Coal Producers' Association of Illinois

COAL PRODUCERS ASSN. OF ILL. Coal Producers' Association of Illinois and Dorman E. Glass, Charging Party. Progressive Mine Workers of America, District No. 1 (Coal Producers ' Association of Illinois) and Dorman E. Glass, Charging Party. Coal Producers' Association of Illinois and Jesse Higgins, Charging Party. Progressive Mine Workers of America, District No. 1 (Coal Producers ' Association of Illinois ) and Jesse Higgins, Charging Party, and W. C. Gill and Dan Villa , Parties in Interest. Cases 14-CA-3802, 14-CB-1332, 14-CA-3819, and 14'-CB-1351. June 13,1967 DECISION AND ORDER On July 6, 1966, Trial Examiner Owsley Vose issued his Decision in the above-entitled proceeding, finding that the Respondents had engaged in and were engaging in certain unfair labor practices and recommending that they cease and desist therefrom and take certain affirmative action , as set forth in the attached Trial Examiner's Decision. Thereafter, the General Counsel and the Respondents filed exceptions to the Decision and supporting briefs. 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 Trial Examiner's Decision, the exceptions and briefs, and the entire record in the case, and hereby adopts the findings, conclusions, and recommendations of the Trial Examiner only to the extent consistent herewith. The complaint alleged that the maintenance of a plan under which members of the Respondent Association provide a welfare and retirement fund for employees or employee relatives, and which requires employee membership, in the Progressive Mine Workers of America (PMW) as a condition of eligibility for benefits, is unlawful under Section 8(a)(3), (2), and (1) and 8(b)(2) and (1)(A) of the Act. It also alleged as violations of the same section the withholding from four employees of accelerated retirement benefits they had earned prior to the abandonment of the mine in which they worked, as well as the prospective forfeiture of funds already allocated from wages for the purpose of future benefits in the case of three other employees who voluntarily quit mines which were covered by the plan and immediately commenced working at mines represented by the United Mine Workers of America (UMW). It was also alleged that these seven employees were denied benefits and/or subjected to forfeiture of fund allocations because they were not members of PMW. 337 The Trial Examiner found that the Respondents violated Section 8(a)(1) and 8(b)(1)(A) because they were parties to the plan and enforced its provisions requiring employees to maintain their membership in the Union after termination of the employment relationship covered by the contract in order to be eligible to receive welfare and retirement benefits; he further found that the Respondent Association also violated Section 8(a)(2) by contributing support to the Respondent Union thereby. The Trial Examiner reasoned that the provisions of the plan which require employees not only to forgo part of the compensation for present work but also to maintain membership in the Union in order to secure benefits provided by such compensation, constitute conditions of employment inconsistent with the basic freedoms of the Act as expressed in Section 7 and Section 8(a)(3). With respect to the allegation that the same conduct also constitutes violations of Section 8(a)(3) and 8(b)(2), the Trial Examiner found it unnecessary to pass upon these issues inasmuch as his proposed remedy included a make-whole order which would fully effectuate the policies of the Act in his view. The Trial Examiner also found that the temporary withholding from the four individuals of accelerated retirement benefits provided by the plan violated Section 8(a)(1) and (2) and 8(b)(1)(A) of the Act, but did not pass upon the additional alleged violations of Section 8(a)(3) and 8(b)(2) in this connection. As to the three employees who quit and immediately went to work in a UMW mine, the Trial Examiner made no finding of violation, particularly in view of the inchoate nature of the alleged violations against these individuals, but also noting that his remedy to cease giving effect to the provisions of the plan which condition the granting of benefits upon the maintenance of membership in the Union after the employment relationship has ceased would be sufficient to prevent future forfeitures. As appears from the Trial Examiner's Decision, the plan itself has been perpetuated under collective-bargaining agreements between the Association and the Union. These agreements have contained union-security clauses requiring membership as a condition of employment. No question is raised as to the validity of the membership requirement under the bargaining agreements during the period of employment at a mine of an association member. Pursuant to that requirement all employees are members. The plan, in turn , provides for maintenance of membership as a condition for sharing in its benefits. In view of these underlying valid union-security provisions, the problem here is not one of restriction of benefits to member employees such as occurs in the absence of a valid union-security provision.' ' Cf. Carty Heating Corp , etc., 117 NLRB 1417, Progressive Kitchen Equipment Co , Inc , 123 NLRB 992 165 NLRB No. 31 338 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The Union contends that the dues required to maintain union membership during periods which an employee is not working at a mine within the bargaining unit are actually in the nature of a service fee for the handling of benefits payable pursuant to the plan, and justifiable as such. It urges that the dues scale, which reflects work status in the industry, is indicative of a service arrangement. Employees working in mines covered by the plan pay 75 cents monthly dues, plus 2 percent of their gross earnings , while members working outside the coal industry pay $1.45 monthly, and retired, disabled, or other employees eligible for benefits pay 1 percent of the benefits being received from the plan, with $1 monthly being the minimum. Thus employees no longer working in the unit are expected to bear substantially less financial liability to the Union. We find merit in the Union's analysis of its dues structure as applied to those not working in the unit, and