Portage Realty Corp.

28 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Portage Realty Corporation and Local 413 , United Brotherhood of Carpenters and Joiners of Amer- ica, AFL-CIO. Case 25-CA-3425 June 30, 1970 DECISION AND ORDER By MEMBERS MCCULLOCH, BROWN, AND JENKINS On March 9, 1970, Trial Examiner Abraham H. Mailer issued his Decision in the above-entitled proceeding, finding that the Respondent had en- gaged in and was engaging in certain unfair labor practices and recommending that it cease and de- sist therefrom and take certain affirmative action, as set forth in the attached Trial Examiner's Deci- sion . Thereafter, the Respondent filed exceptions to the Decision and a supporting brief, the General Counsel filed limited exceptions to the Decision and a supporting brief, and the Charging Party filed an answering brief in support of the Decision ex- cept to the extent set forth in the General Counsel's limited exceptions Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the Na- tional Labor Relations Board has delegated its powers in connection with this case to a three- member panel The Board has reviewed the rulings of the Trial Examiner made 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 recommenda- tions' of the Trial Examiner with the following ad- ditions and modifications. 1. The Trial Examiner found, and we agree, that the Respondent violated Section 8(a)(5) and (1) of the Act by failing and refusing to bargain in good faith with the employee representative, by bargain- ing directly with individual employees regarding take-home pay, and by unilaterally granting pay in- creases and changes in working conditions. 2. We also agree with the Trial Examiner's find- ing that the Respondent independently violated Section 8(a)(1) of the Act by bargaining directly with individual employees regarding take-home pay, and by unilaterally effectuating such increases and changes in working conditions. The General ' Par 2 ( b) of the Trial Examiner's Recommended Order, which we adopt as modified below , does not , of course , require Respondent to pay the health , welfare , or pension contributions for any striking employee for the period he was on strike P We note that par I(b ) of the Trial Examiner 's Recommended Order Counsel excepts, however , to the Trial Examiner's apparently inadvertent failure to find certain addi- tional independent violations of Section 8(a)(1). We find merit in these exceptions. As alleged in the complaint , the record shows that Supervisor Beck offered increased take-home pay and added pay op- portunities such as overtime and other types of work to employees Levi Miller ( around June 1), Merlyn Miller ( around mid -June ), and Leonard Smith ( in early July) as inducements to abandon the strike and return to work . In addition , Super- visor Newcomer told Leonard Smith and another employee ( in April ) and employee Merlyn Miller (in May ) that he , Newcomer, "didn't look for Portage to sign a new contract " and "was sure" Portage "was going to drop out of the Union." Similarly, Supervisor Beck told employees Schock (in May ), Levi Miller ( in May and June), and Smith ( in May ) that Portage was not going to "go along with " the Union any longer . Accordingly, we find that , by each of these unlawful inducements to abandon the strike and return to work ,' and by the announcements of Respondent 's intent to reject the Union in future bargaining and not to sign a con- tract, Respondent violated Section 8(a)(1) of the Act. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the Recom- mended Order of the Trial Examiner and hereby orders that the Respondent, Portage Realty Cor- poration, South Bend, Indiana, its officers, agents, successors, and assigns, shall take the action set forth in the Trial Examiner's Recommended Order, as so modified: 1. Insert after paragraph 1(c) the following, and reletter present paragraphs 1(d) and (e) as (e) and (f) accordingly: "(d) Announcing to its employees that it intends by various specific means to refuse to bargain col- lectively with Local 413, United Brotherhood of Carpenters and Joiners of America, AFL-CIO, with respect to rates of pay, wages, hours of employ- ment, and other terms and conditions of employ- ment." 2. Delete from relettered paragraph 1(e) the words "like or related" and insert in their place the word "other." requires the Respondent to cease and desist from , inter alia , offering or promising employees benefits " to induce them to refrain from" their activi- ties on behalf of the Union , and covers part of the additional unlawful con- duct found herein 184 NLRB No. 4 PORTAGE REALTY CORPORATION 29 3. Insert the following as a separate paragraph following the indented unit description in the Notice to Employees marked "Appendix": We will not tell you that we intend to refuse to bargain collectively with the Union over the above subjects 4. Delete from the fifth indented paragraph of the revised Notice to Employees the words "like or related" and insert in their place the word "other." TRIAL EXAMINER'S DECISION ABRAHAM H. MALLER, Trial Examiner: On June 19, 1969, Local 413, United Brotherhood of Car- penters and Joiners of America, herein called the Union, filed a charge against Portage Realty Cor- poration, herein called the Respondent. Upon said charge, the Regional Director for Region 25 of the National Labor Relations Board, herein called the Board, on August 26, 1969, issued on behalf of the General Counsel a complaint against the Respon- dent. The Respondent filed an answer to the com- plaint, in which it denied the allegations of unfair labor practices. Thereafter on October 3, and 16, 1969, the Regional Director filed an amendment and a second amendment, respectively, to the com- plaint. Answers to such amendments were duly filed by the Respondent, denying all allegations of unfair labor practices. Briefly, the complaint as amended alleged that the Respondent had failed and refused to bargain in good faith with the Union, had engaged in conduct designed to undermine and destroy the Union's majority, by unilaterally chang- ing existing wage rates and other terms and condi- tions of employment, and bargained individually with employees in violation of Section 8(a)(5) and (1) of the Act. Pursuant to notice, a hearing was held before me at South Bend, Indiana, on October 30 and 31, and November 3, 1969. The General Counsel, the Respondent, and the Charging Party were represented and were afforded full opportunity to be heard, to introduce relevant evidence, to present oral argument, and to file briefs with me. Briefs were filed by all parties. Upon consideration