Freeman Manufacturing Co.

FREEMAN MANUFACTURING COMPANY 577 situation, we would find that such group bargaining as took place was for the convenience of the employers and unions involved, and was not undertaken with the intention of establishing a multiemployer unit. It logically follows that as a multiemployer unit did not exist, there was no necessity for the Employer to "withdraw" from such non- existent unit. Accordingly, we would not dismiss the petition, but would, instead, direct an election in the petitioned-for unit limited to employees of the Employer. Freeman Manufacturing Company, Employer and District No. 117, International Association of Machinists , AFL-CIO, Peti- tioner. Case No. 7-RC,-6150. August 27, 196. DECISION AND, CERTIFICATION OF RESULTS OF ELECTION Pursuant to the provisions of a stipulation for certification upon consent election, an election by secret ballot was conducted by the Regional Director for the Seventh Region on March 11, 1964, among the employees in the stipulated unit. After the election the Regional Director served upon the parties a tally of ballots which showed that of approximately 193 eligible voters, 178 votes were cast, of which 86 were for, and 89 were against, the Petitioner, no ballots were void, and 3 ballots were challenged. The challenges were insufficient in number to affect the results. Thereafter, the Petitioner filed objections to conduct affecting the results of the election. In accordance with the Board's Rules and Regulations, Series 8, as amended, the Regional Director conducted an investigation, and, on April 10, 1964, issued and served upon the parties his report on objec- tions, in which he found merit in the Petitioner's objection and recom- mended that the election be set aside and a new election held. The Employer filed timely exceptions to the Regional Director's report and recommendations. Upon the entire record in this case, the Board' finds : 1. The Employer is engaged in commerce within the meaning of the Act and it will effectuate the purposes of the Act to assert jurisdic- tion herein. 2. The Petitioner is a labor organization claiming to represent cer- tain employees of the Employer. '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 [ Chairman McCulloch and Members Brown and Jenkins]. 148 NLRB No. 68. 760-577-65-vol. 148-38 578 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 3. A question affecting commerce exists concerning the representa- tion of employees of the Employer within the meaning of Section 9(c) (1) and Section 2(6) and (7) of the Act. 4. The parties stipulated, and we find, that the following employees of the Employer constitute a unit appropriate for the purposes of col- lective bargaining within the meaning of Section 9 (b) of the Act : All production and maintenance employees employed by Freeman Manufacturing Company in Sturgis, Michigan, excluding office clerical employees, plant-clerical employees, professional and technical employees, production experimental and design em- ployees, fitters, mechanical experimental and design employees, production control employees, guards, and supervisors as defined in the Act. 5. The Petitioner's objection relates to a letter sent to employees by the Employer prior to the election, allegedly containing an implied threat of loss of business and resulting loss of jobs if the employees voted for the Petitioner. The Regional Director's investigation revealed that the Employer sent letters to employees dated February 27 and March 2, 4, 5, 6, 7, and 9. The March 9 letter had an attachment dated March 5. The attachment, to which Petitioner specifically objects, is a purported communication from the Employer's sales manager to Its top execu- tive and states the following : Since nearly 50 percent of our sales are through Sears and since I am responsible for generating and maintaining these sales, I hope you will accept my opinion on the problems we may face if the union vote goes against us. As well you know, competition with over 400 corset and bra manufacturers is severe, cut-throat and many times impossible 'to overcome. The future looks even more difficult because the giants in our industry such as Formfit, Warners, Gossard and Maidenform have, within the last year, formed separate com- panies solely to solicit business from our chief customer, Sears, Roebuck and Company. Because of their large designing and manufacturing facilities and extensive sales forces, they are ex- tremely tough competition for a small company such as ours. Our ability to compete with these giants and all others is absolutely dependent upon our ability to deliver and to maintain quality and price levels. I know that any interruption in delivery would result in the immediate transfer of the business to any one of dozens of manu- facturers who are ready, willing and able to take' over our share (,r FREEMAN MANUFACTURING COMPANY 579 of the business at a moment's notice. The resultant loss of jobs due to the cancellation of orders would be fatal to our company. If our largest buyers, such as Sears, think that union activity could possibly affect our dealings with them in any way, it will be much harder, if not impossible, to sell them. The business we now have has not come easily. It has built up gradually over the years and is the result of experience, long hours of work in designing, fitting and sampling and almost weekly trips to Chicago to fight for a,share of the market. You well know that we have no control over the buying decisions of Sears and that the volume of, orders • we get depends solely on customer acceptance. All items, sold to Sears are always on,a trial basis; and even successful items are constantly subject to being dropped or re- placed by competitive styles. As a matter of fact, some of our garment styles that have been accepted have been disconttinued before the selling season. In other words, Sears' business is always vulnerable and can be maintained only by constant re- styling and repricing.' Our problems now are difficult. But I believe they will be- far