Schill Steel Products, Inc.

SCHILL STEEL PRODUCTS, INC. 939 workweek, with 10.2 such weeks at $78.61 per week between April 1 and June 13, 1961, less $535.54 interim earnings. As indicated, we find merit in the General Counsel's motion for reconsideration and, in accord with the computations above, conclude that Woodrow Wilson is entitled to backpay in the amount of $2,144.74, with interest at the rate of 6 percent per annum from the date of the Trial Examiner's Supplemental Decision. We shall make the necessary correction to effectuate this award. ORDER The tabulation in the Appendix to the Trial Examiner's Decision in backpay proceeding is hereby corrected in accord with the com- putations indicated above to show backpay indebtedness to Woodrow Wilson in the amount of $2,144.74. Schill Steel Products, Inc. and United Steelworkers of America, AFL-CIO. Case 23-CA-2276. November 14, 1966 DECISION AND ORDER On June 8, 1966, Trial Examiner William W. Kapell issued his Decision in the above-entitled proceeding, finding that the Respond- ent had engaged in and was engaging in certain unfair labor prac- tices and recommending that it cease and desist therefrom and take certain affirmative action, as set forth in the attached Trial Examiner's Decision. Thereafter, the Respondent filed "Exceptions and Objec- tions" to the Trial Examiner's Decision and a supporting brief. Pursuant to the provisions of Section (3) (b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its powers in connection with this case to a three-member panel [Chairman McCulloch and Members Brown and Zagoria]. The Board has reviewed the rulings of the Trial Examiner at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Board has considered the entire record in this case, including the Trial Examiner's Decision, the exceptions, and the brief, and hereby adopts the findings, conclusions, and recom- mendations of the Trial Examiner to the extent consistent herewith. In May 1962, United Steelworkers of America, AFL-CIO, herein called the Union, began organizing the Respondent's employees, and on August 31, 1962, was certified by the Board as their exclusive rep- resentative for the purposes of collective bargaining.' Thereafter, on 1 Case 23-RC-1917 , not published in NLRB volumes. 161 NLRB No. 83. 940 DECISIONS OF NATIONAL LABOR RELATIONS BOARD February 8, 1963, the Board found the Respondent had interfered with, restrained, and coerced, and discriiuinatorily discharged employ- ees in violation of Section 8(a) (1) and (3) of the Act.2 On August 20, 1963, the Board found that the Respondent had committed additional violations of Section 8(a) (1) and (3), and had also unlaw- fully refused to recognize and bargain with the certified Union in violation of Section 8(a) (5) of the Act.3 To remedy the unfair labor practices found, the Board ordered the Respondent, inter alia, to recognize and bargain with the Union upon request. Respondent, how- ever, continued to refuse to bargain with the Union on the grounds that the unit designated in the Board's certification was inappro- priate. On January 11, 1965, the Court of Appeals for the Fifth Cir- cuit issued its decision ,4 and on February 2, 1965, its decree, enforcing the Board's orders in both unfair labor practice proceedings, includ- ing its order to bargain. On January 13, 1965, the Respondent advised the Union that it was now willing to recognize the Union pursuant to its certification of August 31, 1962, and requested a meeting date to begin negotiating a collective-bargaining agreement. On February 2, 1965, the parties met for their first bargaining session, and thereafter held about 18 ses- sions. On December 15, 1965, Respondent's attorney, Scott, submitted to the Union two proposed contracts which differed from each other in certain aspects. On January 13, 1966, Union Representative Ray visited Scott's office, accepted one of the Respondent's proffered con- tracts with certain modifications to which Scott agreed, and signed the contract, which was to be effective from December 31, 1965, until December 31, 1966. Scott said that he would get the Company to sign as soon as possible, and would contact Ray within 1 to 4 days. On January 14, Scott met with the Respondent's president and personnel manager, who raised no objections to the contract but expressed doubt that the Union still retained its majority status. On January 17, Scott telephoned Ray and advised him that the Respondent had filed with the Board a representation petition because it was of the opinion that the Union did not represent a majority of its employees, and that it would sign the contract if the Union won the election. The Union hereupon filed the charge which resulted in the instant proceeding. The Trial Examiner found, and we agree, that the parties reached agreement on the terms and conditions of the contract, and that the Respondent did not have a reasonable basis for its alleged doubt of the Union's majority status. The Board and the court have ordered the Respondent to bargain with the Union as it is required to do by 2140 NLRB 1164. 3144 NLRB 69. 4 340 F.2d 568 (C.A. 5). SCHILL STEEL PRODUCTS, INC. 941 Section 8(a) (5) of the Act. Section 8(d) of the Act defines the obli- gation imposed by Section 8(a) (5) as including "the execution of a written contract incorporating any agreement reached if requested by either party." Accordingly, we find, in agreement with the Trial Examiner, that by refusing, without justifiable reason, to execute the contract to which it had agreed, the Respondent violated Section 8(a) (5) and (1) of the Act. THE REMEDY The Board has a particular duty under Section 10(c) to tailor its remedies to the unfair labor practice which has occurred and thereby effectuate the policies of the Act. Thus, depending on the circum- stances of each case, the Board must "take measures designed to recreate the conditions and relationships that would have been had there been no unfair labor practice." 