Associated General Contractors of America, Inc.

HOUSTON CHAPTER, ASSOCIATED GENERAL CONTRACTORS 409 Houston Chapter, Associated General Contractors of America, Inc. and Construction and General Laborers Union, Local No. 18, International Hod Carriers, Building and Common Laborers Union, AFL-CIO Construction Employers' Association of Texas and Construc- tion and General Laborers Union , Local No. 18, International Hod Carriers, Building and Common Laborers Union, AFL- CIO. Cases Nos. 23-CA-1347 and 23-CA-1398. June 28, 1963 DECISION AND ORDER On June 29, 1962, Trial Examiner C. W. Whittemore issued his Intermediate Report in the above-entitled proceeding, finding that the Respondents had engaged in certain unfair labor practices and recom- mending that they cease and desist therefrom and take affirmative ac- tion, as set forth in the attached Intermediate Report. Thereafter, the Respondents filed exceptions to the Intermediate Report and a brief in support thereof. 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 exceptions and brief, and the entire record in this case,' and hereby adopts the findings, conclusions, and recommenda- tions of the Trial Examiner with certain additions indicated herein. As found in the Intermediate Report, the Union has been the bar- gaining representative for all the Respondents' employees in an ap- propriate multiemployer unit since sometime in 1955. On Septem- ber 27, 1961, the parties began a series of meetings for the purpose of negotiating a new contract to succeed the contract then in existence, due to expire on October 31, 1961. The Union submitted a proposed contract which contained provisions for a nondiscriminatory hiring hall : the Union was to be the sole source of employees for the Respond- ents, and was to select and refer applicants for employment on the basis of certain admittedly proper factors (such as length of service in the industry), "without discrimination . . . by reason of membership or non-membership in the Union." The proposed agreement also pro- vided that an Appellate Tribunal, comprised of an equal number of employer and union representatives, would be set up to decide any grievances arising from the operation of the hiring hall. No negotiations took place at the first meeting, as Respondents' representatives requested time to study the proposals. At the second meeting between the parties, on October 5, the Respondents notified the Union that their attorney had advised them that the hiring-hall 'The Respondents' request for oral argument is denied as the record, including the brief, in our opinion adequately sets forth the issues and the positions of the parties. 143 NLRB No. 43. 410 DECISIONS OF NATIONAL LABOR RELATIONS BOARD provision was illegal under the Texas right-to-work law. At all sub- sequent meetings,2 the Respondents refused to negotiate on the hiring- hall proposals, maintaining their claim of illegality. Accordingly, on November 1, the Union struck. On November 17, the strike was en- joined by a Texas district court, on the ground that under Texas law the Union could not strike for the purpose of obtaining an agreement for a hiring hall. On the same day, the Union notified the Respond- ents that it considered the court's decision wrong and that it would appeal the decision, but requested further bargaining on the other provisions of the proposed contract. A few days later, the parties signed a contract covering all issues except the hiring hall, and also executed a stipulation indicating that that issue was not being aban- doned. Thereafter, the Union withdrew its appeal from the Texas district court's decision. The Respondent's contentions, which will be discussed seriatim, are that: (1) the proposed hiring hall is not a mandatory subject for collective bargaining; (2) the hiring hall is a form of union security prohibited by the State of Texas and is, therefore, not authorized un- der Section 14(b) of the Act; and (3) the principal issues have been rendered moot by the execution of the current contract and stipula- tion between the parties. We find no merit in any of the above contentions. 1. No question exists today as to the legality of a nondiscriminatory hiring hall. In its landmark decision in this area 3 the Supreme Court overruled the Board's decision in Mountain Pacific.' which had held that a hiring-hall agreement, despite the absence of any evidence of discrimination, was nevertheless illegal unless it contained certain provisions set forth in the Board's Mountain Pacific decision. The Court stated that discrimination should not be inferred from the face of the instrument particularly where, as in the case before the Court, the instrument specifically provided that there wouldbe no discrimina- tion based on union membership. It cited the Board's recognition in Mountain Pacific that hiring halls came into being "to eliminate wasteful, time-consuming, and repetitive scouting for jobs by indi- vidual workmen and haphazard uneconomical searches by employers," and that in some circumstances hiring halls were lawful. Moving then, from the legality of the nondiscriminatory hiring hall to the issue of its status as a mandatory subject of bargaining, we note, as pointed out by the Trial Examiner, that the case nearest the point at issue is Pacific American Shipowners Association.' There, in 1950, 2 Meetings were held on October 11, 25 , 30, 31 , and November 1. 8 Local 857, International Brotherhood of Teamsters, etc. (Los Angeles -Seattle Motor Express ) v. N.L.R.B., 365 U.S. 667. Mountain Pacific Chapter of Associated General Contractors, Inc., et at., 119 NLRB 883. 6National Union of Marine Cooks and Stewards ( Pacific American Shipowners Associa- tion), 90 NLRB 1099. HOUSTON CHAPTER, ASSOCIATED GENERAL CONTRACTORS 411 the Board dismissed an 8(b) (3) charge against a majority union which insisted on, and struck for, a nondiscriminatory hiring-hall clause in its contract. Subsumed in that decision, in our view, was the proposition that the union had the right, and the employer had the correlative obligation, to bargain about a nondiscriminatory hiring hall. We cannot agree with our dissenting colleagues that the import of that decision goes only to the legality, as opposed to the illegality, of a hiring-hall demand, and does not reach the question of whether the hiring hall was a mandatory or permissive subject of bargaining. The Board was well aware at that time of the distinction between mandatory and nonmandatory subjects of bargaining 6 and would have been acting at cross purposes in allowing the union to strike for a demand upon which it could not lawfully insist. As the dissenting members themselves point out in their introduction, the label "man- datory subject" means that the union is entitled to conduct a strike to gain its end. In its brief the Respondents, while recognizing the correctness of the Pacific Americana case at the time it was decided, contend that the Act was subsequently amended by Section 8(f) so that unions are no longer "permitted to strike construction employers to enforce their demands for exclusive referral arrangements." However, the purpose of Section 8(f), as appears from its legislative history, was to save certain otherwise unlawful agreements in the construction industry. Specifically, Section 8(f) would permit an agreement such as that here involved to be made before the union's majority was established. As the Trial Examiner correctly observed, such an agreement with a union which was certified by the Board or, as was the case herein, was the exclusive bargaining agent under Section 9 of the Act, was not itself unlawful to begin with, and did not need to be saved by the application of Section 8(f). We, therefore, find no merit in this contention. To be considered a mandatory subject of bargaining, a demand must fall with the meaning of "wages, hours, and other terms and condi- tions of employment" as set out in Section 8 (d) of the Act. In this regard, Respondents would have us determine that the collective- bargaining process does not cover the obtaining of employment, but is instead limited only to those conditions which arise after an actual employment relationship has been established. That Respondents' argument is lacking in merit is quickly illus- trated by reference to the Borg-Warner case,' in which the Supreme Court in 1958 set out certain tests to aid in determining whether a subject of bargaining is mandatory. The first test is whether the See Weyerhaeuser Timber Company, 87 NLRB 672. 7 N.L.R.B. v. Wooster Division of Borg-Warner Corp., 356 U.S. 342. 