conclude that such payments can, as revealed by this record, be considered to be a service fee. Fees for job-referral services by a union have been approved by the Board and the courts.2 Other similar charges by unions have received tacit approval, subject to appropriate safeguards.3 An important proviso running through the service charge concept has been that such fees be reasonably related to the value of the services rendered by the union . The services rendered here, as we view them, tend to make the fees set forth above seem reasonable. The services rendered include the Union's assistance in perpetuating the plan itself as well as its sustaining fund through periodic bargaining negotiations . The Union has done this in successive agreements since establishment of the plan in 1946. A determination of the specific amount of the per ton contribution to the fund to be made by operator members during the life of each bargaining contract is part of the periodic bargaining. For example, the 1965 contract increased this sum from 30 to 40 cents per ton. It also appears that the Union renegotiates various provisions of the plan during bargaining with a view to improving the plan. Thus the Union, in its bargaining, is called upon to represent the interests not only of employees currently engaged in mining coal, with respect to their wages, hours, and other terms and conditions of employment, but also the interests of eligible participants in the plan who are no longer mining coal. These eligible participants have an economic interest in the perpetuation of a plan of this sort and the fund which makes it possible. In view of this interest , we do not believe it unreasonable that the Union require employees ' Local 825, Operating Engineers (H John Homan Company), 137 NLRB 1043, Local 138, Operating Engineers (J J. Hagerty, Inc) v N L.R B, 321 F 2d 130 (C A 2), N L R B. v Houston Maritime Association , 337 F 2d 337 (C A 5) covered by the plan to continue making payments, varying according to their employment status and income, to support the Union and its efforts on their behalf with respect to the plan. It seems to us that the Union's endeavors in this connection are a valuable service to employees no longer working in the unit, much as a job referral is to prospective employees. In reaching the conclusion that the Union is entitled to charge a fee to employees who no longer work in the unit who desire to participate in the plan's benefits, we wish to emphasize that we do not reach the further question whether employees are in fact required, pursuant to the plan, to maintain their membership in the Union, or may have their membership forfeited in a manner which would be violative of Section 8(a)(3) of the Act. The Trial Examiner considered this further issue cumulative because of the scope of his proposed remedial order, and so did not reach it. Our reason for not reaching it is that-apart from references in the plan itself which tend to suggest the possibility that such discrimination may occur-the record furnishes no adequate proof to establish that the eligibility status of individuals covered by the plan has been forfeited for any reason other than failure to make periodic payments to the Union. At the hearing the parties stipulated that the seven alleged discriminatees made no attempt to keep up their union dues after ceasing to work at mines represented by the Union. There is some evidence, it is true, that the fund's secretary advised the four alleged discriminatees that their union membership must be kept up for eligibility, and then, in August 1965, was disposed to deny accelerated retirement benefits to the four on the stated ground of "automatic" loss of membership on the date of employment at the Will Scarlett mine, a mine whose employees are represented by the UMW, but, as found by the Trial Examiner, this position was reversed and the benefits claimed were actually paid in January 1966. Thus the record reveals no loss of benefits by these four. The Trial Examiner found the temporary withholding of the benefits to be a violation, but reviewing the record as a whole we are not disposed to base a finding on this isolated occurrence even though in some circumstances we might find it necessary to do so and ban a recurrence by remedial order. The evidence as to possible loss or detriment to the remaining three alleged discriminatees involves only an anticipated cancellation of individual allocations pursuant to the plan, no actual loss of rights or benefits being established. Accordingly, on the record before us, we find no sufficient support for concluding that by being ' See Luggage Workers Union Local 60 (Rexbilt Leather Goods, Inc , et al), 148 NLRB 396, charge for delivering vacation checks, Coca-Cola Bottling Corporation, 153 NLRB 1425, charge for processing a seniority grievance COAL PRODUCERS ASSN. OF ILL. parties to and operating this plan the Respondent Union and the Respondent Association have deprived employees of rights guaranteed by Sections 7 and 8(a)(3) of the Act.4 In view of our conclusion that the postemployment payments required by the Union, and which are tailored to changing work status, are appropriate as a service charge, and in view of the absence of proof that individual discrimination has occurred in the administration of the plan, we shall dismiss the complaint in its entirety. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that the complaint herein be, and it hereby is, dismissed in its entirety. a Member Fanning, with respect to the four alleged discriminatees, is persuaded to the contrary because of the August 31, 1965, letter, which is in evidence, advising them that they "automatically gave up" membership in the Union on the date they were employed at the Scarlett mine where, in fact, the employees were represented by the UMW Because of this evidence lie would find that the plan was applied in the case of these employees to encourage membership in the Progressive Mine Workers, in violation of Section 8(a)(3) and 8(b)(2) TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE OWSLEY VOSE, Trial Examiner: This case was heard at St. Louis, Missouri, on April 18, 1966, pursuant to charges filed on September 28 and November 8 and 20, 1965, and a third amended complaint issued on March 22, 1966. Said complaint, as subsequently amended at the hearing, raises questions concerning the legality of certain provisions in effect in the collective-bargaining contract between the Respondent Coal Producers' Association (herein called the Association) and the Respondent Progressive Mine Workers of America, District No.1 (herein called the Union) which allegedly restrict the benefits of the welfare and retirement fund provided for in the contract to employees who have continuously maintained their membership in the Union, regardless of whether employed in a mine covered by the contract or not, and concerning the alleged refusal of the cotrustees of the retirement fund to pay benefits to four employees who were terminated as a result of the abandonment of the Walnut Grove Mine which was operated by a member of the Association. The conduct of the Respondent Association is alleged to violate Section 8(a)(1), (2), and (3) of the Act, and the conduct of the Union is alleged to violate Section 8(b)(2), and (1)(A) of the Act. After the close of the hearing the General Counsel and the Respondent filed briefs which have been fully considered.' Upon the entire record, including my observation of the witnesses, I make the following: I After the close of the hearing, the parties submitted a stipulation on agreed corrections to transcript of record which is FINDINGS AND CONCLUSIONS 339 1. THE BUSINESS OF THE RESPONDENT ASSOCIATION AND ITS MEMBERS The Association is an organization of coal mine operators, including, as of the time of the events involved in this case, Sahara Coal Corporation, Little Dog Coal Company, Youngs Coal Corporation, and the Pioneer Collieries. The Association acts as the authorized agent of its members for the purpose of bargaining collectively with the Union with respect to the wages, hours, and other terms and conditions of employment of its members. Little Dog Coal Company annually purchases from out-of-State sources goods and materials used in its mining operations which are valued in excess of $50,000. Upon these facts I find, as the Association admits, that it is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act and that it will effectuate the policies of the Act to assert jurisdiction herein. II. THE LABOR ORGANIZATION INVOLVED The Respondent Progressive Mine Workers of America, District No. 1, is a labor organization within the meaning of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. Introductory Statement As indicated above, the complaint as amended herein, challenges not only certain conduct of the cotrustees of the welfare and retirement fund in administering the fund but also certain basic provisions of the plan underlying the administration of the fund. The welfare and retirement fund was established by the Association and the Union in 1946 in a collective- bargaining contract entered into on June 12 and a separate trust agreement which was executed on July 25. The trust agreement provided for the establishment of a joint state executive board, consisting of eight members, four chosen by the Association and four by the Union, and for the selection of two cotrustees, one chosen by the Union and one chosen by the Association. The joint state executive board was charged with the responsibility of overseeing the acts of the cotrustees in setting up and administering the proposed plan of benefits. The June 12, 1946, contract provides as follows: Said Fund shall be used for the purpose, and shall be administered as hereinafter provided:... The two trustees so selected shall be responsible to the Joint State Executive Board for all their acts, and shall submit to the Joint State Executive Board for its approval a plan to provide for using this fund for making payments to employees of the Operator- members of the Coal Producers Association of Illinois who are members of the Progressive Mine Workers of America, with respect to sickness, permanent disability, life insurance, death, hospitalization for members and their dependents, retirement fund to be established as of June 1, 1946, in an amount to be later determined, (2) and other related welfare purposes as determined by the trustees and approved by the Joint State Executive Board. All acts of the approved The record is hereby corrected in accordance with the stipulation 340 DECISIONS OF NATIONAL trustees in setting up various plans shall be consistent with Federal and State Laws. The cotrustees duly established the welfare and retirement fund and a plan for administering the benefits to be paid for out of the fund. The successive collective- bargaining contracts between the Association and the Union have provided for the continuance of the fund, which is supported by a fixed price per ton of coal mined paid solely by the operator-members of the Association. In the first agreement 5 cents per ton was the agreed operator contribution to the fund. The current contract, which calls for the payment of 40 cents for each ton of coal mined by the operator, has been adjusted by agreement between the parties to require the payment of 20 cents per ton. The collective-bargaining contracts between the Association and the Union have for some time provided as follows: ... As a condition of employment all employees covered by this contract shall be, or shall become members of the Progressive Mine Workers of America, District No. 1, to the extent and in the manner permitted by law. Under the successive contracts, only supervisors and office and clerical employees are excluded from coverage. The General Counsel does not raise any question in this proceeding about the validity of the above-quoted union- security provision. These successive contracts have further provided that beneficiaries of the fund shall have no vested right therein. The parties in interest, W. C. Gill and Dan Villa, are the cotrustees for the Association and the Union, respectively, currently charged with the administration of the fund. Gill has been a cotrustee for the Association since the inception of the fund. The basic document now in effect setting forth the scheme of operation of the welfare and retirement fund is known as plan 7, which was adopted by the cotrustees on January 19, 1955, and approved by the joint state executive board on