5 With this in mind, we have care- fully considered all the circumstances of this case, including the Respondent's history of serious unfair labor practices and the nature of the violation found herein, and have concluded that it will best effectuate the policies of the Act to modify the remedy recommended by the Trial Examiner by ordering the Respondent to reimburse the employees, with 6 percent interest per annum thereon, for the loss of any benefits which would have accrued to them under the contract which the Respondent refused to sign; and, in the event the Union requests the Respondent to sign the aforesaid contract, the expiration date thereof be extended until 1 year subsequent to the date on which the Respondent signs it.° [The Board adopted the Trial Examiner's Recommended Order with the following modifications. [1. In paragraphs 1(a) and 2(a) delete the words "comply with its terms retroactively to December 31, 1965" and substitute therefor the words "put into effect and abide by its terms until 1 year subse- quent to the date on which the Respondent signs it." [2. Renumber the present paragraph 2(b) as .2(c) and add the fol- lowing as paragraph 2(b) : [" (b) Reimburse all employees covered by the aforesaid contract, together with 6 percent interest per annum thereon , for the loss of any benefits which would have accrued to them under the contract which the Respondent refused to sign." [3. In the first paragraph of the notice, delete the words "retro- active to December 31, 1965" and substitute the words "effective until 1 year subsequent to the date on which we sign it." 5 See H. W. Elson Bottling Company, 155 NLRB 714, and cases cited therein. 6 N.L.R.B. v. Warrensburg Board & Paper Corp., 340 F.2d 920 (C.A. 2). 942 DECISIONS OF NATIONAL LABOR RELATIONS BOARD [4. Add the following to the notice as the second paragraph : [WE WILL reimburse all employees covered by the above con- tract, together with 6 percent interest thereon, for the loss of any benefits which would have accrued to them under the contract which we refused to sign.] TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE Case 23-CA-2276, a proceeding under Section 10(b) of the National Labor Relations Act, as amended , herein called the Act, was heard before Trial Examiner William W. Kapell in Houston, Texas, on April 18 and 19, 1966,1 with all parties participating pursuant to due notice on a complaint 2 issued on February 23, by the Regional Director of Region 23 of the National Labor Relations Board , herein- after called the Board, alleging violations of Section 8(a)(5) and ( 1) of the Act by Schill Steel Products, Inc., hereinafter called the Respondent. The complaint, in substance, alleges that since on or about January 13, Respondent has failed and refused to bargain in good faith with the Union as the exclusive bargaining repre- sentatives of its employees by refusing to sign a written collective -bargaining agree- ment agreed upon between them . In its duly filed answer Respondent denies that it committed the aforesaid violations , and also denies that the Union continues to be the exclusive bargaining representative of its employees. All parties were represented and afforded full opportunity to be heard , to intro- duce relevant evidence, to present oral argument, and to file briefs. General Counsel and Respondent filed briefs which have been duly considered. Upon the entire record 3 in the case and from my observation of the witnesses, I make the following: FINDINGS OF FACT 1. THE BUSINESS OF RESPONDENT Respondent is, and has been at all times material herein, a corporation duly organized under and existing by virtue of the laws of the State of Texas, having its principal office and warehouse at Houston , Texas, and with branch warehouses at Dallas and Odessa, Texas, and is engaged in business as a steel and metal prod- ucts distributor. During the past 12 months, a representative period, Respondent in the course and conduct of its business operations purchased goods and materials valued in excess of $50,000, which was shipped to its Texas facilities from points and places outside the State of Texas . During the same period, Respondent sold and shipped from its Texas facilities goods and materials valued in excess of $50,000 to points and places in States other than the State of Texas . Respondent admits, and I find , that at all times material herein it has been engaged in com- merce within the meaning of the Act. H. THE LABOR ORGANIZATION INVOLVED Respondent admits, and I find, that the Union is a labor organization within the meaning of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. Background In May 1962 the Union began organizing Respondent's employees. In August of that year the Union filed charges (Case 23-CA-1445 ) alleging that Respondent engaged in unfair labor practices in violation of Section 8(a)(1) and (3) of the 1 All dates hereinafter refer to the year 1966 unless otherwise noted. 