Schnell Tool & Die Corp.

SCHNELL TOOL & DIE CORPORATION, ETC. 385 we find that the employees at Plant 77 are an accretion either to the Seattle-Renton or to the larger nationwide employee grouping, which- ever may constitute the appropriate bargaining unit, a matter on which we do not pass in this proceeding.' Even conceding arguendo their status as craftsmen, it follows that a unit limited to the main- tenance electricians at Plant 77 is inappropriate as being only a seg- ment of the maintenance electricians in the multiplant unit.5 We shall, therefore, dismiss the petition. [The Board dismissed the petition.] MEMBERS FANNING and JENKINS took no part in the consideration of the above Decision and Order. 4 See Simmons Company, 126 NLRB 656, 658-659; Richfield Oil Corporation, 119 NLRB 1425, 1427 ; Hudson Pulp and Paper Corpoi ation, 117 NLRB 416, 418 ; Red Ball Motor Freight, Inc , 118 NLRB 360, 362; Borg-Warner Corporation, 113 NLRB 152, 154; J. W. Rex Company, 115 NLRB 775, 776-777. International Ladies' Garment Workers Union v. N L.R.B. (Bernhard-Altmann Texas Corp ), 366 U S 731 , relied on by Petitioner as establishing that the 1960 agreement un- lawfully deprived the employees at Plant 77 of their right to select a bargaining repre- sentative is inapposite . In that case violations were found where a union which had not established its majority status was accorded exclusive recognition , whereas here the status of L&1f as majority representative in the multiplant unit is not questioned . As an accre- tion to an existing unit, the employees at Plant 77 were properly covered by the contract for the multiplant unit without a self-determination election . The Great Atlantic and Pacific Tea Company, 140 NLRB 1011. 5 General Motors Corporation, 120 NLRB 1215, 1221. Schnell Tool & Die Corporation, and Salem Stamping & Manu- facturing Co., Inc. and United Steelworkers of America, AFL- CIO. Case No. 8-CA-3021. September 6, 1963 DECISION AND ORDER On June 19, 1963, Trial Examiner William Seagle issued his Inter- mediate Report in the above-entitled proceeding, finding that the Respondent had engaged in and was engaging in certain unfair labor practices, and recommending that it cease and desist therefrom, and take certain affirmative action, as set forth in the attached Intermediate Report. The Trial Examiner also found that the Respondent had not engaged in certain other unfair labor practices alleged in the com- plaint'and recommended dismissal of the complaint as to them. There- after, the Respondent filed exceptions to the Intermediate Report and a supporting brief. Pursuant to the provisions of Section 3 (b) of the Act, the Board has delegated its powers in connection with this case to a three-member panel [Members Leedom, Fanning, and Brown]. 144 NLRB No. 52. 386 DECISIONS OT NATIONAL LABOR RELATIONS BOARD The Board has reviewed the rulings made by the Trial Examiner at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Board has considered the Inter- mediate Report, the Respondents exceptions and brief, and the entire record in this case, and hereby adopts the findings, conclusions, and recommendations of the Trial Examiner.' ORDER The Board adopts the Recolmnended Order of the Trial Examiner. 1 Unlike the Trial Examiner, we find it unnecessary to determine whether Hunston. one of Respondent's attornep ,, tral'gr('SSed canon 19 of the ''Canons of Professional Ethics of the American Bar Assor ration " by appearing as a witness iur his client. INTERMEDIATE REPORT AND RECOMMENDED ORDER STATEMENT OF THE CASE Upon charges duly filed,' a complaint was issued against the Respondents under date of February 15, 1963, alleging violations of Section 8(a)(1), (3 ), and (5) of the Act. Issue having been joined , Trial Examiner William Seagle held a hearing with respect to the allegations of the complaint at Salem, Ohio, on March 19 , 20, 21, and 22, and on April 16, 1963.2 At the conclusion of the taking of testimony, counsel on both sides waived oral argument but subsequently filed briefs which have been duly considered. Upon the record so made and based on my observation of the witnesses , I hereby make the following: FINDINGS OF FACT 1. THE RESPONDENTS Schnell Tool & Die Corporation (hereinafter referred to as Schnell Tool & Die) and Salem Stamping & Manufacturing Co., Inc. (hereinafter referred to as Salem Stamping), are both Ohio corporations which have their offices and principal place of business at 631 West State Street, Salem, Ohio. As its name implies, Schnell Tool & Die has been engaged in the making of tools and dies but it has also fabricated metal articles on order for customers. In 1961 and during most of 1962, the opera- tions of Schnell Tool & Die were carried on in two plants, known as Plant No. 1, located at the address on West State Street, and Plant No. 2 (sometimes also known as the Gonda plant ), located on Georgetown Road in Salem, Ohio.3 Salem Stamping has been engaged primarily in the manufacture of V-belt pulleys and some stampings. During the calendar year 1962, Schnell Tool & Die and Salem Stamping each shipped goods valued in excess of $50 ,000 outside the State of Ohio . The Respond- ends admit, and I find, that they are engaged in commerce within the meaning of the Act. It is alleged in the complaint that Schnell Tool & Die and Salem Stamping have been at all material times a single integrated enterprise, and that the two Respondents constitute a single employer for the purposes of the Act. Each of the Respondents has the same officers. They are Michael S. Schnell, president; Charles W. Schnell , vice president ; and Elizabeth Falk, secretary-treasurer. The board of directors of each of the Respondents consists of the same three persons, all of whom are blood relatives : Charles W. Schnell , a son, and Elizabeth Falk, a married daughter, of Michael W. Schnell. Each of the Respondents has authorized, 1'i•he original ebarge was dated December 28, 1962. A first amended charge ivaa filed on January 3, 1963, and a second amended charge was filed on February 11, 1963. 2lvhen the hearing was adjourned on March 22 , it was scheduled to be resumed on March as. Michael S. Schnell, the President of the Respondents , became ill after the adjournment, however, and counsel for the Respondents on Mardi 27 requested a continu- ance. By telegram dated March 27, the hearing was adjourned , therefore, to lpril 16. and was resumed on that day. S The circumstances of the acquisition and disposition of Plant No 2 are discuss ed infra in connection with the charges against the Respondents. SCHNELL TOOL & DIE CORPORATION, ETC. 387 issued, and has outstanding 500 corporative shares. Michael S. Schnell and his wife, Susan Schnell, own 200 of the shares of Schnell Tool & Die, and all but 2 of the remaining shares 4 are held in the names of their children or grandchildren. The same is true of Salem Stamping, except that only 35 of the shares are in the name of Michael S. and Susan Schnell, 68 of the shares are in the name of Michael S. Schnell alone, and 17 of the shares are in the name of Susan Schnell alone. The second largest block of shares in each of the corporations is held by Charles W. Schnell, who owns 70 shares of the Schnell Tool & Die stock and 89 shares of the Salem Stamping stock. Elizabeth Falk owns 38 shares of the stock of Schnell Tool & Die, and 47 shares of the stock of Salem Stamping. Thus, the three members of the Schnell family who are both officers and directors of each of the corporations owns a majority of the stock of each of the corporations. As is indicated by their common address, Plant No. 1 of Schnell Tool & Die and Salem Stamping are both located in the same congeries of buildings. There is an L-shaped stucco building, of which the entire top floor contains Schnell Tool & Die equipment and the offices of the corporations. There are, however, nine addi- tions of steel and sash construction to the L-shaped budding, and these have various bays, some of which are used by Schnell Tool & Die, and some of which are used by Salem Stamping. The additions are connected with each other, and the part of the premises occupied primarily by Plant No. 1 of Schnell Tool & Die is on a somewhat higher level than Salem Stamping, being reached by four steps. The machinery of Schnell Tool & Die consists of milling machines, shapers, planers, saws, blanch grinders, lathes, and presses for die tryout, while the machinery of Salem Stamping consists primarily of presses, spot welders, broaching machines, and painting and packing equipment. Higher degrees and types of skills are required of Schnell Tool & Die employees than of Salem Stamping employees; the former must be machinists or diemakers while the latter need be simply persons possessed of sufficient manual dexterity to be trained for the type of operations required of them. There are occa- sions, however, when the employees of the two concerns are interchanged, or trans- ferred from one to the other, or when employees of one of the concerns will use the tools or equipment of the other. Thus, when Salem Stamping parts have to be run on the larger presses of Schnell Tool & Die, a Salem Stamping employee is assigned as a helper to the Schnell Tool & Die employee who is running the job; when work at Schnell Tool & Die becomes slack and Salem Stamping has plenty of work, em- ployees of the former who would otherwise be laid off are offered employment at the latter; it is a common occurrence for Salem Stamping employees to sharpen their drills on Schnell Tool & Die grinders; and sometimes an employee may even go to the Schnell Tool & Die crib for parts. There are also occasions when one of the companies fills orders for the other. Purchase orders are issued for major jobs and minor orders are done on invoices, but there is nothing to show that one of the Companies is billed for such minor operations as sharpening drills. Schnell Tool & Die and Salem Stamping share a common office area and are served by the same telephone system. The same electrician does the maintenance work for both companies, and the same trucks service both of them. However, separate restroom facilities are provided for the employees of each of the companies. The same employee, who is the receptionist, collects the timecards of the employees of both companies, although each company has its own timeclocks and timecards. When an employee is transferred from one company to another, a new timecard is prepared for him but he is not required to file a new W-2 form for income tax pur- poses, or a new application. The dominant figure in the conduct of both Schnell Tool & Die and Salem Stamping is, undoubtedly, Michael S. Schnell, the president of both companies, who determines the labor and other policies of both companies. If he shares his power and control with anyone, it is with his son, Charles W. Schnell. An old diemaker himself, the elder Schnell's particular preserve is Schnell Tool & Die but he does all the hiring of new employees, and most of the firing, although an employee may also be discharged by Charles Schnell or by Edgar B. Phillips (known among the employees as "Jack" Phillips), the general foreman of Salem Stamping. But the authority exercised by Phillips does not appear to be very great, for he is subject to the supervision of Charles Schnell, who has the general oversight of production in Salem Stamping. In addition to his exercise of this responsibility in Salem Stamping, Charles Schnell performs the financial and administrative functions in Schnell Tool & Die. It is apparent that between them Michael and Charles Schnell run the business of the two companies. These two shares are held by Vilma Dumbleton, an office employee of the company. 727-083-64:--vol. 144-26 388 DECISIONS OF NATIONAL LABOR RELATIONS BOARD It is the contention of the Respondents that they constitute two separate and distinct corporations , and so, of course, they are, since they are separate corporate entities. But this does not mean that they may not be considered a single employer for the purposes of the Act. This may be done when two or more corporations are subject to common ownership and control, are engaged in related operations, and pursue the same labor policies.5 Particular emphasis has been placed upon control by the same family.6 While similarity in operations is usually required to be present, it is not necessary that operations be wholly integrated.? Plants Nos. 1 and 2 of Schnell Tool & Die and Salem Stamping are no more than divisions of the same enterprise. It must be concluded that Schnell Tool & Die and Salem Stamping constitute a single employer within the meaning of the Act, and I so find.8 II. THE LABOR ORGANIZATION INVOLVED United Steelworkers of America, AFL-CIO (hereinafter sometimes referred to as the Union) is a labor organization within the meaning of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. The elder Schnell's personal attempts to undermine the Union The history of the labor relations of the Respondents preceding the events that led to the present proceeding is rather sketchy. But it seems that in 1952 the Steelworkers, who had had a contract with Schnell, struck both Schnell Tool & Die and Salem Stamping. The strike began late in 1952 and extended into 1953. When the strike occurred, Schnell left for Florida to enjoy the sun, and did not return until after the strike was over. During his absence, he was represented apparently by his son, Charles, and his attorney, Harry Manchester, who had represented him in the negotiations leading to the strike, and who was also to represent him in the collective-bargaining negotiations involved in the present proceeding and in the present hearing. In the 1952 negotiations, the Union was represented also by one of the same negotiators who was to participate in the collective-bargaining sessions 6 See N L R.B v. United States Air Conditioning Corp , 302 F. 2d 280, 281 (C A. 1) ; N L.R B. v. Jones Sausage Co ., 257 F. 2d 878 , 879-880 (C.A 4) ; N L R B v Thomas Parran, Jr, t/a Silver Spring Transit Company etc., 237 F. 2d 373, 375 (C.A. 4) ; A. M. Andrews Company of Oregon v. N L R.B., 236 F. 2d 44, 45 (C.A. 9) ; N.L.R B v J. E MoCatron, et al, 216 F. 2d 212, 213-214 (C.A 9), cert denied 348 US. 943; N.L.R.B, v. Concrete Haulers, Inc, 212 F. 2d 477, 479 ( C.A. 5) ; NLR.B. v. Dayton Coal and Iron Corp., 208 F. 2d 394, 394-395 (C A 6) ; N L R B. v Calcasieu Paper Co., 203 F. 2d 12, 13 (C A 5) ; N L R B. v. Williams Lumber Co., 195 F. 2d 669, 670-671, 672 (C A. 4), cert. denied 344 U.S 834; NLRB. v. National Garment Company, 166 F. 2d 233 , 238 (CA. 8), cert denied 334 U.S 845 ; NL.R.B. v. Gluek Brewing Company at at, 144 F. 2d 847, 855 (C.A. 8). 8 See, for example, N L R B v Stowe Spinning Company, 336 U.S. 226, 227, and N.L R B v. Somerset Classics, Inc. and Modern Mfg. Co., 193 F. 2d 613, 615 (C.A . 2), where the court said: "We cannot ignore the fact, however , that both corporations were owned and controlled by members of the same family." 7 See, for instance, N L R.B. v. Summers Fertilizer Company, 251 F. 2d 514, 516 (CA 1) , J. G. Roy and Sons v. N.L.R.B., 251 F. 2d 771 , 773-774 (C.A. 1) ; NL.R.B. v. A K Allen Co . et al., 252 F. 2d 37, 38-39 (C.A. 2). 8 A rather anomalous aspect of the present case Is that separate certifications have been issued for the employees of Schnell Tool & Die and of Salem Stamping, and that the em- ployees of each company have thus been designated as an appropriate bargaining unit It appears that the'Union originally filed a petition requesting that the employees of both of the companies be designated as a single bargaining unit but counsel for the Respondents objected to this , and the Union decided to agree to two separate bargaining units in order not to delay the election. There can be little doubt that if both the Union and the Re- spondents had agreed on a single bargaining unit consisting of the employees of both com- panies that such a unit would have been designated as appropriate. It would seem, how- ever, that despite the existence of the two separate bargaining units the two companies may be held to be a single employer for the purpose of redressing any unfair labor prac- tices . After all, even when a single corporation has been involved various groups of em- ployees have been designated as separate bargaining units. Such designations have been sometimes based primarily on the desires of the parties concerned In the present case, the separate units may be justified also by the fact that the operations of the two com- panies are not completely integrated SCHNELL TOOL & DIE CORPORATION, ETC. 389 in 1962, namely Edward Hilland, the subdistrict director of the Steelworkers in Columbiana County in which Salem, Ohio, is located. In 1962, a decade later, the elder Schnell, although in very poor health-he was now suffering from diabetes, high blood pressure, arthritis, and other afflictions of advanc- ing age-was still active in the business, and was still its dominant figure. Events were soon to demonstrate, moreover, that his previous experience with the Steelworkers had been traumatic, and that he was determined that no union should ever interfere with the way he chose to run his business, even if this could be accomplished only by the commission of unfair labor practices. It seems that in midsummer of 1962 a group of Schnell's employees had approached Charles Hinchcliffe, the staff representative of the Steelworkers in the Salem area, about securing union representation. Hinchcliffe testified that the employees asked him what, if anything, they could do "to an employer that continually cussed them out. shook his fist in front of their face and so on." Apparently, Schnell was accustomed to speaking in rather loud and overpowering tone of voice, and his remarks were some- times rather caustic. One of his employees, Michael Yunk, a machinist, who admitted that he was inclined to be caustic himself, testified: "Mr. Schnell has a voice that could be heard clear across the shop in a whisper. If he whispered, you can hear it." After the visit of the group of employees, Hinchcliffe inaugurated a campaign among the Schnell Tool & Die and Salem Stamping employees. This campaign appears to have been at its peak in August, and the employee who appears to have been chiefly instrumental in getting other employees to sign union authorization cards was a Salem Stamping employee by the name of Ormond Long, who was subsequently discharged by Schnell .9 By September 6, Hinchcliffe believed that he had signed authorization cards from a majority of Schnell's employees, for, on that day, he telephoned to Schnell and requested that the Steelworkers be recognized as the bargaining representative for Schnell Tool & Die and Salem Stamping employees. But Schnell told Hinchcliffe: "Why talk to me about the union, go talk to the men and if the men want the union OK. I will not stand in the road." Schnell added that he had been a union member longer than Hinchcliffe, and that he had signed the first union agreement in the Salem area. Hinchcliffe recorded this telephone conversation in a letter dated the same day as the conversation, and addressed to Schnell as presi- dent of Schnell Tool & Die. In the same letter Hinchcliffe, apparently anticipating a rebuff, informed Schnell that he was filing a representation petition with the Regional Office of the Board. Schnell acknowledged the receipt of Hinchcliffe's letter under date of September 14, and in this letter commented as follows: It is my feeling that a majority of our employees do not desire representation by your union and since you have requested a determination of that question by the N.L.R.B. I would not be in a position to discuss recognition with you until such times as you are certified as the representative of our employees. Since Schnell would not recognize the claims of the Union, arrangements were made for holding an election among the Schnell Tool & Die and Salem Stamping employees. The election was held on October 9, and the Union won the election among the employees of each of the companies.10 On October 16, the Union was certified as the exclusive bargaining representative of all the production and main- tenance employees of Schnell Tool & Die in Plants Nos. 1 and 2 in Salem, Ohio, including truckdrivers but excluding office clerical employees, office cleaning women, guards, professional employees, and supervisors as defined in Section 2(11) of the Act. On October 16, the Union was also certified as the exclusive bargaining representative of the Salem Stamping employees in an identical unit. Thus, Schnell's expectation that a majority of his employees would reject the Union was disappointed. He did not, however, accept the result, despite his dec- laration that he would not "stand in the road" but conducted a campaign to subvert the Union. Indeed, this campaign was waged even prior to the election. In the weeks preceding the election, Schnell was interrogating various employees about union activities, and combining these interrogations with threats. He seems to have concentrated on Salem Stamping employees. At least all those who testified with respect to such interrogations and threats were Salem Stamping employees, namely, Ormond Long, Charles Ardeno, Robert Earl Wolfe, Phillip Groves, and John Chaffin. 