February 1, 1955. In the ensuing years plan 7 has been amended many times. In 1958 special allocation plans for the individual mines were adopted by the cotrustees and approved by the joint state executive board in order to prevent the depletion of retirement funds to the detriment of the younger miners. Under these plans, miners at the individual mines were allocated, in a bookkeeping transaction, specific portions of the payments by their employer to the fund, and these allocated portions could not be used to pay benefits to other miners. In 1960 amendment 21 to plan 7 was adopted by the cotrustees and approved by the joint state executive board. It is set forth below: Amend PART I, GENERAL PROVISIONS, by adding the following as a new section: "Section 45. Union Membership. Although this Plan of Benefits and any Resolutions and Special Allocation Plans adopted pursuant to the provisions of this Plan require Union membership as a pre-requisite to eligibility, all employees hired by the employer, doing contract work, who would be required to become Union members after the statutory period provided in Federal and State laws, shall be considered for all purposes mentioned herein as Union members during such period, provided they meet all other eligibility requirements." On October 27, 1965, amendment 38 to plan 7 was LABOR RELATIONS BOARD adopted by the cotrustees and approved by the joint state executive board. It is as follows: Amend PART I, GENERAL PROVISIONS, by adding the following new paragraph to Section 45. Union Membership. This amendment was adopted after Dorman E. Glass had, on September 30, 1965, filed a charge with the Board's St. Louis Regional Office on behalf of himself, Chester Moore, Paul B. Russell, and James Shepherd alleging that the Union had caused the Association to refuse to pay each of them accelerated retirement benefits from June 30 until August 20, 1965, thereby violating Section 8(b)(1)(A) and (2) of the Act. Glass subsequently, on November 8, 1965, filed a charge against the Association alleging that it had unlawfully supported the Union and had discriminated against himself and the other men in violation of Section 8(a)(1), (2), and (3) of the Act. In view of the evidence regarding the establishment of the fund, the duties of the cotrustees, and their relationship to the joint state executive board, I find that the cotrustees are and have been acting as agents of both the Association and the Union. In the discussion which follows, the various provisions now in effect of plan 7, the amendments thereto, and of the special allocation plans for the individual mines, which have been adopted by the cotrustees to prescribe the manner and conditions under which benefits are to be provided out of the fund, are collectively referred to as the plan. B. The Alleged Illegal Provisions of the Plan Plan 7, the basic charter of the plan, provides as follows with respect to retirement: PART II RETIREMENT PENSIONS Section 2. ELIGIBILITY REQUIREMENTS A member-employee, on a mine by mine basis, who meets the following eligibility requirements, may participate in the Retirement Pension funds allocated to the mine from which he retires, provided: (7) He is a member and remains in good standing in a Local Union of the Progressive Mine Workers of America, District No. 1; * * * * * Section 4. INTERRUPTION OF WORK RECORD * * * * D. ABANDONMENT * * * * * * 6. In order to share in such benefits, however, a member-employee under retirement age must try to remain in the coal industry by seeking other employment, and shall keep up his membership in the Union. * * * * Section 6 . ACTUAL RETIREMENT- REEMPLOYMENT A. An employee must actually retire. Retirement COAL PRODUCERS ASSN. OF ILL. shall be on a voluntary basis, but an individual shall not be eligible to participate unless he actually retires from the coal industry In the event such member- employee shall return to the coal industry after such retirement, or payments to him shall be suspended, then he shall not be entitled to retirement unless he again meets the eligibility requirements for Retirement Pension upon submitting a new application and upon his again actually retiring. The above-basic retirement provisions have been supplemented by the provisions of the special allocation plans in effect for the various mines. Typical standard provisions of such special allocation plans are the following which are taken from the plan for the Walnut Grove Mine of Youngs Coal Corporation: Sec. 8. Abandonment of Mine-In the event of the abandonment of said mine, any special plan adopted for said mine, as provided in Plan No. 7, may provide for different methods of payment between men on the Retirement-Pension Roll, men on the Disability Assistance Roll, others upon rolls, and men who may be then without employment, as circumstances may warrant, provided: (a) Such plan shall protect the allocated funds of each individual so long as eligibility requirements are met. (b) No member-employee who does not have a one year work record prior to the date of abandonment shall have any right to any of said funds. However, any member-employee who has worked at said mine for one year or longer prior to the date of abandonment shall be declared eligible for retirement-pension irregardless of eligibility requirements such as age, work record, etc. to be paid upon application of such member- employee, at the rate of not to exceed $250.00 per month, to be paid from his allocated funds only. The Co-Trustees shall adopt a resolution fixing the amount to be paid to each individual member-employee, not exceeding $250.00 per month, but each employee shall be paid the same amount as provided in said resolution. (c) In the event such member-employee shall again take up employment at a contributing mine, then payments to him shall be suspended, and if such mine has an allocation plan in effect, then any funds to his credit at such time shall be transferred to his allocated funds at such other mine and his eligibility shall be determined by the Plan in effect at such mine. In the event such mine does not have an allocation plan in effect, then such moneys allocated to him shall not be transferred, but shall be held in his accounts until he is eligible to receive payment thereof in accordance