412 DECISIONS OF NATIONAL LABOR RELATIONS BOARD subject matter has settled any term or condition of employment. It can scarcely be denied, since "employment" connotes the initial act of employing as well as the consequent state of being employed, that the hiring hall relates to the conditions of employment. The second test is whether the subject sought to be bargained about has regulated the relations between the employer and his employees. Certainly, the matter of what standards are to be applied in determining pri- orities for employment must of necessity regulate relations between the employer and the employees. In this regard, we do not deem the Supreme Court to have limited its definition of "employees" to those individuals already working for the employer." Rather, the Court contemplated prospective employees as also within the definition 9 Moreover, we find it highly significant that we are dealing with a multiemployer situation in the building and construction industry, an industry characterized by intermittent employment which has received special statutory consideration. In this industry, employees who have been laid off by one employer are customarily desirous of employment with others in the industry, and are still employees within the meaning of the Act as they seek employment with such other employers. Their obtaining of further like employment will neces- sarily be regulated by the operation of the hiring hall. Thus, those employees who are working in the industry and who have a deep concern not only about the length of their present jobs, but also about the opportunities for continued employment elsewhere when they are laid off, are clearly and directly affected by the job priority standards established by the hiring hall.10 8 See Phelps Dodge Corp v. N.L R.B., 313 US. 177. Similarly, the Board has con- sistently stated that the definition of "employee" in Section 2(3) of the Act covers "applicants for employment" and "members of the working class generally" Briggs Manufacturing Company, 75 NLRB 569; Texas Natural Gasoline Corporation, 116 NLRB 405. 8In their analysis of the Phelps Dodge decision, our dissenting colleagues seek to draw an unwarranted distinction between the phrases "hire or tenure of employment or any term or condition of employment" appearing in Section 8(a) (3), and "wages, hours, and other terms and conditions of employment" appearing in Section 8(d). They would inter- pret certain language of the Supreme Court in that case as rejecting a construction which would include matter relating to "hire" as within the scope of the "terms and conditions of employment" that Section 8(d) makes mandatory subjects of bargaining We do not read the language adverted to as implying any such thing. The Court's only concern in that case was with a discriminatory refusal to hire job applicants, and so there was no reason for the Court to look beyond Section 8(3) (now 8(a) (3)) with which it was specifically dealing and imply that hiring was not a matter about which the parties must bargain We note that Section 8(d) not only omits "hire," but also makes no specific mention of "tenure of employment" as does 8(a) (3. Yet it could scarcely be denied today that the concept of "tenure of employment" lies within the "terms and condi- tions of employment" of Section 8(d). An employer who must bargain with the repre- sentative of his employees before subcontracting out work done by employees in the unit is bargaining about their tenure of employment. Town & Country Manufacturing Com- pany, Inc, 136 NLRB 1022, enfd. 316 F. 2d 846 (CA. 5). The same is true for bargain- ing which affects seniority and union security. In similar fashion the concept of "hire," though not specifically set out within 8(d), is clearly a "term or condition of employment," and makes bargaining mandatory with respect to the hiring of prospective employees 1o We did not mean to intimate, as the dissent implies, that the building and construc- tion industry should receive special consideration in this area. Rather, we have only HOUSTON CHAPTER, ASSOCIATED GENERAL CONTRACTORS 413 Thus it is clear that the hiring hall meets the tests laid down in Borg-Warner for determining mandatory subjects of bargaining. Since the tests are satisfied, the bargaining subject is one about which the employer is required to deal with the bargaining representative of his employees. In addition, we note the language of the Supreme Court in the Telegraphers case 11 that ". . . the trend of legislation affecting rail- roads and railroad employees has been to broaden, not narrow the scope of subjects about which workers and railroads may or must ne- gotiate and bargain collectively." This language takes on added sig- nificance from the fact that the courts have held that the bargaining obligation under the National Labor Relations Act is broader in scope than under the Railway Labor Act." Thus, the range of mandatory subjects of bargaining under the National Labor Relations Act has been found to include Christmas bonuses ; 13 retirement and pension plans; 14 vacations; 15 an employees' stock purchase plan; 16 union se- curity, checkoff, seniority, and grievances; 17 and more recently the elimination of jobs through subcontracting," or because of techno- logical changes.19 As the relationship between employers and em- ployees evolves, new areas may be found which affect "wages, hours, and other terms and conditions of employment," and thus the list of mandatory subjects of bargaining quite properly is enlarged. In view of all the foregoing, we agree with the Trial Examiner that the hiring hall is a mandatory subject for collective bargaining. 2. Respondents also contend that the hiring hall is a form of union security, and that the State of Texas, under the provisions of Section 14 (b) of the Act '20 has the right to outlaw it. The concept of union security applicable under the Act emanates from the first proviso to Section 8(a) (3) of the Act, which reads: sought to illustrate, by means of the particular situation presented in this case , the in- volvement of all the employees (those who are seeking employment as well as those who are currently employed) with the hiring ball. 11 Order of Railroad Telegraphers v Chicago & N.W.R R Co., 362 US. 330. 12 See cases cited in Fibreboard Paper Products Corporation, 138 NLRB 550. 10Niles-Bement-Pond Company, 97 NLRB 165, enfd. 119 F 2d 713 (CA. 2) 14 Inland Steel Company, 77 NLRB 1, 4 , enfd. 170 F. 2d 247 ( CA. 7), cert. denied 336 U.S. 960 15 Phelps-Dodge Copper Production Corporation, 101 NLRB 360. 10 Richfield Oil Corporation, 110 NLRB 356, enfd 231 F. 2d 717 (C.A.D C.), cert. denied 351 U.S 909. 17N.L.R.B v. Proof Company, 242 F. 2d 560 (CA. 7), cert. denied, 355 U.S 831; N.L R B. v. Reed & Prince Mfg. Co., 205 F 2d 131 (C A 1) ; N.L.R.B v Andrew Jergens Co., 175 F. 2d 130 (C A. 9 ) , cent denied 338 U S 827; Bethlehem Steel Company, 136 NLRB 1500; United States Gypsum Company, 94 NLRB 112. 18 Town & Country Mfg. Co., 136 NLRB 1022 , supra; Fibreboard Paper Products Corpo- ration, supra. 10 The Renton News Record, 136 NLRB 1294 20 Section 14(b) of the Act states: "Nothing in this Act shall be construed as authoriz- ing the execution or application of agreements requiring membership in a labor organiza- tion as a condition of employment in any State or Territory in which such execution or application is prohibited by State or Territorial law." 414 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ... nothing in this Act . . . shall preclude an employer from making an agreement with a labor organization ... to require as a condition of employment membership therein on or after the thirtieth day following the beginning of such employment or the effective date of such agreement . . . . [Emphasis supplied.] It is abundantly clear that a union-operated nondiscriminatory hir- ing hall does not, by definition, require membership in that union as a condition of referral, and thus of employment. Rather, the non- discriminatory hiring hall operates to serve both members and non- members of the Union, and also services employers. An employee seeking a job referral to an employer having an appropriate contract need not become a member of the union which is running the hiring hall, nor must he even tender "agency shop" payments to the union in lieu of membership. In sum, there are no union-oriented conditions of employment which he is required to satisfy, which might arguably be considered forms of union security. Furthermore, a review of both Board and court cases which have dealt with the issue warrants no inference that a nondiscriminatory hiring hall bears any of the charac- teristics of a union-security agreement. Accordingly, we agree with the Trial Examiner that the hiring hall sought in this case is not a form of union security. The demand has not, therefore, been subjected by Congress under Section 14(b) to regulation by the States. 