2 Eased on a charge filed on January 17, by United Steelworkers of America , AFL-CIO, hereinafter referred to as the Union. B Upon an unopposed motion by General Counsel during the hearing , paragraph 10(b) of the complaint was withdrawn . Respondent's unopposed motion and supplemental motion to correct the transcript are hereby granted, and the record is hereby corrected as moved. SCHILL STEEL PRODUCTS, INC. 943 Act. Following a hearing based upon a complaint issued thereon on August 1, 1962, the Board , rendered its decision 4 on February 8, 1963 , finding Respondent in viola- tion as charged, and ordered its usual and customary relief. Pursuant to a Board -conducted election held on August 23, 1962 , the Union was certified on August 31, 1962, as the collective-bargaining representative of Respond- ent's production, maintenance , truckdriver, and plant clerical employees . During the latter part of 1962, the Union again filed charges (Cases 23-CA-1498 and 23-CA- 1535) against Respondent alleging new 8 (a)(1) and ( 3) violations, and also 8(a)(5) violations based on Respondent's unlawful refusal to recognize and bar- gain with it as the certified union of its employees . On August 20, 1963 , the Board issued its decision 8 in said cases finding Respondent in violation as charged and ordering it, inter alia, to recognize and bargain with the Union upon request. Respondent, however, continued to refuse to bargain with the Union , initially assertedly on the ground that the unit designated in its certification was inappropri- ate for purposes of collective bargaining .6 Thereafter, the Board sought enforce- ment of its aforesaid two orders against Respondent , and on January 11, 1965, the Court of Appeals for the Fifth Circuit issued its decision 7 enforcing those orders, which, inter alia, required Respondent to bargain with the Union , and if an under- standing is reached , embody such understanding in a signed agreement . A decree of the court was entered on February 2, 1965. B. Sequence of events By letter of January 13, 1965, Respondent advised Ray, the union representative, that it was willing to recognize the Union pursuant to its certification of August 31, 1962, and requested a meeting date to begin negotiating a collective-bargaining agreement. In or about February 24, 1965, the parties met for their first bargain- ing session, and thereafter held about 18 sessions. Ray and a committee of three employees represented the Union, while John Miller, Respondent's personnel man- ager, and Henry L. Scott, its attorney, represented Respondent. By about mid- November 1965, the parties had reached agreement upon all contract provisions with the exception of the checkoff, daily overtime pay, arbitration, and insurance provisions. Following a telephone conversation with Scott about December 1, 1965, concerning their contract differences, Ray, pursuant to Scott's request, sent a letter to him proposing the Union's willingness to accept Respondent's arbitration pro- vision in return for a standard checkoff provision, overtime pay for work in excess of 8 hours a day, and a continuation of the insurance already carried by Respond- ent for its employees. By reply letter of December 3, 1965, Scott refused to accept the Union's overtime pay 8 and checkoff proposals, requested further clarification of its arbitration proposals (Respondent had proposed either a voluntary or a com- pulsory arbitration provision and Ray had not clearly indicated his preference), and stated that he would advise Respondent of the Union's position, and would thereafter get in touch with him. Ray left Houston on December 11, 1965, to visit his son who had just returned from overseas Navy duty and was then residing in the area of the Great Lakes with his family. Prior to leaving Houston, Ray had informed Scott of his forth- coming visit to his son .9 Ray returned to Houston on January 3, and found a letter from Scott dated December 15, 1965, transmitting a copy of each of two proposed contracts. The letter related that Respondent was receptive to daily overtime pay for work in excess of 11 hours, but adhered to its checkoff provisions.10 The contracts differed 4140 NLRB 1164. 5 144 NLRB 69. O Respondent also, thereafter, defended its refusal to bargain on technical grounds be- fore both the Board and the court. 7 340 F.2d 568. 8 The Union had sought a provision for overtime pay for work in excess of 8 hours a day, while Respondent had insisted on overtime pay for work in excess of 12 hours a day. 8 Scott admitted being told about the trip, but denied being advised as to «liere Ray was going or how long he would be away, and only learned these details on January 11, when he next talked to Ray. 18 This provision required a new authorization to be executed by each employee after the contract was signed, which was to be submitted by the employee to the Company, and also permitted employee revocation of the checkoff authorization 944 DECISIONS OF NATIONAL LABOR RELATIONS BOARD with respect to the arbitration provision and related discharge clause; one was voluntary, the other mandatory, either of which was acceptable to Respondent. The letter also stated that either contract was its final offer, that the contract be for a year's duration from its date of execution, that the Union take whatever steps was necessary, if any, for approval of the desired contract by its membership, and that he, Scott, be notified immediately when Ray was prepared to sign the contract. The following day Ray discussed Respondent's contracts with the Union's regional director and its attorney, James P. Wolf, and he was authorized to accept the con- tract containing the mandatory arbitration provision. The next day, January 5, and on the following few days, Ray called Scott at his office, but was advised that he was out. On January 11, Scott returned Ray's call, after learning the previous day that Ray had been attempting to reach him. In this conversation Ray advised Scott that the Union could agree to the contract but suggested that they meet first to straighten out a couple of items. Before he could specify what items he had in mind, Scott retorted that he was not going to meet with him any more, that the Company was tired of meeting with him, that they had been meeting for a year, and that if he wanted either contract he should sign and return it and he would get the Company to sign it. Ray then mentioned