with the plan in effect at such other mine, and then shall be paid to him in addition to any moneys which he may receive at such other mine. However, he shall not receive any work credits at such other mine for work performed at this mine. * * * * * Sec. 9. Voluntary Quitting, Discharge and Lay-off (a) In the event any member-employee quits his employment, either voluntarily or involuntarily, or is discharged, or is laid off, or quits his employment upon proper proof that he 341 is physically unable to carry on with his duties in the coal industry, even though he may not be totally and permanently disabled as provided under PART III, B. Disability Assistance, and gives up his job right at said mine , no further allocation shall be made to his accounts other than for any proportionate allocation for months worked during the preceding calendar year on the first allocation made thereafter. If, at such time, he does not have a one year work record he shall not have any right to any of said funds. However, if he has a one year work record or longer, he shall then be declared to be eligible for Retirement-Pension irregardless of eligibility requirements such as age, work records, etc., to be paid upon application of such member- employee at the rate of $100.00 per month, to be paid from his allocated funds only. (b) No further allocation shall be made to his funds, except at the discretion of the Co-Trustees interest may be allocated. (c) In the event such member-employee shall again take up employment at a contributing mine, then payments to him shall be suspended, and if such mine has an allocation plan in effect, then any funds to his credit at such time shall be transferred to his allocated funds at such other mine and his eligibility shall be determined by the plan in effect at such mine. In the event such mine does not have an allocation plan in effect, then such moneys allocated to him shall not be transferred, but shall be held in his accounts until he is eligible to receive payment thereof in accordance with the plan in effect at such other mine, and shall then be paid to him in addition to any moneys which he may receive at such other mine. However, he shall not receive any work credits at such other mine for work performed at this mine. (g) All of the foregoing is with the understanding that a member-employee, or a member if no longer employed, must continuously remain a member in good standing of a Local Union affiliated with District No. 1, Progressive Mine Workers of America. Dropping of such membership shall automatically forfeit any funds then allocated or the right to any future allocation, and reinstatements to membership thereafter shall not reinstate any allocated moneys thus forfeited, unless proof is made that such dropping was in error and such member is reinstated in accordance with the constitution of the Union. Cotrustee Gill testified that the forfeitures of allocated funds are made on a mine-by-mine basis 1 year after the end of the fiscal year for the particular mine involved in which the employee last had allocations made to his account. The end of the fiscal year is also referred to in the record as the allocation date. The allocation dates for the various mines are staggered throughout the year to ease the workload of the office of the cotrustees. This 1 year period is allowed to enable the cotrustees to correct any error in determining the membership status of any employee, as cotrustee Gill testified. The welfare provisions of plan 7 (part III) similarly condition eligibility for benefits upon continued union 299-352 0-70-23 342 DECISIONS OF NATIONAL LABOR RELATIONS BOARD membership after the beneficiary's employment status at a contributing mine has ceased. Section 2, B. of part A, which is headed "Eligibility for dismemberment benefits and medical care benefits" states that eligibility for benefits "shall terminate as of the date and time a member-employee ... terminates his membership in the Union." Likewise, the eligibility of a member-employee who becomes totally and permanently disabled to continue to receive benefits is subject to the following proviso: "3. He is a member in good standing at the time of his disablement and remains a member in good standing of a Local Union of the Progressive Mine Workers of America, District No. 1" (plan 7, part III, paragraph B sec. 3, B, 3). Paragraph D of part III of plan 7 deals with death and dismemberment benefits. Section 5 thereof provides coverage for members of Armed Forces and dependents of "men who die while in the armed forces of the United States . provided: B. [He] was a member in good standing of a Local Union of Progressive Mine Workers of America, District No. 1, at the time of his death." Paragraph E of part III, entitled "Medical Care Plan" provides in section 3 for "Coverage for Dependents of Men in Armed Forces," if "1. Such member-employee has retained his membership in the Union by proper application to the Union during his military service." Under the provisions of the plan above quoted, which are typical of the provisions challenged by the General Counsel, all employees, from the time of their first employment at a mine covered by the plan are required continuously thereafter to maintain membership in the Union as a condition of being entitled to receive the benefits which they have earned as a result of working under the plan, including retirement benefits payable after the employment relationship has ceased This involves the maintenance of membership during periods of unemployment due to the abandonment of a mine, due to the employee's layoff, discharge, or voluntary quitting, and also during periods of employment anywhere else but in a contributing mine. Failing to maintain membership after ceasing employment in a contributing mine results in the ultimate forfeiture of all moneys allocated to the miners' individual accounts. Miners who leave a contributing mine but who maintain their membership in good standing in the Union do not forfeit the moneys allocated to their account, and are able to draw on such funds, when eligible, after again taking up employment in a contributing mine. C. Conclusions Concerning the Legality of the Challenged Provisions of the Plan Under the plan of benefits provided for in the