Lumber and Sawmill Workers, Local No. 2647, Etc.

LUMBER AND SAWMILL WORKERS, LOCAL 2647, ETC. 235 bookkeeper, messenger boy, cleanup man, foreman, and supervisors as defined in the Act. 5. The Petitioner recommends that the Board adopt criteria similar to those used in B and C Stevedoring Co., Incorporated, 88 NLRB 321, for determining voting eligibility. The Employer took no posi- tion on eligibility. Under all the circumstances, and in the absence of any objection, we find, in agreement with the Petitioner, that all em- ployees who meet the following eligibility requirements have a sub- stantial, continuing mutual interest in the selection of their bargaining representative, and are eligible to vote : All employees in the appro- priate unit whose names appear on eight or more different payrolls of the Employer within the period beginning July 4, 1960, and ending with the date of the payroll immediately preceding the date of this Decision and Direction of Election. [Text of Direction of Election omitted from publication.] Lumber and Sawmill Workers, Local No. 2647 ; Joseph Palazzi, Secretary-Treasurer of Local No. 2647 and Northern California District Council of Lumber and Sawmill Workers; Hugh Allen, Secretary-Treasurer and James Stephens, Representative of Northern California District Council of Lumber and Sawmill Workers and Cheney California Lumber Company Lumber and Sawmill Workers , Local No. 2647; Joseph Palazzi, Secretary-Treasurer of Local No. 2647 and Northern California District Council of Lumber and Sawmill Workers; James Stephens, Representative of Northern California District Coun- cil of Lumber and Sawmill Workers and Cheney California Lumber Company. Cases Nos. 20-CB-643 and 00-CB-645. Feb- ruary 15, 1961 DECISION AND ORDER On February 29, 1960, Trial Examiner David F. Doyle issued his Intermediate Report in the above-entitled proceeding, finding that the Respondents had engaged in and were engaging in unfair labor prac- tices and recommending that they cease and desist therefrom and take certain affirmative action, as set forth in the copy of the Intermediate Report attached hereto. The Respondents have filed exceptions to the Intermediate Report together with a brief in support thereof. 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 Intermedi- ate Report, the exceptions and brief, and the entire record in the case, and finds merit in the exceptions. Accordingly, the Board adopts the 130 NLRB No. 34. 236 DECISIONS OF NATIONAL LABOR RELATIONS BOARD findings of the Trial Examiner, only to the extent that they are con- sistent with the following : 1. The complaint alleged that the Respondents violated Section 8(b) (3) of the Act by: (a) striking the Company's mill without com- plying a second time with the proviso requirements of Section 8(d) ; (b) striking the Company's mill without giving the Company the op- portunity of consulting with Pine Industrial Relations Council, herein called Pine, its bargaining agent; (c) striking to compel the Company to agree to a health and welfare trust allegedly in violation of Section 80Q of the Act; and (d) striking in alleged violation of the no-strike clause in the existing collective-bargaining agreement. The Trial Examiner found that the Respondents had unlawfully refused to bargain with the Company by all the aforesaid conduct. We disagree with him. a. Compliance with Section 8(d) The collective-bargaining contract between the Company and the Respondent Local had an April 1, 1958, anniversary date, with pro- vision for automatic renewal in the absence of 60 days' notice by either party. On January 28,1958, the Respondent Local served notice upon the Company that it wished to reopen the contract to negotiate a general wage increase, a health and welfare fund, a wage increase for certain job classifications, and a checkoff provision. On April 11, the Respondent District Council on behalf of itself and its constituent locals, including the Respondent Local, sent to the Federal and State mediation services notice of the existing dispute in accordance with the requirements of Section 8 (d). On April 30, the contracting parties agreed to extend their existing contract to April 1, 1959, leaving open, however, for continued negotiations the subjects covered by the origi- nal requests for reopening.' The strike commenced on September 17, 1958, more than 60 days after the notice of dispute had been served upon the mediation services. The Trial Examiner held that the April 11 notice to the mediation services was not effective compliance with Section 8(d) because "that notice by its terms extended only to the matters at issue in the Pine- District Council negotiations. This notice could not be effective as to the contract which was extended on April 29, 1958, and which by its terms had a year to run. Despite this fact, the ultimatum of the Re- spondent encompassed modifications of the existing contract. There- fore, when the Respondents struck the Company, under the circum- stances here present, they violated Section 8(d) (1), (2), (3), and (4)." 1 The renewal agreement reads • We hereby agree to extend our 1954 working agreements to their 19,59 anniversary dates leaving open the items listed in your letters of January 28, and April 21, 1958, for negotiations. LUMBER AND SAWMILL WORKERS, LOCAL 2647, ETC. 237 The Trial Examiner's conclusion rests on a technicality which, we believe, has no validity. In renewing the existing agreement, the contracting parties left open for continued negotiations the subjects of a general wage increase, special wage increases for certain job classi- fications, a health and welfare fund, and checkoff of union dues. As to these matters, the Trial Examiner apparently concedes that the exist- ing contract was not renewed and that the April 11 notices to the mediation services were sufficient compliance with Section 8(d) so that a strike more than 60 days after April 11 caused by disagreement on such issues was not unlawful.' The Trial Examiner found, how- ever, that the ultimatum served upon the Company immediately before the strike included provisions as to two matters-change in termi- nation date and wage reopening-which were not subject to renegoti- ation before April 1, 1959, because they had not been covered by the reopening notices served upon the Company before the April 1958 anniversary date. The April 11 notices to the mediation services, ac- cording to the Trial Examiner, could be valid only as to matters spe- cifically left open for continued negotiation by the subsequently executed renewal agreement. As to nonopen subjects, the renewal agreement was the equivalent of the making of a new contract and any negotiations for changes thereof required renewed compliance with Section 8 (d), including new notices to the mediation services. The Trial Examiner's analysis overlooks certain factors. In includ- ing proposals for wage reopening and termination in their September 16 "Joint Recommendation," the Respondents dealt with subjects which Pine, bargaining agent for employers, considered to be open for negotiation, as evidenced by its own proposals on these subjects 3 2 N L.R B. v. Lion Oil Company, 352 US. 282. S On September 6, 1958 , Pine submitted proposals for settlement of the dispute which contained , Inter elsa, the following : Contracts that expired on 1958 anniversary dates to be reinstated , and-along with other contracts in existence during 1958 -be extended to 1961 anniversary dates Contractual provisions for changes in wages to be suspended during the extended contract periods, except that wages may be opened by either party on sixty days' written notice prior to April 1, 1960, and April 1, 1961 Two days earlier, on September 4, Pine submitted a proposal which included the identical provision above, except that it permitted wage reopening only before October 1, 1959, and April 1, 1960 The Respondents ' proposed settlement agreement submitted to the Company on Septem- ber 16 contained the following on the same subject: The contract shall be renewed with only the following changes from the anniversary date of the contract in 1958 to the contract anniversary date in 1961 (a) Minimum contract straight time hourly wage rates and/or piece rates may be opened by either party for negotiation of an across the board adjustment by giving thirty (30) days' written notice prior to October 1, 1959, and April 1, 1960 (b) The contract is subject to change or amendment upon sixty ( 60) days ' written notice prior to the contract anniversary date in 1961 , or any subsequent year, and is extended from year to year thereafter unless terminated by sixty ( 60) days' written notice of termination prior to any subsequent anniversary date The contract signed on December 11, 1958 , terminating the strike, was made effective to April 1, 1961 , with provision far automatic renewal unless notice of termination or modi- 238 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Indeed, as a practical matter bargaining about duration would seem necessarily to be incidental to bargaining about wage matters, for the duration of an agreement, including wage reopening, is a prime de- terminant in making and accepting wage offers. Moreover, the "dispute" which resulted in the strike was over health and welfare proposals and not over duration of a new agreement; and the notice to the mediation services specifically mentioned this subject as being one of the issues between the parties. Accordingly, we hold that the Respondents were not required to send a second set of notices of dispute to the Federal and State mediation services in order to comply with the requirements of Section 8(d). b. Striking without allegedly giving the Company the opportunity of consulting with Pine Pine had been designated by the Company to act as bargaining agent "for the purpose of recommendation only." The Company re- tained full freedom to accept or reject recommendations that might be made by Pine. The General Counsel alleged and the Trial Exami- ner found that the Company's employees constituted a separate ap- propriate unit. There is therefore no issue of a possible refusal to, bargain arising out of an attempt to break up a multiemployer bar- gaining unit. Pine and the Respondent District Council met for contract negotia- tions on April 10, May 15, and September 4 and 6, 1958. They were unable to reach agreement principally because the Respondents wanted a single, multiemployer health and welfare trust fund, and Pine sought to give the employers whom it represented the choice of either joining such a fund or establishing individual employer funds. At the final meeting held on September 6, 1958, it became clear that the positions of the parties were irreconcilable. At the close of this meeting, Pine stated that it was not breaking off negotiations, but that a change in economic conditions and further negotiations might change its attitude. The Respondent Unions, on the other hand, indi- cated that they might be forced to take action against individual em- ployers to secure contracts.' fication was served not less than 75 days before the anniversary date. It also provided for wage reopening on April 1, 1960, by giving 60 days' notice prior thereto 4 The Trial Examiner found that the parties had not reached an impasse at this meet- ing. We disagree. " . . . ordinarily a good-faith bargaining impasse connotes the futility of further negotiations. . . Central Metallic Casket Co., 91 NLRB 572, 573. Here there had been good-faith