6 His discharge , which is alleged to'be discriminatory , is considered infra 111 take official notice of the results of the elections. In the Schnell Tool & Die election, there were 56 eligible voters, of whom 28 voted for the Union, and 22 against it. In the Salem Stamping election, there were 39 eligible voters, of whom 29 voted for the Union and 6 against it. 390 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Ormond Long seems to have been the special object of Schnell's attention, and it is not difficult to understand the reason. Long was an incorrigible drunken driver. In 1961 and 1962, in a period covering little more than a year, Long had been convicted no less than three times not only of drunken driving but of driving without a license while in this condition. Schnell, who was personally generous with many of his employees, was particularly helpful in the case of Long. He helped to get Long out of jail, and through his influence with the mayor of Salem, arranged for the payment of his considerable fines in installments, which were withheld from Long's pay. If Schnell had reason to expect gratitude from any of his employees, that employee was Long. If Long was supporting the Union, clearly he would be guilty in Schnell's mind of the basest ingratitude. Toward the end of September, Schnell came out to Long's machine and asked him if he intended to vote for the Union, and added that if he did, it would be a good excuse to tell the mayor that he was no longer working. This meant, of course, that since Long would be out of a job, he would no longer be in a position to continue payment of the installments of his fine. A few days later Schnell came around again to Long's machine with a list of employees and their earnings, and, pointing out to Long what he had earned in the first months of 1962, he told Long that if he voted for the Union he would make a lot less, and that if the employees voted for the Union "they would not get a penny," since "he was not giving the Union one red cent." He again directly asked Long whether he had signed a union card, and when Long denied it, Schnell remarked that he had asked everyone in the plant except one man whether they had signed union cards but that they had all denied it, which led him to think that "he either had a bunch of loyal people or the biggest bunch of liars that he ever run into." Pretty much the same pattern was followed in Schnell's interrogation of the other employees prior to the election, except that having no personal threats to make, he could make only general ones. These were, however, even more vivid. When he asked Ardeno whether he had signed a union card, he received an affirmative reply. "Yes," said Ardeno, "it is home on my refrigerator." Whereupon Schnell told Ardeno: "You know, this is a one-way ticket to the street." When Schnell was interrogating Wolfe as to whether he had been approached to sign a union card, he told Wolfe that there had never been a union shop and that there never would be one but that if they voted the Union in they would probably find themselves "out in the front throwing snowballs at each other." The record does not show whether Wolfe signed a union card but if he did, it was another case of ingratitude, for Wolfe was an alcoholic whom Schnell had fired because of his drinking, but whom he had then reemployed. Schnell, in his interrogation of Chaffin, was not so colorful as he had been in talking to Wolfe. When he asked Chaffin whether he knew anything about the Union, and whether he had signed a union card, Chaffin admitted the signing of the union card but Schnell merely remarked: "There is going to be a lot of trouble around here." As for Groves, Schnell interrogated him about the Union no less than three times. The first time Schnell merely asked Groves whether he had signed a union card, and Groves, who did not sign one until later in September, denied it. The second time Schnell told Groves that they were all nuts and should see a doctor. The third time that Schnell talked to Groves about the Union, however, he engaged in quite an outburst. Thus, Groves testified: He grabbed me by the arm and asked me what the Union had offered me I told him the Union had offered me nothing. And he said that some of us guys whose wives had just had babies, that he had talked to Bud Schnell 11 and that guys who had just had the babies and guys like me who had just got married were due for a raise, but since the Union was messing around, that we weren't going to get a raise. And if he got the union guys there that he would wring their blankety blank necks and that he would like to punch them in the nose, and that the Union was no good and that we should be out walking the streets. And he said that if we did go on strike, the doors would be open. Schnell continued his antiunion conduct even after the elections had been held and the Union had been certified. On October 14, which, although a Sunday, was a working day, Schnell approached Long in an effort to extend the olive branch. He told him that he liked his work and wanted to be his friend, but that he had built the business up, and no man or law in the country was going to tell him how to run it. He recalled to Long what had happened during the strike in 1953, and delivered himself of some rather unflattering remarks about Hinchcliffe whom he blamed for the loss of several large orders as a result of his threats to throw a picket line around the plant. Two days later, in another conversation with Long, 11 The reference is to Michael Schnell's son, Charles. SCHNELL TOOL & DIE CORPORATION, ETC. 391 Schnell again complained that the CIO was running "the business out of here." "If you don't think so," he told Long, "just bring your CIO card in and see if you can get this business back. If I had as much pull with the customers as I have with the Mayor, I would be in pretty good shape ." Schnell also sounded off to Groves about Hinchcliffe . As Groves testified : "He asked me if I had asked Uncle Hinch- cliffe if we were going to get a ham for Christmas or any turkey-ham for Christmas and a turkey for Thanksgiving . And I told him no and he said well, I had better ask him because we wasn't-he wasn't going to give us a dog-gone thing. " Schnell added that he would not even talk to Hinchcliffe. On Thursday, October 18, which was only 4 days after his last conversation with Long, Schnell, who was accustomed , apparently, to distributing the paychecks to the employees personally , took advantage of the occasion to hint to quite a number of them that the paychecks that he was giving them might be their last ones.12 Thus, he told William G. Reed that he had better pay lus union dues because the paycheck which he was giving him might be his last . Schnell also told James I. Louden that he had better pay his union dues since he "might not have another check coming." By the time Schnell came to give his check to John Bergman, he was manifestly pleased with what he was doing, and became rather sardonic . As Bergman testified: He said, "You better take out your union dues out of this check," and he kind of smiled and walked away. Then he came back and said , on second thought, maybe you better take two months out of that check. Michael Yunk, the Schnell Tool & Die employee who described Schnell 's whisper as a shout and who thought Michael Schnell was always caustic, testified that when Schnell gave him his paycheck that Thursday , he remarked in a caustic tone: "Make sure you pay your C.I .O. or union dues out of this check or there might not be any- more." John Chaffin testified that as Schnell handed him his paycheck that Thursday just before noon , he remarked : "You better enjoy it. It may be your last one." 13 After the election , Schnell also had a second conversation with Wolfe . He asked Wolfe what he thought about the Union. Wolfe replied that he had not given it much thought . "Well, you should give it some thought," Schnell admonished him. "Because if you think there is going to be a union come in , you might as well start looking for another job." Schnell also reiterated his most constant thought that his business had never been a union shop, and that it would never be one. He expressed the same thought in a conversation in his office with another Salem Stamp- ing employee , David Williams , whom he had already advised in a previous conversa- tion to stay away from a union meeting altogether , and to have nothing to do with the Union. Schnell also advised Louden that the supporters of the Union had better obtain 75 pair of rubber boots and raincoats , so that they would be prepared for the picketing of the plant. This advice was inspired, apparently, by rumors of a strike which were then current. Schnell seems to have made an especially determined attempt to alienate Bergman, who was an apprentice diemaker in Plant No. 1 of Schnell Tool & Die, from the Union. Early one morning , as Bergman was going to his work station after the buzzer had sounded, Schnell stopped him and asked him to come into his office . When Bergman followed Schnell into his office, he was asked to have a seat. Schnell then told him that he had on his desk a list of the names of 22 "fellows that were standing by," and that he did not see Bergman's name on the list. Bergman asked Schnell whether he knew whether he had worked for the Union , and Schnell answered Bergman's question by telling him that he had no way of knowing that but that he did have in- formation that Bergman had been speaking to other employees in favor of the Union, and he assumed that that was why Bergman 's name was not on the list Schnell then proceeded .to ask Bergman whether he cared about working steady , pointing out that the work in other shops in the Salem area was seasonal , and that the effect of the Union would be to raise the rates, and prevent the employees from working all the year round. Bergman assured Schnell that he liked "to work steady all year long," whereupon Schnell declared to him that if he went for the Union he "might not have a job at all because he would lock the doors . They wouldn't get a red cent from him or probably never get a contract even " In addition to interrogating employees concerning their union sympathies, Schnell questioned a number of applicants for employment on the same subject. As early as '-1 Some of the employees could not remember the exact date of the paycheck incidents but it is inferable from the testimony of the others that they all occurred on the same day 13 As Schnell spoke normally in a loud voice , his remarks in handing out the paychecks must have been heard by all the employees within earshot. 392 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the week of September 12 Schnell asked Merle Dawson, in hiring him as a Salem Stamping employee, how he felt about unions. Dawson, who was hired as a sort of jack-of-all-trades, himself loved to talk, and he welcomed the opportunity to talk which the interview afforded him. When Schnell asked Dawson how he felt about unions, the latter concluded that "there was something going on," because his buddy, who had tipped him off about the possibility of a job at Salem Stamping "hadn't said anything about a union." Avoiding a direct answer to Schnell's question, Dawson replied: "Well, unions have never done me any good," which Dawson added "was an honest answer." In the course of the conversation, Schnell told Dawson that when a union "had tried to come in," he had shut the plant down and gone off of Florida, and that he would shut the plant down again "if they tried to do it again " Although Dawson did not fully grasp, apparently, what occasion Schnell was talking about, the latter was referring, of course, to the strike in the winter of 1952-53. Schnell also directly asked Dawson whether be would join a union if he was asked to do so. Dawson displomatically pointed out that if a union won an election in the plant, he would be required to join but Schnell promptly assured him that he would be able to work in his plant without becoming a union member. Schnell then conducted Dawson on a little tour of the plant, which, in his testimony, Dawson described as follows: And on the tour through the plant-Mike is a friendly sort of a fellow and he likes to talk also-and he would stop and talk to just about everyone of the men we went by. And several of them-that I found out later were in favor of the union-he would make little remarks like, "what are you going to do for work this summer?" And little things like that. Asked specifically whether he heard Schnell ask anybody how he expected to feed his family, Dawson replied in the affirmative, and explained: "He has a sort of little vocabulary that he uses in referring to the union." William Moore, who was hired as a truckdriver on November 20, testified that when he was interviewed about the job, Schnell started talking to him about the Union, and told him that "as far as he was concerned the union was no good. He didn't see why a person couldn't run a plant the way he saw fit without any interference from the union." Robert Endres, who was hired as a spotwelder on November 23, was asked by Schnell when he was interviewed for employment whether he had heard that the Union was trying to get into the plant. Endres answer the qutstion in the affirma- tive and then Schell wanted to know whether it made any difference to him. Endres told Schnell that he needed a job and "it didn't make no difference, union or non- union." After a tour of the plant, Schnell brought Endres back to his office and asked him whether he would join the Union. Endres replied that he did not know. Whereupon Schnell told Endres that if anybody approached him to sign a union card to "go ahead and smack him in the mouth,' and he would back him up. Schnell added that there would be "work out there as long as anybody wanted to work, take it or not." Donald E. Phillips, a youth of 18, who was hired also as a spotwelder just before Thanksgiving, had pretty much the same experience as Endres, except that Schnell was even more emphatic. As Phillips testified: "He told me if someone approached me to join the union to slap them alongside the face, to come up and tell him; and he would fire the guy that tried to get me to sign the card. And he would fire me, too, if I signed one. He told me he wasn't allowed to tell me that, not to join the union." About 2 months later Schnell asked Phillips whether anyone had approached him about joining the Union, and admonished him not to lie. So frequent and numerous were Schnell's interrogations and threats-the interroga- tions extended not only to the signing of union cards but also to attendance at union meetings-that despite the extensiveness of the foregoing account, it is not possible to be certain that all of them have been recorded. Some of Schnell's remarks to em- ployees came under the heading of what the complaint calls "harassment and verbal abuse" of union supporters. Thus, he called Harry Phillips "plain dumb and stupid" because he had signed a union card, and referred to other employees as "hillbillies." On two occasions after the certification of the Union he also raised Cain with Long about the use of the plant bulletin board for the purpose of posting notices of union meetings. He asked Long to reveal who had put the notices up but he declined to do so on the ground that he would be "telling" on his fellow workers. When Berg- man asked for permission to put further notices up, he was told that "the bulletin board didn't belong to the Union" and that he would need to have Schnell's prior approval to post notices. As time went on and his unfair labor practices mounted, Schnell must have become alarmed over the possibility that they would be reported, SCHNELL TOOL & DIE CORPORATION, ETC. 393 for he warned two of the employees, Williams and Harry Phillips, that anyone who signed an affidavit would be fired.14 The testimony concerning Schnell's antiunion activities stands wholly uncontro- verted in the record. Although he was present at the hearing during all the days that the testimony against him was being given, he subsequently became ill, and did not testify at the hearing. Moreover, his counsel even declined an offer to have his testimony taken by deposition subsequent to the hearing. Under the circumstances, it can only be assumed that he was not in a position to deny the accusations against him. Indeed, in his brief, counsel for the Respondents concedes that he must have made many of the statements attributed to him, although he attempts-unsuccess- fully-to limit their scope, and to interpret them as mere expressions of opinions which they were obviously not. Moreover, at least one of the witnesess called by the Respondents gave testimony that tends to confirm the testimony of the General Counsel's witnesses. The Re- spondents called three witnesses in an effort to cast doubt upon the testimony of the General Counsel's witnesses that when they were hired they were questioned con- cerning their altitude toward the Union. Even if the testimony of these witnesses were wholly true, it would establish only that they were not interrogated concerning their union sympathies. Their testimony would not establish that other applicants for employment were not so interrogated. Actually, at least two of the Respondents' witnesses, George McCartney and Eugene Smeltzer, who were called to testify con- cerning their employment interviews, demonstrated that they were not entitled to the slightest degree of credence. McCartney, after denying that there was any dis- cussion of the Union at all when he was hired by Schnell, revealed during his cross- and re-cross-examination that he was later interviewed by Schnell and Hunston, one of the Respondents' counsel, and signed an affidavit dated April 1, 1963, after he had "just glanced at it," and although he "did not pay much attention to it. . The only thing I was interested in," he explained, "was work. I had been out of work and I needed the work." Moreover, although he had also testified during his re- cross-examination that he could not remember anything that was said when he was interviewed by Schnell and Hunston, he proceeded during his redirect examination to deny positively that Schnell had talked to him about the Union during his em- ployment interview. Smeltzer proved to be an even more calamitous witness from the Respondent's point of view Like McCartney, Smeltzer had been interviewed by Schnell and Hunston, and he had given an affidavit, and during his direct examina- tion he testified that he recalled what was said when Schnell hired him, and that Schnell did not say anything about the Union "either way." At the very outset of his cross-examination, however, he undermined his credibility by denying and then ad- mitting in almost the same breath that Schnell had asked him where he "had been working before." Thus, he testified: Q. Was there any inquiry on the part of Mr. Schnell as to where you worked before9 A. No, there wasn't. Q. Was there any inquiry at all? A. No, he did not ask me. Q. For what job did you apply? A. I was going to ask him about a job, and he asked me if I was ever on a drill press, and I said, "Yes." Q. The drill presses are over at the stamping plant, isn't that right? A. Yes. Q. You said you worked on drill presses? A. Yes. Q. Where? A. Steel Door in Youngstown. "A week before the hearing, when various of the Salem Stamping employees mere re- ceiving subpenas to appear and testify , Edgar B. ("Jack") Phillips, the general foreman of Salem Stamping , was told by some of them that they had received the subpenas in the mail. Some of these employees testified that Phillips told them that they need pav no attention to the subpenas In his testimony at the hearing , Phillips explained that he at first thought that the subpenas must have been of the type sometimes sent out by bill collectors and that he , therefore , told the employees that they did not "amount to any- thing" but that when the employees later showed him the actual subpenas he told them "You wait a minute, you boys This Is the Federal government you are messing with " There is just enough plausibility in this explanation to make it acceptable There is no evidence, in