Occidental Petroleum Corp.

304 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Hooker Chemical Corporation, a Wholly Owned Subsidiary of Occidental Petroleum Corp. and Local 820, International Chemical Workers Union; Local 696, International Chemical Workers Union; Local 110, International Chemical Workers Union; Niagara Hooker Employees' Union; Operating &, Stationary Engineers, Local 286, International Union of Operating Engineers, AFL-CIO; Local Lodge 2112, International Association of Machin- ists and Aerospace Workers, AFL-CIO. Cases 7-CA-7515,7-CA-7515 (2) (formerly 9-CA-5328), 7-CA-7515 (3) (formerly 19-CA-4488), 7-CA -7515 (4) (formerly3-CA-3971), 7-CA-7515 (5) (formerly 19-CA-4609), and 7-CA-7515 (6) (formerly 3-CA-3990) October 31, 1970 DECISION AND ORDER BY CHAIRMAN MILLER AND MEMBERS FANNING AND BROWN On June 16, 1970, Trial Examiner Marion C. Ladwig issued his Decision in the above-entitled proceeding, finding that the Respondent had engaged in and was engaging in certain unfair labor practices and recommending that it cease and desist therefrom and take certain affirmative action, as set forth in the attached Trial Examiner's Decision. Thereafter, the Respondent filed exceptions to the Decision and a supporting brief, and the General Counsel filed cross- exceptions and a supporting brief. Respondent also requested oral argument.' Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its powers in connection with this case to a three-member panel. The Board has reviewed the rulings of the Trial Examiner's rulings 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 recommendations of the Trial Examiner.2 ORDER Corp., its officers, agents, successors, and assigns, shall take the action set forth in the Trial Examiner's Recommended Order, with the following modifica- tion: Substitute the attached notice for the Trial Examin- er's Decision. 1 In accordance with the contentions of the General Counsel , we find that employees in the Armed Services are "employees" within the meaning of the Act. Emil Denmark, Inc. 121 NLRB 1370; Link-Belt Co., 91 NLRB 1143; and Lynch Carrier Systems, 92 NLRB 867. However, whether individuals within that status are entitled to be paid the 1969 Christmas bonus, as the General Counsel contends , depends on whether or not they would have been paid such bonus absent Respondent's unilateral action. This matter has not been fully litigated and will be left to the compliance stage of this proceeding. 2 In accordance with the contentions of the General Counsel, we find that employees in the Armed Services are "employees" within the meaning of the Act. Ernie Denemark, Inc., 121 NLRB 1370 (1958); Link-Belt Co., 91 NLRB 1143 (1950); and Lynch Carrier Systems, 92 NLRB 867 (1950). We also find that retirees and pensioners are "employees" within the meaning of the Act. Pittsburgh Plate Glass, 177 NLRB No. 114. To the extent that this finding is in conflict with the decision of the U .S. Court of Appeals for the Sixth Circuit in Pittsburgh Plate Glass Co. v. N.LR.B., 427 F.2d 936, we respectfully disagree and adhere to our view until such time as the U.S. Supreme Court has passed on the matter . However, whether individuals in either status are entitled to be paid the 1969 Christmas bonus, as the General Counsel contends , depends on whether or not they would have been paid such bonus absent Respondent's unilateral action. This matter has not been fully litigated and will be left to the compliance stage of this proceeding. Chairman Miller would find in agreement with the court that retirees and pensioners are not "employees." TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE MARION C. LADWIG, Trial Examiner: These consolidated cases were tried in various cities on March 23, 24, 31 and April 2, 3, and 14, 1970, pursuant to charges filed by the six above-named Unions (by Locals 110, 696, and 820, respectively, on September 4, 9, and 16,' by the Niagara Employees and Local 286, respectively, on December 11 and January 2, 1970, and by Lodge 2112 on January 12, amended January 26 and February 19, 1970), and pursuant to a consolidated complaint issued on December 18 and amended February 20, 1970. The primary issue is whether the Respondent, Hooker Chemical Corporation, herein called the Company, violat- ed its statutory bargaining obligation by announcing to the Unions, without prior notice or consultation, an unaltera- ble decision to cancel the annual Christmas bonus, thereby unilaterally changing the emoluments of its employees in violation of Section 8(a)(5) and (1) of the National Labor Relations Act, as amended. Upon the entire record, including my observation of the demeanor of the witnesses, and after due consideration of the General Counsel's memorandum and the Company's excellent brief, I make the following: Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the Recommend- ed Order of the Trial Examiner and hereby orders that the Respondent, Hooker Chemical Corporation, a wholly owned subsidiary of Occidental Petroleum FINDINGS OF FACT 1. THE BUSINESS OF THE COMPANY AND THE UNIONS INVOLVED The Company, a wholly owned subsidiary of Occidental 1 All dates, unless otherwise indicated, are in 1969. 