negotiations for approximately 5 months during which time the parties were unable to reach an agreement because of the health and welfare issue. Although indicating that it was not breaking off negotiations, Pine held out little hope that it would retreat from its position on health and welfare; the Respondent Unions similarly took a strong and adamant stand on this issue. In view of the entire course of bargaining, we find that the Company and the Respondent Unions reached a bargaining impasse on September 0. LUMBER AND SAWMILL WORKERS, LOCAL 2647, ETC. 239 On September 16, 1958, the Respondents submitted directly to the Company written proposals for the settlement of the dispute. The Company said that the proposals covered matters on which authority to negotiate had been delegated to Pine and that it should be taken up with that organization. The Respondents replied that unless the proposals were signed immediately a strike would be called. The Company asked for a chance to talk to Pine. The Respondents sug- gested that the Company telephone Pine. The Company refused stat- ing that nothing conclusive could be reached over the telephone. In any event, the Company refused to sign the Respondents' proposals and a strike was called which lasted until December 11, 1958. The Trial Examiner found that the "Respondents' ultimatum was peremptory and unreasonable and constituted a refusal to bargain in good faith. . . ." If the September 16 incident was all the bargain- ing that took place between the parties, we would agree with the Trial Examiner that this was not bargaining in conformance with the statutory standards But the "ultimatum" was the culminating action in a course of bargaining that had extended over a period of approxi- mately 5 months between the Company's agent, Pine, and the Respond- ents. It is apparently conceded that up to the date of the "ultimatum" the bargaining was in good faith. If the Respondents had struck immediately after the September 6 meeting, when it was apparent that an impasse had been reached, without further notice to the Com- pany or another opportunity to agree to the Respondents' terms, the strike could not be held violative of 8(b) (3)? A fortiori, a strike preceded by a final offer even on a "take it or face a strike" basis, after breakdown in good-faith bargaining negotiations is not a viola- tion of a union's bargaining obligation. Although the Company con- tends that the Respondents in serving the "ultimatum" denied it the opportunity of consulting with its agent, Pine, the fact is that Pine, as agent in behalf of the Company, had previously rejected the union proposal for a single health and welfare fund, which was the principal subject of the "ultimatum." Pine and the Respondents had already bargained to an impasse on this issue. The latter therefore was not required to resume again its fruitless bargaining on demand of the Company. c. Strike for a health and welfare fund The Trial Examiner found, as contended by the General Counsel, that the Respondents struck to compel the Company to agree to a 5 Other employers in the Company 's general area did agree to the Respondents' terms 9 "[By 8(b) (3) Congress ] intended to prevent employee representatives from putting forth the same 'take it or leave it' attitude that had been condemned in management " N.L.R B . v. Insurance Agents' International Union, AFL-CIO ( Prudential Ins Co ), 361 U.S. 477, 487. 7 N L R B . v. Insurance Agents' International Union, AFL-CIO (Prudential Ins. Co.), 361 US 477. 240 DECISIONS OF NATIONAL LABOR RELATIONS BOARD health and welfare trust proposal which was in violation of Section 302 of the Act. Section 302 as it existed at the time of the events in question provided that : (a) It shall be unlawful for any employer . . . to pay or de- liver, or to agree to pay , or deliver, any money .. . (1) to any representative of any of his employees... . (c) The provisions of this section shall not be applicable .. . (5) with respect to money or other thing of value paid to a trust fund established by such representative , for the sole and exclusive benefit of the employees of such employer , . . . Provided, That (A) such payments are held in trust for the purpose of paying, ... for medical or hospital care, pensions on retirement .. . (B) the detailed basis on which such payments are to be made is specified in a written agreement with the employer , and employees and employers are equally represented in the administration of such fund, together with such neutral persons as the representa- tives of the employers and the representatives of the employees may agree upon and in the event the employer and employee groups deadlock on the administration of such fund and there are no neutral persons empowered to break such deadlock, such agree- ment provides that the two groups shall agree on an impartial umpire to decide such dispute , or in event of their failure to agree within a reasonable length of time, an impartial umpire to decide such dispute shall, on petition of either group, be appointed by the district court . . . and shall also contain provisions for an annual audit of the trust fund, a statement of the results of which shall be available for inspection by interested persons ... ; and (C) such payments as are intended to be used for the purpose of providing pensions or annuities for employees are made to a separate trust which provides that the funds held therein cannot be used for any purpose other than paying such pensions or annuities. Violation is not an unfair labor practice but a misdemeanor punish- able by fine or imprisonment or both. The Board is not charged with direct or primary responsibility for the interpretation or enforcement of the section. In the "Joint Recommendation" submitted to the Company on Sep- tember 16, the Respondents proposed with respect to a health and welfare trust that : 2. Contributions by the Employer to a health & Welfare Fund, the "Lumber Industry Health & Welfare Fund" sometimes called the "Hazard Trust" for the benefit of eligible employees of Fif- teen Dollars ($15.00 ) per month commencing April 1, 1959 .. . LUMBER AND SAWMILL WORKERS, LOCAL 2647, ETC. 241 March hours of work will be used in determining the initial con- tribution made by Employer in April of 1959....8 (a) If prior to March 1, 1959 sufficient Employers in the Northern California area have agreed to a similar Trust for Northern California covering not less than three thousand em- ployees, then a Joint Union-Employer Trust for Northern Cali- fornia shall be established and such obligations and contributions by the Employer shall be to the Trust established between the Employers and the Northern California District Council of Lumber and Sawmill Workers. The Trial Examiner found that this proposal for a health and wel- fare was illegal because it did not provide the safeguards required by Section 302 and that the insistence thereon as a condition to enter- ing into an agreement was a violation of Section 8'(b) (3).9 Contrary to the Trial Examiner, we are not satisfied that the Respondents' pro- posed health and welfare trust violated Section 302. The Supreme Court has said that Section 302 is a criminal statute and is to be strictly construed.lp Neither the General Counsel nor the Trial Ex- aminer has pointed to any court or administrative decision that a proposal for a health and welfare trust similar to that submitted in this case is unlawful. It seems to us that Section 302 is intended to deal with trust agreements and not with proposals to create a trust in the future on the basis of certain financial contributions for each employee. The Respondents' proposal was plainly of the latter sort and contemplates further negotiations. Thus, it contains no schedule of benefits or any details of a plan. Financial contributions were not to be made, and benefits were not to be received, for at least 6 months. Moreover, the proposal contains reference to the "Hazard Trust," a detailed trust agreement which was under negotiation at the time. Finally, during the period preceding the opening of formal negotia- tions between the Respondent Council and Pine, the former sent the latter much material on health and welfare trusts, including a com- plete and lawful trust agreement early in January 1958. All this indicates that the Respondents were striving to establish a lawful trust and that Pine could not have understood otherwise. In the absence of a determination by an agency charged with the enforcement of Section 302 that the Respondents' proposal was unlawful, we are not prepared 8 The "Hazard Trust" mentioned above was not in existence at the time the "Joint Recommendation" was served upon the Company and therefore was not attached to the proposed agreement. There was, however, in existence at that time , according to the Respondents, a collective-bargaining agreement with other employers which set forth in some detail the provisions, administration, and eligibility rules for a trust to cover em- ployees in the central California area This trust was subsequently set up and is known as the "llazard Trust" 9 See International Typographical Union, APL-CIO v N L R B , 278 F 2d 6 (C A 1), enfg. as mod . 123 NLRB 806. 'i Arroijo v U S , 359 U S. 419. 597254-61-vol 130-17 242 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to say that the Respondents' insistence thereon constituted a refusal to bargain in good faith. d. Strike in violation of no-strike clause The Trial Examiner found that the strike of September 17 was in violation of the no-strike clause in the contract as extended and there- fore constituted a refusal to bargain.11 Assuming without deciding that the strike did violate the no-strike clause, we find on the basis of the Supreme Court's decision in the Prudential Insurance case 12 that such conduct did not also constitute a violation of Section 8(b) (3) of the Act. 2. The Trial Examiner found that the Respondents' conduct in con- nection with the strike deprived the Company of the advice of its freely chosen and duly designated bargaining representative, Pine,, and thereby violated Section (8b) (1) (B). We do not agree. Section 8(b) (1) (B) makes it an unfair labor practice for a labor, organization (1) to restrain or coerce . . . (B) an employer in the selection of his representatives for the purposes of collective bargaining or the adjustment of grievances. Both the words of the statute and the legislative history indicate that by this section Congress sought to safeguard the right of em- ployers freely to select their agents for collective-bargaining pur- poses.13 The September 17 strike was not called because of objections to dealing with Pine as representative of the Company but because of disagreement over terms of a contract. The Respondents had dealt with Pine to an impasse before the strike and continued to deal with Pine after the strike in securing a settlement thereof. The present situation is similar to that in the Morand case,14 where a majority of the Board held that it was not a violation of 8(b) (1) (B) for a union to strike one member of an association after an impasse had been reached in associationwide bargaining. The Board said in that case (91 NLRB at p. 415) : 11 International Unwn, United Mine Workers, et al. (Boone County Coal Corporation),. 117 NLRB 1095, set aside 257 F. 2d 211 (C.AD.C ). 