contracts between the Association and the Union, the employees covered by the plan received a portion of their compensation for present work in the form of deferred benefits to become available after the employment relationship covered by the contract has ceased, for example, either as a result of retirement or disablement or because of the employees' voluntarily quitting and taking employment elsewhere. The challenged provisions require all miners covered by the contract in effect to forego part of their compensation for their present work unless they agree to maintain membership in the Union even after the employment relationship covered by the contract has become terminated. Such a term or condition of employment, in my opinion, is inconsistent with basic freedoms which the Act guarantees. Basic objectives of the Act are the protection of employees' freedom of choice of bargaining representatives and the prevention of discrimination in regard to terms and conditions of employment to encourage or discourage union membership. Section 7 of the Act is as follows- Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in Section 8(a)(3). Section 8(a)(3) of the Act provides that it shall be an unfair labor practice for an employer- (3) by discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization: Provided, That nothing in this Act, or in any other statute of the United States, shall preclude an employer from making an agreement with a labor organization (not established, maintained, or assisted by any action defined in section 8(a) of this Act as an unfair labor practice) 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, whichever is the later.... The only case in which an exception is made to the policy of the Act of assuring employees a free choice of representatives is that set forth in the proviso to Section 8(a)(3) of the Act quoted above. This is the one situation where compulsory unionism is permitted. To fall within the exception the terms of the proviso must be strictly observed. While the proviso allows employees to be compelled to join a union under the circumstances therein set forth as a condition of employment, i.e., as an indispensable requirement of retaining their jobs, it does not sanction the imposition upon employees, as a term of their employment, the requirement that they maintain membership in the Union in the future, after the employment relationship covered by the contract has ceased, or forego part of their compensation for work performed. Hence the provisions here in question are outside the scope of the proviso and must fall. As indicated above, such provisions are completely antithetical to the basic objectives of the Act of protecting employees from interference with their free choice of representatives and preventing the encouragement or discouragement of union membership by prounion or antiunion discrimination. It has been repeatedly held that employers and unions may not condition present employment upon an employee's failure to maintain membership in good standing in a union before the employment relationship covered by a union-security provision began. See N.L.R.B. v. Murphy's Motor Freight, Inc., 231 F.2d 654 (C.A. 3); N.L.R.B. v. Spector Freight System, Inc., et al., 273 F.2d 272 (C.A. 8); Local Union No. 1842, International Brotherhood of Electrical Workers (Avco Mfg. Corp.), 124 NLRB 794, enfd. 283 F.2d 112 (C.A. 6); N.L.R.B. v. International Association of Machinists, Aeronautical Lodge 727 (Menasco Mfg. Co.), 279 F.2d 761 (C.A. 9); N.L.R.B. v. International Union, UAW (John I. Paulding, Inc.), 297 F.2d 274 (C.A. 1). While these decisions are not strictly in point, they reflect the concern of the Board and COAL PRODUCERS ASSN. OF ILL. the courts for the basic principles discussed above which, in my view, call for the conclusion that the Act no more permits a union to condition present employment upon the maintenance of membership after the employment relationship has ceased, than it allows the conditioning of present employment on membership before the employment relationship has begun. While the language of the decisions of the district courts in Upholsterers International Union v. Leathercraft Furniture Co., 82 F. Supp. 570 (E.D. Pa.), and the other cases relied upon by the Association and the Union appears to lend support for their position in this case, in none of these cases were the courts faced with the narrow question here involved and in none of these cases did the courts consider the questions there presented from the standpoint of protecting employees' freedom to join or to refrain from joining a union, a fundamental principle underlying the Act as a whole. I have carefully considered these decisions and am not persuaded that they present an interpretation of the Act which is consistent with the guiding principles of the Act. Accordingly, I cannot accept the arguments of the Association and the Union which are based on the Upholsterers and similar decisions. I conclude that the Association and the Union, by being a party to and enforcing contract provisions requiring as a condition of receiving deferred benefits under the collective-bargaining contract, the maintenance of union membership after the employment relationship covered by the contract has ceased, have violated Section 8(a)(1) and 8(b)(1)(A), respectively. Cf. Carty Heating Corp., et al., 117 NLRB 1417.1 The Association, by being a party to and enforcing contract provisions which require continued membership as a condition of receiving deferred benefits, provisions which exceed the limitations of the "union shop" proviso to Section 8(a)(3) of the Act, has thereby contributed support to the Union in violation of Section 8(a)(2) of the Act. Progressive Kitchen Equipment Co., Inc., 123 NLRB 992. - The complaint as amended also alleges that the various provisions of the plan which I have found to be illegal under Section 8(a)(1) and (2) of the Act and 8(b)(1)(A) also are violative of Section 8(a)(3) and 8(b)(2) of the Act. However, I find it unnecessary to pass upon these allegations, which present novel questions concerning the proper interpretation of Section 8(a)(3) of the Act, for the remedy which I propose to recommend herein will include a make-whole provision, and will in my opinion, fully