of the entire record' and the briefs, and upon my observa- tion of each of the witnesses, I make the following: FINDINGS OF FACT AND CONCLUSIONS OF LAW I. THE BUSINESS OF THE RESPONDENT Respondent is, and has been at all times material herein, a corporation duly organized under and ex- isting by virtue of the laws of the State of Indiana. At all times material herein, Respondent has main- tained its principal office and place of business at South Bend, Indiana, and is engaged in the business of real estate broker, real estate agent, realtor, seller of land, and also in the business of construc- tion and sale of residential properties. During the year preceding the filing of the complaint herein, a representative period, Respondent, in the course and conduct of its business operations, sold homes the gross value of which exceeded $500,000. Dur- ing said year, Respondent received goods valued in excess of $10,000 transported to its facility in in- terstate commerce directly from States other than the State of Indiana, and purchased and received goods at its facility at South Bend valued in excess of $10,000 from firms in the State of Indiana, which firms in turn purchased said goods and caused them to be shipped from concerns outside the State of Indiana. Also, during said period, Respondent performed services valued in excess of $50,000 in States other than the State of Indiana. Accordingly, I find and conclude that the Respon- dent is engaged in commerce within the meaning of the Act and that it will effectuate the policies of the Board to assert jurisdiction here. If. THE LABOR ORGANIZATION INVOLVED Local 413, United Brotherhood of Carpenters and Joiners of America , AFL-CIO, is and has been at all times material herein a labor organization within the meaning of Section 2(5) of the Act Iii. THE ISSUES 1. Whether the Respondent bargained in good faith with the Union 2. Whether the Respondent offered, promised, and granted to its employees improved wages, hours, and working conditions if they left the Union. 3. Whether the strike of Respondent's em- ployees was an unfair labor practice strike. IV. THE ALLEGED UNFAIR LABOR PRACTICES A. Background It was stipulated and I find that on or about 1956, a majority of the employees of Respondent in a unit consisting of all carpenter employees of Respon- dent, exclusive of office clerical employees, guards and all supervisors as defined in the Act, designated the Union as their representative for the purposes of collective bargaining with the Respondent; and at all times since 1956 and continuing to the date of the hearing, the Union has been the representative for the purposes of collective bargaining of the em- ployees in said unit, and by virtue of Section 9(a) of the Act, has been and was until the date of the hearing , the exclusive representative of all em- ployees in said unit for the purposes of collective ' The General Counsel has filed a motion to correct the record in certain particulars No opposition to the motion has been filed Upon considera- tion of the motion, it is hereby ordered that the record be corrected as requested 30 DECISIONS OF NATIONAL bargaining with respect to rates of pay, wages, hours of employment, and other terms and condi- tions of employment. Until 1966, the collective- bargaining agreements signed by the Respondent and the Union were identical with those signed by contractor members of the General Building Con- tractors Association of South Bend and Mishawaka, Indiana. In 1966, a group of contractors who built primarily homes, bargaining jointly, demanded a wage differential from that set forth in the standard association agreement , and the parties agreed to a rider applying to residential construction of not more than one or two family units. The effect of this rider was to grant a 35-cent-an-hour discount to employers engaged in home building, and, addi- tionally, delayed new contribution rates to the Health and Welfare Fund for another year. The 1966 agreement was due to expire by its terms on May 31, 1969.2 B. Sequence of Events 1. The Union proposes negotiations for a new contract Under date of February 25, 1969,3 George Elrod, business representative of the Union, wrote to the Respondent stating the Union's desire to "ter- minate" the agreement on its expiration date, and requesting a meeting with representatives of the Respondent as soon as possible for the purpose of negotiating a new collective-bargaining agreement 4 Under date of February 27, the Respondent, by Earl L. Kime, executive vice president, replied in part as follows: For may [sic] years this corporation has at- tempted to negotiate provisions in our collec- tive bargaining agreement which would coin- cide with our business of building homes. In- stead, we have been forced to accept the general terms of the general contractor's agreement which are not applicable to our operation. The letter concluded by agreeing to the termination of the existing contract at its expiration date, but did not respond to the Union's request for a meet- ing for the purpose of negotiating a new agreement. On March 4, the Union, by its attorney, sent the required statutory notification of the contract's ex- piration to the State and Federal mediation and conciliation services Thereafter, there was no com- munication between the parties until April 12, when Business Representative Elrod again wrote to the Respondent, expressing surprise that the Respondent had not telephoned to arrange a 2 The basic agreement with the Association was reopened in December 1968, and a new agreement was signed on December 9 This did not apply to home builders whose contract remained in effect until May 31, 1969 ' Unless otherwise indicated, all events referred to herein occurred dur- ing 1969 4 The notice was pursuant to a provision in the contract under which the LABOR RELATIONS BOARD negotiating session and suggesting that a meeting be arranged during the week of April 14 Under date of April 18, Respondent replied to the Union 's letter, repeating its willingness to "ter- minate" the existing agreement . The letter pointed out that , faced with the probability that without an agreement , members of the Union would not be al- lowed to work for the Respondent , the Respondent had to study the laws and conditions , etc , under which most homebuilders in the area operated, and explained that , since most of the homebuilders were nonunion, the Respondent had to place itself in the same position in order to compete with the nonunion builders However , the letter continued that if the Union would present a draft agreement which would incorporate the conditions , rules, and regulations used by the nonunion builders in the area, it would consider entering into such an agree- ments The letter closed with suggested dates for a meeting 2. The meeting of April 29 The parties met on April 29 Present for the Union were Business Representative Elrod, Union President Klein , and steward Roy Nusbaum. The Company was represented by President Paul D Hass and Executive Vice President Earl L. Kime. At the outset, Kime inquired as to the authority of the committee to accept a proposal. President Klein responded that the committee had authority to negotiate, but that all agreements had to be ratified. Kime then requested that the Union try to find a way whereby the entire membership of the Union did not have to vote on a tenative agreement with the Respondent Business Representative Elrod said that he would get advice from counsel on this matter. Kime then brought up the fact that the Respondent's competition was principally non- union. Business Representative Elrod presented Kime with a copy of the association agreement, stating that this was the Union's starting point and that he expected a counterproposal. Kime made three basic complaints. wage rates, apprentice rates, and over- time rates With regard to overtime, Kime stated that he wanted time-and-a-half and makeup time on Saturdays. Business Representative Elrod replied that the Union would not accept the makeup time, but that it was leaning toward time-and-a-half which was a reduction from the then existing dou- ble-time rate With regard to apprentice rates, Kime complained that his nonunion competition did not have to pay this Elrod replied that the Union would do "everything in our power" to lower the rates, but that it could not do this in any contract was automatically renewable from year to year after May 31, 1969, unless notification was given of the desire to terminate or amend, at least 2 months prior to the expiration date 5 Although in the letter, Respondent carefully avoided the use of the term " nonunion builders," Executive Vice President Kime admitted on cross-examination that he was, in the letter, referring to nonunion builders PORTAGE REALTY CORPORATION 31 one specific contract, because the apprenticeship program involved other contractors. Kime charac- terized the journeymen's rates as ridiculous, and Elrod replied that they were negotiable. Kline also raised a question about the provision in the con- tract relating to pile driving. Elrod asked him if he did any pile driving, and Kime replied in the nega- tive. Elrod then asked the Respondent for a counter- proposal, stating that the association agreement was the Union's first proposal, its starting point. Kline replied that he would review and consider the proposal and would get back to the Union. Elrod then gave the Respondent a copy of the memoran- dum of agreement after writing the word "sample" across the top.6 3. The Company informs its employees that i.t would not sign a union contract In the meantime, the Respondent informed some of its employees that it did not intend to sign a con- tract with the Union. Thus, early in April Super- visor Clyde Newcomer told employee Leonard Smith and at least one other employee that "he didn't look for Portage to sign a new contract." Similarly, in May, Supervisor Newcomer told em- ployee Merlyn Miller that "he was sure that the company was going to drop out of the Union."' Also, early in May, the Respondent circulated among its employees a letter in which it quoted that part of Elrod's letter of February 25, which stated that the Union desired to "terminate" the contract. 4. The meeting of May 26 After further correspondence, the parties met again on May 26. The meeting opened with Kime's raising a question about the fabrication and subcon- tracting clauses. Elrod replied that the fabrication clause was the same as the one in previous con- tracts. Kime replied that he did not understand it and was not aware that it was in there. Elrod ex- plained that the subcontracting clause had been tentatively agreed to between the Union and Hart- man and Place, two residential contractors that had contracts with the Union. Kime said that he did not want the subcontracting clause. Elrod asked Kime if the Company had a counterproposal, and Kime replied that he did not. Elrod told Kime that, upon the advice of counsel, it was agreed that only those carpenters in residential construction would vote on a proposed agreement. Kime replied that this was a little progress. Kime then complained that the Union was not negotiating in good faith because of the association agreement, and Elrod again asked him for a counterproposal. Kime responded that the basic question that the Respondent had to de- cide was whether it would quit homebuilding or join ranks with Willie the Builder (Willis Construc- tion Company, a nonunion residential builder). After further discussion, Elrod again asked for a counterproposal. Kime replied that "he thought he had made a counterproposal and had proposed to terminate the agreement and he didn't feel it was necessary to make any counterproposal regarding any new agreement." The meeting ended with El- rod's promise to deliver a copy of the tentative agreement with Hartman and Place to the Respon- dent's offices. A copy of the tentative agreement was delivered to the Respondent on May 28 or 29. 5. Respondent's simultaneous effort to eliminate the Cement Masons Union The Respondent also had a contract with Local 101 of the Cement Masons Union. The contract which covered also Hartman and Place, the other residential contractors, was also due to expire May 31. Pursuant to a notice from that union, the Respondent met on March 3 with Ferrell E. John- son, and two other representatives of that union. Prior thereto, the Respondent had sent Local 101 a letter stating that the Respondent would like to ter- minate the contract and its relationship with Local 101. At the meeting, the Cement Masons gave the Respondent a proposal and indicated a desire to negotiate before the expiration of the old contract. Johnson asked Kime if he had any counter- proposals, and Kime replied that he had none, but that he would study the contract. Johnson heard nothing further from the Respondent, and around May 18 or 20 called Kime and arranged for another meeting on May 27. At that meeting, Kime stated that he would not make any offer to Local 101. The contract expired by its terms on May 3 1, and a few days later the members of that union withdrew from membership and returned to work for the Respondent. 