any event, that Michael Schnell was himself involved in this incident 394 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Q. Did he ask you where you worked at all? A. He asked me where I worked last-and I told him, Indianapolis, Indiana. Smeltzer was then questioned concerning what was said when Schnell and Hunston interviewed him about giving a statement, and his answer was: "Mr. Schnell said the union was trying to get in and said he didn't want them [Emphasis supplied.] A moment later Smeltzer admitted that Schnell had talked to him once while he was at work in the plant and asked him "if anybody was after me about the union," and that he had told Schnell that nobody had bothered him. Yet when a moment later Smeltzer was asked: "Did he (Schnell) express to you how he felt about the Union being in the plant?" he answered: "He didn't say thing about how he felt." Like McCartney, Smeltzer ended up by denying that there was anything about a union in the statement that he had signed, although he could not remember what was in the statement that he had signed. It hardly requires the citation of authorities to establish that the elder Schnell's conduct constituted violations of Section 8(a)(1) of the Act. While interrogations of employees may under some circumstances be lawful, they are clearly unlawful when, as here, they are accompanied by threats of loss of jobs, decrease in earnings, the cessation of operations, harassment of union supporters, and even encouragement to violence. The fact that the elder Schnell may have been a paternalistic employer did not excuse the conduct in which he actually engaged. The questioning of ap- plicants for employment concerning their attitudes toward unions, which was no less a violation of Section 8 (a) (1) of the Act, was clearly not an exercise in paternalism. The denial of the use of the plant's bulletin board to the Union after it had been certi- fied was also a violation of Section 8(a)(1) of the Act,15 as were the threats of reprisal against employees who might cooperate in an investigation of the elder Schnell's conduct by giving affidavits, since such threats would necessarily interfere with any investigation. It is inherent in the statutory rights of employees under Sec- tion 7 of the Act to seek their vindication in Board proceedings.1e B. The lease of Plant No. 2 In 1960 there was in Salem, Ohio, a firm known as the Gonda Engineering Com- pany. Its main facilities consisted of two masonry-constructed buildings on George- town Road but it also leased a building on Newgarden Street. The Georgetown Road buildings and the Newgarden building were located about a mile from each other. The Gonda firm, which was owned by John Gonda, was engaged in opera- tions closely related to those of Salem Stamping and of Schnell Tool & Die. It had a die shop, as well as a pressroom and assembly area, although the presses in the pressroom of Gonda were much heavier than those used in Salem Stamping. However, the skills of the production employees in the pressrooms of each were substantially the same. The principal customer of Gonda was the Great Lakes Tractor Company of Rock Creek, Ohio, which manufactured and sold power mowers for which Gonda made the decks In 1960, John Gonda found himself in serious financial difficulties, and he turned for help to Michael Schnell, and his son, Charles, with whom he had been acquainted for quite some time The latter had already acquired the finance company's mortgage on Gonda's property, and they decided to step in and purchase the Gonda plant and business. Gonda had appealed to them to do so, in order to save the jobs of his employees, and to prevent him, personally, from losing face in the community. The elder Schnell listened to this appeal all the more readily because for some months he had been making loans to an organization known as the First Salem Corporation, which had been established in order to further the industrial development of the Salem, Ohio, area, which for some years had been in a depressed state, the number of jobs and the industrial payrolls both having declined. The president of the First Salem Corporation was the same Walter Jay Hunston, who is one of the attorneys for the Respondents in the present iproceeding, and who in June 1960 had withdrawn temporarily from the active practice of the law in order to promote the industrial development of the Salem area, which involved not only the creation of new jobs but also the preservation of existing ones.17 Hunston, who had performed legal work for Michael Schnell prior to his retirement from practice, kept in constant 15 See The Proof Company, 115 NLRB 309 , and Talladega Cotton Factory, The, 106 N LRP. 295 16 See , for example , Better Monkey Grip Company, 115 NLRB 1170 , and Hilton Credit Corporation, 137 NLRB 56 17 IIunston returned to the active practice of law shortly before the hearing , after suffer- ing a heart attack in the intervening period SCHNELL TOOL & DIE CORPORATION, ETC. 395 touch with the latter. In describing his relationship with Schnell, Hunston paid the latter the tribute that he had done more than any other individual in the past 3 or 4 years to help the First Salem Corporation. However, when the elder Schnell decided to acquire the Gonda business, he called Hunston to tell him that because of this acquisition he would no longer be able to help the First Salem Corporation with loans. It can hardly be regarded as surprising that on the eve of the election to determine whether the employees of Schnell Tool & Die and of Salem Stamping wanted the Steel- workers to represent them, these employees should have received a circular letter signed by none other than Walter Jay Hunston, appealing to them to vote against the Union if they wished to save their jobs. He described "Mike" Schnell as the pos- sessor of "a heart of gold" who went out of his way to help people all he could, and dwelt upon the efforts he had made to save jobs. But he went on to speak of the dark days that had arrived with the advent of the Steelworkers on the scene. "Please give this matter," he went on to say, "careful and `prayerful' thought before you vote Tuesday." They are your jobs that could be at stake if you make the wrong decision." He concluded, however, by declaring that he had written his letter "without any solicitation from any person connected with your employer." 18 After acquisition of the Gonda assets on December 29, 1960, at a price of $125,000, the lease on the Newgarden building was canceled and the facilities there were moved to the buildings on Georgetown Road, which became known as Plant No. 2 of Schnell Tool & Die. At the time of its acquisition, the building on the south side of the property was used for offices and for die-shop operations, and the building on the north side of the property was used for stamping and assembly. An addition to this building on the north side was constructed in the months of April, May, June, and July, 1961, at a cost of $10,581.82, and the whole continued to be used for stampings and assembly. A second addition constructed at a cost of $13,170.83, in November and December 1961, was a steel and sash section which connected the two buildings and which was used primarily for the storage of steel. In addition to these improvements, new equipment was purchased and installed in Plant No. 2, and some of the old equipment was repaired. The most expensive item of new equipment was a milling machine, which was also acquired in 1961, and which cost approxi- mately $56,000. In all, approximately $100,000 was spent on improvements, repairs, and new equipment. On the other hand, there were few changes in personnel after the Gonda plant was acquired. There were no layoffs of production employees. The number of office employees, however, was reduced. John Gonda himself was kept on as pro- duction manager, but after a few months someone else was put in charge of the die shop, and Gonda was made a superintendent of the stamping and assembly operations only. At the time of the acquisition of the Gonda plant, its major customer in terms of dollar sales was the Great Lakes Tractor Company. In 1961, Schnell Tool & Die did $160,000 worth of business with Great Lakes through Plant No. 2. The second largest customer was the Rockwell Register Company of Bellefontaine, Ohio, which let contract work to Schnell Tool & Die valued at about $6,500 a month, or approxi- mately $78,000 a year. This work was being done in Plant No. 2 on tooling supplied by Rockwell. In 1962, however, Great Lakes, which at one time had saved Gonda from bank- ruptcy, began to experience financial difficulties itself. Although at one time its sales had amounted to as much as $6 million a year, it now had $400,000 in debts. The National Acceptance Corporation of Chicago held a first mortgage on its build- 11 While IIunston asserted that there had been no "solicitation " to induce him to write his letter, he did not assert that he had received absolutely no "cooperation ." This co- operation must have extended at least to supplying him with the names and addresses of the employees who would be eligible to vote. The intervention of Hunston in the election was brought out incidentally when he took the stand as a witness for the Respondents to testify with respect to the subsequent disposition of the Gonda plant The incident of the preelection letter to the employees is not specifically alleged in the complaint as a viola- tion, although some of the general allegations are perhaps broad enough to cover it IIow- ever, in his brief , the General Counsel does not cite the incident as an independent viola- tion of Section 8(a) (1) of the Act and I do not, therefore , consider it necessary to determine whether it constituted such a violation . It is , in any event, only cumulative I deem it necessary to point out , however, that Hunston , by appearing as a witness for his client , transgressed canon 19 of the "Canons of Professional Ethics of the American Bar Association " See the comment of the court in Vanderbilt Products, Inc. v. N L R.B., 297 F. 2d 833 ( C.A. 2) 396 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ings and equipment, and the interest that Great Lakes had to pay on the loan was, as Hunston put it, "literally eating the company up." The creditors of Great Lakes commenced bankruptcy proceedings, and arrangements were made to operate it under chapter 11 of the bankruptcy laws. Michael Schnell borrowed $68,000 from the Farmers National Bank of Salem, Ohio, to pay off the National Acceptance Corpora- tion, and took over the mortgage. A study of the operations of Great Lakes during the previous 5 years was made for Schnell by a firm of certified public accountants. This study convinced Schnell and Hunston that "it was a company that was worth saving" but the latter revealed that this conviction was influenced by something more than the altruistic motive of saving jobs . As Hunston explained it: "One of the reasons that we at First Salem might have considered saving it so important was the fact that the River Lakes Canal is coming right down through there. The gov- ernment has determined that the village of Rock Creek would be ten feet under water and, therefore, at such time as that came through there, if this company were in business, then we would-when the federal Government bought the company, we would get the money to relocate the plant in this area so we could save 100 jobs." Nevertheless, Hunston himself did not feel that the loss of the Great Lakes business would do more than "ultimately affect the Gonda Engineering Division of the Schnell Tool & Die Corporation for the City of Salem." [Emphasis supplied.] Schnell Tool & Die did offer to run Great Lakes until it was able to meet its obligations and Charles Schnell admitted that this would have required an investment of at least $25,000 . Certainly, Schnell Tool & Die did not cast all caution to the winds, for while Great Lakes was operating under chapter 11 of the bankruptcy laws, it sharply curtailed the supply of decks to Great Lakes. Actually. customers would also curtail the orders which they would give to a firm already operating under the bankruptcy laws. Finally, despite all efforts to keep Great Lakes solvent, it was adjudicated bankrupt on August 14, 1962. Trouble also developed, however, with the Rockwell account. In 1962, Rockwell began to make chargebacks for defective work and to complain of delays in delivery. Charles Schnell became so alarmed that in the month of July he personally took over the handling of Plant No. 2 mail . In a letter dated September 25, 1962, and addressed to "Gonda Engineering Division of Schnell Tool & Die Corporation," Rockwell complained of the fabrication of defective parts not suitable for its as- sembly lines, and threatened to remove its tooling unless corrective measures were taken. "I would like to stress the fact," wrote Frederick J. Mauk, the purchasing agent of Rockwell who wrote the letter, "that if immediate correction is not taken, we will have no alternative but to remove all of the tooling now in your possession and purchase these items from another source ." However, Rockwell did not put into immediate execution its threat to remove its tooling On October 16. 1962, which was the very day that the Union was certified as the collective-bargaining representative of the employees of Schnell Tool & Die, as well as of Salem Stamping, Schnell Tool & Die advertised Plant No 2 for sale or lease. The advertisement, which appeared in the Salem News for that day, occupied a space in the paper of approximately 5 inches square and was printed in bold, black type. It read FOR SALE OR LEASE on Georgetown Road, Salem 43,000 Square Feet Tool and Die Shop Press Room, Assembly Room and Steel Storage with overhead crane. Former Gonda Engineering Buildings Schnell Tool & Die Corp will abandon these buildings and conduct all operations at 631 West State Street, Salem, O. Inquire Schnell Tool & Die 631 West State Street ph. ED 2-4686 On October 19, 3 days after the appearance in the Salem News of the advertisement for the sale or lease of Plant No. 2, the following notice was posted in the plant itself. To All Pressroom & Assembly Dept. Employees: To put persistant [sic] rumors to rest, this memorandum is official notification that all operations of Schnell Tool & Die, Plant # 2, will cease. The management made this decision reluctantly. However, due to the unprofitable operation for many months and without any prospect of improve- ment in the future there was no alternative. SCHNELL TOOL & DIE CORPORATION, ETC. 397 Since our business is highly competative [sic], there is no possible relief in offsetting the losses by increasing prices. This was demonstrated in our loss of the Warner Gear pan job. This is being currently considered by the Rockwell Company who have advised us that as soon as they are able to set up another source they will remove all tooling from our plant. While no definate [sic] date has been set, it is hoped that commitments to our customers for whom we do production work will be completed so that the plant can be closed and cease operation by November 30. At that time all tool room work and employees of the Tool & Die Depart- ment will be moved to Plant # 1, so that the entire plant can be vacated. Since it is publicly known that the facilities of Plant #2 have been put up for sale or lease it is hoped that a new tenant will be found by that time. [Em- phasis supplied.] PRODUCTION MANAGER. It is evident that the statement in the fourth paragraph of this notice to the effect that Schnell Tool & Die had been advised by Rockwell that it would remove its tool- ing from the plant as soon as other arrangements could be made was patently untrue. In his letter of September 25, Rockwell had made no such unconditional threat. At the time the notice was posted its letter had not yet even been answered. It was not until November 8 that a reply to this letter was forthcoming. The reply, which was addressed to the attention of "Ted Mauk," Rockwell's purchasing agent, and which was signed by John H. Gonda as production manager of Plant No. 2, read as follows [emphasis supplied] : Mr M. S. Schnell, who is the president and principle [sic] owner of Schnell Tool & Die Corporation, finds that due to his advancing years and gradual impairment of health, it becomes necessary to be relieved of some of his activities and responsibilities. Mr. Schnell has always been and still is the chief motivating force behind this business and it is, therefore, with great reluctance that the Board of Directors acceded to his wishes. All material that we have been producing for your company is being done in seperate [sic] buildings and in a different location from the main plant. This operation is known as Plant #2. After due consideration, over a long period of time, a decision was reached that, in order to serve Mr. Schnell's personal interests, the best, it would be advisable to discontinue operations at Plant #2. Accordingly, the buildings and equipment were advertised for lease or sale and a lessee has acquired these assets. This, of course, involves various parts that we are making for you, and, the tentative effective date is November 30, 1962. Since the building now used for production must be completely vacated before the new lessee takes over, it is our hope that this official notification will give you sufficient time to find a new source. By agreement with the new lessee, all tooling of all customers must be re- moved from our plant not later than the first week in December. We assure you that it is difficult to give up the fine relationship that we have had with your company for many years, and, if there is anything we can do to assist you in locating a new source, or, if we can be helpful in any way, we gladly offer you our fullest cooperation. As it turned out, Rockwell never had to remove its tooling from Schnell Tool & Die Plant No. 2. It asked for bids from other concerns, and it received a bid which it regarded as the most favorable from a new firm just recently organized known as Quaker Manufacturing Company, which had leased Plant No. 2 from Schnell Tool & Die. Quaker thus had taken over the work of Schnell Tool & Die's largest customer, and its business of $78,000 a year. Quaker Manufacturing Company had been organized as a corporation, and its stock is wholly owned by Henry Ickes and Boyd Helm, and their respective wives. Ickes and his wife hold 49 percent of the stock, and the balance is held by Helm and his wife. On the board of directors of the corporation are also Ralph Atkinson, one of Michael Schnell's lawyers, who was shortly to bring, on his behalf, a libel suit against Ormond Long (as is subsequently to be related), and Earl Miller, vice president of the Farmers National Bank of Salem, with whom Michael Schnell had had financial dealings. In the creation of Quaker, moreover, Schnell Tool & Die and Salem Stamping had had to forgo the services not only of Henry Ickes but also of Henry Schnell, 398 DECISIONS OF NATIONAL LABOR RELATIONS BOARD another son of Michael Schnell , who had had charge of maintenance for both corporations . Henry Schnell had been put in charge of the Stamping Division of Quaker after it had been organized. Henry Ickes and Boyd Helm, who had organized Quaker in order to lease Plant No. 2 and take over its business , attempted to explain in their testimony how this came about. Just prior to this event , Henry Ickes had been the manager of the die shop in Plant No. 2, where his office had been located . Boyd Helm had been the plant manager of United Tool & Die, another concern in Salem engaged in die operations . Helm testified that he knew Michael Schnell "very faintly" (as he put it) but Ickes, of course, knew his employer quite well , and Helm and Ickes were close friends who had known each other since their boyhoods , and who now live only two doors apart. Ickes, who was called as a witness on behalf of the General Counsel, made a particular point in his testimony of stressing the role of the ad in the Salem News in bnnging him and Helm together , although he was an insider in Plant No. 2 where he occupied an important supervisory position and where he had his office. Ickes also represented Helm as the moving spirit in the acquisition of Plant No 2. Thus, Ickes testified that "an ad appeared in the paper that this plant was for lease or sale, and from that point on we got together and decided that we would approach Mr. Schnell." [Emphasis supplied .] This testimony left unanswered how he and Helm "got together," and on cross-examination counsel for the Respondents asked Ickes "Do you recall whether after this ad occurred in the paper you approached Boyd or did Boyd approach you?" and