that' he had in mind to discuss with him correcting the Union's name," and deleting the contract clause providing for overtime pay for hours of work in excess of 11 hours a day 12 (the contract also had another provision for the overtime pay computed on the basis of hours in excess of 40 a week). Scott again declined to meet with him and reiterated his objections. Ray then threatened to file charges with the Board of refusal to bar- gain, and Scott replied that he could not see that anything would be gained by meeting, and explained that one contract provided for compulsory arbitration with a court-appointed arbitrator while the other provided for arbitration only by mutual agreement. Ray, thereupon indicated that he desired the contract containing the compulsory arbitration provision, and advised Scott that he was going to write to him confirming their conversation and wanted an answer in writing as to whether he was refusing to meet with him. The following day, January 12, Ray informed Union Attorney Wolf of the events of the preceding day and asked for his assistance in drafting a letter to Scott. Wolf suggested first calling Scott to discuss the matter further, and then telephoned twice to Scott within a half-hour period, advising him in the second conversation that he had convinced Ray to accept one of the contracts but that he, Ray, wanted to take out the daily 11-hour overtime clause and correct the Union's name, and would then be willing to sign the contract, and that Ray would call at his (Scott's) office the following morning to sign and deliver a copy of the contract. The next morning, January 13, Ray visited Scott's office and told him he was ready to sign the contract containing the compulsory arbitration provision but then discovered that he had left that contract in his car and had the other one with him. He volun- teered to go back to his car to get it, but Scott produced another copy of the miss- ing contract, and asked Ray to make the necessary insertions in the blanks appear- ing therein with respect to date of execution, notice to terminate and date of termination . Following a discussion on these points, it was agreed that Decem- ber 31, 1965, should be inserted for the date of execution, and that the duration of the contract be for 1 year to expire on December 31, 1966,, with a 60-day notice to terminate on October 31. Ray also deleted the clause in the contract pertaining to daily overtime work for hours in excess of 11, and initialed that change in the margin. After correcting the name of the Union and inserting the necessary dates, Ray signed the contract and handed it to Scott, who then advised him that Miller (Respondent's personnel manager) was out of town and he would get the Company to sign the contract upon his return and would contact him, Ray, on either the following day, January 14, or on the 17th.13 Ray then left Scott's office and upon reaching his car conformed his copy of the contract, which he had left there, to the copy he had signed. The next day, January 14, Scott met with Miller and John S. Shill, Respondent's president, to discuss the contract. No objections were raised regarding any pro- visions of the contract, but Miller expressed doubt as to whether the Union still "The contract proposal (p 22) referred to the Union as the United States Steelworkers "The Union had unsuccessfully bargained for overtime pay in excess of 8 hours a day 13 Scott contradicted Ray's testimony, related above, that he would get the Company to sign the contract, and asserted that he told Ray he would submit the contract to the Company for is approval. SCHILL STEEL PRODUCTS, INC. 945 retained its majority status and whether the Company could refuse to- sign the con- tract in view of that doubt. Scott advised them that they could request another election to determine the status of the Union if it could be shown that they had a reasonable doubt about the Union's majority status before being obligated to sign a contract, or even recognize the Union because a reasonable period of bargaining had transpired without having entered into an agreement. Respondent thereupon, decided to seek a new election and declared its readiness to sign the contract with the changes sought by the Union, if the Union won the election. On Monday, January 17, Scott called Ray and advised him that Miller had gone to the Board and petitioned for a representation election 14 because the Company was of the opinion that the Union did not represent the majority of its employees, and that they would sign the contract if the Union won the election. Ray refused Scott's request to consent to an election and filed the pending charges against Respondent. On January 18 Ray received a letter from Scott (General Counsel's Exhibit 15) explaining Respondent's position with respect to the contract Ray had signed and delivered the previous Thursday with the request that the Company sign it, not- withstanding his failure to have signed and returned the contract prior to Decem- ber 31, 1965, that in view of the excessive period of time elapsed without any indication from him as to whether or not the contract was acceptable, and the fact that the parties had engaged in good-faith bargaining for a year since the court's decree and the Company's recognition of the Union, the Company doubted the Union's majority status and declined to execute a contract with it unless and until it could prove that it continued to represent a majority of its employees in the bargaining unit, and the Company had therefore filed a petition for a representation election. On February 2 Ray replied to this letter setting forth that on January 12 the Union advised Scott on the telephone that it was accepting the Company's con- tract proposal, that on the following day