12 N L.R B. v. Insurance Agents' International Union, AFL-CIO ( Prudential Ins. Co.), 361 D.S. 477. The Court said (at p. 494) . But surely that a union activity is not protected against disciplinary action does not mean that it constitutes a refusal to bargain in good faith. The reason why the ordinary economic strike is not evidence of a failure to bargain in good faith is not that it constitutes a protected activity but that . . . there is simply no incon- sistency between the application of economic pressure and good-faith collective bargaining. is Local 294, International Brotherhood of Teamsters , etc. (K-C Refrigeration Trans- port Company, Inc ), 126 NLRB 1 , Los Angeles Cloak Joint Board at at . (Helen Rose ' Co., Inc ), 127 NLRB 1543. 14 Morand Brothers Beverage Co., at al, 91 NLRB 409, 413-416 (Member Reynolds. dissenting), enfd. In relevant part 190 F. 2d 576 (C.A. 7). LUMBER AND SAWMILL WORKERS, LOCAL 2647, ETC. 243 ... the Old Rose strike was called, not because of any objection by the Local to dealing with the negotiators for the Associations, but solely because of the inability of the Local to obtain a satis- factory contract through joint bargaining. Under these circum- stances, wishing to bargain further during the strike on the basis of its demands, the Local had no alternative but to propose sep- arate negotiations. . . . Viewed in the light of these facts, such proposal could not reasonably be construed by Old Rose as having any object other than to secure a satisfactory contract. The fact that the Company may have felt that it needed more time than the Respondents were prepared to allow for consulting with its bargaining agent does not, in the light of the entire history of bar- gaining, establish that the Respondents sought to restrain the Com- pany in the "selection of [its] representatives for the purposes of col- lective bargaining...." [The Board dismissed the complaint.] MEMBER RODGERS, dissenting : I do not agree with the majority decision to dismiss the complaint in this case. I would adopt the Trial Examiner's findings that Re- spondent had unlawfully refused to bargain with the Employer in three of the four respects he found to constitute violations of the Act. As demonstrated below, neither the findings nor the reasoning ad- vanced by my colleagues in reversing the Trial Examiner will with- stand analysis. The Respondent's strike in violation of Section 8(d) : It is undis- puted that the Respondent served on the Employer, more than 60 days before the April 1, 1958, anniversary date of their expiring contract, the notice required by Section (8) (d) (1) with respect to that con- tract, and that it later served on the mediation services the notices re- quired by Section 8(d) (3). It is just as clear that the Employer and the Respondent thereafter, on April 11, 1958, executed an agreement which renewed the expired contract until April 1, 1959, excepting- only wage and welfare provisions, which were left open for negotia- tion. Neither the duration of the agreement nor the contract provi- sion relating to holidays was left open for negotiation. The contract contained a no-strike clause. Notwithstanding the signing of this contract the Respondent in September 1959, presented to the Employer an ultimatum, which in addition to containing wage and welfare demands, would have re- quired that the Employer sign another contract, extending the already existing contract until April 1961, and modifying the number of paid holidays in the existing contract. The Respondent struck immedi- ately when the Employer refused to sign, although it had given no 8 (d) (1) or (3) notice with relation to the existing contract. 244 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The majority does not dispute the Employer's conclusion that the agreement which renewed the expired contract constituted a collec- tive-bargaining agreement within the meaning of Section 8(d). From this finding it necessarily follows that the Respondent was re- quired to give 8(d) notices before striking for modification of the term of the agreement, and modification of its paid holiday provi- sions. The majority does not take issue directly with either of these findings. Instead, it circumvents them by use of a rationalization which holds first, that as wages were left open, the duration of the contract term was also left open; 15 and secondly, that the strike was not really a strike over duration of the contract, and the holiday pro- visions, but was over the health and welfare proposals. I am not willing to substitute such conjecture for the findings of the Trial Ex- aminer. The Trial Examiner's findings are based accurately not only on the specific terms of the contract, but also on the explicit terms of the Respondent's written strike ultimatum. I would affirm them. Respondent's bad-faith withdrawal from negotiations; its strike without giving the Employer an opportunity to consult with Pine: As described in detail by the Trial Examiner, the Employer and the Respondent Local, following their practice of at least 15 years' stand- ing, designated Pine and the District Council as their respective bar- gaining representative. Pine also represented approximately 43 other employers in the industry; the District Council represents 9 locals, including Respondent. After four meetings between Pine and the District Council, the Local abandoned negotiations through the Dis- trict Council, and presented to the Employer an ultimatum. As de- scribed above, the ultimatum announced that there would be a strike unless the Employer immediately signed a contract yielding to the Respondent's demands on several items, including wages and welfare plan, which items were still the subject of bargaining between Pine and and District Council. When the Employer asked for time to consult Pine, the Respondent brushed aside the request" and struck on the following day. The Trial Examiner found that by thus break- ing off the fruitful negotiations between Council and Pine, which had not come to impasse, and by striking the Employer pursuant to its 15'The majority also suggests that the Respondent had no obligation to give notices before striking to change the term of the agreement because Pine had, subsequent to making the agreement , offered to extend its term in return for other concessions from the Respondent But clearly such offers by Pine , not accepted by the Respondent , could not negative the provisions of Section 8(d) requiring notices before striking to modify the agreement The majority is thus suggesting that Pine 's offers constituted an implied waiver of statutory provisions enacted in furtherance of a public policy. Obviously, such a suggestion is fallacious. ie This single fact sufficiently distinguishes the case from 1orand Bros , supra, relied on by the majority for its reversal of the Trial Examiner' s 8(b) (1 ) ( B) finding it is certainly an empty gesture to say that Section 8(b) (1) (B ) was designed to safeguard the right of employers freely to choose their agents for collective bargaining, if the Board is going to bold that a union can, when it pleases, bypass the designated agent and strike an employer who requests time to consult the agent, instead of yielding to the union's demands on the spot LUMBER AND SAWMILL WORKERS, LOCAL 2647 , ETC. 245 preemptory and unreasonable ultimatum, Respondent had refused to- bargain in good faith. The Trial Examiner also found that this conduct violated Section 8(b) (1) (B) because it deprived the Em- ployer of an opportunity to consult, or bargain through its duly designated representative. These findings are eminently sound. The crux of the majority's reversal of these findings is its finding that the District Council and Pine had ailready bargained to impasse. In finding that there was no impasse, the Trial Examiner made a careful and detailed analysis of the four bargaining meetings. The analysis shows that in the course of the negotiations the District Council had made considerable progress in connection with its pro- posal for an industrywide health and welfare plan. In the third and fourth meetings, it had achieved a general acceptance of the idea that the industry should have such a plan, and a number of the employers were apparently agreeable to the Union's proposals as to the method of financing the plan. It is true that the written proposal which Pine submitted at the fourth meeting did not contain a specific proposal as to the welfare plan, as had its offer at the third meeting. However, it is also clear that Pine's representatives told the Union at the end of the fourth meeting that they believed further discussion might change the attitude of those employers who still disagree with the financing proposals. It is obvious from this state of the bargaining that no impasse ex- isted or was developing. On the contrary, the circumstances indi- cated that there was every likelihood of further concessions by the employers. No case in the history of the Board, save this one, holds that such circumstances connote a "futility of further negotiations." is In so holding here, my colleagues allude to the above outlined course of four bargaining meetings as ". . . approximately 5 months of bar- gaining . . ." in which ". . . it became clear that the positions of the parties were irreconcilable." These are but empty characterizations which gloss over the true state of the facts and they are a poor substi- tute for the Trial Examiner's sound analysis and conclusions. The strike to compel signing of an agreement violative of Section 302: One of the written demands included in the Union's ultimatum, and for which it struck, would have required the Employer to agree to pay into a nonexistent trust fund the specified sum of $15 per month for every employee who had been employed for 1 year and who had worked 80 hours in any given month. Payment was to begin, to a trust yet to be established, on April 1, 1959, approximately 6 months later. The Trial Examiner found that, had the Employer agreed to it, this provision would have been unlawful under the prohibitions of 17 In Central Metallic Casket Co., cited supra, by the majority, the Board did not find that an impasse existed. 