186 NLRB No. 49 HOOKER CHEMICAL CORPORATION 305 Petroleum Corp., is a New York corporation, engaged in the manufacture and sale of chlorine, caustic soda, phosphorus, phosphorous compounds, and related prod- ucts. At each of its plants located at Niagara Falls and North Tonawanda, New York, at Montague, Michigan, at Jeffersonville Indiana, and at Tacoma, Washington (the plants involved in this proceeding), it annually receives goods and materials valued in excess of $50,000 directly from outside the State in which the plant is located, and annually ships products valued in excess of $50,000 directly to points outside the State . The Company admits, and I find, that it is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act, and that each of the six Unions involved in this proceeding is a labor organization within the meaning of Section 2(5) of the Act. II. THE ALLEGED UNFAIR LABOR PRACTICES A. Discontinuance of Christmas Bonus In 1969, after becoming a subsidiary of Occidental Petroleum Corp., the Company began a review of the fringe benefits being provided the employees in its 28 plants. In many-but not all-of the plants, the Company had been giving both hourly and salaried employees an annual Christmas bonus (or gift) of $25-$12.50 if the employee had less than 6 months of service. (Since 1943 , when the Internal Revenue Service ruled that the "gift" was taxable, $5 and $2.50, respectively, had been withheld for taxes.) The annual cost to the Company was about $250,000. Rather than giving the same annual bonus to employees in the remaining plants, the Company decided to eliminate the Christmas bonus completely , to substitute $2,000 of life, accidental death , and dismemberment insurance for the salaried (unrepresented) employees, and to make the same offer of substitution to the various unions representing the hourly employees. At the five plants involved in this proceeding, company representatives announced in August and September the discontinuance of the Christmas bonus, and offered to negotiate for a substitution of insurance . The Company did not offer to negotiate on whether or not the bonus should be eliminated. In each of the six bargaining units, the union representatives protested the Company's unilateral decision to discontinue the bonus . Two of the Unions, at the Niagara Falls and Tacoma plants, filed grievances. The Company rejected the grievances , stating that the Christ- mas "gift" was given at the Company's sole discretion, and that the matter was not grievable. The Christmas bonus was not included in the respective collective-bargaining agreements, expiring in 1970 and 1971. The $25 bonus had been given each year for over 20 years at the Niagara Falls and Tacoma plants, for 15 years at the Montague plant, and for about 10 years at the North Tonawanda and Jeffersonville plants . At the Company's Niagara Falls "mother plant," where the Niagara Hooker Employees' Union represents about 1 ,275 employees, the Union in 1960 used the Christmas bonus as a talking point for selling the collective-bargaining agreement to the membership . As credibly testified by Union President Oswald L. Schiavi, the union leadership "was trying to sell the contract for the second time. . . . [T]he membership still refused to buy the package" because "a rival . . . firm within the same locality, was at that time receiving a few cents an hour more than we were. I used the Christmas bonus of a penny and a fifth an hour to point out to the membership" that the bonus closed the gap, from 3 or 4 cents to only 1 or 2 cents an hour, and the membership ratified the agreement. Insofar as the testimony reveals, the Christmas bonus had never been mentioned in negotiations at any of the plants, except at the Niagara Falls plant where, as Schiavi also testified, the union negotiating committee took into consideration the Christmas bonus when preparing its wage packages, and mentioned the bonus at four or five negotiations. Schiavi testified that the Company "always seemed to object to the words `Christmas bonus' at any of the negotiations tables... . They just bypassed it and changed the subject immediate- ly." There was no past practice clause in any of the agreements. The Christmas bonus was not given at any of the plants in 