he received the reply: "Boyd came to my house. We live only two doors apart and have been close friends ." Not entirely satisfied with this answer, counsel for Respondents then asked : "Then he came to you in response to the ad?" and received a reply in the affirmative . Helm himself, who was called as a witness by counsel for the Respondents , testified on the same subject as follows: Q. Mr. Helm, would you explain just how this came about as nearly as you can recall that you folks leased the premises from Schnell Tool & Die? A. Well, it was advertised in the paper. Q. You read the ad? A. Yes. Q. All right, go ahead. A Then I approached Mr. Ickes because Mr Ickes was much more familiar with Mr. Schnell than I was. I knew Mr. Schnell very faintly. Charles Schnell also contributed a bit of hearsay to the testimony concerning the acquisition of Plant No. 2 by testifying that the ad in the Salem News "was seen by Mr. Boyd Helm and he, in turn , contacted a boyhood friend of his (Ickes, of course) ... and the two of them approached us about buying the plant" When, according to the testimony of Helm, he and his friend , Ickes, conceived the idea of leasing Plant No. 2, they were worried by the fact that they did not have the necessary funds but they found Michael Schnell an easy man to deal with. This can be best described in Helm's own words. As he testified: We discussed this thing for several days between ourselves because from a financial standpoint it was a big undertaking for the two of us. We did not have that kind of money . We had nothing to lose, so we approached Mr. Schnell, and Mr. Schnell was very pleased to find two people that he felt could carry on the business, and he was very, shall we say lenient, as far as financial terms were concerned . [Emphasis supplied.] Ickes and Helm testified that Plant No. 2 was leased by Schnell Tool & Die to Quaker for a term of 5 years at a yearly rental of $50,000, with an option to purchase the plant for $450,000, in which case the rentals , less interest and insurance, might be applied to the purchase price. Although Schnell Tool & Die and Quaker were, obviously, highly competitive, Ickes and Helm conceded that the lease contained no provision to prevent Quaker from soliciting the customers of Schnell Tool & Die, and that it was for this reason that Quaker was able to solicit Rockwell , as well as the other customers of Schnell Tool & Die. If this was an example of Schnell's leniency, the option to purchase the plant for $450,000 certainly was not, considering that it had been acquired for $125,000 and not more than $100,000 had been put into improvements and new equipment, and that it had lost its chief customer. If the lessees exercised the option to purchase , they would pay for the plant twice what had been put into it. However, subsequent to the leasing of Plant No. 2, Schnell has proved to be, in other respects, lenient to the point where leniency ceases to be either prudent or good business. Ickes and Helm have been unable to pay the monthly lease rentals of SCHNELL TOOL & DIE CORPORATION, ETC. 399 over $4,000 a month, and Schnell Tool & Die has taken notes for the amounts due. Since Plant No. 2 has no Blanchard grinder of its own, it has had to have this work performed by Schnell Tool & Die but it has not been pressed for payment. One of the major puzzles in the present case is precisely when the lease of Plant No. 2, which was never produced,19 was actually executed. In the notice of Octo- ber 19, posted on the plant bulletin board, it is stated that "it is hoped" that a new tenant would be found by November 30. In this letter of November 8, which was written by John Gonda, to Rockwell less than 3 weeks after the posting of the notice, the lease is stated to be an accomplished fact ("a leasee has acquired these assets"). Helm testified that it was his "belief" that the advertisement for the sale or lease of Plant!No. 2 "appeared in the paper the very latter part of September or very early in October" (he was wrong, therefore, by 2 or 3 weeks, since the ad ap- peared on October 16), and then he testified further that "the official papers for the lease were signed-this is a guess, approximately, November 8." [Emphasis supplied.] The guess thus coincided exactly, except for the qualifying "approximately," with the date given by Gonda in his letter to Rockwell. On the other hand, Ickes, who testified that while "they" (meaning Ickes and Helm) had an informal organization and did some preliminary work prior to December 1, the date he chose for the formal commencement of operations, also testified that the lease was not signed until some- time in the month of December. But the testimony of Helm and Ickes, which is contradictory in itself, is still further contradicted by the testimony of Charles Schnell. After first testifying that it had been decided with respect to leasing Plant No. 2 that "the closing date would be at the end of November," he gave, incom- prehensibly, the following testimony: Q. And after you were contacted by Mr. Helm and Mr. Ickes, you entered into negotiations for the sale? A. Yes. Q. And then you closed out the sale on what day? Or when did they take over? A. Actually, they took over on the first day of September, midnight, Septem- ber 3. We did have some dies in there, customers' dies in there we had to clean up, crate, and ship after that date. We were given permission to do so one week after the first of September. [Emphasis supplied.] Having related the story of the organization of Quaker, and the lease of Plant No. 2 to the corporation so organized, it is now in order to inquire why Schnell Tool & Die got rid in 1962 of that part of its business which it had acquired less than 2 years previously. The posing of this question at this point may seem paradoxical, since rea- sons for taking this action have already been mentioned. The inquiry must be pressed further, however, because these reasons are wholly contradictory. In the notice of October 19 posted in Plant No. 2 itself, the necessity of leasing the plant was attributed to bad business, of which two examples were given, namely, the loss of the Warner Gear pan job (the reference is to oil pans), and the imminent loss of the Rockwell account, which, it has already been pointed out, was exaggerated. However, in John Gonda's letter of November 8 to Rockwell, in which the loss of the Rockwell business was shown to be a self-inflicted wound, bad business was not advanced at all as a reason for discontinuing operations in Plant No. 2. The reason advanced, it should be recalled, was simply that Michael Schnell, despite the fact that he still was the motivating force in the business, had to be relieved of some of his activities and responsibilities "due to his advancing years and gradual impair- ment of health." Finally, in the answer filed in the present proceeding by Schnell Tool & Die, Michael Schnell's bad health and advancing age were abandoned al- together as reasons for disposing of Plant No. 2, and a return was made to bad business. It was alleged in paragraph 15 of this answer that it was decided on January 1, 1962, to liquidate Plant No. 2 unless there was a drastic improvement in its financial position but that matters only became worse and that it was decided in August to sell or lease the plant. Apart from Hunston, the only witness called by the Respondents to attempt to explain the disposition of Plant No. 2 was Charles Schnell?o He, however, could not entirely abandon his father's advancing age and poor health as explanations. 19 When it was suggested to counsel for the Respondents at the hearing that the lease itself be produced, since it would be the best evidence of its terms, the suggestion was received with a singular lack of enthusiasm. 20 John Gonda, who at least thought that he knew why Plant No 2 was being liquidated, was not called as a witness by the Respondent. 400 DECISIONS OF NATIONAL LABOR RELATIONS BOARD He sought to represent them at least as subsidiary reasons which formed the back- ground of the decision to liquidate Plant No. 2. But he explained rather differently the bearing of these reasons on the ultimate decision, and extended their scope to the disposition of the whole business, Schnell Tool & Die Plants Nos. 1 and 2, as well as Salem Stamping. Because of his father's advancing age and poor health, he testified, they had been trying to sell the whole business for the past 10 years in anticipation of the estate tax problem that would be created by his death. Thus, they had been advertising the business for sale in various trade papers and other papers, which did not, however, include the Salem News. But he knew of no ads between 1958 and 1960. It is difficult to perceive what bearing this protracted 10-year effort to dispose of Schnell's whole business in contemplation of his death would have on the partial and temporary liquidation of one part of the business in 1962, particularly at a time when, allegedly, that part of the business was losing money. The estate tax problem could not be solved by leasing half the business for the short term of 5 years. The lessee had, to be sure, an option to purchase Plant No. 2 but not only was there no certainty that it would be exercised but the purchase price, if the lessee chose to exercise the option, was put so high that it was not reasonable to expect that it would be exercised by impecunious lessees. Charles Schnell did not, however, put all his eggs in the estate tax basket. After all, it is evident that a long-term problem could not satisfactorily explain a short- term decision. He also relied, therefore, on the explanation that Plant No. 2 was in financial difficulties. He did not dwell, however, upon the loss of the Warner Gear job as the source of these difficulties. According to him, the source was the bank- ruptcy of the Great Lakes Tractor Company. Despite the fact that in 1961 Schnell Tool & Die, through Plant No. 2, had done in excess of $160,000 worth of business with Great Lakes, Plant No. 2 showed a profit of only $14,000 on its total operations, and they began to talk at once about selling the plant. As Charles Schnell put it: "It came up for discussion immediately after the end of 1961 ... .. But, after Great Lakes went bankrupt, in August 1962, they decided then and there to close out Plant No. 2. At the end of 11 months of operation Plant No. 2 showed a loss of $56,000 on its total operations. A number of questions immediately suggest themselves. On January 1, 1962, Schnell Tool & Die still had its two principal customers, Great Lakes and Rockwell, whose business alone, not counting its other customers, was worth approximately $238,000. While the profit at the end of 1961 was very small, still Plant No. 2 was not in the red. Moreover, it was still undergoing improvement and acquiring new equipment at a cost of nearly $100,000, and in December 1961 the second addition to Plant No. 2 was still under construction. Surely, it seems odd, to say the least, that at such a time the Schnells should be contemplating the sale of Plant No. 2? But, even more significantly , if the Schnells could contemplate the necessity of selling at the very beginning of 1962, the loss of the Great Lakes business could be at the most only "a last straw." Furthermore, if the decision to sell was definitely made in August 1962, why wait until 2 months later to advertise the plant for sale, especially when the Schnells had been in the habit of advertising for a period of 10 years? In August 1962, moreover, they could not know that in November 1962 the plant would show a loss. Finally, if in August it had already been decided to sell Plant No. 2, why should Charles Schnell have become so agitated about the Rockwell account that he took over in July the handling of Plant No. 2 mail? To be sure, his motive might have been to preserve the business so as to hand it on to a purchaser; yet he either turned the same business away before he had found a purchaser, or he put himself in a position preventing him from turning the business over to a purchaser. But, if it is permissible to look at the financial position of Plant No. 2 as of the end of November rather than the end of August 1962, was it really so desperate? Analysis shows that the loss of $56,000 was really no more than a book loss. A "loss" of nearly $40,000 resulted from inventory adjustment on closing down of Plant No. 2. Other losses were represented by bad debts in the amount of over $12,000 and legal expenses in the amount of almost $5,000. Since both of these items resulted from the bankruptcy of Great Lakes, they would be nonrecurring items which, in themselves, would not be very disturbing. An increase of at least $3,000 to $4,000 in charges for depreciation would be attributable to the extensive improve- ments and new equipment in 1961. An increase in taxes of about $7,000 over 1961, was due to the fact that the Gonda plant or Plant No. 2 was acquired at the very end of 1960, and the personal property and real estate taxes were not charged off until the following year. One of the most dubious items in the balance sheet is represented by the salary of Henry Ickes, three quarters of which was charged off as an admin- istrative expense against Plant No. 2, although he worked not only for Plant No. 1, SCHNELL TOOL & DIE CORPORATION, ETC. 401 but also for Salem Stamping during most of 1962. Almost $15,000 was also ex- pended in 1962 on perishable tools, as compared to an expenditure of $9,500 in 1961 for perishable tools, which is a significant indication of the extent to which the Respondents were willing to go to keep Plant No. 2 running. All of the asserted losses must be evaluated, moreover, against the fact that the sales of Plant No. 2 actually increased from $699,678 21 in 1961 to $761,332.51 in 1962, although the figure for 1962 represents sales for only 11 months. The asserted losses must be evaluated also against the apparent prosperity of the Schnell business as a whole. While the record does not include figures showing the profits of Salem Stamping, it was engaged in operations similar, if not identical , to those of Plant No. 2. One unmistakable indication that business was excellent in Salem Stamping is that at the time Plant No. 2 was leased, Salem Stamping was working two shifts , with each shift working overtime 6 and 7 days a week. Salem Stamping was hiring, moreover, a substantial number of new employees in the months of October, November, and December, 1962.21 Having just expended almost a quarter of a million dollars in expanding its opera- tions, it is inconceivable that Michael Schnell and his son, Charles, would have sud- denly and precipitously decided to curtail them unless the position of the business as a whole were truly desperate, or unless they had found a buyer who was so desirable that his offer could not possibly be resisted . The expenditures in expanding opera- tions are also inexplicable if in fact for some 10 years the Schnells had been planning to go out of business altogether. This very riddle was submitted to Charles Schnell. "Now, Mr. Schnell," he was asked, "if for 10 years the intention of Schnell Tool & Die Corporation was to go out of business why then was it willing to invest such huge sums of money in acquiring new plant and equipment?" The reply of Charles Schnell was: "To offer a more attractive package to prospective buyers." Conceivably, this could be true in other circumstances but it has absolutely no bearing on what actually happened in the present case. The attractive package was offered to a highly un- attractive purchaser. The attractive package was being prepared although for 10 years, despite expensive advertising , no willing purchaser had been found. The at- tractive package was being prepared , moreover, for sale, but it was finally handed over to unattractive parties on a short -term lease, although they could not even pay the rent. Finally, the purchasers acquired what was, after all, an unattractive pack- age, since, according to Charles Schnell , the business had been sustaining what he called "continued losses." How losses during I year-and that the first full year of operation-could be called, moreover, "continued" losses is not apparent The indications that Plant No. 2 was not disposed of for any legitimate business reasons are simply overwhelming . The Respondents' explanations of the decision constitute a farrago of contradictions , absurdities, and irrationalities which include the acquisition of Plant No . 2 at the very end of 1960 , and its precipitous disposition before the end of 1962 after almost a quarter of a million dollars had been spent on it; the shift in the explanation of this action from Michael Schnell 's valetudinarianism to business losses; the exaggerated representation of these losses; the exaggerated statement concerning the status of the Rockwell account; the posting of the notice in the plant announcing its disposition before there could have been a tenant for it; the lease of the plant, after a show of advertising , to tenants who, like Maeterlinck's bluebird, were found at home; the impecunious character of these tenants, and the character of the terms of the lease itself ; the close relationship between the personnel of Quaker and Schnell Tool & Die; the failure of Schnell Tool & Die to protect its own business interests against the lessees and its indulgence toward them after they took possession ; and, despite the failure to sell the whole business for a period of 10 years, its partial disposition for a short term to undesirable parties. If there could be said to be any lingering doubt concerning Michael Schnell's real motive in disposing temporarily of Plant No. 2, it is certainly dispelled by his behavior toward the Union after the decision had been made. He did not inform the union representatives of his intention to advertise the plant for sale or lease, or give them advance information concerning the posting of the notice in the plant, although by that time 3 days had elapsed since the Union had been certified as the collective-bargaining representative of all the employees of Schnell Tool & Die, in- cluding those in Plant No. 2. The union representatives were left to gather Michael Schnell's intentions from such other sources as might be available, which were rumors based no doubt on the advertisement in the Salem News and the notice posted in the plant. At the first collective-bargaining session of November 7, the union representatives brought up the rumors concerning the possible disposition of Plant No. 2, and Manchester read to the union representatives the text of the 2 'General Counsel's Exhibit No. 2 shows that 26 new employees were hired in these months. 