the Union delivered a signed copy of this proposal to Scott, and that accordingly, the Union has a contract in full force and effect despite Respondent's repudiation thereof. Ray received a reply dated Febru= ary 7 from Respondent, stating that the contract offer made to the Union was 'for a 1-year term to be executed and placed in effect by the parties prior to the end of 1965, that the Union failed to accept or execute said contract until January 11, and then only after insisting upon making some modifications therein, that accord- ingly the Company denied accepting the contract or its existence in effect between the parties. The letter further stated that Respondent conditions the acceptance of the contract upon proof [in an election] that the Union continues to represent a majority of the employees because it doubts the majority status of the Union after a year of bargaining, and that meantime the Company was not repudiating in any way the proposals made to the Union in its contract, and insofar as the economic benefits to the employees thereunder were concerned, the Company has placed them into effect and will act consistently therewith in the future. Contentions of the Parties General Counsel contends that Respondent could not question the Union's majority status on January 17; that the parties on or about January 13 reached agreement upon the terms and conditions of the collective-bargaining contract; and that since that time Respondent has refused to sign the contract embodying the terms and conditions agreed upon by them. Respondent asserts that it could require the Union to establish its majority status (by an election) prior to signing a contract with it; and that on January 13 the parties had failed to reach agreement on the terms and conditions of a contract. Conclusions Union Recognition Respondent predicates its refusal to continue to recognize the Union on the ground that a year had elapsed during which it was required to recognize it pur- suant to its certification, and that it no longer enjoyed a majority status. Respond- '4 By letter of March 11, the Board's Regional Director advised Respondent that its petition for a representation election ( Case 23-R1I-167 ) had been dismissed. because of the outstanding complaint issued herein. 264-188=67=vo1 . 161-61 946 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ent contends that the "one year rule" 15 began on January 13, 1965, when it wrote to the Union advising it of its willingness to recognize and bargain pursuant to the court's decision dated January 11, 1965, enforcing the Board's Orders. The Board and the courts, however, have held that litigation involving and following a certifi- cation, as herein, entitles a union to' recognition for a year after the termination of the litigation. Thus, in John S. Swift, Inc., 133 NLRB 185, 188, enfd. 302 F.2d 342 (C.A. 7), the Board stated, "Where litigation of unfair labor practices inter- venes and prevents the certified agent from enjoying a free period of a year after certification to establish bargaining relations, it is entitled to resume its free period after termination of the litigation.13 [Citation omitted]." To the same effect see Arlington-Fairfax Broadcasting Co., 95 NLRB 846, 860, enfd. 204 F.2d 128 (C.A. 4).16 The decree, which terminated the litigation herein was entered on Februaiy 2, 1965. Accordingly, it would follow that the year accorded to the Union to establish its bargaining relation ended on February 2, and not on January 11 when the decision was issued, during which Respondent could not raise a question of repre- sentation or refuse to recognize the Union. Moreover, even assuming, as also asserted by Respondent, that the year began when the Union was notified of Respondent's willingness to recognize it, the year would not have begun prior to January 14, 1965, when it received Respondent's letter of January 13. Thus, Respondent by its own position could not raise the question of the Union's major- ity status until at least January 14 if not February 2 of the following year. Furthermore, even assuming that the certification year had lapsed prior to Respondent's approval of the contract, it could then rebut the presumption that the Union's majority status continued in effect in the circumstances involved herein only by demonstrating sufficient facts upon which it could base a reasonable cause to believe that the Union had lost its majority satus through the defection of its members. The evidence introduced for that purpose shows that of the 48 employees in the appropriate unit employed on the date of the election (August 23, 1962), only 17 were employed on January 14 when there were 55 employees in the bar- gaining unit; and that of the 18 employees in the unit on March 11, 1963, who struck when a strike was called by the Union, only about 8 are still employed. The Board, however, has held that employee turnover, standing alone, does not prove a reasonable basis for believing that a union has lost its majority status since the last election. New employees will be presumed to support a union in the same ratio as those whom they have replaced.17 In further support of its position that the Union no longer represented a majority of is employees, Respondent introduced evidence tending to show that two employ- ees, Henry Wilson and Charles Grayson, had advised Respondent's warehouse superintendent that they no longer wished to have anything to do with the Union. The record, however, establishes that these two employees, who were in Respond- ent's employ at the time of the election held herein, were found to be ineligible to vote because of their supervisory status. Sometime thereafter, Respondent granted their request to be relieved of their supervisory status and they became members