1969. In lieu of the bonus , the Company started providing the new insurance benefits to salaried employees on September 1, and to hourly employees at various plants whenever the bargaining representatives approved the substitution. At the five plants involved in this proceeding, the hourly employees received neither the bonus nor the insurance. B. Credibility Issue A serious credibility issue arose from the testimony of Thomas B. Moorhead, the Company's vice president of Industrial Relations, that the decision to discontinue the Christmas bonus to hourly employees was made after company representatives discussed the proposed substitu- tion of insurance with union representatives. Other testimony and evidence indicate that the decision was made before. Vice President Moorhead was the only witness who had attended the June 20 meeting of the Company's Retirement Program Committee which, as discussed below, made certain corporate decisions concerning the substitution of insurance for the "Christmas Gift Program." Following this meeting of top company officials, several lower ranking representatives of the Company were admittedly told that a corporate decision had been made to discontinue giving the Christmas bonus to hourly employees . Union representa- tives at all five of the plants were given the same information, beginning in August. John W. Judy, works manager at the Tacoma plant, testified that in the early part of August , he received a telephone call from Vice President Moorhead, who told him that the Company was "planning to discontinue" the Christmas bonus, and instructed him to announce that the Company "had decided to discontinue the Christmas bonus, the Christmas gift." Judy further admitted that on August 19, he met with union representatives of the two bargaining units in the plant and "announced the Christmas gift was to be discontinued for the hourly people." (Local 286 Acting Steward Chester Larson, Jr., and Local 110 Financial Secretary Vernon V. Gierke credibly testified that Judy announced that the "Christmas bonuses would not be paid" at any of the plants in 1969 or 306 DECISIONS OF NATIONAL LABOR RELATIONS BOARD in the future, that this was "direct from corporate headquarters," and that it was due to the merger with Occidental, "to make the plants uniform throughout the Hooker combine.") Phillip D. Bosso, manager of Industrial Relations for the Industrial Chemical Division (comprising the Niagara Falls, Montague, Tacoma, and seven other plants), admitted that early in July, Vice President Moorhead told him, in a meeting with various other corporate and division officials, that the Company had decided to eliminate the Christmas gift for all employees. Labor Relations Manager Joseph G. Albano, on Bosso's staff, admitted that before August, Bosso told him that the Company had decided to discontinue payment of the Christmas gift to all employees, salaried and nonsalaried. Furthermore, as testified by Arthur Brierley, industrial relations administrator at the Montague plant, Bosso telephoned him on August 12 and instructed him to inform the Union that the Company "was going to discontinue the Christmas gift." (The next day, August 13, Brierley admittedly told the union representa- tives that the Company "was going to discontinue the Christmas gift for the hourly employees.") Likewise, at the Niagara Falls plant, Industrial Relations Administrator William J. Barnes admitted that "this is probably correct," that before he spoke to the'Union there, Bosso told him that the Company had decided to discontinue giving the Christmas gift to the employees. (Union President Schiavi credibly testified that on August 15, Barnes met with the union representatives and told them "unofficially" that a notice had just been received that the Christmas bonus to union employees "will be discontinued," and that on August 20, Albano "told us that he was officially notifying us that the Company was discontinuing the Christmas bonus and that they would like to substitute $2,000 worth of free life insurance.") Barnes admitted that Albano stated in the August 20 meeting that Albano "had been advised that the purpose of discontinuing the Christmas bonus was that the corporation wanted to standardize things and make them uniform." As credibly testified by Union President Schiavi, Albano indicated his willingness to issuing a letter similar to the one written to the salaried employees, concerning the discontinuance of the Christmas bonus and the substitution of insurance. The letter was not issued, and in early September, Shiavi asked Bosso about the letter "that Mr. Albano promised us." Bosso informed Shiavi and another union official that there would be no letter because "he did not