246 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ;Section 302. This finding is sound. The express provisions of Sec- tion 302 quoted by the majority necessarily requires the conclusion that as there was no written trust fund agreement specifying any of .the elements required by the section, the proposal was for an unlawful agreement. The majority avoids this conclusion by calling the Re- •spondent's demand "proposals to create a trust fund in the future," implying therefore that it was not a demand for an agreement to pay, within the meaning of Section 302. Even if the majority's semantic distinction is accepted, it must be said that agreement to this type of proposal, is an unlawful way in which to proceed to set up a future trust fund, and is precisely the type of device that Section 302 was designed to prevent.18 I would therefore affirm the Trial Examiner's finding that striking to compel the signing of the proposed agreement constituted striking to compel performance of an unlawful act, and was therefore a bad- faith repudiation of the collective-bargaining process, in violation of Section 8(b) (3). Summarizing, I would affirm the Trial Examiner's findings that Respondent violated Section 8(b) (3) by striking to compel modifica- tion of its existing agreement with the Employer without giving the notices required by Sections 8 (d) (1) and (3). I would also affirm the finding that the Respondent had engaged in a refusal to bargain in good faith in violation of 8(b) (3) by breaking off the joint negotia- tions and striking pursuant to its peremptory ultimatum, and further that its ultimatum and strike violated Section 8(b) (1) (B) because they prevented the Employer from consulting or bargaining through its designated representative.19 MEMBER JENKINS took no part in the consideration of the above Decision and Order. is Nor do the other factors relied on by the majority support their holding Thus, it appears immaterial that payments were not to begin for 6 months. There is nothing to indicate that the September 16 demand was related to any written material on the sub- ject given the employers in the preceding January. And surely it is immaterial to specu- late whether the Employer, in the few hours provided in which to decide whether to sign an agreement which on its face appeared to violate the law, should have supposed that the Respondent was trying to establish a lawful trust fund. Moreover, the fact that the Respondent had submitted materials relating to trust funds to the employers almost 9 months earlier , indicates that the Respondent, if it were intent upon complying with the law, had ample time in which to develop a complete trust proposal which conformed to the requirements of Section 302 '01 find it unnecessary to pass on whether the Respondent's conduct may also be found to violate Section 8(b) (3) of the Act because there was a no-strike clause in. effect at the time of the strike, as indicated herein, I would find that the Respondent's noncompliance with the notice requirements of Section 8(d) imposed on Respondent the duty to continue the contract in effect without striking Further, as I would find that the Respondent's withdrawal from the negotiations for the purpose of striking the Employer was a refusal to bargain in good faith, I do not find that there is here presented an issue as to whether violation of a no-strike clause is, of itself, an 8(b) (3) violation . In any event, I am not prepared to agree with my colleagues that the Supreme Court's opinion in the Prudential ease, which did not involve a no-strike clause, necessarily means that in all circumstances, such a strike may not be an 8(b) (3) violation. LUMBER AND SAWMILL WORKERS, LOCAL 2647, ETC. 247 INTERMEDIATE REPORT AND RECOMMENDED ORDER STATEMENT OF THE CASE This proceeding with all parties represented , was heard before the duly desig- nated Trial Examiner at San Francisco, California, on October 14 and 15, 1959, on complaint of the General Counsel and answer of the above-named Respondents. The issues litigated were whether or not the Respondents violated Section 8(b)(1)(B) and (3) of the Act by certain conduct, which is more particularly described hereinafter. Upon the entire record, and from my observations of the witnesses, I hereby make the following: FINDINGS AND CONCLUSIONS 1. THE BUSINESS OF THE COMPANY AND PINE INDUSTRIAL RELATIONS COUNCIL Cheney California Lumber Company, herein called the Company, is a California corporation with its principal office and sawmill located at Greenville, California, where it is engaged in the manufacture of fir log studdings . During the calendar year ending December 31, 1958, the Company sold and shipped products of a value in excess of $50,000 directly to points outside the State of California. It is undis- puted, and I find, that at all times material hereto the Company was and is engaged in commerce within the meaning of Section 2(6) and (7) of the Act. Francis Cheney, who testified in this proceeding, is the treasurer and active man- ager of the Company. It is not disputed, and I find that Pine Industrial Relations Council, herein called Pine, is an Oregon nonprofit corporation, with its principal office and place of business located at Klamath Falls, Oregon. Pine is an association of employers who engage in the lumbering industry in the geographical area of central and southern Oregon and northern California. These employer-members pay dues to Pine, and in return Pine renders such services in the conduct of their labor relations as the member-employers request and authorize. C. L. Irving is managing vice president of Pine, and in such capacity has advised the members and customarily acted as their spokesman in collective bargaining since the formation of Pine in the year 1942. It is also undisputed and I find that the Company became a member of Pine in 1944 and since that year Pine has been the duly designated representative of the Company for the purposes of collective bargaining on an area or industry basis, as more specifically described hereafter. II. THE LABOR ORGANIZATIONS INVOLVED; THE INDIVIDUALS NAMED IN THE COMPLAINT; THE APPROPRIATE UNIT; THE REPRESENTATIVE CAPACITY OF THE LOCAL Upon the pleading and the record as a whole, I find that Lumber and Sawmill Workers, Local No. 2647, herein called the Local, and Northern California District Council of Lumber and Sawmill Workers, herein called the District Council, are both labor organization within the meaning of Section 2(5) of the Act. Both the Local and the District Council are components of Lumber and Sawmill Workers, a national labor organization. It is also found that at all times pertinent hereto Joseph Palazzi was secretary- treasurer of the Local; and that Hugh Allen was secretary-treasurer and James Stephens was business representative of the District Council. It is found that at all times pertinent hereto these individuals were acting in their respective official ca- pacities. The named labor organizations and individuals are collectively referred to herein as the Respondents. It is also undisputed and I find, that the employees of the Company, exclusive of clerical and supervisory employees, at its sawmill constitute a unit appropriate for collective bargaining within the meaning of Section 9(b) of the Act, and that for many years prior to the commencement of this proceeding, and at all times per- tinent hereto, the Local has been, and now is, the duly designated representative of a majority of the employees in said appropriate unit. It is also undisputed, and I find, that for approximately 15 years past the District Council has been and is the designated bargaining agent for the Local, on an area or industry basis, as more specifically described hereafter. III. THE UNFAIR LABOR PRACTICES The Issues It is the contention of the General Counsel that on September 16, 1959, the Respondents demanded that the Company execute a certain contract, entitled 248 DECISIONS OF NATIONAL LABOR RELATIONS BOARD "Joint Recommendation," forthwith, or be struck; that upon refusal of the Company to comply with this demand, the Company's mill was struck on the following day. The General Counsel claims that this conduct of the Respondents was unlawful because of the following: A. The Respondents had not complied with Section 8(d) (1), (2), (3), and (4) of the Act. B. The Company was precluded from consulting with Pine, its designated bar- gaining representative. C. The strike had as one of its purposes the coercion of the Company into becoming a party to a health and welfare trust, which violated Section 302(a) and (c) (B) of the Act. D. The strike violated the "no-strike clause" of the current labor contract between the parties. E. By the above conduct, the Respondents had coerced the Company in the selection of its bargaining representative in violation of Section 8(b)(1)(B), and had refused to bargain in good faith with the Company in violation of Section 8(b)(3) of the Act. The Respondents deny the commission of unfair labor practices. The Evidence There is practically no dispute between the parties as to the basic facts, or the sequence of events which constitute this controversy. Most of the evidence is. documentary in form, and there is no substantial conflict in the verbal testimony of the witnesses. Background; the Mechanics of the Multiemployer-Multiunion Bargaining in the Lumber Industry; the Local Issues It is undisputed that the parties hereto have conducted their labor relations on the basis of multiemployer-multiunion bargaining for the past 15 years. As a result, practically all contracts in the industry in the area have the same approxi- mate termination date. The mechanics of the bargaining procedure, which the parties adopted, is relatively simple. As a contract between the individual local and individual employer approached its termination date, the individual local or indi- vidual employer notified the other of its desire to modify or change the terms of the expiring contract. Usually contained in such notice was a delegation of bargaining authority, on industrywide issues, to the District Council, by the local union, or to Pine, in the case of an individual employer. Such a notification was usually answered by letter, which conferred corresponding authority on the representative of the party notified. By this procedure, on a date agreed upon a committee of the District Council, representing the locals in northern California, and a committee of Pine, representing approximately 44 employers in the same geographical area, met at the bargaining table, each duly authorized to negotiate on all matters at issue between the group of unions and the group of employers which were of industrywide or areawide application. Thereafter, in negotiations the committees hammered out the substantive terms, and on some occasions the exact contract language of a new agreement. However, the agreement of these committees was a recommendation only, and not a contract. When the terms of the recommenda- tion were agreed upon, then Pine transmitted them to its employer-members, and the District Council performed the same service for its locals. After that, each individual company and individual local executed a contract, embracing the terms and sometimes the contract language of the recommendation. The bargaining between the parties also had a second, well-defined procedure. Usually, in the course of a contract term there arose certain questions peculiar to a particular employer, and a particular local union. These issues, not being of industrywide or areawide application, were regarded by all concerned as "Local Issues " Authority to bargain on these local issues was always retained by the par- ticular local and the particular company, to be resolved by individual employer- local bargaining, after the District Council-Pine bargaining had resolved the ques- tions of industrywide importance. By the above procedure, the unions and employers in the lumber industry in the Pacific Northwest have for many years achieved both uniformity in wages, hours, and working conditions on the industry level, and a certain amount of flexibility on other conditions of employment, on the plant level. That this procedure of bar- gaining is of value, is evidenced by the parties' adherence to it for the past 15 years. LUMBER AND SAWMILL WORKERS, LOCAL 2647, ETC. 249 The 1958 District Council-Pine Negotiations It is undisputed that the above procedure was followed for a period of time by all concerned with the negotiations in the year 1958. In that year, the contract between the Company and Local 2647 was due to expire by its terns on April 1.1 It is undisputed that on January 28, 1958, Joseph Palazzi, secretary-treasurer of Local 2647, sent a series of three letters to the Company. The first of these reads as follows: Re: Opening of Wages. GENTLEMEN: The undersigned Lumber and Sawmill Workers Local Union hereby gives the required