6. Respondent's offers to employees to increase their take-home pay Meanwhile, and continuing after the strike, Respondent embarked on a program of weaning away its carpenter employees from the Union. This The account of this and the other meetings (except that of September I I) is taken from the detailed testimony of Business Representative Elrod based on his notes made at the meetings and was supported by the stipu- lated testimony of President Klein I credit Elrod's testimony Kime's testimony as to what occurred does not differ substantially from Elrod's, as Kime admitted Kime did not make any notes , but testified from memory Hass, although present at all meetings , did not testify In his account of the meeting, Kime testified that the Union was adamant in its insistence that the entire membership vote on an agreement However, it is clear from El- rod's testimony that at the second meeting, he informed Kime that the Union had checked with its attorney , and it had been agreed that only car- penters working for residential builders would vote on the agreement Similarly, Kime testified on direct examination that the Union insisted that the Respondent sign the first proposal that day On cross -examination, however, he admitted that the Union only " asked" that the Respondent ac- cept the first proposal 'The credited testimony of Smith and Miller Newcomer , admittedly a supervisor , was not called as a witness 32 DECISIONS OF NATIONAL LABOR RELATIONS BOARD it sought to accomplish by offering to increase their wages by the amount of 35 cents per hour, previ- ously paid to the Union for fringe benefits, if they remained after the contract expired ." Thus, in May, employee Stanley Golba overheard Construction Supervisor Elon W. Beck, admittedly a supervisor within the meaning of the Act, talking to another employee about an addition of 35 cents an hour and, upon inquiry , was told that the 35 cents an hour previously paid as fringe benefits would be added to the paycheck as wages after the union contract expired. Beck had similar conversations with employees James Morgan, Levi Miller, Merlyn Miller , and Leonard Smith In his conversation with Morgan , Beck implied that Morgan would work a 50-hour week, instead of the usual 40. In Smith's case, Beck offered him an additional 10 cents per hour if he learned cement finishing and did that type of work Also in June, when employee Gordon Schock went to pick up his last paycheck, Beck told him that the Respondent was not going along with the Union; that quite a few of the men were going to stay on; and that if Schock wanted to stay on, the Respondent would pay him $5 35 an hour (as against the $4 78 plus fringe benefits that he was receiving), but that he would receive no fringe benefits 9 7 The strike On June 2, the Union held a meeting of carpen- ters employed by the homebuilders. Business Representative Elrod explained that a tentative agreement between the Union and builders Hart- man and Place had been reached, but that the Union had never received a counteroffer from the Respondent. The members authorized a strike by a vote of 43 to 2. A strike was called against Respon- dent the next day. No pickets, however, were placed on the jobsites until the middle of June because of the general practice among unions in that area of attempting to avoid involvement by the other trades in the area Thereafter there were pickets at Respondent's jobsites, except for a short period in September when little or no work was in progress The picketing signs read' "On Strike for Contract " At the time of the hearing the Union was still on strike. 8. Respondent grants pay raises After the contract expired, the Respondent changed the wage structure by adding 35 cents to the basic rate and dropping the fringe benefits to those carpenters who abandoned the strike Kime admitted that the increase of the basic rate by 35 cents per hour was a "pay raise " The two car- penter foremen , Kaufman and Holderbaum , 10 were raised from $5 03 per hour to $5.63. Employee Levi Miller was given an additional increase of $25 a month for the use of his truck, plus 5 hours of overtime each week. The Union was never notified that the Respondent contemplated making a change in the wage rates 9. The meeting of August 25 Following the calling of the strike, the Union communicated with Federal Mediator Hupp, advised him of the strike, and asked him to set up another meeting with the Respondent. Hupp's efforts apparently were not successful. On August 18, the Union sent a telegram to the Respondent demanding further bargaining and asked for the Respondent's suggestion of time and place of meeting . By letter dated August 19, the Respondent stated that it was bewildered by the telegram as it had "always promptly cooperated in meeting with representatives of the Union to bar- gain in good faith for an agreement ." It suggested a bargaining meeting to be held on August 25 at its office, and the parties met on that date. Kime opened the meeting by stating that the Respondent would be willing to sign a contract which was based on the economic conditions of the area. Elrod stated that the Union had completed negotiations and signed agreements with Hartman and Place and other homebuilders, and would like to have this type of agreement with the Respon- dent. He thereupon showed Kime either the signed agreement or a copy thereof He explained further that the controversial subcontracting clause had been deleted. Kime replied that the Hartman and Place agreement was out of the economic picture for the Respondent and he could not agree to it Elrod then stated that this represented the Union's third proposal and that if he did not like the con- tract, he should put something in writing so that the Union could consider it. Kime replied, "Well, didn't I put it in writing?" Elrod asked him what he meant by that, and Kime referred to the letter in which the Respondent had agreed to terminate the previously existing agreement and said, "That's our proposal." Elrod demanded a counterproposal from the Respondent, and Kime said that it would take some time for research to come up with an agree- ment-about 2 weeks-but he would come up with a written counterproposal and would get in touch with Elrod to set up a meeting to present the coun- terproposal " Under the contract , Respondent paid the Union 35-1 /2 cents per hour for each carpenter employee, made up as follows 20 cents into the pension fund , 15 cents to the health and welfare fund , and one - half cent for the ap- prentice training fund The foregoing is based on the credited testimony of the named em- ployees Schock 's testimony was undenied Superintendent Beck did not recall any such conversation with Golba, but admitted