effectuate the policies of the Act. D. The Enforcement of the Illegal Provisions of the Plan in Specific Cases 1. The alleged refusal to pay benefits to Dorman Glass, Chester Moore, Paul Russell, and James Shepherd The four men above named were employed by the Youngs Coal Corporation at its Walnut Grove Mine at the 2 The General Counsel also notes that the plan provides for benefits to "member-employees" only, and does not make it clear that the only ground for discharge of an employee for failing to maintain membership in good standing is his failure to pay periodic dues and initiation fees. This, the General Counsel contends, is an illegal condition. However, since all employees were required to he members of the Union after 30 days under the terms of the valid union-security clause of the contract and new employees were specifically covered with the various benefits which were applicable to any short-term member by amendment 21 to plan 7, it is understandable that the terminology "member- 343 time the mine was abandoned about June 28, 1965. None of them had reached the usual retirement age. At this time the four men were covered by section 8 of the special allocation plan in effect for the Walnut Grove Mine. Section 8, which is quoted in the preceding section of this decision, provides for accelerated retirement benefits for employees of abandoned mines. Section 11 of said special allocation plan provides as follows: Sec. 11. Union Membership-All persons mentioned herein except widows and dependents shall continuously remain members in good standing of a Local Union of the Progressive Mine Workers of America, District 1, to be eligible hereunder. In the event a member shall fail to continuously remain a member in good standing, any moneys allocated to his individual accounts shall be transferred to the regular Welfare Fund of said mine. About July 6 the four men made application for benefits under section 8 quoted above. About the end of July each was notified by the executive secretary of the welfare and retirement fund that he were eligible to receive $250 per month in "accelerated Retirement Pension benefits" from his allocated funds beginning July 1, 1965. The letter concluded with the following paragraph: Before we can make any payment to you we must have a certificate that you are not now employed in the coal industry. If you are employed in the coal industry then such payment cannot be made until after you are no longer so employed. In addition, your Union membership must be kept up so long as you are eligible to draw monies from this fund. None of the four men paid any dues to the Union for the period after June 30, 1965. About August 19, 1965, each of the four men obtained employment at the Will Scarlett Mine, at which the employees are represented by the United Mine Workers, and have the benefits of a retirement and pension fund similar to the Union's. On August 31, 1965, the executive secretary of the fund sent each of the four men a letter, the text of which is as follows: We have had under consideration your application for benefits from the Welfare and Retirement Fund of the Progessive Mine Workers of America, District#1. According to our information , you became employed at the Will Scarlett Mine at Stonefort , Illinois, and are now so employed. Since you automatically gave up your membership in the Union on the date you were so employed at that mine, under our Plan of Benefits, we regret that we cannot pay you benefits from, this Fund. Although you were previously notified by letter that you would be paid benefits, that letter went out before employees" was used throughout the plan. I find no suggestion in this case that the Union has ever requested, or has any intention of requesting, the discharge of an employee for failing to maintain membership in good standing for any other than the permissible reason of the employees' failure to pay dues or initiation fees. In these circumstances 1 find that here, as in N.L.R.B. v. Revere Metal Art Co., 280 F.2d 96, 101-106 (C.A. 2). cert. denied 364 U.S. 894, and Local 138, Operating Engineers ( 3 . 3. Hagerty, Inc.) v. N.L.R.B., 321 F.2d 130, 133 (C.A. 2), it is unreasonable to attribute to the parties an intention to construe these particular provisions of the plan other than in conformity with the Act. 344 DECISIONS OF NATIONAL LABOR RELATIONS BOARD this information was available to us, and you will please disregard that letter. In January 1966, after the filing of charges by Glass, the cotrustees of the fund, upon reconsideration of their previous decision to refuse accelerated retirement payments to the four men, decided to grant benefits for the month of July 1965, and pursuant to this decision sent each of the four men a check for $250. As found above, the provisions of the plan requiring continued membership in the Union as a condition of the employees of abandoned mines receiving their accelerated retirement benefits are illegal under Section 8(a)(1) and (2) and 8(b)(1)(A) of the Act. The temporary withholding from Glass, Moore, Russell, and Shepherd of the accelerated retirement benefits which they had earned at the Walnut Grove Mine before its abandonment pursuant to these illegal provisions constitutes a further violation of Section 8(a)(1) and (2) and 8(b)(1)(A) of the Act.3 For the reasons stated above, I need not decide whether the Respondents' temporary withhold of benefits also violated Section 8(a)(3) and 8(b)(2) of the Act. 2. The alleged forfeiture of benefits of Jesse Higgins, Wendell Bennett, and Herbert Bennett Higgins worked at mine 5 of the Sahara Coal Corporation from February 9, 1960, until June 1, 1965, when he voluntarily quit. While employed by Sahara, Higgins was a member of the Union. A day after quitting at Sahara, Higgins commenced working for the Old Ben Coal Corporation at a mine organized by the United Mine Workers of America, which had a welfare and retirement program similar to these of the Respondents in this case. At the time Higgins quit, he had allocated to his account in the fund the sum of $1,746.81. Herbert Bennett and Wendell Bennett, who had started working at mine 16 of the Sahara Coal Corporation in 1960 and 1963, respectively, voluntarily quit their jobs on August 23, 1965. Both men had been