greater if the Company is Unionized. Therefore,•I sincerely hope the employees will vote "no." The Employer's letter of February 27 expressed its opposition to the Union and explained that, by law, the Employer could make no promises to its employees. It also encouraged all eligible employees to vote. The March 2 letter explained to the employees that the Em- ployer has a personal interest in their welfare, that it fulfilled a com- munity need by providing steady employment for its employees as well as temporary work without the restriction of union membership, and that it did not know what employee dissatisfactions could have caused the interest in unionization. The final paragraph of the March 2 letter stated' in part, that "Our company has survived its com- petition and has grown because all of us working together have ef- ficiently produced quality products for delivery when our customers wanted them." - The March 4 letter repeated the Employer's ignorance of employee dissatisfactions, that gave rise to interest in the Union and the Em- ployer's inability to' make any changes lest it commit unfair labor practices. The March 5 letter was a reply to a union handbill which was in answer to the Employer's February 27 letter. It reiterated the Employer's interest 'in the welfare of its employees and pointed out that the Union's only source of income is dues, fees, as'sessments, etc., and that regardless of promises made the union can only secure benefits for its members through the. give and take of collective bargaining. 580' DECISIONS OF NATIONAL LABOR • RELATIONS BOARD The March 6 letter dealt with job security and contained the follow- ing paragraphs : Regardless of what specific job you may be performing, most of you work for one customer. Many of you work only on girdles. If Sears were dissatisfied with our quantity, our deliveries or our prices, they could dwnap us as a supplier in a moment. We have no long term contract with them. We depend upon this business almost on a day to day basis. If they switched to another sup- plier, imagine how many jobs would be discontinued. Suppose Kimberly-Clark decided to buy their belts-elsewhere, which they would do almost without notice if they so chose. If they did this, just think how many jobs would be discontinued. This same thing could happen with our other products, our other customers. If the customers do not buy, there are no jobs and hence no job security. There is no way in the world a union can make our customers continue to buy from us. But a union can make jobs insecure if it insists that an employer engage in .practices which adversely affect quality, delay deliveries or result in higher prices for the product. The customer is the boss. He will place his business where he wishes. While we are on this subject, there is another way a union can contribute to the insecurity of jobs. That is by inducing em- ployees to strike. Every account of any substance that we have would desert us like a sinking ship if we were struck. Our cus- tomers are not concerned about you, us or the company. They only want a reliable source of supply and, with as many suppliers as there are who are eager for the business, they would not hesitate to permanently ditch this company. The March 7 letter again pointed out to employees that there is 'the possibility the Union may not be able to negotiate the changes it has promised the employees. The March 9 letter stated that the Em- ployer's profit margins were not large, that it is a small company in a highly competitive field, that it is completely dependent upon a few large customers, and that job security depends upon the Employer's ability to satisfy its customers at prices the customers are willing to pay. The Regional Director's investigation further revealed that the Petitioner also sent to employees a series of letters and distributed handbills. These communications for the most part answered spe- cifically the arguments against unionization presented by the Em= ployer and gave reasons why the employees should vote for the Peti- tioner. They stressed the advantages of collective bargaining through a chosen representative, that strikes can be called only by a three- FREEMAN MANUFACTURING COMPANY 581 fourths majority, that under the law, the Employer has a duty to bar- gain over layoffs, seniority, and benefits, and that Federal law protects employees in the event of plant closure. Viewing the Employer's statements in their total context, the Regional Director, relying on Carl T. Mason Co., Inc., 142 NLRB 480, in which the Board was concerned with related type preelection statements, was of the opinion that the March 9 letter and attachment was the culmination of a series of communications that had the impact of instilling "a clear fear in the employees that their future welfare would not truly be served by designation of the Petitioner as their bargaining representative." The Regional Director found that the basic subject matter of the objections had its origin in the above-quoted portions of the March 2 letter, was expanded in the March 6 letter, quoted above, and culminated in the March -9 letter with its attach- ment. He concluded that the March 9 communication, taken alone or in context with the preceding series of letters, contained the implied threat that "introduction of a union into the Employer's business op- erations would be the principal, if not only, cause for future insecurity, loss of employment or complete elimination of the Employer from the competitive scene," and that this threat interfered with the free choice of the employees. The fact that the Petitioner had an op- portunity to respond in detail to the Employer's written statements, in the opinion of the Regional Director, did not remove the adverse impact of such statements. Accordingly, he recommended that Peti- tioner's objection be sustained and the election set aside. We do not agree. We have read the letters of the Employer in, their entirety and have considered not only their contents, but their timing, the op- portunity for the