402 DECISIONS OF NATIONAL LABOR RELATIONS BOARD notice that had been posted in the plant on October 19. But, since the notice expressed only a "hope" that the plant would be sold or leased, the union repre- sentatives were still in the dark as to the ultimate outcome. Before the next bar- gaining session, which was scheduled for November 26, Hinchcliffe wrote a letter to Michael Schnell-it was dated November 15 and was sent as certified mail-in which he stated as follows: It has come to our attention that you have recently posted notices of em- ployment termination for employees employed at Plant No. 2 situated on Georgetown Road. We have not been advised by you or your bargaining representative as to the plans your company may have with respect to the opera- tion of the facilities at which the notices have been posted. Moreover, the November 14, 1962 edition of the Salem News carried a news item revealing that the Quaker Manufacturing Company had leased your facil- ities at the Georgetown Road plant. Will you kindly promptly advise as to what effect, if any, the news item and the notices of termination of the plant will have upon the collective bargaining negotiations now being conducted by your company with this Union. This matter is urgent, and we ask an immedi- ate response. The very next day Manchester replied to Hinchcliffe's letter, as follows- I have for acknowledgement a copy of your "certified mail" letter to Mr. Schnell dated 15 November 1962 asking "immediate" reply. When we met on 7 November the matter of Plant No. 2 was raised by you on the basis of "rumors." At that time I read to your committee a copy of the notice placed on the bulletin board at that plant. I have now prepared a copy thereof which I enclose. I also read to the committee and we discussed the rejects and potential loss of the Rockwell job. The notice is rather clear. Production work will be completed by 30 No- vember and the Tool and Die work employees will be moved to Plant No. 1. Plant No. 2 has been put up for sale or lease. I am now advised that Quaker Manufacturing Company has leased Plant No. 2 with an option to purchase it. Production will conclude on 30 Novem- ber 1962. Tool and Die employees will be called into Plant No. 1 on 23 De- cember 1962 if the Company has work for them. This move, necessitated by economic reasons, will have no effect upon pend- ing negotiations other than a possible reduction in the working force. I have not seen the newspaper article to which you refer but Schnell expects to conduct its reduced volume of business at Plant No. 1. It is plain that in this letter the lease of Plant No. 2 is announced to the Union simply as a fait accompli. At the next bargaining session on November 26, Hilland made the suggestion, however, that the production workers in Plant No. 2 be transferred to Salem Stamping. Despite the fact that such transfers had occurred in the past,22 and despite the fact that Salem Stamping was hiring totally new employees at that very time, Hilland's suggestion was not favorably received. He was told that the production workers in Plant No. 2 who were about to be termi- nated would not be transferred to Salem Stamping because Schnell Tool & Die and Salem Stamping were separate and distinct enterprises. Again the threadbare legal fiction was invoked to refuse to do what normally would have been done even if the legal fiction were a reality. The refusal is readily understandable, how- ever, in terms of the real objective of the liquidation of the business of Plant No. 2, which was to undermine the Union where it was weakest, for in Schnell Tool & Die the Union had won the election by a slender margin only. The very day after the collective-bargaining session of November 7, moreover, Schnell Tool & Die advertised in the Salem News its desire to sell or lease Plant No. 1. No explanations or justifications for this step were offered, except perhaps the long-term desire to dispose of the whole business. But, in the past, the Schnells had refrained at least from advertising in the local press. Obviously, such local advertising would cause consternation not only among the employees but in the community as a whole. But now Michael Schnell was, apparently, ready to abandon even his support of the efforts to create and save jobs in the Salem community, and to disassociate himself once and for all from the laudable objectives of the First Salem Corporation. In the end, he had executed, at least in good part, the very threat which he had been making all along to go out of business rather than to deal with the Union. 22 In fact, the meeting had opened with a discussion of several such transfers ! , SCHNELL TOOL & DIE CORPORATION, ETC. 403 C. The alleged violations of Section 8(a) (3) of the Act 1. The case of Ormond Long Long had several periods of employment at Salem Stamping since early in 1959. His last period of employment commenced in 1960, and he was employed as a production worker in a considerable variety of operations. Long's leadership in promoting the Union, as well as the elder Schnell's unsuccess- ful attempt to win him over to his side, have already been mentioned. Long was subsequently elected president of the union local, and under date of November 12 Michael Schnell was informed of his election in a letter from Hinchcliffe.23 Long was also a member of the union negotiating committee which, on November 7, entered into collective-bargaining negotiations with Harry Manchester as the repre- sentative of the Respondents. As the negotiations between the Union and management were not going well for the Union, there were rumors of a strike, which would naturally be a subject of considerable public interest in a town as small as Salem On Friday, December 14, Glenn F. Schotten, a reporter for the Salem News, published a story in the paper about the situation. It was based on a telephone interview with John Bergman, the vice president of the Union, and bore the headline: "Schnell Co. Wage Talks Continue." The story related chiefly to the reduction of overtime pay which had been effected by Schnell on December 1.24 "Workers involved," Schotten reported in his story, "come from Schnell's Nos. 1 & 2 plants and the Salem Stamping and Manufacturing Co." The inclusion of Plant No. 2 was clearly in error, so far as Schotten could know, since Schnell had already disposed of Plant No. 2 to Quaker. The next day, which was Saturday, December 15, Schotten published another story in the Salem News, based on a telephone interview with Long, and this story was entitled "Union Delays Strike at Schnell Co." The union mentioned in the first sentence of the story was the United Auto Workers, which was another error, since the union involved was, of course, the United Steelworkers. In the fourth paragraph of his story Schotten attributed the following statement to Long. The union head said the main bone of contention is the "too low wages" paid by Schnell Tool and Die Co. The bulk of the workers belonging to his union he said, receive hourly wages ranging from $1.15 to $1.35, while a few are paid from $1.45 to $1.60, the latter figure being maximum, Long declared. He said many of the men with large families cannot support their families on this pay. [Emphasis supplied.] After reporting further that the "company and the union" had also been at odds with respect to the issues of overtime pay, vacation time, and pay on holidays, Schotten continued: Long contrasted Schnell's pay of a top hourly rate of $1.60 to the $2.28 he reports is paid to sweepers at some local organized plants. The union, which is still seeking its charter from the USW represents about 50 percent of the total labor force at Schnell's No. 1 and 2 plant and Salem Stamping and Manufacturing. Michael Schnell himself called Schotten 25 to complain about the statement at- tributed to Long that the wages paid by Schnell Tool & Die were too low. Schotten asked Schnell whether he wanted anything printed about the article but the latter declined this offer. On the morning of Monday, December 17, when Long reported for work shortly before 7 a.m., the night watchman barred him from entering the plant. At about 9 a.m. he was allowed, however, to see Michael Schnell, who summonded his son Charles to be present at the interview. The elder Schnell complained to Long that the wages quoted in Schotten's article in the Salem News story of December 15 "were not the wages paid by the Schnell Tool & Die Corporation." Long explained the circumstances of his interview with Schotten and asked the elder Schnell "if it would help if I went down to the newspaper and talked to the reporter and have 23 In the same letter, which is in evidence as Respondents' Exhibit No. 8, Hinchcliffe also informed Schnell that John Bergman had been elected as vice president ; Al Beeson as recording secretary ; John Chaffin as financial secretary, and Mathias Green as treasurer, of the Union 24 This is discussed intro in connection with the failure of collective bargaining. 25 Schotten's best recollection seemed to be that Schnell called him the very afternoon that the story appeared but the call may not have been made until Monday, December 17. 727-083-64-vol. 144-27 404 DECISIONS OF NATIONAL LABOR RELATIONS BOARD him print a correction." The elder Schnell told Long, however, that "it would not help a bit," and then remarked: "I have what I want in black and white. This is what I am using," and he then added: "As far as this union is concerned, something will pop and it won't be very long." [Emphasis supplied.] As he handed Long his paycheck, the elder Schnell remarked: "I am very sorry to do this." However, Long was not immediately discharged on December 17. He was merely "suspended." But on January 4, 1963, Schotten was interviewed by Ralph Atkinson, one of Schnell's attorneys who was also a member of the board of directors of Quaker, and in Atkinson's office Schotten executed on that date an affidavit which, apparently, satisfied Schnell that he had been libeled. In his affidavit Schotten deposed that his interview with Long on December 15 "for sometime . . . had related primarily to Schnell Tool & Die when said Ormond Long said in substance that the main bone of contention is the `too low wages paid' and that the bulk of the workers belonging to his union receive hourly wages ranging from $1.15 to 1.35, while a few are paid from $1.45 to $1.60, the latter figure being maximum, and that many of the men with large families cannot support their families on this pay." In the final para- graph of the affidavit, Schotten averred: "Affiant then believed, and believes he was intended to believe, that the foregoing statements by said Ormond Long referred primarily to Schnell Tool & Die Corporation." [Emphasis supplied.] Long was formally discharged on January 16 when the elder Schnell sent him a letter labeled "Notice of Separation " The letter, which was on the stationery of Salem Stamping but was mailed in an envelope of Schnell Tool & Die, read as follows: On December 15, 1962, you issued for publication in the Salem News certain false statements derogatory and highly damaging to this company and to Schnell Tool & Die Corporation, which statement the News published the same day. This is to advise you that after mature consideration, we feel that these statements make your continued connection with this company untenable and require your discharge. Indeed, we have today brought suit against you and the labor organization you represent on account of said false statements. Accordingly you are hereby discharged effective at once. [Emphasis supplied.] On the same day as Long's discharge Schnell Tool & Die and Salem Stamping brought suit for libel against the Union and against Long claiming damages in the amount of $1,000,000. The suit, which was brought by Atkinson in the Court of Common Pleas of Columbiana County, was based, of course, on Schotten's story in the Salem News for December 15. In their petition the plaintiffs alleged the gravamen of their complaint to be that Long had stated that the bulk of the workers belonging to his union (which the plaintiffs averred would include employees of Schnell Tool & Die) received hourly wages ranging from $1.15 to $1.35, while a few were paid from $1.45 to $1.60, the latter figure being maximum, and that many of the men with large families could not support their families on their pay; and that Long had contrasted top hourly rate of pay of $1.60 to the $2.28 he claimed was paid to sweepers at some local organized plants. If the plaintiffs' libel suit ever came to trial, Schotten would be, of course, an indispensable witness. His appearance at the hearing in the present case could be regarded, therefore, as a form of dress rehearsal. But, surprisingly, he was not called as a witness by the Respondents but by counsel for the General Counsel. Rarely has a witness seemed more embarrassed and irresolute. He explained some of the errors in his story in the Salem News for December 15, which may well have been due to the fact that, as he testified, he had "some hearing trouble." So far as concerned the fourth paragraph of his story, which was the key paragraph, he testi- fied that in his telephone conversation with Long, he had asked the latter what the basic problem was between the Union and the companies and that Long had replied that it was "too low wages" without stating, however, that the wages quoted in the fourth paragraph were paid by Schnell Tool & Die 26 When the hearing in the present case was resumed after a lapse of several weeks, Schotten again appeared as a surprise witness. This time he was called neither by counsel for the General Counsel nor by counsel for the Respondents. He appeared of his own volition, stating that he wished to clarify his previous testimony. Upon the stand again, he now testified that while the first sentence of the much-disputed fourth paragraph of his story in the Salem News of December 15 was not true, the 20 This was also essentially the purport of an affidavit which he had given to the General Counsel under date of March 6, 1963. SCHNELL TOOL & DIE CORPORATION, ETC. 405 balance of the paragraph was true. "Mr. Long," explained Schotten, "did not himself say, 'Schnell Tool & Die' but said merely 'Schnell.' I interpreted this to mean Schnell Tool & Die." Schotten's testimony and affidavits relate to what Long told him in his telephone conversation on which his story was based. Whichever version of what Long is supposed to have said one accepts, it is clear that Long never stated to Schotten that the wages paid by Schnell Tool & Die were too low. The most that Schotten ever asserted-and this was in the affidavit which he gave to Schnell's lawyer-was that Long led him to believe that he was talking about Schnell Tool & Die. But this, obviously, was no more than Schotten's own opinion or impression. This being all that Schnell had on which to base a libel suit, it seems difficult to believe that Schnell could honestly and sincerely have thought that Long had deliberately made a false statement. In any libel suit, Schnell Tool & Die and Salem Stamping would bear the burden of proving at least that Long had made a false statement. They bear the same burden in the present proceeding 27 but they have failed to establish that anything said by Long to Schotten was false. In the first sentence of the fourth paragraph of Schotten's story he is represented as having stated merely that he thought that the wages paid by Schnell Tool & Die were too low, but he is not represented as quoting any particular wages or wage scales paid by Schnell Tool & Die. It is obvious, therefore, that in this sentence Long was merely stating no more than an opinion-both his and the Union's-that the wages paid by Schnell Tool & Die were too low. Even if Schnell Tool & Die were paying the highest wage rates in the in- dustry in its particular area, there is nothing that would prevent Long and the Union from considering that they were too low and demanding still higher ones. It is true that in the very next sentence Long is represented as having mentioned specific wage rates but these rates are attributed neither to Schnell Tool & Die nor to Salem Stamping. Long is quoted merely as saying that "the bulk of the workers belonging to his union" received these wages. That this was an absolutely true statement is affirmatively established by the record which includes an exhibit furnished by the Respondents in which the wage rates paid to Schnell Tool & Die, as well as to Salem Stamping, employees are set forth.28 While almost all the 22 employees in Schnell Tool & Die Plant No. 1 were paid over $2 an hour, and were paid for the most part from $2.50 to $2.90 an hour, the 42 production employees of Salem Stamping were paid only from $1.15 to $1.60 an hour.29 Since the Union represented an overwhelming majority of the 39 eligible Salem Stamping employees, and such a majority would far exceed the 22 employees in Schnell Tool & Die Plant No. 1, there is actually nothing to show that the bulk of the employees belonging to the Union were receiving more than from $1.15 to $1.60 an hour. Moreover, for all that appears to the contrary, employees of other employers in the area may have been members of the local of which Long was president. As for the question whether Schnell's top hourly rate of $1.60 compared unfavorably with what was paid to sweepers at some local organized plants, the Respondents offered no proof whatso- ever that this was not a true statement. Assuming for the sake of argument, however, that the statements made by Long to the reporter for the Salem News were not all strictly true, and that Long may have even exaggerated somewhat in commenting on the wages paid by Schnell Tool & Die, it does not necessarily follow that his offense must be regarded as wholly un- =The Board has always held that when an employee has been discharged for engaging in a concerted activity not per se unlawful , and the employer justifies his action on the ground that the employee has forfeited the protection of the Act by engaging in a particu- lar form of misconduct, the burden is on the employer to establish by a preponderance of the evidence the actual fact of the dischargee's guilt. See Mid-Continent Petroleum Corpo- ration, 54 NLRB 912, 933; Porto Rico Container Corporation, 89 NLRB 1570, 1576; Standard Oil of California, 91 NLRB 783, 789-790; Ohio Associated Telephone Company, 91 NLRB 932, 934-935, reversed on other grounds 192 F. 2d 664 (C.A. 6) ; Jefferson Standard Broadcasting Company, 94 NLRB 1507, 1513, enfd. sub nom. Local Union No. 1229, International Brotherhood of Electrical Workers, 346 U.S. 464. 29 This is General Counsel's Exhibit No. 14, which is based on the payroll period of October 22, 1962. 29 Eight of them were paid $1 15 an hour ; 2 were paid $1 20 an hour ; 11 were paid $1 25 an 'hour ; 2 were paid $1.30 an hour ; 6 were paid $1 35 an hour ; 2 were paid $1.40 an hour ; 3 were paid $1.45 an hour ; 2 were paid $1.50 an hour ; 1 was paid $1.55 an hour; and 1 was paid $1 60 an hour. Thus a majority of these employees were not paid more than $1.25 an hour. 406 DECISIONS OF NATIONAL LABOR RELATIONS BOARD pardonable and unamendable. It must not be forgotten that at the time Long gave the interview the Union's negotiating committee, of which Long was a member, was engaged in collective bargaining with the Respondents, and that one of the major issues in the bargaining was wage rates. Long gave the interview in an effort to rouse public sympathy and support for the Union's position. He was engaged, there- fore, in a concerted activity which was protected against employer reprisal as long as he did not make statements that were deliberately false. An employee may not be discharged simply because in making propaganda against his employer he has made a slip of the tongue, or even indulged in a somewhat ambiguous statement. If it were otherwise, the statutory rights of employees to engage in concerted activities would have little, if any, value.30 That Long did not set out deliberately to libel Schnell is apparent. As soon as it was called to his attention that he may have misinformed the reporter for the Salem News, he offered-but without having the offer accepted- to make any necessary correction. Moreover, if there ever was a case in which confusion and inaccuracy were almost inherent in the situation, it is the present one. In talking about the wage policies of Schnell Tool & Die and those of Salem Stamp- ing, it would take the ultimate in care and precision to distinguish always between Schnell, the man; Schnell, the president of Schnell Tool & Die; and Schnell, the president of Salem Stamping. Confusion would be worse confounded in the present case, moreover, because Schnell had only 2 weeks earlier disposed of Schnell Plant No. 2, and the Union's supporters, of whom Long was certainly one, were contending that the sale was not genuine. In Schnell Plant No. 2, which was part of the Schnell Tool & Die business, Schnell had been paying eight of his production workers wages that ranged from $1.15 to $1.60 an hour. It was only the fact that Schnell and his lawyers had erected between Schnell Tool & Die and Salem Stamping a wall of separation which, in their minds, was more absolute than the wall of separation between church and state, that they were enabled to persuade themselves that the corporations had been libeled. It is one of the ironic, if not comic, aspects of the present case that when they came to send Long his formal "notice of separation," they used the letterhead of Salem Stamping but mailed the letter in an envelope which bore the printed return address of Schnell Tool & Die. Moreover, if Schnell Tool & Die and Salem Stamping are indeed wholly separate and distinct corpora- tions, it may well be asked how Long, who was an employee of Salem Stamping, could be fired for libeling Schnell Tool & Die. The conclusion seems inescapable that Schnell seized upon the alleged libel in the December 15 issue of the Salem News simply as a convenient pretext to get rid of Long as the principal union supporter. If Schnell had been really interested in securing damages for libel, he would have sued the Salem News rather than the Union and Long, or he would at least have also made the newspaper a party defend- ant. While the Union might have a million dollars in its treasury, it is a certainty that Long did not have that much in his bank account. But, more importantly, the chances of success would have been far greater if the newspaper were the party defendant, for in a suit against the newspaper it would have been quite immaterial what Long actually told its reporter. In fact, Schnell had been threatening to get rid of Long for a considerable time. In October, in the course of the conversation with Chaffin in which Schnell