3. Respondents further maintain that the issues herein have been rendered moot by the execution of the current contract and stipulation between the parties. As stated above, the Union's strike was enjoined on November 17, and on that day the Union notified the Respondents that it considered the court's decision to be wrong and that it would appeal the case. At the same time, the parties continued to bargain on the other pro- visions of the proposed contract. On November 29, the parties signed a contract covering all issues except the hiring hall. However, they stipulated in writing at the same time that the contract between them was without prejudice to the right of either party to appeal the injunc- tion granted by the court. The stipulation further stated : Neither party will contend in said case that the dispute as to the hiring hall subject is moot since the same was withdrawn by the union solely because it was compelled to do so by injunction of the court. Respondents contend that the stipulation should be construed strictly as relating only to a direct appeal from the State court's order, and not to any proceeding before the Board. Respondents further argue that the presence in the executed contract of a clause reading in part ".... and, except by mutual consent of the parties, no new or addi- HOUSTON CHAPTER, ASSOCIATED GENERAL CONTRACTORS 415 tional issues shall be the subject of negotiations during the term of this Agreement," leaves them with no duty to negotiate with the Union on the hiring-hall demand. As to the first contention, Respondents would hold the Union to the literal meaning of the word "appeal" as it appears in the stipulation. However, since the parties were dealing with a question that also lies within the scope of the Act, the Union cannot be said to have clearly waived a determination by the Board. In fact, when the injunction was sought by the Respondents, the Union filed a plea to the jurisdic- tion of the State court, alleging that the matter was solely within the jurisdiction of the Board. The Respondents' second contention, in our opinion, would mean that even if the State court injunction were reversed, the contract clause would relieve the Respondents of any duty to negotiate with the Union on the hiring-hall demand. This was clearly not the intention of the Union, and in any event, we are unable to find a meeting of the minds on this matter. Accordingly, we find no merit in the Respondents' contentions, and we agree with the Trial Examiner that the issues herein have not been rendered moot. In conclusion, as it has been found above that the nondiscrimina- tory hiring hall is a mandatory subject for collective bargaining, that, the State of Texas does not have the right under Section 14(b) of the Act to outlaw such a hiring hall, and that the issues herein have not been rendered moot, and as we agree with the Trial Examiner that the Respondents have consistently refused to discuss the Union's proposal for a nondiscriminatory hiring hall, we hereby find that the Respondents have unlawfully refused to bargain collectively with the Union within the meaning of Section 8(a) (5) and (1) of the Act. ORDER The Board adopts as its Order the Recommended Order 21 of the Trial Examiner. MEMBERS RODGERS and LEEDOM, dissenting in part : We disagree with our colleagues to the extent that they find a union's proposal for the establishment of a nondiscriminatory hiring hall is a mandatory subject of collective bargaining. At the outset, we point out that the question presented here is not one of mere nomenclature. Rather, it is one of fundamental importance in the construction and administration of the Act. For the hiring hall is not peripheral to industrial relations. It goes right to the core of '1 The first sentence below the signature line in the Appendix attached to the Inter- mediate Report is amended to read: "This notice must remain posted for 60 consecutive days from the date of posting . . . . 416 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the employer-employee relationship, it impinges on the employer's privilege of choosing his employees; it may even, in some cases, impede the workingman's effort to procure work. And the label "mandatory subject" has a potent significance: it means here that the Union was entitled to insist upon the establishment of a hiring hall to the point of a bargaining impasse; it means further that the Union was entitled to conduct a strike to gain this end. In reaching their conclusion our colleagues, in substance, find that: (1) the hiring-hall proposal meets the Supreme Court's test laid down in Borg-Warner as a subject matter of mandatory bargaining; (2) the Pacific American case, 90 NLRB 1099, where the Board dismissed an 8 (b) (3) allegation against a majority union which struck for a non- discriminatory hiring-hall clause, subsumes the proposition that the union had the right, and the employer had the duty, to bargain about the hiring-hall clause; (3) the instant case involves the building and construction industry, an industry characterized by intermittent em- ployment, which has received special statutory consideration, and that it would be desirable to require bargaining as to a nondiscriminatory hiring-hall proposal in such an industry; and (4) the decisional trend has been to broaden the range of mandatory subjects of bargaining. Our colleagues properly point out that a demand is not a mandatory subject of bargaining unless it falls within the meaning of "wages, hours, and other terms and conditions of employment," as set forth in Section 8(d) of the Act; and, further, that the Supreme Court has determined that a subject matter is not a mandatory subject of bar- gaining unless it settles a term or condition of employment and regu- lates the relations between the employer and his employees. However, our disagreement with them is over the application of the Supreme Court test. We cannot accept their argument that hiring relates to conditions of employment because "employment" connotes the initial act of employing as well as the consequent state of being employed. If the initial obtaining of employment is within the scope of obligatory collective bargaining then it must follow that, in addition to a hiring- hall provision, an employer must bargain with the exclusive bargain- ing representative as to such major matters as the size of its labor force and the extent and timing of any expansion thereof, or as to such details as per diem allowances for job applicants summoned for interview or observation, prior to their acceptance as employees-a conclusion which our colleagues would apparently not embrace and which we could not accept. The Board, with the approval of the U.S. `Court of Appeals for the District of Columbia has heretofore indicated that,22 in determining whether a union proposal that the employer post re Local 16k, etc., Painters, Decorators and Paperhangers of America, AFL-CIO (A. D. Cheatham Company ), 126 NLILB 997, enfd 293 F. 2d 133 (C.A.D.C ), cert. denied 368 U.S. 824 ( 1961). HOUSTON CHAPTER, ASSOCIATED GENERAL CONTRACTORS 417 a performance bond as a condition to an agreement is a mandatory subject of collective bargaining, it is proper to draw the line at the point that the work is undertaken. Thus, the court said : "The re- quirement of a performance bond has nothing to do with performance of work but is a condition which must be met even before work is undertaken. We are unwilling to say that a condition precedent to employment is a condition of employment, such as wages and hours, in the meaning of the statute." 23 [Emphasis supplied.] Similarly, since hiring occurs before work is undertaken, an identical finding of a non- mandatory subject would seem to follow. Nor can we agree that a hiring-hall clause regulates the relations be- tween an employer and his employees. To support this conclusion, our colleagues rely on Phelps Dodge and like cases and assert that the term "employees" includes not only individuals already working for the employer, but also prospective employees. In Phelps Dodge, the Supreme Court was concerned with whether a discriminatory refusal to hire job applicants violated former Section 8(3) of the Act. That section prohibited, as does the present Section 8(a) (3), an employer from discriminating in regard "to hire or tenure of employment or any term of condition of employment" [emphasis supplied]. In contrast, Section 8(d) of the Act requires an employer to bargain only as to "wages, hours, and other terms and conditions of employment." In- deed, the Supreme Court, in Phelps Dodge, expressly rejected a con- struction which would have included the term "hire" within the mean- ing of the phrase "any term or condition of employment." 