think that he could word it in any way that it wouldn't be used against'them." In the meantime, before Bosso rejected the idea of a letter at the Niagara Falls plant, Albano had approved the posting of a written notice at the Jeffersonville plant. This notice, dated August 26, stated that "it is now the policy" of the Company that the Christmas "bonus will no longer be given to the employ- ees." Concerning the North Tonawanda plant, Industrial Relations Administrator Norman Hansen credibly testified that before he met with union representatives there on September 19, he was told by his superior, Durez Division Industrial Relations Manager Frederick C. Gray, Jr., that "the benefits group of the corporate staff had reviewed the benefits program in general and that they planned to discontinue the Christmas gift, "to standardize the fringe benefits. (Personnel Development Supervisor Sebastian Paterniti testified that Gray told him before the September 19 meeting that "the corporate pension committee had decided that the bonus would no longer be given.") Hansen's notes, taken in meetings with union representa- tives, reveal that Hansen advised the Union on September 19 "that the Company will discontinue the Christmas gift as of this year," and that Gray opened the October 29 meeting by stating, "The corporation has eliminated the Christmas gift." (I discredit Gray's denial that he had been advised by top management that the Christmas gift would not be made. Gray was present with Bosso at the July meeting in which, as admitted by Bosso, Vice President Moorhead stated that the Company had decided to eliminate the Christmas gift for all employees. The minutes of that July 8 meeting state that the replacement of insurance for the Christmas gift "does not automatically apply to hourly employees and may be the subject of union contract negotiations," but do not state whether or not a decision had already been made to eliminate the hourly employees' Christmas gift.) This testimony indicates that before the Company met with the union representatives, to propose the substitution of insurance for the Christmas bonus, the Company had already made a unilateral, unalterable corporate decision to discontinue the bonus for all employees. Vice President Moorhead, however, denied this. Near the beginning of the trial, before any of this evidence was introduced, Vice President Moorhead was called as an adverse witness to testify about when the decision was made to terminate the Christmas bonus at the Montague plant. He denied that any decision had been made in the June 20 Retirement Program Committee meeting with respect to terminating the hourly employees' Christmas gift. According to him, "There was never any decision to terminate the cash gifts as far as the Montague union was concerned until such time as we had time to sit down and talk to the Montague union. The decision had to do with the salaried employees." When asked when the decision was made not to pay the Christmas bonus at Montague, Moorhead answered, "I can't give you a specific date on that but it was sometime in the late fall" when he personally made the decision. At the next day of the trial, the Company produced the official minutes of the Retirement Program Committee's June 20 meeting. Although the minutes elsewhere refer specifically to "salaried employees," there is nothing in the paragraph concerning the Christmas Gift Program limiting the decision to salaried employees. The paragraph reads: A proposed increase in the amount of free life insurance to be used in place of the Christmas Gift Program was reviewed and discussed by the Committee. The Committee approved an increase in the amount of $2,000 per employee of free life insurance. The effective date will be set at the discretion of the Vice President- Industrial Relations. [Emphasis supplied.] Even though it is obvious, as testified by Vice President of Industrial Relations Moorhead, that the minutes "don't purport to be a complete discussion of what took place at the meeting," they show on their face that a decision was HOOKER CHEMICAL CORPORATION made to replace the "Christmas Gift Program," and that the Committee approved an insurance replacement for all employees. I therefore regard as legal argument the testimony of Moorhead (a member of the New York bar) that the paragraph "does not apply to hourly employees" but refers only "to the salaried employees," because "you cannot substitute life insurance which has been negotiated in contracts with the Unions." The same argument is made in the Company's brief. Without mentioning the fact that the minutes refer to replacing the "Christmas Gift Program" (instead of the "salaried employees' Christmas Gift Program"), the