was engaging in the well-known stratagem under Taft-Hartley whereby union employees and union bargaining agents can be eliminated at the time of an economic strike by resort to a Board election at which only replacements are eligible to vote. This stratagem has been so well recognized for many years as one of the weaknesses of the Taft-Hartley Act that even the President of the United States has had occasion to remark on it . That this technique was not unknown to Respondent's labor consultant is obvious from the similar technique employed by Respondent upon his advice as described in the case of Local 135, International Brotherhood of Teamsters, etc. (Aetna Plywood & Veneer Company), 126 NLRB 251, decided January 20, 1960, of which the Trial Examiner hereby takes judicial knowledge. The whole coterie of facts in the instant matter from the sudden and unexpected demands made by Respondent on November 6, 1958 , the very nature of those de- mands coupled with the threat of substantial reduction of employees in the ware- house unit, the adamant adherence to, and strengthening of, those demands by Respondent together with the several temporary diversions created by Respondent from time to time, plus the March 23, 1959, "terminations" of strikers and the filing of the RM petition for a unit of 14 employees , leads but to the conclusion that on and after November 6, 1958, Respondent was sitting at the negotiations with a firm resolve either to reach no agreement with the Union or to provide for the elimination of the Union as the bargaining agent by abolishing the bargaining unit. This con- stitutes a refusal to bargain in violation of Section 8(a)(5) and ( 1) which neces- sarily prolonged the economic strike and converted it on November 6, 1958, into an unfair labor practice strike as of that date. The Trial Examiner so finds. As a necessary corollary thereto the Trial Examiner must also find that on and after November 6, 1958, the strikers became unfair labor practice strikers so that the terminations of March 23, 1959, were discriminatory and in violation of Section 8(a) (3) and ( 1) of the Act. The Trial Examiner so finds. However, Respondent accuses the Union of being guilty of a refusal to bargain because it never "withdrew" a provision in a proposed strike settlement agreement proposed by the Union on November 7, 1958, which contained the following provi- sion : "Termination of strike and release of all litigation and claims in accordance with suggested strike settlement memorandum. Withdrawal of all charges, claims or actions against Local 200." This seems to be a defense of desperation because the evidence shows without contradiction that the matter was never discussed after the proposal was submitted and, therefore , had no effect upon the subsequent negotiations. The Trial Examiner further finds that Respondent discriminatorily discharged the 11 employees on strike by letter of March 23, 1959. As unfair labor practice strikers, the 11 strikers retained their status as employees within the meaning of the Act, were protected from discharge , and were entitled to reinstatement upon request 342 DECISIONS OF NATIONAL LABOR RELATIONS BOARD .even though this involved the discharge of employees who had "replaced" them.4 Mastro Plastics Corp. et al. v. N.L.R.B., 350 U.S. 270, 278, 286. However, as these 11 employees have not yet abandoned their strike nor requested reinstatement from Respondent, they are not as yet entitled to reinstatement. Upon ending the strike and requesting reinstatement from Respondent, they will be entitled to reinstatement even though this involves the discharge of employees hired by the Respondent on and after November 6, 1958. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondent set forth in section III, above, occurring in con- nection 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 It having been found that the Respondent discriminated in regard to the hire and tenure of employment of the striking employees by discharging each of them on March 23, 1959, as set forth above, the Trial Examiner will recommend that, upon request, the Respondent offer to each of them immediate and full reinstatement to his former or substantially equivalent position, without prejudice to his seniority or other rights and privileges, dismissing, if necessary, those employees hired by the Respondent on and after November 6, 1958. The unfair labor practices committed by the Respondent in the instant case are such as to indicate an attitude of opposition to the purposes of the Act generally. In order, therefore, to make effective the interdependent guarantees of Section 7 of the Act, thereby minimizing industrial strike which burdens and obstructs com- merce, and to effectuate the policies of the