24 Although the Court there held that the Act protects applicants for employment against discrimination in the hiring process, that case by no means stands for the proposition that prospective employees are employees as to whom bargaining is mandatory under Section 8 (d). Secondly, our colleagues' reliance on Pacific American is also mis- placed. That case is inapposite because the specific issue posed there concerned the alleged illegality of the hiring-hall proposal and not its bargainability. In dismissing the 8 (b) (3) allegation in that case, 23 We note that the Board also held in the Cheatham case that a union proposal which sought to impose residence requirements for employees of the employer outside the bargain- ing unit was not a compulsory subject of collective bargaining. 2411. . . We are asked to read 'hire' as meaning the wages paid to an employee so as to make the statute merely forbid discrimination in one of the terms of men who have se- cured employment. So to read the statute would do violence to a spontaneous textual reading of § 8(3) In that '-hire' would serve no function because, in the sense which is urged upon us, it is included in the prohibition against 'discrimination in regard to . . any term or condition of employment.' Contemporaneous legislative history,5 and, above all, the background of industrial experience, forbid such textual mutilation." Phelps Dodge v. N L.R.B., 313 U.S 177, 186 (footnote 5, omitted). Contrary to our colleagues, it is illogical to argue that "hire" falls within the ambit of "terms and conditions of em- ployment" because "tenure of employment," admittedly a mandatory subject of bargaining, is Included therein although, like "hire," It is not expressly mentioned in Section 8(d). Unlike "hire," "tenure of employment" refers to an employment relationship already established and is therefore encompassed within the phrase " terms and conditions of employment." 418 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the Board affirmed the Trial Examiner who framed the issue in these words : "The issue is whether the Union had adopted a `fixed determi- nation to require as -a condition to the conclusion of any agreement, the inclusion of provisions which by their very terms or in their ef- fectuation, [were] repugnant to the Act's specific language or basic policy.' " The Trial Examiner found that the evidence did not warrant such a conclusion. In its decision, the Board restated the Trial Ex- aminer's finding in the following words : ". . . as the August 31 [hir- ing-hall] proposal by the Respondent was not violative of Section 8(a) (3) of the Act, we find that, by including such proposal as part of the strike issues and advancing it as a condition to any agreement with the Employers, the Respondent did not violate Section 8 (b) (2) or 8 (b) (3) of the Act." There, unlike here, no one raised any issue as to whether the hiring-hall proposal was a mandatory subject for bargain- ing, and the Board did not address itself to that question. We there- fore regard Pacific American as having dubious value as a precedent with respect to the issue presented here. Nor are we persuaded by our colleagues' plea that the hiring-hall proposal should be treated as a mandatory subject of bargaining be- cause the building construction industry should receive special con- sideration, or because the trend of decisions has been to broaden the range of mandatory subjects of bargaining. Suffice it to say, that the Board, as an administrative agency, cannot go beyond the special con- sideration given the building and construction industry by Congress; and there is clearly no legislative basis for such special consideration in the present context. While it is true that the range of mandatory subjects of bargaining has been expanded by Board and court decisions to include an increasing number of new subject matters, unlike here, those subject matters all relate to an employee status already established. In sum, we believe that a hiring hall does not meet the Supreme Court's test to qualify as a subject matter of mandatory bargaining. It settles no term or condition of employment because the obtaining of employment is not a term or condition of employment. Further, the hiring hall does not deal with an employer's relationship to his employees because applicants for employment are not employees under Section 8(d), and thus these individuals are not employed within the bargaining unit. What we have here then is a demand that the Em- ployer bargain with the Union concerning applicants for employment who are outside the unit, and concerning a subject which will not settle a term or condition of employment in the event of actual hire. We see no warrant in the Act for compelling an employer to bargain with a union as to nonemployees and as to matters which antedate the entry of a nonemployee into the bargaining unit. Stated in another way, we would hold that, under this Act, an exclusive bargaining rep- HOUSTON CHAPTER, ASSOCIATED GENERAL CONTRACTORS 419 resentative may not compel bargaining as to whether it shall be the hiring agent for the employer. As we do not view the hiring-hall proposal as a mandatory subject for bargaining, the Respondent was under no obligation to bargain with respect to it. Accordingly, we would dismiss the complaint al- leging that the Respondents' refusal to do so violated Section 8 (a) (5) of the Act. INTERMEDIATE REPORT AND RECOMMENDED ORDER STATEMENT OF THE CASE A charge was filed by the Union against Houston Chapter, Associated General Contractors of America, Inc. (herein referred to as AGC) on December 11, 1961, in Case No. 23-CA-1347. A charge was filed by the same labor organization against Construction Employers' Association of Texas (herein called CEA), on March 20, 1962, in Case No. 23-CA-1398. Upon these charges the General Counsel of the National Labor Relations Board issued an order consolidating the cases, a complaint, and notice of hearing thereon on March 27, 1962. Thereafter the Respondent associations jointly filed an answer to the complaint. The complaint alleges and the answer denies that the Respondents have engaged in and are engaging in unfair labor practices in violation of Section 8(a) (5) and (1) of the National Labor Rela- tions Act, as amended. Pursuant to notice, a hearing was held on April 17, 1962, in Houston, Texas, before Trial Examiner C. W. Whittemore. At the hearing all parties were represented by counsel. Prior to the hearing the Regional Director for the Board's Twenty-third Region had granted a motion for leave to intervene submitted by the attorney general of Texas. The attorney gen- eral entered his appearance at the opening of the hearing, briefly stated his posi- tion regarding the chief issue raised by the complaint, and then withdrew from the hearing. All other counsel participated fully in the proceedings and presented evidence pertinent to the issues. Oral argument was waived at the conclusion of the taking of evidence. Comprehensive briefs have been received from all parties, in- cluding the Intervenor. Upon the record thus made, and from his observation of the witnesses, the Trial Examiner makes the following: FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENTS Based upon allegations of the complaint admitted by the answer, the following facts are found: (1) The Respondents AGC and CEA are nonprofit Texas corporations, having their principal offices and places of business in Houston, Texas. Each is authorized to represent and act as collective-bargaining agent for its member and associate member construction firms and companies engaged in the building and construction industry in Texas. (2) During the 12 months before issuance of the complaint members and as- sociate members of AGC purchased and received, in the aggregate, materials and sup- plies valued at more than $500,000 which were transported to their various business establishments or jobsites in Harris County, Texas, directly from points outside the State of Texas. (3) During the same period members of CEA purchased and received from points outside the State of Texas materials and supplies also valued at more than $500,000. The complaint alleges, the answer admits, and it is here found that the Respond- ents and their members and associate members are engaged in commerce within the meaning of the Act. II. THE