of the appropriate unit. During the summer of 1965, they were again made supervisors at their request because they allegedly did not wish to have anything to do with the Union. Inasmuch as these employees were not members of the appropriate unit, at the time of the election, and even assuming that they desired to defect from he Union by requesting restoration of their supervisory status, it would not reflect any change in the initial majority representative status of the Union. Moreover, in Febru- ary these individuals actually signed designation and checkoff authorization cards for the Union, thereby nullifying Respondent's contention that they were opposed to the Union. The only other employee whom Respondent claimed to have dis- affected from the Union is J. S. Johnson. In March of this year, 2 months after Respondent's refusal to continue recognizing the Union , Johnson asked the ware- >6 The Board, with court approval, has long held that absent unusual circumstances there is an irrebuttable presumption that a union majority status continues for 1 year from the date of certification. See, e.g., Ray Brooks v. N.L R B., 348 US. 96; Celanese Corporation of America, 95 NLRB 664, 672. After the year the certificate still creates a presumption of majority statue, which is normally rebuttable by an affirmative showing that the Union no longer commands a majority status. Frito-Lay, Inc., 151 NLRB 28. 10 See also N L R B. v. Satilla Rural Electric Membership Corp., 322 F.2d 251 (C A 5), enfg. 137 NLRB 387, where the court stated,, "the Company is not relieved of its duty to bargain with a union within its certification year merely'because a majority of employees may have defected from the Union" ; and cited Brooks y. N L.R.B , '348 U.S 96. 17 National Plastic Products, 78 NLRB 699, 706, affd.• 175 F.2d 755 (C.A. 4). • . SCHILL STEEL PRODUCTS, INC. 947 house superintendent to make him a leaderman of a new shift opening at the plant because he no longer wished to be associated with the Union. The timing of John- son's request vitiates Respondent's assertion that his desire to disaffiliate from the Union played any part in its refusal to recognize the Union during January. No other evidence was introduced to establish that the Union had lost its majority status ; and it is significant to note that prior to its refusal to sign the contract, Respondent never requested the Union to prove its majority status, or offered it an opportunity to do so without resorting to an election. Nor did Respondent ever explain to the Union the basis for doubting its majority status. I, accordingly, con- clude that the turnover of Respondent's employees per se is insufficient to demon- strate that the Union lost its majority status, and that, consequently, it has failed to substantiate its belief that the Union no longer enjoyed a majority status. A mere subjective doubt, even in good faith, without a demonstrable objective basis does not entitle Respondent to refuse to recognize its employees' certified bargaining representative, even assuming that the refusal occurred after the certification year. Absent such a reasonable based doubt of the Union's majority status, Respondent must continue to honor the certification until it is lawfully rescinded. Ray Brooks v. N.L.R.B., supra; N.L.R.B. v. Auto Ventshade, Inc., 276 F.2d 303, 307 (C.A. 5); N.L.R.B. v. American Aggregate Company, Featherlite Corporation, 305 F.2d 559, 561 (C.A. 5). Respondent in its brief cites N.L.R.B. v. Laystrom Manufacturing Co.,19 in sup- port of its right to withdraw recognition of the Union because of a good-faith doubt as to its majority status. That case is clearly distinguishable on the facts. There, the court stressed that there had been no history of union difficulties, that the parties had successfully bargained and entered into three successive collective- bargaining contracts and has enjoyed a harmonious and friendly relationship for a period of 4 years, and that in this long relationship there was nothing on the part of the employer upon which an inference of bad faith could be drawn. Fur- thermore, the court also pointed out that in N.L.R.B. v. Swift, supra, cited and relied on by the Board in support of its position in the Laystrom case, the employer was burdened with a long history of unfair labor practices and litigation, which impugned its good faith The contrast between the facts in the Laystiom case and the instant case is too obvious to require further discussion. I, therefore, conclude that at all times material herein, Respondent was required to recognize and bargain with the Union as the exclusive representative of its employees in the appropriate unit. The Agreement on the Terms of a Contract Respondent contends that no agreement was reached between the parties at the time Ray signed the contract on January 13 because Ray had deleted the clause pertaining to daily overtime work and Scott had to present it to Respondent for approval.19 Scott by his own admission was chief negotiator for Respondent and concededly had authority to make minor changes without consultation with and approval by Respondent. Viewing the record in its totality, I find it reflects Scott's negotiating authority to be far greater than admitted. However, I find it unneces- sary to delineate the extent of his authority. The contract provision relating to the payment of overtime at the rate of one and one-half times the regular hourly rate of pay for all hours of work performed in excess of 40 hours a week is not in dispute. The daily 11-hour overtime clause viewed in any realistic appraisal was of dubious value to the employees and of some potentially possible expense to Respondent. The deletion of the clause relieved Respondent of that expense, and not only was of no advantage to the employees, but, actually deprived them of the possibility of an economic benefit. In fact, on cross-examination Scott admitted that he appreciated the Union was giving up something by deleting the clause, although he disclaimed knowledge as to how Respondent would view it. In these circumstances I find that the deletion of the daily overtime clause did not sig- nificantly affect the contract and amounted to no substantial modification thereof justifying Respondent to view it as a union counterproposal requiring its concur- rence. At most, it could be regarded as a counterproposal of minor import in a technical sense only to which Scott even under his admitted limited authority could - 359 F.2d 799 (C.A. 7), reversing 151 NLRB 1482. 