Company argues that the decision to substitute insurance and to give Moorhead discretion when to implement the substitution applied only to salaried employees, but that "no such decision was, or could, be made at that time with respect to the hourly wage employees. The reason being that many of the collective-bargaining agreements contain a provision fixing the amount of insurance which the Company provides to the employees covered by such agreements and any proposed increase in such amount of insurance would, therefore, have to be discussed with the Unions prior to an implementation thereof." The Company offers no explanation why, if the quoted paragraph in the minutes concerned only the salaried employees, that limitation was not stated in the paragraph. However, even assuming that the last sentence of the paragraph (concerning Moorhead's discretion when to make the substitution effective) referred solely to salaried employees, it is obvious from Moorhead's own testimony that the first two sentences (concerning replacement of the "Christmas Gift Program," and the authorization of $2,000 in insurance .per employee' ") referred to hourly employees as well. Relying on Moorhead's testimony, the Company states in its brief that "it was decided at such [June 201 meeting to have the Company's local line representatives sit down with the various union representatives and offer to provide the employees covered by such collective-bargaining agree- ments with . . . insurance in lieu of the Christmas gift for 1969." Thus, the Company acknowledges that its top officials did discuss benefits of the hourly employees in the June 20 meeting, and did approve an increase in the amount of the hourly employees' insurance, to be offered "in place of the Christmas Gift Program." Still the Company contends that "no corporate decision was made at that time to terminate the Christmas gift for 1969 with respect to the hourly wage employees." Conceding that division officials Bosso and Gray thereafter authorized "line representatives to advise the Unions, if necessary, that the Christmas gift would not be given in 1969" (but ignoring the evidence that Vice President Moorhead himself instructed the Works Manager at the Tacoma plant to announce that the Company "had decided to discontinue" the Christmas gift), the Company contends in its brief that "it is clear that such communica- tions were designed to effectuate the Company's strategy of having the Unions request the same benefits as those being given to the salaried employees and that such commumca- tions were not based upon any unalterable corporate decision not to give the Christmas gift to the hourly employees in 1969." (This argument, paraphrased, is that 307 the Company had not reached an unalterable corporate decision to discontinue the Christmas gift, but it told the Unions that it had.) The evidence does support the Company's contention that in the July 8 meeting, it discussed the strategy of dealing with the Unions in such a way as to get them (in Moorhead's words) "to be in a position of asking for the insurance." However, such a strategy does not preclude an earlier decision to eliminate the hourly employees' Christmas bonus. The Company also acknowledges that its "line representatives admitted being told that the Christmas gift would not be paid (although the brief ignores division official Bosso's admission that Vice President Moorhead advised, in the July meeting of corporate and division officials, that the Company had decided to eliminate the Christmas gift for all employees). The brief states: "Such fact, when coupled with the testimony of the union representatives to the effect that they had been advised by such line representatives that the Christmas gift would not be given in 1969, would ordinarily lead one to believe that a corporate decision to this effect had been made prior to the meetings with the union representatives." The brief then asserts, however, that a "close personal relationship" exists between the line representatives and the union representatives, and that if "the Company's line representatives were to have tipped their hand in any way and indicated to the Unions that the gift was available, such action would obviously have made it very difficult, if not impossible, to attempt to sell the proposed substitution. " (Emphasis supplied.) Thus, the Company argues that it was necessary to deceive its own "line representatives," as well as the Union. (Having ignored Bosso's admission that Vice President Moorhead gave the same information, about eliminating the gift for all employees, to Bosso and other division officials, the Company does not indicate whether the necessity of deception also applied to those