notice under our collective bargaining agreement to open the contract on wages, to provide for a general wage increase of 18¢ per hour for all employees in the bargaining unit. This Local Union has delegated collective bargaining authority on wages to the Northern California District Council of Lumber and Sawmill Workers. We are looking forward to meeting with you to discuss the terms of the new agreement.2 [Emphasis supplied.] The second letter reads as follows: Re: Opening of Contract. GENTLEMEN: The undersigned Lumber and Sawmill Workers Local Union hereby gives the required notice under our collective bargaining agreement to open the contract on the below listed items. We propose to amend the contract as follows: (1) A new section entitled "Health and Welfare Provisions" shall be added to read as follows: "Section ----------- (a) The Lumber and Sawmill Workers Employer- Union Health and Welfare Fund is hereby established. The Fund shall be jointly administered by those signatory Employers and the Unions parties to the Agreement and Declaration of Trust providing for the Lumber and Sawmill Workers Employer-Union Health and Welfare Fund executed on the ---------- day of ________________, 1958. "(b) Effective ________________, 1958, the Employer shall be obligated to contribute to said Fund the sum of ten cents per hour worked or paid for for each employee per month. Said contributions shall be used to provide life, accident, disability and sickness insurance, and medical and hospital expense benefits for employees and dependents. "(c) Contributions for the month of ----------- 1958 are due and payable between ---------- I and 10, 1958, and contributions for each month there- after are due and payable prior to the 10th of each succeeding month. "(d) The Employer hereby accepts, ratified and becomes bound by the terms of that certain Agreement and Declaration of Trust, as amended, executed by and between signatory Employers and Unions creating the Lumber and Saw- mill Workers Employer-Union Health and Welfare Trust Plan dated ----------- 1958, the same as though he were signatory thereto. A copy of said Agreement and Declaration of Trust is herewith provided the Employer. "(e) The obligations of the Employer and other provisions relating to the Fund are hereby incorporated as a part of the collective bargaining agreement between the parties hereto." (2) Provide for a maximum of 6 holidays paid for at straight-time if not worked and 21/2 times if worked, without restriction This Local Union has delegated collective bargaining authority to the Northern California District Council of Lumber and Sawmill workers on these items. We are looking forward to meeting with you to discuss the terms of the new agreement.3 The third letter reads as follows: DEAR Sms: Please be advised that in addition to the enclosed demands on Health and Welfare, Holiday pay, and general wage increase, this Local Union wishes to negotiate an additional 100 per hour increase on the following classi- fications: "This contract is in evidence as General Counsel's Exhibit No. 2. a This letter is General Counsel's Exhibit No. 3 in evidence. s This letter is General Counsel's Exhibit No. 4 in evidence. 250 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Deckman, Planerman, Carrier Driver, Loader, Planerchain crew, Mill- wright, Stacker, Unstacker, Planerfeeder, Lumber Grader and Grease monkey. Also we wish to add to Article I, the following-an additional Section to read as follows: SECTION 6. The Union agrees to furnish the Company with proper authorization for de- duction of Union dues and initiation fees from employee's [sic] wages, and the Company agrees to deduct said dues when so authorized. Our Union Committee is looking forward to an early meeting with your com- pany to discuss these demands. In connection with the last letter, it should be noted that Local 2647 did not au- thorize the District Council to bargain for it on these demands, evidenly regarding them as local issues, within the procedure of the bargaining .4 On February 19, the Company, by letter, replied to Local 2647 as follows: GENTLEMEN : We have your letters of January 28, 1958, in which you seek a wage increase and amendments to our collective bargaining agreement. We assume that the wage increase proposal supersedes the proposals made on items (f) and (g) in your letter dated January 26. 1957. We would also assume that our offer to close the contract except as to items (f) and (g), made in our letter to you under date of May 17, 1957, was accepted by you. You will be notified at a later date of any plans we may make as to repre- sentation in negotiations . Unless so notified , any arrangements for meetings must be made through this office.5 On March 31 , Hugh Allen, secretary-treasurer of the District Council , wrote the Company the following letter. DEAR SIR: We hereby request a joint meeting of yourself and other employers within the District with the Northern California District Council representing the various Local Unions at 1:00 P.M. on April 10, 1958 at the Hotel Redding, Redding, California to discuss the wage and contract demands previously sub- mitted to you by the Local Unions. Please advise whether or not your Company will be represented at this meeting.6 On April 7, the Company, by letter, replied as follows: GENTLEMEN : Until further notice, and for the purpose of recommendation only, we are authorizing an Employers ' Committee of Pine Industrial Relations Council to represent us in negotiations on matters you have assigned to the LSW Northern California District Council. Our assignment of this limited au- thority extends only to such matters that are properly open to discussion under contractual terms, and on which negotiations under those terms are now timely. It is undisputed that the Company 's letter of April 7 was transmitted to Pine, as well as to the District Council , and that this letter constituted authority to Pine to bargain for the Company in accordance with the tenor and terms of the letter.? First Meeting, District Council-Pine On April 10, a committee of Pine and a committee of the District Council met at Redding, California, for the purpose of negotiating on the proposals of the Union_ C. L. Irving of Pine testified as to the events of this and subsequent meetings. He testified in a fair and frank manner and I credit his testimony in its entirety. Hugh Allen and Daniel Johnston of the District Council also testified to specific events which recurred at these meetings . Their testimony, except to the extent hereafter noted, was in substantial agreement with the testimony of Irving. According to Irving this first meeting of the committees was largely exploratory and informational. Johnston was spokesman for the District Council. He took the lead in the discussion , reviewing the economic situation in the industry , the prob- lems facing the Union , the formation of the Western Council of the Union-an overall organization , the cost of living, etc . He also said that the union's search This letter is General Counsel's Exhibit No . 5 in evidence. This letter is General Counsel's Exhibit No 6 in evidence This letter is General Counsel 's Exhibit No . 7 in evidence 7 This letter is General Counsel's Exhibit No. 8 in evidence. LUMBER AND SAWMILL WORKERS, LOCAL 2647, ETC. 251 for security for its members led the Union to place primary emphasis on the estab- lishment of a health and welfare trust for the benefit of the employees. Irving, as spokesman for Pine, then reviewed the economic situation in the indus- try, which at that time was in a pronounced slump. He pointed out that the price of lumber was considerably below the price levels prevailing at the time of the last wage increase. The meeting adjourned after this discussion. One conflict of testimony developed as to one facet of this meeting. It should be mentioned in the interest of clarity. Irving testified that the only documents before the conferees were the Local's demands contained in the Local's letters of January 28. Irving said that he had no recollection of a proposed trust agreement having been presented to him at any time prior to this meeting. Johnson testified that "early in 1958," prior to the meeting, he had sent to Irving a complete trust agreement for his consideration. On the basis of Johnston's testimony, a copy of such a document was received in evidence.8 However, Johnston agreed with Irving that the document was not before the committees as they discussed the subject of health and welfare, and apparently was not referred to by the representatives. Both of these witnesses agreed that the discussion of the topic had reference only to the idea and advisability of a health and welfare fund, as proposed in the Local's demands in the letter of January 28. It should also be noted that although the Local's letter of January 28 states, "A copy of said Agreement and Declaration of Trust is herewith provided the Em- ployer," no such copy was submitted to each employer with said letter. Hugh Allen of the District Council testified that at a later date, after August 22, he received a supply of the trust agreements from the State Council, and that he ordered his secre- tary to mail one copy to each employer concerned in the industrywide bargaining. On the same subject Francis Cheney of the Company testified that his Company did not receive at any time a copy of any proposed trust agreement. I credit Cheney's testimony in full, and find that the Company never received any so-called trust agreement. As to whether Pine received a copy of the proposed trust agreement, I will accept the positive testimony of Johnston in preference to Irving' s less positive recollection. In all events, whether Pine received a copy of this particular trust agreement is of little consequence because all parties agree that this trust agreement was not referred to in the bargaining conferences, and was not connected with the later demands of the Respondents upon the Company. Notice to the Conciliation Services It is undisputed that on the day following the first meeting of the parties, April 11, the District Council sent the following letter to the California State Conciliation Service, and the Federal Mediation and Counciliation Service: DEAR SIR: This letter is intended to serve as a Notice of Dispute filed to comply with Section 8(d)(3) of the Labor Management Relations Act, 1947. We are using this means to supply the necessary information as we do not have any regular forms. The 60 days notice required by Section 8(d) (1) was served on the enclosed parties February 14, 1958 and no agreement has been reached to date. Dispute is between the enclosed list of companies and ourselves. The Northern Cali- fornia District Council of Lumber & Sawmill Workers, AFL-CIO, 1046 Yuba Street, Redding, California, Telephone No. CHestnut 1-4411 representing the Local Unions listed opposite the names of the companies. Principal products of these operations are logging, lumber, box shook, plywood and etc. Contract expiration dates vary between April 1, 1958 and June 1, 1958. Principal issues involved are wages, health and welfare, and holiday benefits. The estimtaed number of employees involved in these establishments and involved in this dis- pute for which this notice covers is approximately 4500. This dispute arose as part of the industry wide negotiations currently being conducted on the West Coast between various Employer Association groups and the Western Council of