had characterized some of the union supporters as hillbillies, Schnell had also complained of the ingratitude of one of his employees, and when Chaffin asked: "I suppose you mean Ormond Long?" Schnell had replied in the affirmative. Similarly, in another conversation with Groves in October, Schnell had confided to this em- ployee that he had been good to Long but that Long had double-crossed him, and that Long was "going to get his." In November, in the course of a conversation with Williams in which he had told the latter that the Union would never get into his 31 See N.L.R B v. Peter Cailler Kohler Swiss Chocolates Company, 130 F. 2d 503 (C A 2) ; NLRB. v. Illinois Tool Works, 153 F. 2d 811 (C A. 7) ; Paul Cassano et al, trading as American Shuffleboard Co., 92 NLRB 1272, enfd. 190 F 2d 898 (C A 3) , Jefferson Standard Broadcasting Co., 94 NLRB 1507, enfd. sub nom Local Union No 1229, I B E W., 346 U.S. 464; Ofner Electronics, 134 NLRB 1064; Walls Manufacturing Com- pany, Inc, 137 NLRB 1317. The protection of the Act is lost only when the employees act beyond the scope of their legitimate interests , as in Jefferson Standard Broadcasting, supra On the other hand, it has been held that a discharge is still unlawful despite the employer's honest belief that the statement for the making of which the employee was discharged was false, when in fact it is not false. See The Marlin Firearms Company, 116 NLRB 1834, 1840; American Shuffleboard Co., supra ; N.L.R.B. v. Industrial Cotton Mills, 208 F. 2d 87, 91 (C.A. 4). SCHNELL TOOL & DIE CORPORATION, ETC. 407 shop, he had also remarked to Williams that Long was "on his way out." Finally, as already related, when he suspended Long for publishing the alleged libel, he told his victim himself: "I have what I want in black and white." While there were no witnesses to the other incriminating remarks, there was a witness to the incrimi- nating remark to Long himself. He was none other than Schnell 's son, Charles. Although Charles Schnell was a witness at the hearing and was on the stand for a long time, he was not asked whether his father had made the remark attributed to him. 2. The case of Charles Messenger In paragraphs 13, 14, and 15 of the complaint, it is alleged that Charles Messenger, an employee of Salem Stamping , was discharged on December 19 because the Re- spondent believed that he had engaged in union activities . The discharge of Charles W. Messenger is admitted in paragraph 9, subdivision 2, of the answer of Salem Stamping but it is pleaded that he was discharged "for cause, to wit, insubordination." Messenger did not testify at the hearing , having died shortly before it commenced. Hilland, the subdistrict director of the Steelworkers in Columbiana County, testi- fied, however, that he had seen Messenger at several union meetings , and that he had had personal conversations with Messenger several times after the meetings were over. Hilland also testified that Messenger had indicated to him that he had been approached by Schnell and that he had signed a statement for Hinchcliffe, the staff representative of the Union , about this experience Williams, one of Messenger's fellow employees , testified that in the weeks preced- ing his discharge Messenger had spoken to him , as well as to other employees, in favor of the Union. Williams also testified with respect to two conversations which he had with Michael Schnell after Messenger's discharge. In the first conversation, Schnell asked Williams how he was doing without Messenger , and Williams replied: "We are still working," whereupon Schnell remarked that "there would be more to follow." In the second conversation , Schnell who had stopped Williams as he was coming back from the tool crib , asked the latter : "How are you doing without Messenger and Long?" and Williams replied - "We are still working." John Chaffin, who also worked for Salem Stamping , testified that when, after Messenger's death, he was taking up a collection for his widow, Michael Schnell stopped him and asked him what he was doing . When Chaffin explained , Schnell told Chaffin that he was thinking of donating but that he wanted to think it over. About a half hour later, Schnell called Chaffin to his office and asked the latter how many had donated and how much they had given . Then Schnell told Chaffin that he would donate $ 10 and Chaffin thanked him . Later in the day Schnell personally brought a check down to Chaffin and it was for $100 rather than for $10 As Schnell handed the check to Chaffin , he remarked to the latter: "I want you to understand I wouldn't give Charles Messenger anything , but I feel sorry for his wife and kids, and that's why I am giving this ." Schnell also explained to Chaffin that Messenger had given him a lot of trouble in the plant and had double -crossed him . Chaffin commented : "That's neither here nor there. He is dead now." When it was brought out at the hearing that Messenger had died, counsel for the General Counsel specifically declared that he had no intention of striking Messenger's name from the complaint . Despite this warning, and despite the fact that none of the testimony of the witnesses concerning Messenger had been shaken on cross-examination, counsel for the Respondents saw fit to offer no evidence whatsoever in support of the allegation in Salem Stamping's answer that Messenger had been discharged for insubordination. Counsel for the General Counsel presented a strong prima facie case when he established that Messenger was a union supporter , that Schnell at least believed him to be a union supporter, that Schnell linked the names of Messenger and Long, who had been suspended just 2 days before Messenger's discharge, and made the ominous remark that there would be more to follow. The burden of proving dis- crimination always remains on the General Counsel. But when he has established a prima facie case, it is incumbent upon a respondent to go forward with evidence that will persuasively establish its affirmative defense 31 Since the Respondents si See NLRB v. J G Boswell Co, 136 F 2d 585, 597 ( CA 9) ; NLRB v Cambria Clay Products Company , 215 F. 2d 48 , 56 (C A. 6) ; Montgomery Ward & Co v N L.R 13, 107 F 2d 555 , 560 (CA 7) ; Law and Son v. N L.R B , 192 F. 2d 236 , 238 (CA 10) ; and Jackson Tale Manufacturing Co, 282 F 2d 90, 92-93 ( CA 5) The facts of the last cited case are particularly close to those in the present case . In the Jackson Tire case, the General Counsel had established that ( 1) the employer had been engaged in an anti- union campaign ; ( 2) the two discharged employees were leaders in the union m ovement, and the respondent knew it; and (3) the respondent 's personnel direction was `but to 408 DECISIONS OF NATIONAL LABOR RELATIONS BOARD wholly failed to do so in the case of Messenger, I have no alternative but to find that Messenger, too, was discharged because Schnell had become aware that he was actively supporting the Union, or believed this to be so. 3. The case of Phillip Groves Groves had three periods of employment with Salem Stamping. He was first employed in April of 1960 but this was only for a period of 2 months. He was employed again for about 5 months in the winter of 1960-61. His third and last period of employment commenced on October 5, 1961, when he was rehired over the combined protests of Charles Schnell and Jack Phillips.32 According to his foreman, Jack Phillips, Groves had always been a most undesir- able employee. Groves was engaged during his last period of employment in gen- eral production work, which included spot-welding, punch press and, reamer opera- tions, as well as painting. The trouble with Groves, Phillips thought, was that he regarded himself as a gifted mechanic, and was constantly "tearing up the machin- ery," by which Phillips meant that Groves was constantly attempting to fix every- thing. Groves seems to have been even fonder of painting, for he asked to be put on it several times even though he was allergic to a chemical used in the degreaser that produced rashes on his hands and body. Groves signed a union card in September at one of the union meetings. It has already been related how Groves was interrogated by Michael Schnell concerning the Union no less than three times in October. Although he had at first denied to Michael Schnell that he had signed a union card, Groves finally admitted it to him. When Groves admitted it, Schnell took him to task for not telling him about it when he asked him the first time. Groves explained to Schnell that at that time he had not yet signed the union card, whereupon Schnell denounced Groves as a liar, and reminded the latter that "they" (namely, the union employees) would be out throwing snowballs. Moreover, in the same conversation that Schnell told Groves that Long had double-crossed him and that Long "was going to get it," he had added that "we are all going to get it." Groves was discharged on November 19, and it is alleged in the answer of Salem Stamping that the cause of his discharge was "loafing on job, disobeying foreman's orders, and smoking in forbidden areas." The Respondents offered no evidence whatsoever that Groves was guilty of loafing on the job. Just what is meant by the allegation that Groves was disobeying his foreman's orders is not entirely clear but it seems that it had something to do with the business of tearing up machinery. But, although this had been going on for a long time, there is no evidence that Groves had torn up any machinery in the period preceding his discharge. This leaves the smoking in forbidden areas as the alleged cause of Groves' discharge. In his own testimony Groves admitted that he had long been given to smoking all over the plant, and that Michael Schnell would tell him to put his cigarette out "just for the fun of it," as he expressed it. But Groves contended that smoking was forbidden only in the packingroom. Jack Phillips, to be sure, testified that smok- ing was forbidden around the paint booth, as well as the packingroom. But, even accepting this testimony, the fact remains that shortly prior to his discharge Groves was smoking only in the packingroom. This occurred, however, no less than 3 days prior to his discharge, and it is reasonable to assume that, since smoking in the packingroom was really dangerous, Michael Schnell, who found him smoking there, would have instantly fired him, especially since Groves was an inveterate smoker who smoked all over the plant. But it is important to realize that there actually is no evidence that Groves was discharged for smoking in forbidden areas. This is simply one of the allegations of Salem Stamping's answer The person who discharged Groves was neither Charles Schnell nor Jack Phillips. Although Charles Schnell testified at the hear- ing. and was asked what he knew about Groves' discharge, he replied that he knew nothing about it firsthand. Phillips also testified at the hearing but he was not present when Groves was discharged, and quite evidently had no personal knowledge concerning his discharge. The person who discharged Groves was Michael Schnell, get them " Said the court: "These factors, we think were sufficient to establish the illegality of the discharges in the absence of an explanation by the employer which was 'so overwhelming that it made the contrary evidence unacceptable as a matter of law.' " 32 These findings are based on the testimony of Charles Schnell rather than the testi- mony of Tack Phillips Although the latter was Groves' immediate supervisor, he was utterly confused about Groves' tenure and behavior. He thought Groves had been previ- ously fired, although he had only been laid off In general , Phillips, who had only the vaguest recollections of dates and events, must be regarded as a most unreliable witness SCHNELL TOOL & DIE CORPORATION, ETC. 409 and since the latter did not testify at all at the hearing, there really is no evidence presented by the Respondents to explain Groves' discharge. The contention that he was discharged for smoking in forbidden areas thus turns out to be a conjurer's illusion. He might just as well have been discharged for tearing up the machinery or for any other reason. The case of Groves is, thus, essentially similar to the case of Messenger: the Respondent simply failed to rebut the prima facie case made by the General Counsel. The very fact that the Respondents allege such a mul- tiplicity of reasons for discharging Groves is odd. What they are alleging is, in effect, that they suddenly decided to discharge Groves by accumulating all of his past faults. This strains credibility. It is not the way employers normally be- have. I am constrained to find, therefore, that Groves was discharged by Michael Schnell as an act of reprisal for his support of the Union. 4. The case of Harry Phillips Phillips has been an employee of Plant No. 1 of Schnell Tool & Die since May 5, 1961. He is thus a very old employee. Indeed, he is second in seniority among all the employees of Schnell Tool & Die. At the time of his layoff on November 13, 1962, his job was to operate a Blanchard grinder, and he appears to have been the only employee who performed such work.33 Phillips signed a union card sometime in November. This would be after the election as well as after the certification of the Union. He was, thus, a late sup- porter of the Union. On the morning of the day of his layoff, Michael Schnell asked Phillips whether he had signed a union card, and the latter admitted it. Whereupon Schnell be- came angry and asked Phillips whether he had yet paid any union dues, and when Phillips replied in the negative, Schnell declared that he would never have to pay union dues since he would never agree to either the closed shop or the union shop. Indeed, Schnell approached Phillips two other times that day, and raised the devil with him for being so stupid as to sign a union card. Schnell also accused Phillips of ingratitude, declaring that he had carried Phillips along and feather- bedded for him 34 When Phillips inquired whether he "hadn't done a day's work since I was working for him," Schnell told him to shut up and not argue with him, .and that if he had not been a good worker he would not have kept him all those years. After being laid off on November 13, Phillips was called back to work on De- cember 12. About a week after his return to work, Michael Schnell asked Phillips whether the Union had paid his rent yet. Despite Michael Schnell's interrogation of Phillips, and his manifest hostility toward his old but ungrateful employee, there is nothing to show that Phillips was laid off because of his late support of the Union. It is apparent from Phillips' own testimony that work was very slack in the period of his layoff. In the case of Phillips, Charles Schnell did have personal knowledge of the reason for Phillips' layoff, which he stated to be that there was not enough work for him. Indeed, in the month preceding Phillips' layoff, he spent most of his time building corncribs that were not really needed. Work was made for Phillips because he had a large family to support. Moreover, six other employees were laid off on the same day as Phillips, and the period of Phillips' layoff was brief. I do not find persuasive the argument of counsel for the General Counsel that when work became slack at Plant No 1 a job should have been found for Phillips at Salem Stamping where it was very busy. There is no proof that there was a suitable job there, or that it would have been very practical to transfer Phillips to Salem Stamping for a brief period. Moreover, it was the normal practice for Phillips to work on the corncribs when his own work became slack. As Phillips himself testi- fied: "I always work on the corn cribs when any other job I worked on all run out." I find that the brief layoff of Phillips was not discriminatory. 5. The case of John Chaffin The complaint alleges that on or about November 19 the Respondents assigned John Chaffin "to less desirable work shifts than those to which he had previously as The job data attached to General Counsel's Exhibit No . 17 show only one Blanchard hand a+ Schnell had indeed been generous with Phillips He lent Phillips money many times, and often the loans were not repaid On one occasion , Schnell even built a chimney on Phillips' house and put in a furnace , so that he could have heat in the winter 410 DECISIONS OF NATIONAL LABOR RELATIONS BOARD been assigned." Chaffin was one of the earliest and most active supporters of the Union, and was ultimately elected financial secretary to the local. But there is not a scintilla of evidence that Chaffin's work shift was changed. He always worked the same shift, which was the day shift. Chaffin was transferred between Salem Stamping and Schnell Tool & Die but these transfers were actually promotions to better jobs. At the close of the hearing, I granted the motion of counsel for the Respondents to strike from the complaint the allegations relating to John Chaffin. D. The failure of collective bargaining After the Union had been certified on October 16 as the collective-bargaining representative of the Respondents' employees, Hinchcliffe, under date of October 22, wrote to Michael Schnell , calling his attention to the certification of the Union, and requesting a meeting for the purpose of negotiating a contract . Hinchcliffe suggested that the first meeting take place on November 7, and also requested that the Union be furnished data, showing the names of the employees , their job titles, and rates of pay. Hinchdiffe's letter was promptly acknowledged-in fact on the same day that it was received unless the letter is misdated-by Manchester, who told the union representative that copies of the certification were on his desk, and that he had been retained by Michael Schnell to handle the forthcoming negotiations, 'which he would do to the best of his ability. Manchester also told the union representative that Michael Schnell had made available an office in the Keener Building in Salem for the negotiations, and requested that Hinchcliffe suggest suitable times for. the meet- ings which he could work into his schedule. The job and wage rate data requested by Hinchcliffe in his letter of October 22 were promptly furnished to the Union. The data were forwarded to Hinchcliffe by Manchester with a covering letter dated October 31. The fulfillment of this useful preliminary was to remain, however, the first and last mark of progress . For this there was a variety of reasons, which are suggested by the events that have already been related. In the first place , it is hardly to be expected that an employer will bargain with a union in good faith when he has declared to his employees , even after they have chosen a union to represent them , that no man or law in the country would ever be permitted to tell him how to run his business ; that his business had never been a union shop, and would never be one; that the union .would never get a red cent out of him; and that be would rather shut the plant and go off to Florida. In the second place, an employer can hardly be said to intend to bargain in good faith when, according to his own version of the relevant events, he is careful to refrain from revealing that he was planning to liquidate part of his business while arrangements are being made for an election to determine who should represent his employees , and who then announces the liquidation before the first negotiating session has even opened 35 Charles Schnell testified that he and his father decided to liquidate Plant No. 2 in August 1962 after Great Lakes had been adjudged bankrupt . The month of August was precisely when the union campaign was at its peak, and this coincidence would only suggest that the liquidation of Plant No. 2 was being kept as an ace in the hole. If, on the other hand , the decision to liquidate was not definitely made until after the election , then it is equally clear that it was simply announced to the Union as an accomplished fact on the very eve of the opening of negotiations with- out any prior notification to or consultation with the union representatives. When Charles Schnell was asked whether he felt any obligation to notify the Union that Plant No. 2 would be shut down, he gave a most revealing answer: "The thought," he replied, "never entered my mind." In the third place, an employer who fails to provide an effective negotiator preju- dices the negotiations from the very start. There were collective-bargaining ses- sions held on November 7, 26, 28,36 and 30, December 4, 11, 14, 21, and 28, 1962, and on January 4, 1963. Michael Schnell designated Manchester as his sole repre- sentative in the negotiations with the Union, and at all 10 of these sessions Man- chester alone represented Michael