CHARGING UNION Construction and General Laborers Union, Local No. 18, International Hod Car- riers, Building and Common Laborers Union, AFL-CIO, is a labor organization within the meaning of the Act. 717-672-64-vol. 143-28 420 DECISIONS OF NATIONAL LABOR RELATIONS BOARD III. THE UNFAIR LABOR PRACTICES A. Setting and major issues In quick and preliminary summation, the chief issue for decision in this case is whether the State of Texas is empowered, under its right-to-work law, to hold unlaw- ful within that State the exclusive but nondiscriminatory hiring hall which the United States Supreme Court has held to be permissible under the National Labor Relations Act. Of nearly equal, if not paramount, importance is the question as to whether a hiring hall is a mandatory subject for collective bargaining. These issues stem from a controversy between the Respondents and the Charging Union which developed at the beginning of contract negotiations in the fall of 1961. As described more fully below, the Union included in its proposed contract a pro- vision for an exclusive hiring-hall arrangement, by its terms nondiscriminatory in nature. Spokesmen for the Respondents promptly contended that Texas law pro- hibited such a clause, and declined to negotiate concerning it. The Union struck. The Respondents sought and obtained in the District Court of Harris County, Texas, an injunction restraining the Union from striking for the purpose of obtaining any agreement with the Respondents which provided for an exclusive hiring hall. Under compulsion of the court order, the Union withdrew the hiring-hall demand from further negotiations A few days after issuance of the injunction, the parties entered into a collective-bargaining agreement. Thereafter the Union filed its original charge against the Respondent AGC alleging violation of Section 8(a)(5) and (1) on the ground of refusal to negotiate concerning the proposed hiring hall arrangement. B. The negotiations Because the Respondents maintain, in one of their sundry defense arguments that the complaint should be dismissed on the ground that they did, if fact, bargain in good faith on the hiring-hall issue, it is necessary to review briefly the events themselves. There is small dispute among the parties as to what happened during the negotiat- ing meetings. In the first place, admissions in the answer dispose of the question of the Union's status as the lawful bargaining representative for all the Respondents' employees in an appropriate unit. And there is in evidence a collective-bargaining contract, effective from January 1959 to October 1961. Beginning in the latter part of September 1961, the parties met at a series of meet- ings for the purpose of negotiating a succeeding contract. At the first meeting the Union submitted a proposed contract which contained, among others, the following pertinent provisions: 1. The Union shall be the sole and exclusive source of referrals of applicants for employment. 2. The Employer shall have the right to reject any applicant for employment, and shall have the right to discharge any employees for good cause who have been accepted but who consequently prove unsatisfactory. 3. The Union shall select and refer applicants for employment without discrimination against such applicants by reason of membership or non-member- ship in the Union and such selection and referral shall not be affected in any way by rules, regulations, by-laws, constitutional provisions or any other aspect or obligation of Union membership policies or requirements... . The same proposed agreement contained additional safeguards insuring non- discrimination and the Union subsequently offered further amendments to its hiring- hall proposals which provided that the Union would refer to an employer any ap- plicant he called for by name, and which also provided for an "Appellate Tribunal," comprised of an equal number of employer and union representatives to decided upon any grievances arising from operation of the referral system. There were no negotiations or any matters at the first meeting, the Respondents' representatives desiring time to study the proposals. At the second meeting the only "discussion" concerning the hiring-hall issue was the flat statement by the spokesman for the employers that their attorney had told them that this provision was illegal. At all subsequent meetings the Respondents' position thus taken was stoutly maintained, and at all times they declined to nego- tiate concerning details of the proposal or any modifications thereof.' This summary 1 Meetings were held on September 27, October 5, 11, 25, 30, 31, and November 1, when the strike began. HOUSTON CHAPTER, ASSOCIATED GENERAL CONTRACTORS 421 finding rests not only upon the credible testimony of union representatives, but that of Fred Fisher, a witness for the Respondents and one of their representatives during the negotiations. His testimony is to the effect that although throughout the meetings union representatives sought to discuss details of the hiring-hall provision "We did not talk about details." He gave as a reason for this, "I felt it was pointless to discuss something that was so obnoxious to us along with what we thought was an illegality." As noted in the preceding section, after receipt of the court order, dated November 17, the Union under compulsion withdrew its demand for negotiation on this subject. The Respondents were notified of such withdrawal by a letter delivered the same date which also stated the Union's intention to "appeal the case" on the belief that "said injunction is wrong." Although the Union later (in March, upon issuance of the complaint in these proceedings), withdrew its appeal from the injunction order, it is clear that the Union at no time since September 27, 1961, has voluntarily or as a result of negotiations abandoned its request for bargaining on the subject matter. As early as December the Respondents were put upon notice, with the filing of the original charge, that the Union was invoking the National Labor Relations Act in support of its position. In summary, then, it is concluded and found that on October 5, 1961, and at all times since then, the Respondents have refused and have continued to refuse to negotiate and discuss with the union matters with respect to the subject of an exclusive referral procedure.2 C. The hiring hall as a subject of mandatory bargaining General Counsel and the Union contend, while the Respondents deny, that the hiring-hall issue is a subject of "mandatory" bargaining- that is, a subject concern- ing which Section 8(d) of the Act requires good-faith negotiations.3 The Trial Examiner is aware of no governing precedent upon the precise point, and counsel have cited none. He agrees with General Counsel, however, that the referral procedure herein involved "meets the Borg-Warner" test? It directly regulates rela- tions between the employer and the employees. It appears to the Trial Examiner that the hire of an employee is an essential and integral factor in the entire employment relationship. Justice Frankfurter many years ago enunciated this underlying principle, the Trial Examiner believes, when he said, in Phelps Dodge Corp. v. N.L.R.B., 313 U.S. 177, 188, To differentiate between discrimination in denying employment and in terminat- ing it, would be a differentiation not only without substance but in defiance of that against which the prohibition of discrimination is directed. Thus it was early held by the Supreme Court that the Act empowered the Board to protect applicants for employment as well as those on an employer's payroll. The case nearest the specific point, it seems, is National Union of Marine Cooks and Stewards (Pacific American Shipowners Association), 90 NLRB 1102, wherein the Board found that the union had not violated the Act by striking for the purpose of obtaining (in a contract) a nondiscriminatory hiring-hall provision. Two years later, in 1952, on identical issue involving the same parties, the Board reaffirmed its position. (98 NLRB 582, 584.) The Trial Examiner is unable to find any case in which the Board since 1952 has retreated from this position. Coupling the Board's determination that striking for a lawful hiring clause with the Supreme Court's holding that hiring is a matter within the Act's protection seems plainly to lead to the conclusion here made, that under the circumstances here not in dispute a hiring arrangement is a mandatory subject of collective bargaining. The foregoing general conclusion, the Trial Examiner believes, is firmly buttressed in this case by a meritorious point raised by the Union in its brief. In effect, the Union contends that the nondiscriminatory hiring-hall subject is especially manda- tory here because the Union is and has been recognized by the Respondents as the exclusive bargaining representatives of all hod carriers and laborer employees of 2 Discussion of points raised by the Respondents: (1) whether by maintaining an adamant position they failed to bargain in good faith, and (2) whether the controversy is moot will be made in a later section. 