Act, it will be recommended that the Respondent cease and desist from infringing in any manner upon the rights guaran- teed in Section 7 of the Act. Upon the basis of the foregoing findings of fact, and upon the entire record, the Trial Examiner makes the following: CONCLUSIONS OF LAW 1. Warehousemen and Mail Order Employees, Local No. 743, International Brotherhood of Teamsters, Chauffeurs, Warehousemen, and Helpers of America, is a labor organization within the meaning of Section 2(5) of the Act. 2. By discharging Chester Luka, Lawrence Lucas, John Niewinski, Albert Miller, James Johnson, George Delnick, Stanley Nowak, Joseph Petek,, Raymond Ostrow- ski, William Lynch, and Joseph Niewinski on March 23, 1959, thus discriminating in regard to the hire and tenure of employment of each of them because he engaged in union activities for the purposes of collective bargaining or other mutual aid or pro- tection, the Respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (a) (3) and (1) of the Act. 3. By thus interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act, Respondent has committed unfair labor practices within the meaning of Section 8(a)(1) of the Act. 4. The aforesaid unfair labor practices are unfair labor practices within the mean- ing of Section 2(6) and (7) of the Act. [Recommendations omitted from publication.] 4 In view of the findings here the Trial Examiner sees no reason to consider the question of whether the strikers had actually been "permanently replaced" as claimed. APPENDIX A NOTICE TO ALL EMPLOYEES Pursuant to the recommendations of a Trial Examiner of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Man- agement Relations Act, we hereby notify our employees that: Upon request we will offer to the employees named below immediate and full reinstatement to his former or substantially equivalent position without preju- dice to any seniority or other rights and privileges enjoyed: WEST INDIA FRUIT AND STEAMSHIP COMPANY, INC. 343 Chester Luka George Delnick Lawrence Lucas Stanley Nowak John Niewinski Joseph Petek Albert Miller Raymond Ostrowski James Johnson William Lynch Joseph Niewinski WE WILL NOT in any manner interfere with , restrain, or coerce our employees in the exercise of their right to self-organization , to form labor organizations, to join or assist Warehousemen and Mail Order Employees , Local No. 743, International Brotherhood of Teamsters, Chauffeurs, Warehousemen , and Help- ers of America , or any other labor organization, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purposes of collectively bargaining or other mutual aid or protection, or to refrain from any or all such activities , except to the extent that such member- ship may be affected by an agreement requiring membership in a labor organi- zation as a condition of employment , as authorized in Section 8 (a) (3) of the Act. WE WILL NOT discriminate in regard to the hire or tenure of employment or any term or condition of employment of any employee because of membership in or activities on behalf of Warehousemen and Mail Order Employees, Local No. 743, International Brotherhood of Teamsters , Chauffeurs , Warehousemen, and Helpers of America, or because he is engaged in concerted activities for the mutual aid or protection of the employees. AETNA PLYWOOD AND VENEER COMPANY, Employer. Dated------------------- By------------------------------------------- (Representative ) ( Title) This notice must remain posted far 60 days from the date hereof, and must not be altered, defaced, or covered by any other material. West India Fruit and Steamship Company, Inc. and Seafarers International Union of North America , Atlantic & Gulf Dis- trict, AFL-CIO. Case No. 15-CA-1454. February 16, 1961 DECISION AND ORDER This proceeding is brought under Section 10(b) of the National Labor Relations Act. On December 31, 1958, the Seafarers Interna- tional Union of North America, Atlantic & Gulf District, AFL-CIO, herein called the Union, filed a charge with the National Labor Rela- tions Board. On January 2, 1959, a copy of the charge was served upon the Respondent, West India Fruit and Steamship Company, Inc. Thereafter, the General Counsel for the National Labor Relations Board issued a complaint and notice of hearing, dated April 23, 1959, alleging that the Respondent had engaged in and was engaging in unfair labor practices affecting commerce within the meaning of Section 8(a) (1) and (3) and Section 2(6) and (7) of the Act. Copies of the complaint and notice of hearing were duly served upon the parties. With respect to the unfair labor practices the complaint alleges in substance that (1) from on or about December 22 to on or after De- cember 31, 1958, the Respondent interrogated its employees on the 130 NLRB No. 46.