offering the addi- tional 35 cents per hour to the other employees 10 The status of Holderbaum as a member of the unit was not agreed on by the parties , who stipulated as to the rest of the employees in that unit No evidence was offered on the matter PORTAGE REALTY CORPORATION 33 10. The meeting of September 1 1 The parties met for the last time on September 11 Elrod was not present, and President Klein spoke for the Union and took minutes." Kime passed out a four-page proposal with a letter of ex- planation. Klein examined the proposal and re- marked about the absence of a wage proposal. Kime admittedly responded "that we needed to work on an agreement that fits our business before we can discuss the wages " The meeting ended with Kime's urging the Union to give his proposal seri- ous consideration.12 C. Concluding Findings 1 The refusal to bargain It is clear from the foregoing, and I find, that the Respondent had determined to rid itself of the Union and pursuant to that determination did not bargain in good faith with the Union in violation of Section 8(a)(5) and (1) of the Act Respondent's conduct in the negotiating sessions demonstrates beyond doubt that the Respondent did not enter into the negotiations "with an open mind and pur- pose to reach an agreement consistent with the respective rights of the parties" (L. L. Mature Transport Company v. N.L.R.B , 198 F 2d 735, 739 (C.A. 5) ). Indeed, Respondent's actions in these sessions do not rise even to the level of "surface bargaining" which , in itself, has been condemned as violative of Section 8(a)(5) of the Act. N.L.R.B. v. Herman Sausage Company, 275 F.2d 229, 232 (C.A. 5). Thus, until the September meeting, the Respondent merely rejected the Union's proposals and did not make any proposals of its own, other then its proposal to terminate the then existing con- tract. And when it finally made a counterproposal to the Union in September, its proposal was meaningless, as it contained no proposed wage rates or other specific working conditions. It was a proposal in form only, wholly devoid of sub- stance-in sum, a pure sham. It is evident from the negotiations that the Respondent never intended to enter into an agreement with the Union and made a very poor pretense of going through the motions of bargaining. Texas Coca-Cola Bottling Company, 146 NLRB 420, 430-431, enfd.. 365 F.2d 321 (C.A. 5), N.L.R.B. v. Reed & Prince Manufacturing Company, 118 F.2d 874, 882 (C.A. 1), cert. denied 313 U.S. 595,13 Since it is clear from Respondent's conduct dur- ing the negotiations that Respondent did not bar- gain in good faith, it is unnecessary to look beyond the negotiations.14 Yet if one were to look at the totality of Respondent's conduct, such an examina- tion would confirm and solidly buttress the conclu- sion that the Respondent did not intend to enter into a contract with the Union. First, there is the undenied testimony that Respondent's Supervisor Newcomer told employees while the negotiations were pending that "he didn't look for Portage to sign a new contract," and that "he was sure that the Company was going to drop out of the Union." Chatham Manufacturing Company, 172 NLRB No. 219. Second, while the negotiations were going on, Respondent approached employees individually and offered them increased take-home pay if they would remain with the Respondent after the expira- tion of the contract. Third, it granted individual employees such increases after the strike had com- menced to induce them to leave the Union and return to work. Fourth, it engaged in parallel treat- ment of Local 101 of the Cement Masons Union which had attempted unsuccessfully to negotiate a new contract with the Respondent at the same time as the Union herein. Not only does the foregoing recital demonstrate beyond dispute that the Respondent did not bargain in good faith, but it may be noted that Respon- dent's conduct in bargaining directly with in- dividual employees regarding take-home pay was independently violative of Section 8(a)(5) of the Act,'-' as well as of 8(a)(1),11 as was its unilateral granting of such increases and changes in working conditions.17 Respondent contends that it made no unilateral changes in wages and working conditions. Its argu- ment runs as follows: The payment of 35 cents per hour to the union health and welfare and pension funds was made pursuant to the preexisting con- tract and related only to members of the Union. When the contract expired and certain employees abandoned the strike, they were no longer members of the Union, and Respondent was relieved of its obligation to pay this sum to the Union. Since the Respondent did not want to cut wages of these em- " The account of this meeting is based on the credited testimony of Klein ix Other features of Respondent's proposal are The only reference to hours of work or payment of overtime is a provision that the Respondent should be subject to the Federal Wage and Hour Act The provision in the prior contract relating to maintenance of membership in the Union was replaced by language expressly negating such requirement No provision was made for the following matters which had been contained in the prior agreement apprenticeship program, fringe benefits, e g , health and wel- fare and pension programs, holidays, jurisdictional dispute procedure, al- most all working conditions, e g , report for work, layoff, discharge, and slow-up pay, shifts, work limitations, premium pay, and work outside the territory In lieu thereof, the proposal contained a strong management rights clause " Indeed, the instant case is even stronger than Reed & Prince There, the court observed " though agreeing with the Union on some matters [the Respondent] showed no disposition to consider the seriously disputed items from any other point of view than requiring a complete surrender on the part of the Union to the proposals of the respondent " In the instant case, the Respondent did not agree with the Union on miv matters, and of- fered no proposals whatsoever "Orkin Exterminating Company of Florida, Inc , 152 NLRB 83, 84 "In the more difficult case the Board must take an intelligent look at the totality of the Respondent's conduct " See also N L R B v Reed & Prince Manufacturing Company, 205 F 2d 131, 134 (C A I ), cert denied 346 U S 887, Teras Cocoa-Cola Bottling Company, supra, 429 15 Medo Photo Supply Corporation v N L R B , 321 U S 678, 683-684 16 E g , Sunshine Art Studios, 152 NLRB 565, 569-570 it N L R B v Katz, 369 U S 736, 745, 747 34 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ployees, it paid them the sum of 35 cents per hour previously paid to the Union. The