Schnell . The Union was represented by a negotiat- ing committee consisting , as a rule, of Hilland, Hinchcliffe, Ormond Long, John 35 Compare New England Web, Inc., et al., 135 NLRB 1019 36 There were two sessions on November 28-one in the morning , and the other in the afternoon SCHNELL TOOL & DIE CORPORATION, ETC. 411 Bergman, and John Chaffin 37 However skilled and eminent Manchester might be in his own profession, that profession was the law. He was not a diemaker, and could know about the problems of Schnell's companies only at second hand 38 Upon several occasions Hilland requested an opportunity for the union representatives to meet with Michael Schnell himself but these requests were made in vain. On one of these occasions, Manchester stated that "Mike" Schnell was an old man who had arthritis, and that he had been advised by his doctor to go to California, and that he was leaving on December 1. Actually, Michael Schnell remained in Salem at least through most of December,39 but did not directly participate in the negotiations. Whenever the union representatives made a proposal or counterproposal, all Man- chester could tell them was that he would have to talk to "Mike." He almost invariably came back with the doleful tiding that "Mike says no." It is plain that Manchester was acting merely as an intermediary and courier. He had no real authority as a negotiator. Hilland, the Union's chief negotiator, was quite dismayed by this situation, which he had never before personally encountered 49 Actually, Manchester's real function, so far as Michael Schnell was concerned, was to conduct a holding operation, while he himself concentrated on his attempts to dissipate the Union's majority. One of the most persuasive indications that an employer is engaged in a holding operation is his taking action to effect, unilaterally, changes in existing terms and conditions of employment after negotiations have been requested by the representa- tives of his employees, or are in progress. It is alleged in the complaint that on or about November 1, 1962, Salem Stamping instituted a second workshift, and changed the rate of pay for employees working on this shift without notifying the Union or consulting with it about taking this step. The evidence shows that a second shift, operating from 5:30 p.m. to about 4 a.m., was instituted at Salem Stamping on or about November 1, 1962, without notification to the Union but it does not establish that the action taken was an unfair labor practice designed to undermine the Union and dissipate its majority. The busy season at Salem Stamping commenced in November when parts began to be made for lawnmowers and garden tractors that would be sold in the summer. In past years, it had been the practice either to pay employees willing to work on the second shift a 10-cent-an-hour differential, or to pay them for the half hour spent at lunch. When the problem of recruiting a second shift arose in 1962, Jack Phillips, the general foreman of Salem Stamping, was sent to talk to the employees in order to ascertain whether they would prefer the 10 cents an hour differential to the paid half hour for lunch. Apparently most of the employees expressed a preference for the differential, which was adopted 41 The procedure followed in instituting a second shift was entirely in accordance with past practice. It is evident, moreover, that it was necessary to institute a shift without delay to satisfy the demand for production, and that it was not to the financial detriment of the employees. Furthermore, the collective-bargaining ses- sions had not yet begun, and there is nothing to show that the first meeting of November 7 was even definitely scheduled. When this meeting was finally held neither Hinchcliffe, Hilland, nor any other member of the negotiating committee uttered so much as a single word of complaint about the institution of the second shift, although they did complain loudly and vigorously about the plan to dispose 37 The first three persons named testified as to the course of the collective bargaining In addition, Hinchcliffe kept notes on the negotiations, and these notes were admitted in evidence over objection of counsel for the respondents. But see N L R B. v Tex-Tan, Tue , 318 F. 2d 472 (C.A. 5), holding that such notes are admissible in evidence as This is well illustrated by an incident that occurred at the bargaining session which took place the morning of November 28 When the Union brought up the ouestion of a change in the method of overtime payment, Manchester revealed that he did not know what the overtime system had been in the past and that he would have to check with Michael Schnell. '' This is apparent from Schotten's testimony that Michael Schnell called him after his interview with Long appeared in the Salem News for December 15 40 But actually it was not unique. In a number of recent cases, lawyers have been the sole negotiators in collective bargaining with labor organizations See, for instance, Vanderbilt Products, Inc, 129 NLRB 1323, enfd. 297 F. 2d 833 (CA 2) ; Roy E Hansen, Jr. 31fq, 137 NLRB 251 ; and Almeida Bats Lines, Inc, 142 NLRB 445 However, viola- tions of Section 8(a) (5) of the Act were found in all these cases 41 Among the employees consulted was Long, the chief union supporter, who raised no objection to the second shift, or to the differential. However, Long was consulted by the elder Schnell personally. 412 DECISIONS OF NATIONAL LABOR RELATIONS BOARD of Schnell Tool & Die Plant No. 2. They also failed to register any complaint about the second shift at any of the subsequent meetings 42 Under these circum- stances, the complaint about the second shift assumes all the characteristics of an afterthought. While ideally the Union should have been notified, at least as a matter of comity, it cannot be said that the failure to do so was anything more than a peccadillo. It was a peccadillo, moreover, that would have little effect in compromising the position of the Union which was then concerned with far graver issues, and it should not be distorted into the indignity of an unfair labor practice.43 The same cannot be said of another unilateral action which was made effective about a month later and which applied to the employees of Schnell Tool & Die as well as of Salem Stamping. On this occasion the existing practice governing the payment of overtime was altered to the detriment of the employees. For work performed on weekdays, employees had been paid straight time for work during the first 8 hours, time and a half for work during the 9th and 10th hours, and double time for work over 10 hours. For work performed on Saturdays, time and a half was paid for the first 8 hours, and double time for all work over 8 hours. Double time was also paid for work performed on Sundays. The change now made was to pay only time and a half for all hours worked over 40 hours a week. This reduction in overtime pay was embodied in the proposed contracts submitted by Manchester to the union negotiators-it was in article VIII, section 2-at the second bargaining session as counterproposals to the contract they had submitted at the first bargaining session on November 7. There was, however, no discussion of the overtime problem until the next bargaining sessions on November 28. At neither the morning nor the afternoon sessions on November 28 did Manchester make any announcement to the union representatives that the change in the method of paying for overtime would be put into effect. It was, nevertheless, put into effect within a few days by a notice posted on the plant bulletin board, stating that on and after December 3 44 payment for overtime would be computed at the rate of time and a half for all hours worked over 40. Charles Schnell attempted, in his testimony, to justify the change in the method of paying for overtime both as a measure that was necessary to meet competition and as a disciplinary measure. He asserted that in the 3-week period preceding November 30 there had been 21 midweek unexcused absences in Schnell Tool & Die and 87 in Salem Stamping, which the employees made up by working on Sat- urdays at the premium rate. Yet he also contended that, despite the reduction in the overtime rates, the employees earned just as much as they had previously earned. This overlooks, of course, that they had to work more hours to make the same pay. But whether there were justifications for changing the method of paying for overtime is not the point at issue. It is clear that the change was effected unilaterally without telling the union representatives of the intention to do so and while bar- gaining on the terms of the contracts, which, of course, included many other pro- visions than those relating to overtime pay was still proceeding. Indeed no less than seven bargaining sessions were to follow and it was obvious that the situation was extremely fluid. The union representatives might well have accepted the change in the method of paying for overtime if Schnell were willing to make other conces- sions. In these circumstances the contention of the Respondents that bargaining had proceeded to the point of impasse on the question of overtime pay and that what the Respondents did was simply a continuation of the status quo must be regarded as frivolous. The contention of the Respondents appears to be based on the strange theory that as soon as a subject had been mentioned at a bargaining ses- sion bargaining had occurred to the point of impasse. As a matter of fact the union representatives were still dwelling on the subject of the overtime pay reduction at the collective-bargaining sessions of November 30 and December 4. They were not given any of the explanations for the reduction advanced by Charles Schnell. They were told rather that the more generous overtime pay which had previously been paid was simply a favor that Michael Schnell had given and then taken away. 42 Not only is no complaint indicated in the testimony of Iiinchcliffe but none is re- flected in the minutes kept by him. 43 Compare A. S. Beck Shoe Corporation, 92 NLRB 1457, 1458, and Betty Brooks Com- pany, 99 NLRB 1237, 1247. 44 Long testified that the date was December 1. and Chaffin testified that it was Decem- ber 2. In his story in the Salem News for December 14, Schotten gave,the date as De- cember 1, but in his story in the paper the next day he gave the date as December 3 Since December 3 was a Monday , I believe that Schotten in his second story actually had the right date for the change in the method of paying overtime. SCHNELL TOOL & DIE CORPORATION , ETC. 413 When one passes from the negative to the positive aspects of the bargaining be- tween Manchester and the union representatives, one finds that he did submit sug- gested contracts to the union representatives but that he could not induce Michael Schnell to budge an inch in the discussions of the various proposals embodied in the contracts. After talking to his client, he could only report that "Mike" knew what he wanted, and that he was "a bull-headed Dutchman" whom it was hard to move. This attitude would be understandable perhaps if the contracts offered by Schnell embodied some improvement, however slight, over the terms and conditions of em- ployment that had previously prevailed. Actually, the contracts either preserved existing terms and conditions, or embodied less favorable ones, quite apart from the reduction in overtime pay that had been effected unilaterally. Generally speaking, the contracts embodied existing wage rates, which the union representatives thought were drastically low, but in some job categories the contracts made provision for rates that were even somewhat lower than the prevailing rates 45 In addition, the contracts reserved to Schnell the right to determine, in his sole discretion, when merit increases should be granted to individual employees; made no provisions for paid holidays, although such holidays had been allowed at some time in the past; and made no provision for vacation pay during the first year of employment. While remaining unyielding on what is usually known in collective bargaining as "the money-package," Schnell also offered no compensating concessions. He would not agree to a union shop or to the checkoff of dues of union members. The con- tracts proposed by him did contain provisions for the maintenance of union mem- bership, but beyond this he could not be persuaded to go. Moreover, although offering the Union absolutely nothing that would serve to secure its bargaining posi- tion, the contracts contained provisions which would have banned strikes while they were in force. In addition, the contracts included a management-rights clause that would virtually have rendered nugatory any benefit or concession which had escaped the vigilance of Schnell's draftsman.46 This management-rights clause had approximately three times the verbiage and three times the scope of the one which the Supreme Court of the United States held not to be unlawful per se in N.L.R.B. v. American National Insurance Co., 343 U.S. 395 (1952) 47 As a counterproposal, the Union offered a ^This becomes apparent when the rates given in General Counsel's Exhibit No. 14 are compared to the rates given in exhibit A to the respective contracts. 49 The management-rights clause of the Schnell contracts provided as follows EXCEPT as expressly limited by a specific provision of this Agreement, the Company shall continue to have the exclusive right to take any action it deems appropriate in the management of the business and the plant and the direction of the workine forces in accordance with its judgment, including but not limited to the right, to determine the number, location and types of plants ; to decide on the products to be manu- factured, the methods of manufacture, the materials to he used, and the discontinu- ance of any product, material, or method of production ; to introduce new equipment, machinery, or processes, and to change or eliminate existing equipment, machinery, or processes ; to discontinue, temporarily or permanently in whole or part, the conduct of its business or operations ; to decide on the nature of materials, supplies, equip- ment, or machinery to be used, and the price to be paid: to decide on the sales methods and sales price of all products ; to subcontract any or all of the processes of manufacture, facility maintenance, or location service work ; to select the work- ing forces in accordance with the requirements determined by its management* to transfer, promote or demote employees ; to lay off, terminate or otherwise relieve employees from duty for lack of work or other legitimate reason : to discipline or discharge for cause; to direct and control the working forces; to promulgate and enforce compliance with safety and plant rules and impose penalties for violations thereof ; to determine the size of the working force, including the number of employees assigned to any particular operation ; to determine the work pace and work perform- ance levels; to establish, change, combine, or abolish any job classifications and the job content of any classification; to determine the length of the workweek, and when overtime shall be worked, and to require reasonable overtime. 47 In this case, the management-rights clause provided as follows- The right to select and hire, to promote to a better position, to discharge, demote or discipline for cause, and to maintain discipline and efficiency of employees and to determine the schedules of work is recognized by both union and company as the proper responsibility and prerogative of management to be held and exercised by the company, and while it is agreed that an employee feeling himself to have been ag- 414 DECISIONS OF NATIONAL LABOR RELATIONS BOARD management-rights clause , which was fairly close to the one in this case , and which it regarded as the worst one ever included in one of its contracts , but even this clause proved wholly unacceptable to Schnell. The management-rights clause which he re- garded as absolutely essential was coupled, moreover, with a provision on arbitra- tion that was equally extreme. It was expressly provided that the prerogatives reserved to management under the management -rights clause , as well as general adjustments of the wage structure, were not to be subject to arbitration; that the power of the arbitrator was to be limited to determining the meaning and interpreta- tion of the explicit terms of the agreement; and that, except in cases involving the discipline or discharge of employees, there could be no arbitration if either party to the agreement took the position that the issue was not arbitrable unless and until an Ohio court of competent jurisdiction had passed on its arbitrability. It sometimes requires a close analysis of the views and proposals advanced by the respective parties at each of the bargaining sessions in which they have engaged to determine whether they have bargained subjectively in good faith. But the manifestations of subjective bad faith are so plain and numerous in the present case that such an analysis would be supererogatory. The bargaining sessions themselves were brief and perfunctory; the position of management remained wholly inflexible; and that position was one that no self-respecting union could possibly accept.48 It is true, of course, in the abstract, that good faith can exist despite the refusal to yield positions. But good faith must be judged in the light of all the circumstances of a particular case, and these show that there never was even a sincere or earnest effort to reach agreement. An employer can hardly be said to have bargained in good faith when at the very time that bargaining is underway, he is doing everything in his power to undermine the position of the union . An employer cannot be said to be bargaining in good faith at the conference table when his conduct away from the conference table wholly belies it. Unilateral changes in the terms and conditions of employment constitute in themselves a refusal to bargain in violation of Section 8(a) (5) of the Act, even when unaccompanied by evidence of subjective bad faith 49 IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE I find that the activities of the Respondents set forth in section III of this report, occurring in connection with the operations of the Respondents described in section I thereof, have a close, intimate, and substantial relation to trade, traffic, and com- merce among the several States, and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY The scope of the Respondents' unfair labor practices in the present case are ex- tremely extensive, and I shall recommend, therefore, a broad from of cease-and-desist order, designed not only to prevent the repetition of the specific unfair labor prac- grieved by any decision of the company in respect to such matters, or the union in his behalf, shall have the right to have such decision reviewed by top management officials of the company under the grievance machinery hereinafter set forth, it is further agreed that the final decision of the company made by such top management officials shall not be further reviewable by arbitration 48 As Chief Judge Magruder said In N L R B. v. Reed & Prince Manufacturing Company, 205 F 2d 131, 139 (C.A. 1), cert. denied 346 U.S. 1887, involving a very similar situation: It is difficult to believe that the Company with a straight face and in good faith could have supposed that this proposal had the slightest chance of acceptance by a self-respecting union, or even that it might advance the negotiations by affording a basis of discussion; rather, it looks more like a stalling tactic by a party bent upon maintaining the pretense of bargaining. 