Lumber & Sawmill Workers. [Emphasis supplied.) Attached to the notices was a list of the disputants, which listed the names of 9 locals in northern California, and the names of approximately 44 employers in the same area, including the name of the Company.9 e Union's Exhibit No. 1 in evidence. e General Counsel's Exhibits Nos 9 and 10 In evidence 252 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The Contract Extended ,On April 21, 1958, Local 2647 sent a letter to the Company requesting a meeting on "wage brackets," and noting the importance of a meeting prior to April 30, the -termination date of the contract.10 Cheney of the Company went to Greenville and met with Palazzi of the Local on April 30. At the meeting he and Palazzi agreed to extend the contract. In consequence, Palazzi drafted an extension agree- ment, which Cheney and Palazzi signed. This document entitled "Memorandum of Agreement" reads as follows: We hereby agree to extend our 1954 working agreements to their 1959 anni- versary dates leaving open the items listed in your letters of January 28, and April 21, 1958 for negotiations." In this connection it should be noted that the contract, which was extended by the above, contained a no-strike clause which reads as follows: ARTICLE V. STRIKES AND LOCKOUTS SECTION 4 The Union further agrees that there will be no strike during the life of this agreement unless it is determined through proper channels that the Com- pany has violated some terms of the agreement. SECTION 5. The Union further agrees that in case of a dispute that it will continue work under the terms of this Agreement in effect at the time the dispute arose and for so long a time as the dispute remains unsettled. Second Meeting of District Council-Pine On May 15, the committees of the parties met again at Redding, California. Irv- ing, as spokesman for Pine, expanded on his previous theme that the companies could not absorb increased costs. Johnston, the economic advisor of the District Council, who had particular inter- est in the health and welfare program of the Union, was not present, but Hartley and Allen of the District Council elaborated further on the health and welfare proposal. In the course of his remarks Hartley said that the institution of a health and welfare program was the Union's number 1 goal for that year. Irving outlined the objections of the employers to a multiemployer approach to health and welfare. He explained that some of the employers did not like to mingle their funds with funds of other employers. Also, the larger employers who could carry the financial burden of such a fund, preferred to make their own arrangements, for they were fearful that they would be absorbing the cost of carrying the employees of the smaller companies, who were their competitors in the lumber market. In the course of the meeting Irving told the union representatives that the employ- ers were willing to extend the expiring contracts for another year without any chance but permitting a wage reopening in the fall of the year. Allen replied that the District Council committee would not recommend acceptance of that offer, but that he would report it to the District Council. Third Meeting of District Council-Pine On September 4, the committees of the parties again met at Redding, California. At this meeting Allen, for the District Council, explained that after discussing the subject of health and welfare with individual employers, the District Council had decided to set up a northern California trust for health and welfare purposes, and he presented to the representatives of Pine, a document entitled "Joint Recom- mendation," which he said was the Union's proposal in that regard.I2 The conferees discussed this proposal and then the employers' committee caucused. At the conclusion of the caucus Irving informed the District Council's representa- tive that the employers remained reluctant to set up one fund for all employers. The Pine Committee then gave the District Council representatives a proposal for health and welfare, which the employers' committee had worked out, and which the employers considered satisfactory. This proposal is entitled "Joint Recom- 10 This letter is General Counsel's Exhibit No. 11 in evidence. 11 This document is General Counsel's Exhibit No. 12 in evidence 12 This "Joint Recommendations" Is General Counsel's Exhibit No 13 in evidence LUMBER AND SAWMILL WORKERS , LOCAL 2647 , ETC. 253 mendation" and has attached to it a document entitled "Exhibit 1-September 1958." 13 This proposal was based on a wage increase in April 1959 , with an option for individual employers and locals to either: ( 1) participate in a joint trust, or (2) provide for the same health and welfare benefits on an individual employer-local basis. This was rejected by the District Council representatives on the ground that it permitted deviation from the uniform approach which the District Council desired. Pine urged the acceptance of the proposal pointing out that it afforded a certain amount of flexibility which would accommodate the varying desires of the em- ployers, and yet afforded the employees substantially uniform benefits. As the meeting concluded, Allen said that since the District Council had been unsuccessful in setting up a northern California trust, he felt the District Council would have to try to set up the central California trust. The latter-named trust had not been mentioned in the negotiations up to that point and it should be noted that no complete trust proposal had ever come before the conferees up to that point. The parties agreed to meet again on September 6. Fourth Meeting of District Council-Pine On September 6, the parties again met . On this occasion Allen was spokesman for the District Council, Johnston not being present , and Irving continued as spokes- man for Pine . Pine offered a new written proposal which called for an immediate pay increase of 5 cents per hour and a further increase of 5 cents per hour on October 1, 1959, and the extension of the present contracts.14 No mention was made of the health and welfare proposal. Allen said the proposal was not acceptable , that it was not as good as the proposal made at the previous meeting, and that the District Council rejected both offers. Also, the District Council withdrew its proposal to set up a northern California trust for health and welfare. Irving then said that Pine was not breaking off negotiations . He said that further negotiations and changing economic conditions in the industry might affect the employer's attitude. He pointed out that during the week of September 8, he would be busy , as would the employers, in the meetings of the Western Pine Asso- ciation at Portland, and that he also was committed to a joint meeting on September 16 with the Willamette Valley and Central Oregon District Councils of the Lumber and Sawmill Workers. He explained that, with those exceptions, the Pine com- mittee was available for further meetings at any convenient time and place. Allen stated that it might be necessary for the District Council to "force its way" with individual employers . Irving replied that he thought it might be per- missible for the District Council to use peaceful methods to persuade individual employers to their point of view, but that coercion through strike threats or strike action, in his opinion, would be an unfair labor practice. The Demand on Cheney ; the Strike On September 15, 1958 Allen telephoned Francis Cheney , treasurer of the Com- pany, and asked for an appointment to discuss "some matters." Cheney agreed to meet Allen on September 16 at the Company 's office. At the agreed time, not Allen, but Palazzi and Stephens , together with a committee of employees from the Cheney- Grant Lumber Company at Pondosa , Oregon, appeared . Cheney told the delega- tion that bargaining authority had been delegated to Pine on all areawide demands, but that he was prepared to meet on "local issues." Cheney also said that the Pine committee was not available that day. Some local issues were discussed. Then Cheney was presented with a written proposal entitled "Joint Recommendation." 15, This document reads as follows: JOINT RECOMMENDATION In full satisfaction of the contract negotiations between the undersigned par- ties, it is agreed as follows: 1. The contract shall be renewed with only the following changes from the anniversary date of the contract in 1958 to the contract anniversary date in 1961: 13 This document is General Counsel's Exhibit No . 14 in evidence. is This proposal is General Counsel's Exhibit No . 15 in evidence. lb This document is General Counsel's Exhibit No. 16 in evidence. 254 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (a) Minimum contract straight time hourly wage rates and/or piece rates may be opened by either party for negotiation of an across the board adjustment by giving thirty (30) days' written notice prior to October 1, 1959 and April 1, 1960. (b) The contract is subject to change or amendment upon sixty (60) days' written notice prior to the contract anniversary date in 1961 , or any subsequent year, and is extended from year to year thereafter unless terminated by sixty (60) days' written notice of termination prior to any subsequent anniversary date. (c) It is further agreed that during the life of this arrangement , from any negotiated general wage increase , the Local Union may have an option of taking paid holidays up to a total of six (6) paid holidays in the contract as a part of such negotiated wage increase . The cost of such paid hohdays shall be computed at 21 cents per hour for three (3) paid holidays. 2. Contributions by the Employer to a Health & Welfare Fund, the "Lumber Industry Health & Welfare Fund" sometimes called the "Hazard Trust" for the benefit of eligible employees of Fifteen Dollars ($ 15.00 ) per month com- mencing April 1, 1959 for each regular employee who has been on the payroll for at least one ( 1) month and who has worked or is paid by the Employer for eighty (80) or more hours in the immediately preceding month . March hours of work will be used in determining the initial contribution made by the Employer in April of 1959. Contributions will be made between the first and tenth of each month. (a) If prior to March 1 , 1959 sufficient Employers in the Northern California area have agreed to a similar Trust for Northern California covering not less than three thousand employees , then a Joint Union-Employer Trust for Northern California shall be established and such obligations and contributions by the Employer shall be to the Trust established between the Employers and the Northern California District Council of Lumber & Sawmill Workers. (b) Credit of Eight and one-half cents (8'iO) per hour will be granted to the Employer in future negotiated wage increases. Accepted and agreed to this ------ day of ----------------, 1958. By --------------------------------- By - ------------------------- Lumber & Sawmill Workers Local Union Name of Company No. ------ ----------------------------- Northern California District Council Lum- Address of Company ber & Sawmill Workers By -------------------------- By --------------------------------- [Emphasis supplied.] Cheney read the document and said that it involved matters on which authority had been delegated to Pine, and that it should be taken up with Pine . The Re- spondents then gave Cheney an ultimatum; the proposal would be signed , then and there, or strike action would be taken immediately . On this subject, Cheney testified as follows: A. Well, I read it through, and I told them that I thought this was the matter that had been delegated to Pine for negotiation, and they told me that they were going around to all the mills directly and getting their signature upon the recommendation, to which I replied that it was still a matter which had to be taken up directly with them, and I should wait their advice on it. They then told me that they were prepared to take strike action unless I signed that, and I said, "You mean sign this day?" And they said, "Yes, today." And I said , "I haven't had a chance to talk with Pine, nor have I had a chance to talk with my own principals , my own company." They said, "There is the telephone . Call them." And I said, "Well, I can't." "Nothing conclusive could be arrived at over the telephone. I want a chance to look this thing over." They said, "You sign this today or we will have a picket line around your mills tomorrow." Q. You say this was stated by one of the union representatives? A. This was stated by Mr. Stephens. Q. All right. Continue. A. And I told them I couldn't help it; if they were going to strike, they were doing it illegally because I felt it was being coercive, I was being coerced into signing something I had no opportunity to study or to consult with Pine or LUMBER AND SAWMILL WORKERS , LOCAL 2647 , ETC. 255 with my company, and I also reminded them that I felt that a strike would be a violation of our contract. And I asked them questions about this health and welfare fund. I asked them if they had anything more to show me than just what they had here, and they said that that was it, and that the health and welfare plan had not been drawn , and that this , in fact, I was signing here an agreement to engage in a health and welfare fund to start in April 1st, but I would have to agree today to do it. I would have to agree to pay into this fund $ 15 per month per man, and I asked them again and again if they had an outline of the fund or plan giving me more detail, telling me what the benefits were. They said they did not. I also told them-1 was asked if I objected to a health and welfare plan, and I said that I do not object to an insured plan, and that the company had been working for some months to develop an insured plan, but I couldn't go for this. In the first place, I didn't think it was legal and, in the second place , I didn't agree or wouldn't agree without knowing more about it to a plan which involved other employers as well as other unions. And they said , "Well, we are going to strike your mill, both mills, Pondosa and Greenville, if this isn't signed today." They stated that they were going down to the local union hall in Medford, and they would be there an hour or so, and that if I changed my mind I could call them, and if I didn't they would assume that I wasn't going to sign it, and that there would be pickets at the mill the next morning. And Mr. Stephens said , "Just tell us how many men you are going to need to button it up, because there will be pickets there in the morning." Then we 'got into quite a discussion as to the fact that they were coercing me and trying to force me into doing something at the spur of the moment, and I said, "Can't you give me at least until the week -end to look into this thing and determine its merits and try to give you an answer?" They said , "No, you sign it today or else." This was Tuesday.18 It is undisputed that no further information or details of the trust provisions were furnished to Cheney. Indeed, none could be furnished for it is undisputed that on that date neither the so-called "Hazard Trust" nor the "Northern California Trust" had been formulated , even in skeletal outline. Also, in going over the proposal Cheney pointed out that the proposal changed certain provisions of the current contract , extended by the memorandum of April 30, 1958 . The Respondent's attitude remained the same. It was, "sign or else." It is undisputed that Cheney refused to sign the document and that the Respondents struck the company sawmills on the next day, September 17, 1958. The strike continued until December 11, 1958 , when a new contract was signed . Cheney testified that the new contract was negotiated by himself with the assistance of Pine with various representatives of the Local and the District Council . Ultimately, the health and welfare proposal was worked out in negotiations , with the added assistance of insurance representatives of the Company and of the Aetna Insurance Company. On or about December 11 , 1958, a plan for health and welfare, which was called the Cheney-Aetna Plan, was submitted to the employees , who voted to accept it. With the execution of the new contract the strike came to an end. Concluding Findings The evidence establishes that in the 1958 negotiations , the Company designated Pine as its bargaining representative and that the Local designated the District Coun- cil as its representative to negotiate on the contract proposals which had areawide or industrywide application . Among the items for negotiation by these representa- tives was the proposal that an employer-union health and welfare trust be established for the purpose of furnishing certain benefits to employees . Thereafter, the repre- sentatives of the District Council and Pine met and engaged in a series of fruitful ne- gotiations . In these negotiations it developed , that the District Council sought to set up one trust in its district to which all employers would contribute . On its part, Pine found a division of its members on the acceptability of the District Council's proposal. Some employers were agreeable to the Union's proposal ; others preferred to set up trusts limited to their own employees with a fund to which the particular '"Transcript, pp. 149-150. Note the Trial Examiner has substituted the term Pine for P.I.R.C. In this passage. The latter term was used by the witness to designate Pine 256 DECISIONS OF NATIONAL LABOR RELATIONS BOARD employer alone would contribute; others wished to avail themselves of the services of insurance companies in setting up the trust; still others preferred to grant a pay raise in lieu of the acceptance of the District Council's health and welfare proposal. In the meeting of September 4, the Pine Committee proposed a three-way approach to the problem, based on a wage increase, or in lieu thereof, an option granted the em- ployers to enter either a joint trust pursuant to the Union's proposal, or an individual welfare plan covering the employees of a single employer, but affording uniform benefits. As one analyzes the situation as of September 4, it is apparent that the District Council had made considerable headway with its proposal for the establishment of a health and welfare plan for the employees in the industry. It had achieved a gen- eral acceptance of the idea, that such benefits should be secured to the employees and a raise in pay which could be used to finance a plan. The only disagreement at that point was as to the method to be used to secure those benefits, either the multi- employer method espoused by the District Council or the individual method as de- sired by some of the employers. On September 6, Pine offered the union representatives an immediate raise in pay of 5 cents per hour, and a further raise of like amount to be effective on October 1, 1959. The District Council's representatives said that they considered the Septem- ber 4 proposal to be better than the instant offer, but they rejected both offers. The Pine Committee, at the close of the meeting on this day, told the District Council representatives that the Pine Committee would be busy with an industry meeting, and meetings with a sister District Council of the Lumber and Sawmill Workers for approximately 2 weeks, but thereafter the Pine Committee would be ready to nego- tiate further with the representatives of the District Council at any time and place. Furthermore, the spokesman for Pine pointed out that changing economic factors and further discussion might bring a change in the attitude of some employers. On the other hand, the District Council spokesman said that the District Council might have to "force its way" with individual employers. The spokesman for Pine replied that Pine had no objection to the District Council attempting to persuade individual employers to the District Council's point of view, even to the point of persuading the individual employers to rescind their bargaining authority then held by Pine, but the spokesman for Pine stated that Pine would consider any form of coercion to be unlawful. At this point in this analysis certain findings must be made. From the undisputed evidence it is clear and I find that the District Council-Pine negotiations had been initiated and were proceeding in accordance with the traditional bargaining pro- cedure of the parties I also find that this bargaining had been fruitful, being produc- tive of proposals and counterproposals, which were the basis for the ultimate solution of the health and welfare question, and that no impasse had been reached in these negotiations, when the District Council and the Local, acting in concert, embarked on the course of conduct of which the General Council complains. Despite the fruitful state of negotiations, on September 16 the Respondents issued what can only be termed an ultimatum to Cheney, that he sign forthwith their joint proposal or be struck The Respondents gave short shrift to Cheney's various pro- tests and when he did not capitulate, struck his plants on the next day. The General Counsel contends that this action constitutes unfair labor practices, for a variety of reasons, and in a variety of aspects. These will be discussed seriatim. It is clear from the record that the Respondent's ultimatum required the Company to accept an agreement calling for the payment of large sums of money for the purposes of health and welfare, according to an indefinite plan to be drawn by unnamed persons at some unknown date in the future. In effect, the Respondents re- quired the Company to sign a blank check in this regard. When Cheney asked for information and details of the plan, he was told that the Respondents could not furnish details, because the trust plan at that time was only in the idea stage When he asked for time to consult the bargaining representative and to study the proposal, his request was denied. In the light of these undisputed facts, I must find that the Respondents' ultimatum was peremptory and unreasonable and constituted a refusal to bargain in good faith with the duly designated bargaining representative of the Company in violation of Section 8(b)(3). The same conduct also constitutes a violation of Section 8(b) (1) (B) because it deprived the Company of the counsel and advice of the Company's freely chosen and duly designated bargaining representative. On this aspect of the case, the General Counsel urges that the language of the Board in Retail Associates, Inc., 120 NLRB 388, is pertinent. The cited passage reads as follows: We would accordingly refuse to permit the withdrawal of an employer or a union from a duly established multiemployer bargaining unit, except upon ade- LUMBER AND SAWMILL WORKERS, LOCAL 2647, ETC. 257 quate written notice given prior to the date set up by the contract for modifica- tion, or to the agreed-upon date to begin the multiemployer negotiations. Where actual bargaining negotiations based on the existing