fallacy of this argument is that it was the Respondent's unfair labor practice in making the offer to the employees to induce them to abandon the strike that created the situation. Thus, in uni- laterally effectuating the change in wages and working conditions, Respondent was merely carry- ing out its illegal promises to the individual em- ployees . Furthermore , Respondent 's argument ignores the fact that employee Levi Miller was given an increase of $25 per month for the use of his truck, plus 5 hours of overtime each week-a clear change in working conditions. Likewise, the carpenter foremen received raises of 60 cents per hour. Despite the strike, the Union continued to be the exclusive bargaining representative of the em- ployees. At no time, either before or after the strike commenced, did Respondent bargain with the Union concerning these changes, as it was required by law to do. N.L.R.B. v. Remington Rand, Inc., 130 F.2d 919, 927 (C.A. 2); Industrial Union of Marine & Shipbuilding Workers v. N.L.R.B., 320 F.2d 615, 620 (C.A. 3), cert. denied 375 U S. 984; Sioux City Bottling Works, 156 NLRB 379, 385; Harold W. Hinson, d/b/a Hen House Market No. 3, 175 NLRB 596.18 It is well settled that the calling of a strike does not relieve the employer of his duty under the Act to bargain collectively with his employees. See, e g., N.L.R.B. v. Remington Rand, Inc., supra, 927; Black Diamond S. S. Corporation v. N.L.R.B., 94 F.2d 875 (C.A. 2), cert. denied 304 U.S. 579. As the Court of Appeals for the Second Circuit stated in N.L.R.B. v. Pecheur Lozenge Co., Inc., 209 F.2d 393, cert. denied 347 U.S. 953: "On the contrary, the need for carrying out that obligation when a strike is in progress is all the greater in order that a peaceful settlement of the dispute may be reached." (Id. at 403). Accordingly, I find and conclude that the Respondent failed and refused to bargain with the Union in violation of 8(a)(5) and (1) of the Act. 2. The nature of the strike That the strike which the Union called on June 2 was an unfair labor practice strike is so clear from the record as to obviate the necessity for extended discussion. It followed Respondent's egregious un- fair labor practices in failing to negotiate in good faith and was called by a vote of the membership of the Union because Respondent had not bargained in good faith. Despite this, Respondent refers to the strike as a "work stoppage" and argues that it was the expiration of the contract, rather than any al- leged unfair labor practices, that was the sole reason for the Union's action. Respondent points to the fact that the Union did not immediately picket the jobsites and, further, when it did so 2 weeks later its picket signs read: "On Strike for Contract." The argument is patently lacking in merit. Whether the strike was an unfair labor practice strike or otherwise is determined by Respondent's intransigent failure to bargain in good faith and by the Union's vote to strike for that express reason. And, as I have indicated, this is crystal clear from the record. The fact that the Union did not picket immediately is of no consequence. Business Representative Elrod explained that the Union's failure to do so was because of an understanding with other unions. In any event, there is no legal requirement that a union must picket the employer when it calls a strike . Nor is it significant that, when the Union did picket, its signs did not in express terms charge the Respondent with unfair labor practices.19 Thus, the fact that picket signs in- dicated that the Union sought recognition was held not to be determinative of the nature of the strike where the entire record showed that recognition was not an objective of the strike. Happ Brothers Company, Inc., 90 NLRB 1513, 1516-117, reversed on other grounds 196 F.2d 195 (C.A. 5). Similarly, where the picket signs indicated that a strike had economic objectives, it was held that this circum- stance did not require a holding that the strike was economic in character. American Manufacturing Company of Texas, 98 NLRB 226, 243, reversed on other grounds 203 F 2d 212 (C.A. 5).20 Moreover, the strike was prolonged and ag- gravated by Respondent's continued unfair labor practices. Thus, after the inception of the strike it unilaterally changed wages and working conditions, and when asked to resume bargaining, continued to bargain in bad faith. Hence, even if the strike had not been an unfair labor practice strike at its incep- tion , the Respondent's unfair labor practices con- verted the strike to an unfair labor practice strike. N.L.R.B. v. Crosby Chemicals, Inc., 188 F.2d 91, 95 (C.A. 5); N L.R.B. v. Remington Rand, Inc., 130 F.2d 919, 928, fn 8(C.A. 2), General Drivers and Helpers, Local 662 v. N.L.R.B., 302 F.2d 908, 911 (C.A.D C.), cert. denied 371 U.S. 827. i' There is no contention or evidence that the desertion of the employees who abandoned the strike destroyed the Union 's majority To the contrary, the record shows that at the time of the strike , Respondent employed 23 men who were members of the Union Only 5 (plus Foreman Holdcrbaum whose status as a member of the unit was in dispute ) abandoned the strike And even if the Union 's majority had been destroyed, such destruction could not be relied on by Respondent , as it was its unfair labor practices that brought about such a situation Medo Photo Supply Corp v N L R B supra, 687 i' The signs which read "On Strike for Contract" did not negate the fact that the strike was an unfair labor practice strike As previously found, in voting to strike , the Union had taken the position that it had been denied a contract by virtue of Respondent 's unfair labor practice in refusing to bar- gain in good faith x" it is, of course , well settled that a strike directed against an employer's unfair labor practice does not lose its character as an unfair labor practice strike simply because it may also have economic objectives See, e g , N L R B v Remington Rand, Inc , 94 F 2d 862, 872, cert denied 304 U S 576 PORTAGE REALTY CORPORATION Respondent relies on cases that are inapposite. In N.L.R.B. v Getlan Iron Works, Inc., 377 F 2d 894 (C.A. 2), the court disagreed with the Board 's hold- ing that evidence of the employer 's conduct sub- sequent to a bargaining session demonstrated that the employer had not bargained in good faith. The court relied on the fact that at the last bargaining session the employer agreed to some of the terms of the contract proposed by the Union and rejected others and had made a substantially economic offer . In the case at bar , the Respondent had made no offer whatsoever during the negotiations, but limited