members of the Union during their employment by Sahara. A day or two after quitting at Sahara, both men went to work for the Old Ben Coal Corporation at a mine covered by a contract with the United Mine Workers of America. At the time the Bennetts quit working for Sahara, Wendell had allocated to his retirement account in the fund $640.15 and Herbert also had funds allocated to his retirement account. Neither Higgins nor the Bennetts paid any dues to the Union nor made any effort to remain in good standing after quitting work for Sahara. They had not reached the normal retirement age. As found above, the special allocations plans for Sahara mines 5 and 16 have identical provisions covering accelerated retirement pensions for employees who voluntarily quit their jobs. The relevant portions of these provisions, which are applicable in the cases of Higgins and the two Bennetts, have been quoted hereinabove. Section 6 of part II of plan 7 requiring the suspension of benefits if the member-employee returns to the coal industry is also applicable in the cases of these men. As found above, under the applicable provisions of the plan with respect to members voluntarily quitting their jobs at a contributing mine, those who fail thereafter to maintain their membership in good standing forfeit the :i The fact that the cotrustees have paid each of the four men $250 is asserted fulfillment of their obligations to them under the accelerated retirement provisions of the plan does not render this aspect of the case moot. Assuming that $250 constitutes all that each man was entitled to under the valid provisions of the plan, allocations to their credit in the retirement fund 1 year after the end of the fiscal year in which sums were last allocated to their account. Higgins and the two Bennetts have never made any application to the fund for benefits and consequently no claim has been denied them. However, it is admitted by cotrustee Gill, that 1 year after the allocation date on which Higgins and the two Bennetts last had funds allocated to their retirement accounts, the sums allocated to their credit will be forfeited. The complaint as amended alleges that the Union violated Section 8(b)(1)(A) and (2) and the Association violated Section 8(a)(1), (2), and (3) of the Act in connection with the forfeiture of accelerated retirement benefits in the case of Higgins and the two Bennetts. However, so far as the record shows, the Respondents have done nothing as yet to effect such forfeiture. Higgins and the two Bennetts are in the same position as any number of other miners who, because of the operation of the plan, stand to forfeit benefits in future, or credits towards benefits, because of the enforcement of the illegal maintenance-of- membership provisions of the plan. My findings as to the illegality of these provisions take care of the cases of Higgins and the two Bennetts and render unnecessary any further findings in their cases, if indeed, any such findings could be made because of the inchoate nature of the conduct complained of. The provisions of my Recommended Order will prevent any future forfeiture of benefits pursuant to the provisions of the plan which I have found to be illegal, including the forfeiture of the accelerated retirement benefits due Higgins and the two Bennetts. CONCLUSIONS OF LAW 1. By maintaining and enforcing contract provisions which condition the grant of benefits upon the continued maintenance of membership in good standing in the Union after the employment relationship covered by the contract has ceased and by withholding accelerated retirement benefits from Dorman Glass, Chester Moore, Paul Russell, and James Shepherd, the Association has interfered with, restrained, and coerced employees in the exercise of the rights guaranteed in Section 7 of the Act in violation of Section 8(a)(1) of the Act, and contributed support to the Union in violation of Section 8(a)(2), and the Union has restrained and coerced employees in the exercise of their Section 7 rights in violation of Section 8(b)(1)(A) of the Act. 2. The aforesaid unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. THE REMEDY Having found that the Association and the Union have violated various provisions of the Act by their maintenance and enforcement of contract provisions which condition the grant of certain benefits upon the continued maintenance of membership in the Union after the employment relationship covered by the contract has ceased, my Recommended Order will provide that the Respondents cease and desist therefrom and from engaging in any like or related violations of the Act. I have also found that the Respondents, -through their agents, the cotrustees, temporarily withheld accelerated such a payment does not bar the Board from entering an appropriate remedial order. The Respondents ' conduct constituted an unfair labor practice and the Board was entitled to ban its resumption. N.L.R.B. v. Mexie Textile Mills, Inc., 399 U.S. 563. COAL PRODUCERS ASSN. OF ILL. retirement benefits from Dorman Glass, Chester Moore, Paul Russell, and James Shepherd pursuant to certain of the illegal provisions of the plan. It is not clear from the record that the $250 which the cotrustees paid each of the four men in January 1966 in payment for accelerated retirement benefits due them for the month of July 1965 constitutes full payment to them of the accelerated retirement benefits to which they were entitled under the valid provisions of the plan. Each may be entitled to further payment for that part of the month of August which elapsed before he again obtained a job in the coal industry. Accordingly, my Recommended Order will provide, as a 345 remedy for the Respondents' violations of Section 8(a)(1) and 8(b)(1)(A), that they jointly and severally make Glass and the other employees whole for any loss of accelerated retirement benefits which they may have suffered as a result of the Respondents' enforcement of the illegal provisions of the plan referred to above. The sums due, if any, are to be computed on a quarterly basis, with interest at 6 percent per annum, in accordance with the formula set forth in F. W. Woolworth Company, 90 NLRB 289, 291-293, and Isis Plumbing & Heating Co., 138 NLRB 716. [Recommended Order omitted from publication.]