Petitioner to respond, and its actual responses thereto. Contrary to the Regional Director and our dissenting col- league, we conclude that under all the circumstances the Employer's letters differed in tone, context, and impact from the type of preelec- tion propaganda relied upon by the Regional' Director in setting the election aside. The issue of loss of business and a resultant reduc- tion in the work force was fully brought to the attention of the employees by the electioneering of both the Employer and the Peti- tioner.2 In our opinion, the Employer's letter could clearly be eval- uated by the employees as partisan electioneering and was within the permissible limits of campaign propaganda 3 The Employer's z Contrary to the implication in the dissenting opinion , we do not question the validity of the principle that employer coercion is neither legitimatized nor diluted by a union's opportunity to respond Our point of departure is our inability to agree with the dissent that the Employers statements , read in context and considered in their entirety , consti- tuted threats of reprisal 3 See American Greetings Corporation, 146 NLRB 1440 ; Arch Beverage Corporation, 140 NLRB 1385 582 DECISIONS OF NATIONAL LABOR RELATIONS BOARD statements set forth its economic and competitive position in the in- dustry and presented this information in a noncoercive manner. Ac- cordingly, we shall overrule the Petitioner's objection and certify the results of the election. [The Board certified that a majority of the valid votes was not cast for District No. 117, International Association of Machinists, AFL- CIO, and that said labor organization is not the exclusive representa- tive of the employees in the unit found appropriate.] MEMBER BROWN, dissenting : I agree with the Regional Director's conclusion that the Employer's preelection comment interfered with the employees' exercise of free choice. In its March 6 letter the Company clearly threatened its employees with an inevitable cutback in jobs if unionism occurred, and further underlined this theme by predicting that it was unlikely to make any effort to seek added opportunities after it was "deserted" by its present accounts. The Employer concluded this letter with the following paragraphs-omitted by my colleagues in their recitation of its con- tents-warning of the results of any strike : Maybe some of our employees would like to see such things occur. We hope that most of you would not. If we were to be struck and thus lose practically all of our business, there would be practically no jobs for the employees. We seriously doubt that we would have the energy or desire to go to the effort to start all over from scratch to rebuild the business. The organizers will probably try to' convince you that what we are saying is "hog-wash." It isn't. The March 9 letter amplified the hazards of voting for the Union, and continued to stress the tenuous nature of the employees' job security. Attached to this communication was -an appeal by the Company's sales manager, quoted by my colleagues,` again emphasizing that the advent of a union would likely cause customers to go to other sup- pliers. He noted that "The resultant loss of jobs due to the cancella- tion of orders would be fatal to our company." In certain circumstances, an employer may have some justification for relating its competitive market position to employees. But when this information is relentlessly brought home to the employees, coercion replaces fact and fear dominates reason. In my opinion, the record leaves no doubt that the Employer's campaign tended to instill in its employees a fear of imminent job loss if they voted for the Union. Furthermore, the Board again is departing from its well- GARDEN SUPER MARKET, INC. 583 founded principle by legitimizing the Employer's conduct because the Union also reached the employees with its campaign material. Comment amounting to threats is not diluted by such means, for threats by one having economic control over the voters cannot be dispelled or abated by a response from any outside source.4 The fact that a party has an opportunity to respond is material only in deter- mining whether a misrepresentation warrants setting an election aside. Time to reply is immaterial where interference with an elec- tion occurs by other conduct, such as threats or the undue creation of fears of economic loss. As set forth in my dissenting opinion in Sivure Brothers, Incorporated,' the rationale behind this difference is the fact that misrepresentations are appeals to reason based on er- roneous facts, whereas other types of improper campaign material have their impact by generating fear. Misstatements of fact possi- bly can be met by the supplying of correct information, but an emo- tional reaction of fear is not responsive to denials or explanations and cannot be dissipated or counterbalanced by factual replies. Here the Employer's sustained emphasis on the probability of job loss if the Union were certified could only prevent the uncoerced vote which the Act envisions. Accordingly, I would direct the Regional Director to hold another election. 6 Oak Manufacturing Company . 141 NLRB 1323; see also Trent Tube Company, Sub- sidiary of Crucible Steel Company of America, 147 NLRB 538 (dissenting opinion). 6147 NLRB 43. Garden Super Market, Inc. and Retail Clerks Union, Local 1015, Retail Clerks International Association , AFL-CIO. Case No. 17-CA-4337. August 28, 1964 DECISION AND ORDER On May 5, 1964, Trial Examiner Robert E. Mullin issued his De- cision 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 Trial Examiner's De- cision. Thereafter, the Respondent filed exceptions to the Trial Ex- aminer's Decision with a supporting brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, the Board has delegated its powers in connection with this case to a three-member panel [Chairman McCulloch and Mem- bers Fanning and Jenkins]. The Board has reviewed the rulings of the Trial Examiner made at the hearing and finds that no prejudicial error was committed. 148 NLRB No. 64.