19 Apparently , Respondent raises no objection to the fact that Ray corrected the name of the Union in the contract , nor does it contend that Respondent had to approve the correction. 948 DECISIONS ' OF NATIONAL LABOR RELATIONS BOARD agree; and that he, in effect, indicated his agreement.20 Furthermore, Respondent actually expressed its approval both orally and in writing of this so-called "inodifi- cation" by agreeing to sign the contract as modified and submitted by Ray provided the Union won the election. In view of my findings that Respondent was required to continue its recognition of the Union at the time when the parties reached agreement on all the necessary terms of the contract, I conclude that Respondent was obligated to sign said contract when requested. Other Defenses Raised by Respondent Respondent also contended that its refusal to sign the contract was warranted on the following grounds: 1. The Union's acceptance of its contract proposal was untimely in view of the fact that Respondent expected and contemplated, pursuant to the understanding of both parties, that the contract would be signed in December 1965, and terminate 1 year thereafter. I find no merit in this contention. The contract as signed by the Union specifically provides that it became effective on December 31, 1965, and terminated 1 year thereafter., Thus, even assuming that Respondent's time con- ditions were applicable, they were satisfied. Furthermore, the Union was, notified in writing for the first time in Scott's letter of January 17, that its failure to sign the contract prior to December 31, 1965, was a factor influencing the decision of Respondent to refuse to sign it. The preponderance of the evidence indicates that this objection was raised as an afterthought. 2. The contract could not be binding because not signed by the Union's Inter- national officers.21 I find this contention to be specious. Even if it be assumed that their signing was necessary, Respondent precluded Ray from complying therewith by its refusal to sign and return the contract to Ray for that purpose 22 Moreover, this objection never was raised by Scott when he advised, Ray of Respondent's refusal to sign the contract. In fact, Scott had assured Ray that should Respondent sign the contract there would be no objection to having the Union's International officers sign thereafter. 3. The failure of the Union to reply to Scott's letter of December 15, 1965, transmitting Respondent's contract proposals, for almost a month (until Janu- ary 11) warranted the assumption that the Union had abandoned the negotiations. Even assuming that Scott was wholly unaware of the reason for the Union's silence, although the evidence indicates otherwise, this assumption was unwarranted. Thus, in Ken's Building Supplies,23 the Board held that the lapse of 3 months without a reply by the Union to the employer's offer did not justify an assumption that the Union had abdicated its, responsibilities as the exclusive representative of the employees. - I accordingly, conclude that the parties had reached an agreement on the terms and conditions of the contract, as signed and submitted by Ray, and that Respond- ent's refusal to execute said contract was a failure and refusal to bargain collec- tively in violation of Section 8(a)(5) and (1) of the Act. Section 8(d) of the Act; Standard Oil Co. v. N.L.R.B., 322 F.2d 40, 45 (C.A. 6); Huttig Sash and Door Co., 151 NLRB 470; Monarch Hardware & Mfg. Co., 145 NLRB 775. N. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The, activities of Respondent set forth in section III, occurring in connection with its operations set forth in section I, 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. 20 Moreover, the mere assertion by Respondent that the Union 's deletion of the 11-hour daily overtime clause, was a counterproposal requiring its approval raises a strong Infer- ence that it was engaging in bad -faith bargaining. 21 There was some testimony to the effect that Scott and Ray had alluded in their con- versation on January 13 to the possible necessity of having the International officers of the Union sign the contract as required by the Union 's constitution. 22 Respondent 's citation in its brief of Cresent Bed Co., Inc, 157 NLRB 296 , in support of its position is misplaced . The Board there expressly stated that it was not passing on `that point, and explained that the parties never contemplated entering into any agree- ment other than fixed by the written agreement , thereby indicating that it was tli be -effectuated. 