itself to rejecting the Union 's proposal. The case of Hawaii Meat Co. v. N.L.R.B., 321 F.2d 397 (C.A. 9), bears no relationship to the case at bar. The only issue involved there was whether an em- ployer faced with an economic strike may subcon- tract his work without bargaining with the union about that decision . Respondent 's reliance upon Simmons, Inc. v . N.L.R.B., 315 F 2d 143 (C.A. 1), is likewise misplaced . There , a dissident group of employees , in disagreement with the union , caused the employees to strike . The employer discharged this group and erroneously included one employee who had not participated in the action of the group. Thereupon , the employees again struck to protest the discharged . The court held that although the discharge of the one employee was an unfair labor practice , it was apparent that the second strike would have occurred in any event because of the employer's discharge of the dissident group. Ac- cordingly , it concluded that the strike was not caused by the unfair labor practice of the employer with regard to the individual employee who had been wrongfully discharged . In so holding, the court did not depart from the well-established prin- ciple that " if an unfair labor practice had anything to do with causing the strike, it was an unfair labor practice strike" ( General Drivers and Helpers, Local 662 v. N.L.R.B., supra ). The facts of the case at bar place it squarely within the rule just quoted. Ac- cordingly , I find and conclude that the strike which occurred on June 2 was an unfair labor practice strike from its inception and was prolonged and ag- gravated by Respondent's unfair labor practices thereafter. V. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of Portage Realty Corporation set forth in section IV, above, occurring in connection with the operations described in section I, above, have a close, intimate, and substantial relationship to trade, traffic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow thereof. " Harold W Hinson, dibla Hen House Market No 3, supra tz The prior history of the Porter case is as follows The original Board's decision and order appears at 153 NLRB 1370 and was enforced by the VI. THE REMEDY 35 Having found that the Respondent has engaged in unfair labor practices within the meaning of Sec- tion 8(a)(5) and (1) of the Act, I shall recommend that it cease and desist therefrom and that it take certain affirmative action designed to effectuate the policies of the Act. Having found that the Respondent has refused to bargain with the Union in violation of Section 8(a)(5) and (1) of the Act, I shall recommend that it be ordered to bargain in good faith with the Union, upon request, as the exclusive representa- tive of all its employees in the appropriate unit described concerning rates of pay, wages, hours of employment, and other terms and conditions of em- ployment and, if an understanding is reached, em- body csuch an understanding in a signed agree- ment. In addition, in order to restore the status quo ante, I shall recommend that the Respondent be or- dered to make whole the employees in the unit by paying all health and welfare and pension contribu- tions, as provided in the expired collective-bargain- ing agreement, which have not been paid and which would have been paid absent Respondent's unlaw- ful unilateral discontinuance of such payments found herein. Said payments shall continue until such time as the Respondent fulfills its bargaining obligation by either bargaining out a new agree- ment covering the subject or bargaining to an im- passe 21 The Union contends that the Board should go further and require the Respondent "to commence bargaining with an initial offer being the old con- tract plus the wage increases already given, with, of course, the concessions made by the Union." It ar- gues that since the Respondent was willing to rid it- self of the Union at this price, this should be its ini- tial bargaining offer. This, the Union says, is not an unreasonable offer even in a vacuum, because Hartman and Place, Respondent's competitors, had agreed to a 62-cent wage increase, effective June 1, 1969, and an additional 40 cents effective June 1, 1970. In support of its position, the Union relies on H. K. Porter Co., 172 NLRB No. 72, upon remand from the Court of Appeals for the District of Columbia, enforced 414 F.2d 1123, cert. granted 34 LW 3114, where the Board ordered the em- ployer to grant a checkoff provision to the union because the employer's bargaining position oppos- ing a checkoff was due solely to its desire to thwart agreement on a contract.22 The Union's proposal formula is too simplistic. It ignores the fact that in granting the 35-cent raise to the journeymen and the 60-cent raise to the foremen, the Respondent relieved itself of the other working conditions, including fringe benefits, im- posed by the preexisting contract. The raise thus Court of Appeals, 363 F 2d 272, cert denied 385 U S 851, order clarified, 389 F 2d 295 36 DECISIONS OF NATIONAL LABOR RELATIONS BOARD granted does not, therefore , reflect what the Respondent would have offered had it bargained in good faith . Furthermore , to the extent that the Union 's position is supported by the Porter case, such support has evaporated . As this decision is being written , the Supreme Court has reversed the decision in that case, holding that " allowing the Board to compel agreement when the parties them- selves are unable to agree would violate the funda- mental premise on which the Act is based-private bargaining under governmental supervision of the procedure alone, without any official compulsion over the actual terms of the contract." (397 U.S. 99, 108.) RECOMMENDED ORDER Upon the basis of the foregoing findings of fact and conclusions of law and the entire record in the case, I recommend that the Respondent, its of- ficers, agents, successors, and assigns, shall. 