8 The relevant part of Section 8 (d) : ". . . to bargain collectively is the performance of the mutual obligation of the employer and the representatives of the employees to . . . confer in good faith with respect to wages, hours, and other terms and conditions of employment. . . ." A N L.R.B. v. Wooster Division of Borg-Warner Corp., 356 U.S. 342. 422 DECISIONS OF NATIONAL LABOR RELATIONS BOARD their employer-members,5 and that as such representative it possessed, under Section 7 of the Act, both the expressed right and implied responsibility , in seeking agreement on this point, to bargain and to engage in "concerted activities " for the purpose of "mutual aid and protection." In its hiring-hall proposal the Union specified that referrals should be made "with- out discrimination against such applicants by reason of membership or nonmember- ship in the Union"-plainly in consonance with and affirmation of the "right to refrain" clause of Section 7. And the basis of referrals, as proposed , was to be the seniority of applicants who had been employees of the "Employers in the industry." Seniority not only has long been recognized as a mandatory subject of bargaining,6 but in the construction industry, where work is intermittent and workers float from one locality to another , seniority also becomes an important factor of "mutual aid or protection." The fact that the Union was pursuing a lawful objective while acting in the lawful and conceded capacity as sole bargaining agent of all employees , in the opinion of the Trial Examiner , fully answers the apparent implication , raised in the Respondents' brief, that an exclusive referral system may not be held to be a mandatory bargaining subject because Section 8(f) of the Act,7 as amended in 1959, does not "authorize" a strike or picketing to achieve an agreement embracing such provisions. The implication stems from the brief's quotation, in the section devoted to the "mandatory" issue, of the following language of the Conference Report accompany- ing the 1959 Amendments of the Act, and in reference to Section 8(f). The conference adopted the provisions of the Senate bill permitting prehire agreements in the building and construction industry . Nothing in such provision is intended . . . to authorize the use of force, coercion , strikes or picketing to compel any person to enter such prehire agreements. The new amendment manifestly applies to conditions where the labor organization involved has not been certified by the Board or recognized by the employer con- 5 The complaint alleges and the answer admits that: "At all times since about 1955, and continuing to date, the Union has been recognized by Respondent AGC and Respondent CEA as the representative for the purposes of collective bargaining of the employees in the unit" consisting of "all hod carriers and laborer employees of the members and asso- ciate members of Respondent AGC and Respondent CEA, exclusive of all supervisors as defined in the Act" and "by virtue of Section 9(a) of the Act, has been since about 1955, and is now, the exclusive representative of all employees in said unit for the proposes of collective bargaining with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment." 0 In N L R.B. v. Proof Co, 242 F. 2d 560, cert denied 355 U.S. 831, the Seventh Circuit Court of Appeals said: , Nor can it be doubted that seniority provisions and bulletin board use are those "conditions of employment" which the Act requires to be the subjects of collective bargaining. Inland Steel Co v. N.L R B., 7 Cir, 170 F 2d 247, 252, 12 A.L.R 2d 240 and N.L R B v Reed 4 Prince Mfg Co , 1 Cir, 205 F. 2d 131, 136. 7 Section 8 (f) of the 1959 amendments reads. It shall not be an unfair labor practice, under subsections (a) and (b) of this sec- tion for an employer engaged primarily in the building and construction industry to make an agreement covering employees engaged (or who, upon their employment, will be engaged) in the building and construction industry with a labor organization of which building and construction employees are members (not established, maintained, or assisted by an action defined in section 8(a) of this Act as an unfair labor prac- tice) because (1) the majority status of such labor organization has not been estab- lished under the provisions of section 9 of this Act prior to the making of such agreement, or (2) such agreement requires as a condition of employment, member- ship in such organization after the seventh day following the beginning of such em- ployment or the effective date of the agreement, whichever is later, or (3) such agree- ment requires the employer to notify such labor organization of opportunities for employment with such employer, or gives such labor organization an opportunity to refer qualified applicants for such employment, or (4) such agreement specifies mini- mum training or experience qualifications for employment or provides for priority in opportunities for employment based on length of service with such employer, or in the industry or in the particular geographical area: Provided, That nothing in this subsection shall set aside the final proviso to section 8(a)(3) of this Act• Pvovsded further, That any agreement which would be invalid, but for clause (1) of this sub- section, shall not be a bar to a petition filed pursuant to section 9(c) or 9(e) HOUSTON CHAPTER, ASSOCIATED GENERAL CONTRACTORS 423 cerned as the exclusive bargaining agent under Section 9 of the Act. The intent of Congress on this point was voiced by both Senators Kennedy and Dirksen. Senator Kennedy said, in an analysis of S. 1555, as passed: [This section] Permits an employer primarily engaged in the building and con- struction industry to enter into agreements with labor organizations despite the fact that the union's majority status has not been established under Section 9 of the Act. [Emphasis supplied.] Page 1262, Board's Legislative History of the Labor-Management Reporting and Disclosure Act of 1959. And Senator Dirksen said, in his report as Minority Leader on the same bill: . the bill permits building trades firms and unions to sign union contracts in advance of a construction job, even if the union had not won an NLRB certifi- cation election or did not represent the majority of the existing or potential employees. [Emphasis supplied.] Page 1823, same source Finally, the following Supreme Court reasoning would seem to approve the fore- going conclusion regarding the hiring-hall issue. The Union's brief thus quotes Justices Harlan and Stewart in their separate concurring opinion in Local 357, Inter- national Brotherhood of Teamsters, etc. (Los Angeles-Seattle Motor Express) v. N L.R.B, 365 U.S. 667 at 682 (one of the four definitive decisions on hiring halls issued by the Supreme Court on April 17, 1961) : the Act was not intended to interfere significantly with . . . nondiscrim- inatory attempts to benefit all the represented employees. And the same Justices, in dissociating themselves from the Board's holding in the Teamsters case that the hiring-hall provision was unlawful because it lacked the "Mountain Pacific" clauses 8 to isolate the valid from the discriminatory effects, said that the Board's contention in this respect: does not seem . consistent with the balance the labor acts have struck be- tween freedom of choice of management and union ends by the parties to a collective bargaining agreement and the freedom of employees from restraint and coercion in their exercise of rights guaranteed by Section 7 of the Act. D. The preemption issue The attorney general of the State of Texas and the Respondents contend that the Board is without jurisdiction in the determination of the hiring-hall issue because the 113th District Court of Harris County, Texas, has held that an exclusive hiring hall is illegal under the laws of Texas. The Texas right-to-work law, as cited by the attorney general (art 5207(a) of the Texas Revised Civil Statutes) reads: SECTION 1. It is hereby declared to be the public policy of the State of Texas that the right of a person to work and bargain freely with his employer, indi- vidually or collectively for terms and conditions of employment shall not be denied or