multiemployer unit have begun, we would not permit, except on mutual consent, an abandonment of the unit upon which each side has committed itself to the other, absent un- usual circumstances. While I agree fully with the rationale of the cited case, I cannot see that it is pertinent to this situation. Here, there was no withdrawal, or attempted withdrawal from the multiemployer bargaining. Here, the Local and its designated bargaining agent, the District Council, in the course of fruitful negotiations, uaunched a joint attack against the Company to obtain benefits, some of which were at issue in the bargaining between Pine and the District Council, and some of which were changes in the extended contract. In the light of all the evidence, I must conclude that at that point, the Respondents repudiated the principles of good-faith collective bar- gaining and resorted to economic warfare to gain these various objectives. This finding is buttressed by the other considerations advanced by the General Counsel. It is undisputed that Palazzi and Cheney executed an ambiguous exten- sion of the existing contract on April 29, 1958. It is also undisputed that the con- tract, so extended, contained a no-strike clause. While it is true that some bargain- ing issues between the parties were excepted from the extension, and thus from the no-strike clause, it is equally true that the ultimatum of the Respondents encom- passed a change in the termination date, and a change in the wage-reopening provi- sions-two subjects on which the no-strike clause of the extended contract was operative. When Cheney called this to the attention of the Respondents, they brushed aside his protest. On the undisputed evidence I find that in striking on these issues contrary to the tenor of the existing agreement, the Respondents also failed to bargain in good faith in violation of Section 8(b)(3). On the basis of the same facts, it follows that the strike of the Respondents was in violation of Section 8(d) (1), (2), (3), and (4). While it is true that the Local and District Council gave notice on April 11, 1958, to the Federal and State Conciliation Services, that notice by its terms extended only to the matters at issue in the Pine- District Council negotiations. This notice could not be effective as to the contract which was extended on April 29, 1958, and which by its terms had a year to run. Despite this fact, the ultimatum of the Respondents encompassed modifications of the existing contract. Therefore, when the Respondent struck the Company, under the circumstances here present, they violated Section 8(d)(1), (2), (3), and (4).17 The General Counsel also contends that the strike of the Respondents was un- lawful because by the strike the Respondents sought to coerce the Company into becoming a party to a health and welfare trust which violated Section 302(a) and (c)(B) of the Act. Briefly stated, Section 302 forbids employers to pay or agree to pay money into a trust fund for the benefit of employees except when such trust fund is to be used solely for the following purposes: (a) Medical or hospital care; (b) pensions or retirement or death; (c) compensation for injuries, etc.; (d) unem- ployment benefits; (e) life insurance; (f) disability or sickness insurance; and (g) accident insurance. Section 302 also requires the following: 1. The nature of the benefits must be spelled out specifically in a written agree- ment between the employer and the employees. 2. The fund must be administered equally by management and the union, with certain provisions for recourse to a mutual third party in case of disagreement. 3. There must be an annual audit, with results available for inspection by in- terested parties. 4. Contributions for pensions must be kept separately and used only for that purpose. Examining the Respondents' "Joint Proposal" of September 16, we must conclude that the aforesaid document, which required the Company to pay sums for the health and welfare of its employees, did not meet the requirements of Section 302. Under these circumstances the Company was caught on the horns of a dilemma. It must suffer a strike, if it refused to sign, and must violate Section 302 with the penal sanctions, if it did. It is the contention of the Respondents that the Board is without jurisdiction to consider any violation of Section 302 of the Act in assessing the Respondents good faith under Section 8(b)(3) of the Act, since Section 302 specifically confers juris- diction on the U.S. district courts to enjoin violations of that section, and to im- 17 New Mexico Sheet Metal Contractors Association, Inc., 122 NLRB 1192. 5 9 7 2 5 4-61-vol. 130-18 258 DECISIONS OF NATIONAL LABOR RELATIONS BOARD pose the penalty prescribed for a violation . I can find no merit in this contention. Congress by the Act has entrusted to the Board the supervision of collective bargain- ing, and it is well-established law that the creation of trust funds for the health and welfare of employees is a subject on which employers must bargain at the re- quest of employee representatives. In Arroyo v. U.S., 359 U.S. 419, the Supreme Court made the following statement: When the Congress enacted 302 its purpose was not to assist states in punish- ing criminal conduct traditionally within their jurisdiction, but to deal with problems peculiar to collective bargaining. The provision was enacted as part of federal labor policy in the light of experience acquired during the years fol- lowing passage of the Wagner Act, and was aimed at practices which Congress considered inimical to the integrity of the collective bargaining process. The Court elaborated on such background in the following words: Congress believed that if welfare funds were established which did not define with specificity the benefits payable thereunder, a substantial danger existed that such funds might be employed to perpetuate control of union officers, for political purposes, or even for personal gain. To remove these dangers, spe- cific standards were established to assure that welfare funds would be estab- lished only for purposes which Congress considered proper and expended only for purposes for which they were established. From the above, it would seem inescapable that a proposal to create a trust fund, which did not meet the requirements of Section 302, would be within the juris- diction of the Board. The General Counsel makes no claim that the Board could impose the penalty prescribed for violation of the Act, or in any other way infringe on the jurisdiction specifically conferred by the section on the U.S. district courts, but certainly when an unlawful proposal is made in collective bargain- ing, and becomes the objective of a strike, the Board has the power and the duty to condemn such conduct, and to prevent it, lest it imperil "the integrity of the collective bargaining process." I find that the Respondents' proposal did not meet the requirements of Section 302, and that the strike to coerce the Company to sign that document was unlawful, and a violation of Section 8(b) (3).18 IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondents set forth in section III, above, occurring in connection with the operations of the Company and Pine 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 obstruct- ing commerce and the free flow of commerce. V. THE REMEDY Having found that the Local and the District Council and their respective officers, Joseph Palazzi , Hugh Allen, and James Stephens have violated Section 8 (b)(1)(B) and (3 ) of the Act, I shall recommend that they cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act. Upon the basis of the foregoing findings of fact , and on the entire record in this proceeding, I make the following: CONCLUSIONS OF LAW 1. Lumber and Sawmill Workers, Local No. 2647, and Northern California Dis- trict Council of Lumber and Sawmill Workers, are and have been at all times ma- terial to this proceeding labor organizations within the meaning of Section 2(5) of the Act. At all times pertinent hereto, Joseph Palazzi was and now is the secretary- treasurer of the above-named Local, and Hugh Allen was and now is the secretary- treasurer and James Stephens was and now is the business representative of the above-named District Council. 2. Pine Industrial Relations Council, and its member-employers, including Cheney California Lumber Company, are employers within the meaning of Section 2(2) of the Act. 1 See The American News Co , Inc., 55 NNLRI; 1302, Southern Steamship Co v N L R R , 120 F 2d 505 (CA. 3) JONES & LAUGHLIN STEEL CORPORATION 259 3. All employees of Cheney California Lumber Company in the unit hereinafter described, constituted at all times pertinent hereto, a unit appropriate for the pur- poses of collective bargaining within the meaning of Section 9(b) of the Act. The unit is described as follows: All employees of the Company at its sawmill , exclusive of clerical and super- visory employees, as described in the Act. 4. The above-named Local is, and at all times pertinent hereto has been, the exclusive representative of all the employees in the aforesaid appropriate unit for the purpose of collective bargaining. 5. The above-named District Council is , and at all times material hereto has been, the duly designated bargaining representative of the Local for the purposes of collective bargaining on industrywide issues with the Company and its representa- tive. 6. Pine Industrial Relations Council is, and at all times material hereto has been, the duly designated representative of the Company for the purposes of collective bargaining on industrywide issues with the Local and its r representative. 7. By restraining and coercing the Company in the selection of Pine as its repre- sentative for the purposes of collective bargaining , as found above, the Local and the District Council, and the above-named individuals , have jointly engaged in un- fair labor practices within the meaning of Section 8(b)(1)(B ) of the Act. 8. By refusing to bargain with Pine, as found above, the Local and the District Council and the above -named individuals have jointly engaged in unfair labor prac- tices within the meaning of Section 8 (b) (3) of the Act. 9. 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.] Jones & Laughlin Steel Corporation' and United Steelworkers of America, AFL-CIO, Petitioner. Case No. 9-RC-4201. Feb- ruary 15, 1961 DECISION AND ORDER Upon a petition duly filed under Section 9 (c) of the National Labor Relations Act, a hearing was held before Arthur P. West, hearing offi- cer. The hearing officer's rulings made at the hearing are free from prejudicial error and are hereby affirmed. Pursuant to the provisions of Section 3(b) of the Act, the Board has designated its powers in connection with this case to a three- member panel [Chairman Leedom and Members Fanning and Kimball]. Upon the entire record in this case, the Board finds : 1. The Employer is engaged in commerce within the meaning of the Act. 2. The labor organization named above claims to represent certain employees of the Employer.' 3. No question affecting commerce exists concerning the representa- tion of employees of the Employer within the meaning of Section 1 The name of the Employer appears as amended at the hearing 2 Warehouse, Production and Maintenance Employees, Local 661, International Brother- hood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, was permitted to intervene at the hearing on the basis of a contractual interest. 130 NLRB No. 35.