49 N L R B. v Benne Katz, d/b/a Williamsburg Steel Products Co, 369 U.S 736, 742- 743 (1962). I do not accept the contention of counsel for the General Counsel that the Respondents were under a duty to bargain with the Union as early as September 6 when Hinehcliffe requested recognition. There is no evidence that the Union then represented a majority of the employees in each of the bargaining units. Actually, however, the ques- tion is academic The Respondents made a unilateral change in the method of paying for overtime not only after the Union had been certified, but also after collective bargaining was in progress. Thus, it would affect neither the result nor the remedy to hold that the duty to bargain arose on September 6. It arose only upon certification of the Union See White's Uvalde Mines, 117 NLRB 1128, 1129. SCHNELL TOOL & DIE CORPORATION, ETC. 415 tices in which the Respondents have engaged but also to effectuate all the guarantees of Section 7 of the Act. I shall further recommend that the Respondents take appropriate affirmative action to effectuate the policies of the Act. Such affirmative action requires the restoration of the status quo insofar as prac- ticable. As a result of the cessation of operations at Schnell Tool & Die Plant No. 2, and the lease of the plant to Quaker, it is alleged in paragraph 25 of the complaint that 13 employees who worked in the plant were permanently laid off. These employees were Robert Bates, George Bettis, Alfred Stockwell, Orville Wein- gart, Arthur Brandonisio, John Carlisle, Frank Chestnut, Arthur Rozeski, Homer McCartney, Marvin McFarland, George Pow, Steve Rogers, and an employee whose name is either Yocus or Yokus 50 Charles Schnell testified that Robert Bates was offered work at Plant No. 1 of Schnell Tool & Die and ultimately accepted a job there but Charles Schnell did not specify when the offer was made to Bates or when it was accepted by Bates. As Bates has been offered employment in Plant No. 1, there is no need to direct his reinstatement but I shall direct that he be made whole to the same extent and in the same manner as the laid-off employees for any loss of pay he may have suffered by reason of his layoff. Charles Schnell also testified that a John Bettis quit his job in Plant No. 2 without notice on November 21, 1962, was hired by Salem Stamping but subsequently quit his job there. As it is not established that George and John Bettis are one and the same person, the testi- mony of Charles Schnell cannot be accepted as exculpating the Respondents from any further liability for the layoff of George Bettis. If in fact they are one and the same person, the Respondents may show this at the compliance stage of the proceedings. With respect to the other 11 employees listed in paragraph 25 of the complaint, Charles Schnell testified only that he believed that they had subse- quently been employed by Quaker or other firms. This in no way affects their right to reinstatement by the Respondents, or their right to backpay for such periods of time as they may have been without employment. I shall recommend, therefore, that the Respondents offer to the 13 employees listed in paragraph 25 of the com- plaint, except Robert Bates, substantially equivalent employment at Salem Stamp- ing, or Schnell Tool & Die Plant No. 1, or at Plant No. 2 if the Respondents should repossess the latter plant, dismissing if necessary any employees who may have been hired on or after October 19, 1962. In the event that, after this is done, there should be an insufficient number of jobs to take care of all 12 of the employees to be reinstated, the employees for whom no jobs are available shall be placed upon a preferential hiring list. I shall also recommend that each of the 13 em- ployees listed in paragraph 25 of the complaint be made whole for any loss of pay he may have suffered by reason of the disposition of Plant No. 2 of Schnell Tool & Die by payment to him of a sum of money equal to the amount which he normally would have earned as wages from the date of his permanent layoff to the date of the Respondents' offer of reinstatement, less his net earnings during said period, said backpay to be computed on a quarterly basis in the manner estab- lished by the Board in F. W. Woolworth Company, 90 NLRB 289. Interest shall be added to the backpay due each employee, as directed by the Board in Isis Plumb- ing & Heating Co., 138 NLRB 716. I shall also recommend that Ormond Long and Phillip Graves shall, similarly, be reinstated with backpay, except that they shall be offered immediate and full reinstatement to their former or substantially equivalent positions at Salem Stamp- ing where any employees who may have been hired to replace them shall be dis- missed. Since Charles Messenger is deceased, I shall only recommend, of course, that his estate be made whole for any loss of pay he may have suffered from the date of his discharge to the date of his death. Counsel for the General Counsel also requests that the employees of Schnell Tool & Die and Salem Stamping be made whole for any loss of pay they may have suffered by reason of the change in the method of paying for overtime that was unilaterally made by the Respondents on December 3, 1962. The Board has held such action to be necessary to restore the status quo 51 The Board has also recog- so His name is given as L. Yocus in paragraph 25 of the complaint but he is referred to in paragraph 16 of the answer of Schnell Tool & Die as John L. Yocus. In his testimony, however, Charles Schnell gave the name as John Yokus. He was a welder, apparently, and a welder by the name of John Yocus is listed on General Counsel's Exhibit No 14 He will be referred to by this name in the Recommended Order. si See, for instance, Beacon Piece Dyeing and Finishing Co., 121 NLRB 953, The Press Company, Incorporated, 121 NLRB 976; Herman Sausage Co , Inc., 122 NLRB 168, enfd 275 F 2d 229, rehearing denied 277 F. 2d 793 (C.A. 5) ; Cascade Employers Association, 126 NLRB 1014 416 DECISIONS OF NATIONAL LABOR RELATIONS BOARD razed, however, that the restoration of the status quo may not always be to the advantage of the employees, and in such cases has conditioned the order of restora- tion upon the desire of the affected employees as expressed through their collective- bargaining representative 52 This qualification would also seem to be necessary in the present case. While the reduction in the rates paid for overtime was to the immediate detriment of the employees, at least in the sense that they had to work longer hours for the same amount of pay, once the previous rate is restored, the Respondents may so curtail the amount of overtime worked, that the total take- home pay of the employees may actually be less. I shall recommend, therefore, that, while the employees of the Respondents be made whole for any loss of pay they may have suffered by reason of the change in the method of paying for over- time, the continuance of the old rates shall be conditioned upon the desire of the affected employees as expressed through their collective-bargaining representative. CONCLUSIONS OF LAW 1. The Respondents, Schnell Tool & Die Corporation and Salem Stamping & Manufacturing Co., Inc., are employers engaged in commerce within the meaning of Section 2(6) and (7) of the Act, and are jointly and severally liable for the redress of the unfair labor practices committed by them. 2. United Steelworkers of America, AFL-CIO, is a labor organization within the meaning of Section 2(5) of the Act. 3. By coercively interrogating their employees, and threatening them with reprisals, such as loss of employment, reduction in earnings, or cessation of operations if they continued to support the Union; by harassing and subjecting to verbal abuse em- ployees who supported the Union; by questioning applicants for employment con- cerning their attitude toward unions; by denying to the Union, after its certification, the privilege of posting notices on the plant bulletin board, and by threatening to discharge employees who gave affidavits or statements to Board agents investigating charges of unfair labor practices the Respondents interfered with, restrained, and coerced their employees in the exercise of the rights guaranteed in Section 7 of the Act in violation of Section 8 (a) (1) of the Act. 4. By discharging Ormond Long because he had supported the Union and had engaged in a protected concerted activity, and by discharging Charles Messenger and Phillip Groves because of their union activities, the Respondents discriminated with respect to their tenure of employment in violation of Section 8 (a) (1) and (3 ) of the Act. 5. By leasing Plant No. 2 of Schnell Tool & Die to Quaker; by permanently laying off the 13 employees enumerated in the section of this report entitled "The Remedy"; and by refusing them employment in Salem Stamping, the Respondents have interfered with, restrained, and coerced their employees in the exercise of the rights guaranteed in Section 7 of the Act, and discriminated with respect to their hire and tenure of employment in violation of Section 8 (a) (1) and (3) of the Act. 6. All production and maintenance employees of Schnell Tool & Die, including truckdrivers, but excluding office clerical employees, office cleaning women, guards, professional employees, and supervisors as defined in Section 2(11) of the Act, constitute a unit appropriate for the purpose of collective bargaining within the meaning of the Act. 7. All production and maintenance employees of Salem Stamping, including truckdrivers, but excluding office clerical employees, office cleaning women, guards, professional employees and supervisors as defined in Section 2(11) of the Act, con- stitute a unit appropriate for the purpose of collective bargaining within the meaning of the Act. 8. At all relevant times since October 16, 1962, the Union has been the exclusive bargaining representative of the employees in the aforesaid appropriate units within the meaning of Section 9 (a) of the Act. 9. By unilaterally deciding to lease Plant No. 2 of Schnell Tool & Die and by fail- ing to bargain with the Union with respect to the effect of the shutdown on the employees of the plant; by unilaterally instituting a change in the method of paying for overtime while bargaining with the Union was in progress; and by failing to bargain with the Union in good faith, the Respondents have engaged in unfair labor practices in violation of Section 8(a)(5) and (1) of the Act. RECOMMENDED ORDER Upon the basis of the foregoing findings of fact and conclusions of law , and upon the entire record in the case, it is recommended that Schnell Tool & Die Corporation 52 See Herman Sausage Go., Inc., supra, pp. 172-175. SCHNELL TOOL & DIE CORPORATION, ETC. 417 and Salem Stamping & Manufacturing Co., Inc., their officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Interrogating employees coercively concerning their union membership or activities; threatening them with reprisals, such as loss of employment, reduction in earnings, or cessation of operations if they continue to support the Union; harassing or subjecting union supporters to verbal abuse; questioning applicants for employment concerning their union affiliations, sympathies, or attitudes; denying to the Union the privilege of posting notices on the plant bulletin board; or threatening to dis- charge employees who give affidavits or statements to Board agents investigating charges of unfair labor practices. (b) Discouraging membership in United Steelworkers of America, AFL-CIO, or any other labor organization of its employees, by discharging employees or terminat- ing their employment and refusing to reinstate them, or discriminating in any other manner against them in regard to hire, tenure, or any other term or condition of their employment. (c) Refusing to bargain collectively with the Union with respect to rates of pay, wages, hours of employment, or other terms and conditions of employment in the bargaining units hereinbefore described as appropriate. (d) In any other manner interfering with, restraining, or coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act. 2. Take the following affirmative action in order to effectuate the policies of the Act: (a) Offer employment at Salem Stamping, or at Schnell Tool & Die Plant No. 1, or at Plant No. 2, if it is repossessed, to George Bettis, Alfred Stockwell, Orville Weingart, Arthur Brandonisio, John Carlisle, Frank Chestnut, Arthur Rozeski, Homer McCartney, Marvin McFarland, George Pow, Steve Rogers, and John Yocus, without prejudice to their seniority or other rights and privileges, and make whole these employees, as well as Robert Bates, for any loss of pay they may have suffered by reason of their permanent layoff at Schnell Tool & Die Plant No. 2 in the manner and to extent set forth in section V of this report entitled "The Remedy." (b) Offer to Ormond Long and Phillip Groves immediate and full reinstatement to their former or substantially equivalent positions, without prejudice to their senior- ity or other rights and privileges, and make them, as well as the estate of Charles Messenger, whole for any loss of pay they may have suffered by reason of the Respondents' discrimination in the manner and to the extent set forth in section V of this report entitled "The Remedy." (c) Upon request bargain collectively with the Union as the exclusive representa- tive of the employees in the bargaining units hereinbefore described as appropriate and embody in a signed agreement any understanding which may be reached. (d) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social security payment records, time- cards, personnel records and reports, and all other records necessary to analyze and compute the amounts of backpay due under the terms of this Recommended Order. (e) Post at their plants at Salem, Ohio, copies of the attached notice marked "Appendix." 53 Copies of the said notice, to be furnished by the Regional Director for the Eighth Region, shall, after being duly signed by Respondents' representatives, be posted for 60 consecutive days thereafter in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondents to insure that such notices are not altered, defaced, or covered by any other material. (f) Notify the Regional Director for the Eighth Region, in writing, within 20 days from the receipt of this Intermediate Report and Recommended Order, what steps the Respondents have taken to comply herewith.54 53 In the event that this Recommended Order be adopted by the Board, the words "A Decision and Order" shall be substituted for the words "The Recommended Order of a Trial Examiner" in the notice. In the further event that the Board's Order be enforced by a decree of a United States Circuit Court of Appeals, the words "A Decree of the United States Court of Appeals, Enforcing an Order" shall be substituted for the words "A Decision and Order." 5a In the event that this Recommended Order be adopted by the Board, this provision shall be modified to read : "Notify the said Regional Director, in writing, within 10 days from the date of this Order, what steps the Respondents have taken to comply herewith " 418 DECISIONS OF NATIONAL LABOR RELATIONS BOARD APPENDIX NOTICE TO ALL EMPLOYEES Pursuant to the Recommended Order of a Trial Examiner of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Rela- tions Act, we hereby notify our employees that: WE WILL NOT coercively interrogate our employees concerning their union membership, activities, or affiliations, or threaten them with reprisals, such as loss of employment, reduction in earnings, or cessation of operations if they continue to support the United Steelworkers of America, AFL-CIO, or any other labor organization of their choice. WE WILL NOT harass or subject to verbal abuse any of our employees who support the United Steelworkers of America, AFL-CIO, or any other labor organization of their choice. WE WILL NOT question applicants for employment concerning their union affiliations, sympathies, or attitudes. WE WILL NOT deny to the United Steelworkers of America, AFL-CIO, which is the certified bargaining representative of our employees, the privilege of posting notices on the plant bulletin board. WE WILL NOT threaten to discharge employees who cooperate with agents of the National Labor Relations Board in the investigation of charges of unfair labor practices. WE WILL NOT discourage membership in United Steelworkers of America, AFL-CIO, or any other labor organization of our employees, by discriminating with respect to the hire or tenure of their employment or any term or con- dition of their employment. WE WILL NOT in any other manner interfere with, restrain, or coerce our employees in the exercise of the rights guaranteed to them in Section 7 of the Act. WE WILL offer employment either at Salem Stamping & Manufacturing Co, Inc., or Schnell Tool & Die Corporation, to George Bettis, Alfred Stockwell, Orville Weingart, Arthur Brandonisio, John Carlisle, Frank Chestnut, Arthur Rozeski, Homer McCartney, Marvin McFarland, George Pow, Steve Rogers, and John Yocus, and make whole these employees, as well as Robert Bates, for any loss of pay they may have suffered by reason of their layoffs when Plant No. 2 was leased to Quaker Manufacturing Company. WE WILL offer to Ormond Long and Phillip Groves immediate and full rein- statement to their former or substantially equivalent positions, without prejudice to their seniority or other rights and privileges, and we will make whole these employees, as well as the estate of Charles Messenger, for any loss of pay they may have suffered by reason of our discrimination. WE WILL, upon request of United Steelworkers of America, AFL-CIO, the certified bargaining representative of our employees in appropriate bargaining units, bargain collectively in good faith with the Union with respect to rates of pay, wages, hours of employment, and other terms and conditions of employ- ment, and WE WILL NOT in the meantime make any unilateral changes in such terms and conditions of employment without consultation with the Union unless an impasse in bargaining has been reached with respect to any term or con- dition of employment. If agreements are reached, we will embody the terms in such agreements in appropriate written documents. All our employees are free to become, remain, or refrain from becoming or re- maining members of United Steelworkers of America, AFL-CIO, or any other labor organization, except to the extent that such right may be affected by an agree- ment requiring membership in a labor organization as a condition of employment, as authorized in Section 8(a) (3) of the National Labor Relations Act, as amended. SCHNELL TOOL & DIE CORPORATION, SALEM STAMPING & MANUFACTUR- ING CO., INC., Employers. Dated------------------- By------------------------------------------- ( President) ------------------------------------------- (Vice President) NOTE -We will notify the above-named employees if presently serving in the Armed Forces of the United States, of their right to full reinstatement upon applica- MINNESOTA MINING AND MANUFACTURING COMPANY 419 tion in accordance with the Selective Service Act and the Universal Military Train- ing and Service Act of 1948 , as amended, after discharge from the Armed Forces. This notice must remain posted for 60 consecutive days from the date of posting, and must not be altered , defaced, or covered by any other material. Employees may communicate directly with the Board's Regional Office, 720 Bulkley Building, 1501 Euclid Avenue, Cleveland, Ohio, Telephone No. Main 1-4465, if they have any question concerning this notice or compliance with its provisions. Minnesota Mining and Manufacturing Company and The Voice of Teamsters Democratic Organizing Committee, Petitioner. Case No. 4-RC-5334. September 6, 1963 ORDER AMENDING CERTIFICATION OF REPRESENTATIVES On March 19, 1963, pursuant to a stipulation for a consent election, a representation election was held among the Employer's hourly ware- house employees at its Philadelphia Branch, 5698 Rising Sun Avenue, Philadelphia, Pennsylvania. On March 27, 1963, the Petitioner, hav- ing received a majority of the valid votes cast,' was certified by the Board as the exclusive bargaining representative of the aforemen- tioned employees. Thereafter, on June 7, 1963, the Petitioner and Local 5, Interna- tional Union of United Brewery, Flour, Cereal, Soft Drink, and Dis- tillery Workers of America, AFL-CIO, herein sometimes called Local 5, jointly filed a motion to amend the certification "to designate Local 5, International Union of United Brewery, Flour, Cereal, Soft Drink, and Distillery Workers of America, AFL-CIO as the collective bar- gaining agent of said employees." The motion alleges that shortly after April 28, 1963, the Petitioner "decided to cease existing as a labor organization . . . ," and that on on May 31, 1963, with the approval of the Employer, a majority of the employees in the certified unit "voted for representation by Local 5 in an election conducted by the American Arbitration Association. The Employer has agreed to recognize Local 5 as the collective bar- gaining agent of this unit upon appropriate amendment of the certi- fication by the N.L.R.B." Thereafter, the Board requested that the Employer submit a state- ment of its position on the motion. On June 28, 1963, the Employer advised the Board that on May 31, 1963, the American Arbitration Association conducted an informal secret ballot at the Employer's plant among the employees in the unit for the purpose of determining whether the said employees desired to be represented by Local 5, and the Employer enclosed a letter, dated June 7, 1963, received from the I No other labor organization appeared on the ballot. 144 NLRB No. 44. 727-083-64-vol. 144-28