infringed by any organization of whatever nature. SEC. 2. No person shall be denied employment on account of membership or nonmembership in a labor union. SEC. 3. Any contract which requires or prescribes that employees or applicants for employment in order to work for an employer shall or shall not be or remain members of a labor union, shall be null and void and against public policy . . . . It is the Respondents' position that "Congress did not intend to prohibit the States from acting in this area of union security"-"an exclusive referral arrangement," and they cite Section 14(b) of the Act, which reads: Nothing in this Act shall be construed as authorizing the execution or applica- tion of agreements requiring membership in a labor organization as a condition of employment in any State or Territory in which such execution or application is prohibited by State or Territorial law. Both the attorney general and the Respondents quote a Board remark in its decision in General Motors Corporation (133 NLRB 451) : We do not think it is the Board's province to undermine a State court decision interpreting a State statute. . . . as support for their claim that the Board should not " undermine" the Harris County District Court decision in this case. 8In passing, it is to be noted that the Union's exclusive referral system proposal con- tained all the Mountain Pacific safeguards 424 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Only the district court's restraining Order is in evidence here. Its findings and conclusions, if any, upon which the Order was based, are not in this record. At the opening of the hearing, however, the attorney general stated, in summary: The position the State [takes] is that the basic purpose of a union is to advocate the interest of its membership . to be an active agent and advocate for securing employment for its membership, and that it being put in an advocate's position it would find itself in a conflicting situation if it were called on to also represent non-union members . As a matter of law this type arrangement is such that a union cannot consistently fulfill its own inherent purpose and at the same time be called upon to fairly certify for employment non-union members. Assuming the accuracy of the attorney general's interpretation of the court's reasoning as to its own interpretation of the Texas law, then the Trial Examiner sug- gests that the Board reexamine its quoted policy of not questioning a State court's interpretation of a State law. Otherwise the Board and the Act are likely to be out of business in the State of Texas. The same or another court may, by the same ex- ercise of leapfrog logic, decide that the Texas right-to-work law also bars Board certification of a labor organization as the exclusive bargaining agent. For surely if the assumption is sound that a labor organization by its very nature will discrim- inate in favor of its own members in an exclusive but nondiscriminatory referral arrangement, it is no less sound to assume that it will likewise discriminate in serving as the exclusive bargaining agent of all employees, whether union members or not, in an appropriate unit. The Trial Examiner cannot believe that the Board or the Federal courts are prepared to yield to a State court interpretation of that State's laws which, in effect, nullifies for that State Justice Douglas' words in the same Teamsters case cited heretofore (365 U.S. at 675) : . .. surely discrimination cannot be inferred from the face of the instru- ment when the instrument specifically provides that there will be no- discrimination. .. . and, at 676: We cannot assume that a union conducts its operations in violation of law. . . . The Trial Examiner is in accord with General Counsel's contentions that: (1) "the exclusive referral arrangement proposed by the Union is not an agreement making union membership a condition of employment"; (2) Section 14(b) of the Act, quoted above, is not applicable here; and (3) Texas is not empowered by the Act to prohibit a nondiscriminatory hiring hall which does not require membership as a condition of employment. It is the Trial Examiner's opinion that the Texas law, at least as to this case and contrary to the Respondents and the attorney general of Texas, is preempted by the National Labor Relations Act This opinion is governed by the following language of the Supreme Court in San Diego Building Trades Council v. Garmon, 359 U.S. 236,243-245: .. . When the exercise of a state power over a particular area of activity threat- ened interference with the clearly indicated policy of industrial relations, it has been judicially necessary to preclude the States from acting When it is clear or may fairly be assumed that the activities which a State purports to regulate are protected by § 7 of the National Labor Relations Act, or constitute an unfair labor practice under § 8, due regard for the federal enact- ment requires that state jurisdiction must yield. To leave the States free to regulate conduct so plainly within the central aim of federal regulation involves too great a danger of conflict between power asserted by Congress and require- ments imposed by state law. Nor has it mattered whether the States have acted through laws of broad general application rather than laws specifically directed towards the governance of industrial relations. Regardless of the mode adopted, to allow the States to control conduct which is the subject of national regulation would create potential frustration of national purposes. At times it has not been clear whether the particular activity regulated by the States was governed by § 7 or § 8 or was, perhaps. outside both these sec- tions. But courts are not primary tribunals to adjudicate such issues. It is es- sential to the administration of the Act that these determinations be left in the first instance to the National Labor Relations Board. What is outside the scone of this Court's authority cannot remain within a State's power and state jurisdic- tion too must yield to the exclusive nrimarv competence of the Board See, e.g.. Garner v. Teamsters Union, 346 U.S. 485, especially at 489-491; Weber v. Anheuser-Busch, Inc., 348 U.S. 468. HOUSTON CHAPTER, ASSOCIATED GENERAL CONTRACTORS 425 E. The issue of "mootness" The Respondents maintain that the entire controversy has been rendered moot by the execution of the current "completely integrated" contract. The Trial Examiner finds this contention to be without merit. The record clearly shows that the Union at no time expressly or by implication waived its right to appeal the exclusive hiring-hall issue to a higher Texas court or to file a charge under the Federal Act. That it executed a contract without the hiring-hall clause was not a voluntary action by the Union, nor agreed upon as a result of negotiations , but only in compliance with the State court's restraining order. F. Application of Section 8(a)(5) and (d) of the Act This issue , tentatively indicated in an earlier section , must also be resolved against the Respondents' contention. It has now been concluded that the issue of an exclusive hiring hall is a subject of mandatory bargaining under the existing circumstances . It was earlier found that the Respondents, during negotiations , adamantly refused to discuss details, variations, or amendments to the Union's proposed provision for an exclusive referral system.9 It follows, and in conclusion is found, that by refusing to negotiate , in good faith, regarding a mandatory subject of collective bargaining , the Respondents failed and refused to bargain collectively with the Union within the meaning of Section 8(a) (5) and (1 ) of the Act. G. Summary In conclusion , the Trial Examiner concludes and finds that the evidence and authorities set forth above fully support the allegations of the complaint as follows: (1) All hod carrier and laborer employees of the members and associate members of Respondent AGC and Respondent CEA, exclusive of all supervisors as defined in the Act, constitute a unit appropriate for the purpose of collective bargaining within the meaning of Section 9(b) of the Act. (2) At all times since about 1955 the Charging Union has been and is now the exclusive representative of all employees in the said unit for the purpose of collective bargaining with respect to rates of pay, hours of employment, and other terms and conditions of employment, by virtue of Section 9(a) of the Act. (3) Under circumstances herein described, where the labor organization is the exclusive representative of all employees in an appropriate unit, the subject of an exclusive, nondiscriminatory referral system for applicants for employment is an ap- propriate and mandatory subject for collective bargaining. (4) There is no merit to the contention of the Respondents and the attorney general of Texas that the Board is without jurisdiction in this matter because a State court has already ruled that such a referral system is prohibited by State statute. (5) The chief issue in this proceeding is not moot. (6) By failing and refusing to negotiate in good faith with the Charging Union concerning the mandatory subject herein described, the Respondents have interfered with, restrained, and coerced employees in the exercise of rights guaranteed by Section 7 of the Act. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondents , set forth in section III, above, occurring in con- nection with the operations of the Respondent described in section I, above, have a close, intimate, and substantial relation to trade, traffic , and commerce among the several States , and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. Upon the basis of the foregoing findings of fact and upon the entire record in the case, the Trial Examiner makes the following: CONCLUSIONS OF LAW 1. Construction and General Laborers Union, Local No. 18, International Hod Carriers, Building and Common Laborers Union, AFL-CIO, is a labor organization within the meaning of Section 2(5) of the Act. 2. All hod carrier and laborer employees of the members and associate members of the Respondent AGC and the Respondent CEA, exclusive of all supervisors as 9 This fact disposes of the Respondents ' argument to the effect that an "impasse" in negotiations on the point was reached There were no negotiations , as the term applies to collective bargaining, on the matter of an exclusive referral system 426 DECISIONS OF NATIONAL LABOR RELATIONS BOARD defined in the Act, constitute a unit appropriate for the purposes of collective bar- gaining within the meaning of Section 9 (b) of the Act. 3. By virtue of Section 9(a) of the Act the said labor organization has been since 1955, and now is, the exclusive representative of all employees in the said unit for the purpose of collective bargaining with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment. 4. By refusing, since October 5, 1961, to bargain collectively in good faith with the said labor organization as the exclusive representative of all employees in the said appropriate unit, the Respondents have engaged in and are engaging in unfair labor practices within the meaning of Section 8(a) (5) of the Act. 5. By interfering with, restraining, and coercing employees in the exercise of rights guaranteed by Section 7 of the Act, the Respondents have engaged in and are en- gaging in unfair labor practices within the meaning of Section 8(a)(1) of the Act. 6. The aforesaid unfair labor practices are unfair labor practices within the mean- ing of Section 2 (6) and (7) of the Act. THE REMEDY Having found that the Respondents have engaged in unfair labor practices the Trial Examiner will recommend that they cease and desist therefrom and take certain affirmative action to effectuate the policies of the Act. It will be recommended that the Respondents, upon request, bargain in good faith with the Charging Union on all matters concerning wages, hours, and conditions of employment, including a nondiscriminatory referral system, and, if an understanding is reached, embody such understanding in a signed agreement. RECOMMENDATIONS Upon the basis of the above findings of fact and conclusions of law, and upon the entire record, the Trial Examiner recommends that Houston Chapter, Associated General Contractors of America, Inc., and Construction Employers' Association of Texas, their officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Refusing to bargain collectively with Construction and General Laborers Union, Local No. 18, International Hod Carriers, Building and Common Laborers Union, AFL-CIO, as the exclusive representative of all their employees in the following appropriate unit: All hod carriers and laborer employees of the members and associate members of AGC and members of CEA, exclusive of all supervisors as defined in the Act. (b) In any like or related manner interfering with, restraining, or coercing em- ployees in the exercise of the right to self-organization, to form labor organizations, to join or assist the above-named or any other labor organization, to bargain col- lectively through representatives of their own choosing, and to engage in other con- certed activities for the purpose of collective bargaining or other mutual aid or pro- tection, or to refrain from any or all such activities. 2. Take the following affirmative action: (a) Upon request, bargain collectively with the above-named labor organization as the exclusive representative of the employees in the above-named described appropri- ate unit, upon wages, hours, and other terms and conditions of employment, includ- ing an exclusive, nondiscriminatory referral system, and embody any understanding reached in a signed agreement (b) Post at its offices in Houston, Texas, copies of the attached notice marked "Appendix."'() Copies of said notice, to be furnished by the Regional Director of the Twenty-third Region, shall, after being duly signed by the Respondents, be posted by them immediately upon receipt thereof and maintained by them for 60 consecutive days thereafter in conspicuous places Reasonable steps shall be taken by the Re- spondents to insure that said notices are not altered, defaced, or covered by any other material Signed copies of said notice, also, shall be returned to said Regional Director, for transmission to the labor organization herein involved and for posting, said labor organization willing, at its regular meeting halls for members. lU In the event that this Recommended Order be adopted by the Board, the words "A De- cision 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 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 " EAST TEXAS PULP AND PAPER COMPANY 427 (c) Notify the Regional Director for the Twenty -third Region in writing within 20 days from the date of the service of this Intermediate Report what steps the Re- spondents have taken to comply herewith.I" "In the event that this Recommended Order be adopted by the Board , this provision shall be modified to read : "Notify said Regional Director , In writing, within 10 days from the date of this Order, what steps the Respondents have taken to comply herewith." 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, as amended , we hereby notify you that: WE WILL NOT refuse to bargain in good faith with Construction and General Laborers Union, Local No. 18, International Hod Carriers , Building and Com- mon Laborers Union , AFL-CIO, as the exclusive representative of all employees in the following appropriate unit: All hod carrier and laborer employees of our members and associate members, exclusive of all supervisors as defined in the Act. WE WILL NOT in any like or related manner interfere with, restrain, or coerce employees in the exercise of rights guaranteed them by Section 7 of the Act. WE WILL, upon request, bargain collectively in good faith with the above- named labor organization concerning all matters relating to wages, hours, and other terms and conditions of employment , including a nondiscriminatory ex- clusive referral arrangement , and embody any understanding reached in a signed agreement. HOUSTON CHAPTER, ASSOCIATED GENERAL CONTRACTORS OF AMERICA, INC., Employer. Dated---------- --------- By------------------------------------------- (Representative) (Title) CONSTRUCTION EMPLOYERS' ASSOCIATION OF TEXAS, Employer. Dated------------------- By------------------------------------------- (Representative) (Title) This notice must remain posted for 60 days from the date hereof, and must not be altered, defaced, or covered by any other material. Employees may communicate directly with the Board's Regional Office, 650 M & M Building, 1 Main Street, Houston, Texas, 77002, Telephone No. Capitol 2-7201, Extension 041, if they have any question concerning this notice or compliance with its provisions. East Texas Pulp and Paper Company and Ike E. Baugh. Case No. 23-CA-1472. June 28, 1963 DECISION AND ORDER On March 25,1963, Trial Examiner William Seagle issued his Inter- mediate Report in the above-entitled proceeding, finding that the Re- spondent 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 Inter- mediate Report. The Trial Examiner also found that the Respondent had not engaged in certain other unfair labor practices as alleged in the complaint and granted the Respondent's motion to dismiss these 143 NLRB No. 55.