1 Cease and desist from. (a) Failing or refusing to bargain collectively with respect to rates of pay, wages, hours of em- ployment, and other terms and conditions of em- ployment with Local 413, United Brotherhood of Carpenters and Joiners of America, AFL-CIO, as the exclusive representative of its employees in the appropriate unit described below and, if an agree- ment is reached, embody such understanding in a signed agreement. The bargaining unit is All carpenter employees of Respondent, exclu- sive of office clerical employees, guards, and all supervisors as defined in the Act and exclu- sive of all other employees. (b) Bargaining directly and individually with em- ployees concerning rates of pay, wages, hours of employment, and other terms and conditions of em- ployment, or offering, promising, or granting em- ployees wage increases and/or other benefits and improvements in their working conditions and terms of employment to induce them to refrain from becoming or remaining members of the Union, or to induce them to abandon their mem- bership in and activities on its behalf. (c) Unilaterally changing the wages or working conditions of employees without notifying, consult- ing, or bargaining with the Union prior to making such changes, except that nothing herein contained shall be construed as requiring Respondent to revoke any wage increase or other benefits which it has heretofore granted. (d) In any like or related manner interfering with, restraining, or coercing its employees in the exercise of the right to self-organization, to form, join, or assist any labor organization, to bargain col- lectively through representatives of their own choosing, and to engage in other concerted activi- ties for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any and all such activities, except to the extent that such right may be affected by an agreement requir- ing membership in a labor organization as a condi- tion of employment, as authorized in Section 8(a)(3) of the Act, as modified by the Labor- Management Reporting and Disclosure Act of 1959 2. Take the following affirmative action which is necessary to effectuate the policies of the Act: (a) Upon request , bargain collectively with Local 413, United Brotherhood of Carpenters and Joiners of America, AFL-CIO, as the exclusive representative of the employees in the aforesaid ap- propriate unit 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 (b) Make whole the employees in the ap- propriate unit by paying all health and welfare and pension contributions , as provided in the expired collective-bargaining agreement , which have not been paid and which would have been paid absent Respondent 's unlawful conduct found herein, and continue such payments until such time as the Respondent negotiates in good faith with the Union to a new agreement or an impasse. (c) Post at its office and facility at South Bend, Indiana, copies of the attached notice marked "Ap- pendix."23 Copies of said notice, on forms provided by the Regional Director for Region 25, after being duly signed by an authorized representative, shall be posted by the Respondent immediately upon receipt thereof, and be maintained by it for 60 con- secutive days thereafter , in conspicuous places, in- cluding all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to insure that said notices are not altered , defaced, or covered by any other material. (d) Notify said Regional Director , in writing, within 20 days from the receipt of this Decision, what steps have been taken to comply herewith.24 29 In the event no exceptions are filed as provided by Section 102 46 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, recommendations, and Recommended Order herein shall, as provided in Section 102 48 of the Rules and Regulations, be adopted by the Board and become its findings, conclusions, and order, and all objections thereto shall be deemed waived for all purposes In the event that the Board's Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "Posted by Order of the Na- tional Labor Relations Board" shall be changed to read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board - °' In the event that this Recommended Order is adopted by the Board, this provision shall he modified to read "Notify the Regional Director for Region 25, in writing, within 10 days from the date of this Order, what steps Respondent has taken to comply herewith " _ PORTAGE REALTY APPENDIX NOTICE TO EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL NOT fail or refuse to bargain collec- tively with respect to rates of pay , wages, hours of employment, and other terms and condi- tions of employment with Local 413, United Brotherhood of Carpenters and Joiners of America, AFL-CIO, as the exclusive represen- tative of our employees in the unit described below, and , if an agreement is reached, em- body such understanding in a signed agree- ment . The bargaining unit is: All carpenter employees employed by us, exclusive of office clerical employees, guards, and all supervisors as defined in the Act and exclusive of all other em- ployees. WE WILL NOT bargain directly and in- dividually with our employees concerning rates of pay, wages, hours of employment , and other terms and conditions of employment , nor will we offer, promise, or grant employees wage in- creases and/or other benefits and improve- ments in their working conditions and terms of employment to induce them to refrain from becoming or remaining members of the Union, or to induce them to abandon their member- ship in and activities on behalf of the Union. WE WILL NOT unilaterally change the wages or working conditions of our employees without notifying , consulting , or bargaining with the Union prior to making such changes, except that nothing herein contained shall be construed as requiring us to revoke any wage increase or other benefits which we have heretofore granted. WE WILL NOT in any like or related manner interfere with , restrain, or coerce our em- ployees in the exercise of the right to self-or- CORPORATION 37 ganization, to form, join, or assist any labor or- ganization, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mu- tual aid or protection, or to refrain from any and all 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) of the National Labor Rela- tions Act, as amended, as modified by the Labor-Management Reporting and Disclosure Act of 1959 WE WILL, upon request, bargain collectively with Local 413, United Brotherhood of Car- penters and Joiners of America, AFL-CIO, as the exclusive representative of the employees in the aforesaid appropriate unit 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. WE WILL make to the appropriate funds, from the date of the expired agreement, all such health and welfare and pension payments which we have not made and which we would have made absent our unilateral changes PORTAGE REALTY CORPORATION (Employer) Dated By (Representative) (Title) This is an official notice and must nog be defaced by anyone. This notice must remain posted for 60 consecu- tive days from the date of posting and must not be altered, defaced, or covered by any other material. Any questions concerning this notice or com- pliance with its provisions may be directed to the Board's Office, 614 ISTA Center, 150 West Market Street, Indianapolis, Indiana 46204, Telephone 317-633-8921. 427-835 0 - 74 - 4