23 142 NLRB 235, 237. SCHILL STEEL PRODUCTS, INC. 949 CONCLUSIONS OF LAW Upon the basis of the foregoing findings of fact and upon the entire record in the case, I make the following conclusions of law: 1. Respondent is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. The Union is a labor organization within the meaning of Section 2(5) of the Act. 3. All production and maintenance employees employed by Respondent at its Houston, Texas, warehouse establishment, including truckdrivers and plant clericals, excluding office clerical employees, professional employees, guards, watchmen, and supervisors as defined in the Act, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 4. At all times material herein, the Union has been, and now is, the exclusive bargaining representative of the employees in the aforesaid unit for the purposes of collective bargaining within the meaning of Section 9(a) of the Act. 5. By refusing, on and after January 13, 1966, to execute the written contract signed and submitted by the Union incorporating the terms and conditions agreed upon between them, Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(5) of the Act. 6. By the foregoing conduct, Respondent has interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act, and has thereby engaged in unfair labor practices within the meaning of Sec- tion 8(a)(1) of the Act. 7. The aforesaid unfair labor practices are unfair labor practices affecting com- merce within the meaning of Section 2(6) and (7) of the Act. THE REMEDY Having found that Respondent engaged in certain unfair labor practices, it will be recommended that it cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act. It will be recommended that, upon request of the Union, Respondent execute the written contract signed and submitted by the Union embodying the terms and conditions agreed on between them, and comply with its terms retroactively to December 31, 1965. If no such request is made by the Union, it will be recommended that Respondent bargain collectively, upon request, with the Union as the exclusive representative of the employees in the unit found appropriate, and, if an understanding is reached embody such understanding in a signed agreement. RECOMMENDED ORDER Upon the basis of the foregoing findings of fact and conclusions of law, it is recommended that Schill Steel Products, Inc., its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Refusing, if requested by United Steelworkers of America, AFL-CIO, to sign the written contract executed and submitted by said Union, embodying the terms and conditions of the agreement reached between them, and to comply with its terms retroactively to December 31, 1965, or, if no such request is made, refusing, on request, to bargain collectively with said Union as the exclusive bar- gaining representative of all its employees in the appropriate unit with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment and, if an understanding is reached, embody such understanding in a signed agreement. (b) In any like or related manner, interfering with, restraining, or coercing employees in the exercise of rights guaranteed in Section 7 of the Act. 2. Take the following affirmative action which is found will effectuate the policies of the Act: (a) Upon request of the aforesaid Union, sign forthwith the written contract embodying the terms and conditions agreed on with said Union and comply with its terms retroactively to December 31, 1965. If no such request is made, bargain collectively with said Union upon its request as the exclusive bargaining representative of the employees in the appropriate unit and, if an understanding is reached, embody such understanding in a signed agreement. 950 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (b) Post at its plant in Houston, Texas, the attached notice marked "Appendix." 24 Copies of said notice to be furnished by the Regional Director for Region 23, after being duly signed by an authorized representative of Respondent , shall be posted by Respondent immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by Respondent to insure that said notices are not altered , defaced, or covered by any other material. (c) Notify the Regional Director for Region 23, in writing , within 20 days from the receipt of this Decision,25 what steps it has taken to comply herewith. 29 In the event that this Recommended Order Is 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 is 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." a1 In the event that this Recommended Order Is 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 Respondent has 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 our employees that: WE WILL, if requested by United Steelworkers of America, AFL-CIO, sign the written contract incorporating the terms of the agreement reached with that Union, said contract to be retroactive to December 31, 1965. If no such request is made , WE WILL, upon request, bargain collectively with that Union for the unit described herein with respect to rates of pay, wages, hours of work, and other terms and conditions of employment and, if an understanding is reached, embody such understanding in a signed agreement . The bargaining unit is: All production and maintenance employees employed by us at our Houston, Texas, warehouse establishment, including truckdrivers and plant clericals, excluding office clerical employees , professional employ- ees, guards, watchmen, and 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 in Section 7 of the Act. SCHILL STEEL PRODUCTS, INC., Employer. Dated------------------- By------------------------------------------- (Representative ) (Title) 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. If employees have any question concerning this notice or compliance with its provisions , they may communicate directly with the Board's Regional Office, 6617 Federal Office Building, 515 Rusk Avenue, Houston, Texas 77002, Telephone 228-4722. Frito-Lay, Inc. and International Union of District 50, United Mine Workers of America. Case 3-CA-92957. November 14, 1966 DECISION AND ORDER Upon a charge filed by International Union of District 50, United Mine Workers of America (hereinafter referred to as the Charging 161 NLRB No. 90.