officials.) Regrettably, no mention is made of this serious credibility issue in the General Counsel's so-called "memorandum." After weighing all the evidence, and having considered all the Company's arguments, I find that a preponderance of the evidence shows that the Company had made a unilateral, unalterable corporate decision to discontinue the Christmas bonus for all employees before discussing the proposed substitution of insurance with the Unions. Accordingly, I discredit the testimony to the contrary. Moreover, even if such a decision had not been made, the Company (as alleged in the complaint) announced that it had been. C. Contentions and Concluding Findings 1. Wage or gratuity The Company's first contention is that it "was not, as a matter of law, required to bargain with the Unions with respect to the elimination of the gift." As previously found, the $25 bonus had been given each year through 1968, for periods of time ranging from 10 years at two of the plants, to 15 years at another, and in excess of 20 years at the two other plants involved in this proceeding. Although described on the separate check as a 308 DECISIONS OF NATIONAL LABOR RELATIONS BOARD "gift," the $25 was reported by the Company as wages on the employee's W-2 form for income tax purposes; $5 was shown by the Company on the check stub as being withheld for taxes ; and the annual check has been generally referred to by the employees, and sometimes by management representatives, as the Christmas bonus. Even though the bonus is not included in the collective-bargaining agree- ments, the employees obviously regarded it as part of their wages, and expected it to be continued. This fact is clearly shown by the reasons which the union representatives gave the Company for protesting its unilateral decision to eliminate the bonus, and by the votes at the respective union membership meetings to reject the Company 's offers of future benefits (insurance) in substitution for the bonus. Furthermore, at the largest of the five plants, the independent union used the Christmas bonus (figured at a cent and a fifth an hour) as a talking point in 1960 for "selling" to the membership a newly-negotiated collective- bargaining agreement which contained wages a few cents below the wages already being paid by another firm in the area, and since that time has taken into consideration the Christmas bonus when preparing its wage packages for negotiations. In Gravenslund Operating Co., 168 NLRB No. 72 (1967), the Board ruled : "It has long been held that Christmas bonuses which are not gratuities and which have been paid with regularity over extended periods of time are not only an integral part of the wage structure, but also constitute a mandatory subject of bargaining. In view of the Respon- dent's regularity in the payment of such bonuses over 15 consecutive years, we are persuaded that the Christmas bonuses are not mere gifts or `discretionary' bonuses as claimed, and that, as also has long been established, the Respondent's employees had the right to expect and rely upon the continuation of such bonus payments as part of their wages." (Footnote citations, of Board and Court decisions dating back as far as 1952, omitted.) Similarly in United Steelworkers of America (Mississippi Steel Corp.) v. N.LR.B., 405 F.2d 1373, 1375 (C .A.D.C.), the court held: "Payments called `bonuses' or `gifts' may be 'so tied to the remuneration which employees receive for their work that they are in fact a part of it,' so that they constitute wages within the meaning of the Act.. . . Here the testimony that a regular Christmas bonus had been paid for at least seven years was sufficient evidence to support the Board's finding that the bonus was part of the wage structure , and hence that the Company had a duty to bargain with the union before eliminating it." In a case cited in the Company's brief, Beacon Journal Publishing Co. v. N.LR.B., 401 F.2d 366 (C.A. 6), where the employer contended "that it has always regarded the bonus as voluntary and purely discretionary with management and had repeatedly said so in paying it," the Court held, "There is nothing in this record to dispute this as management view. But it appears to be settled labor relations law that a regularly paid bonus may come to be relied upon by employees as a part of total compensation .... Such a bonus is a mandatory subject for collective bargaining under the NLRA." (Emphasis supplied). In a case where the annual bonus was $10, the Board held, "The fact that the amount of the Christmas checks was not related directly to employees' earnings does not warrant a different result." General Telephone Company of Florida, 144 NLRB 311, 314, In. 2 (1963), enfd. 337 F.2d 452 (C.A. 5). I find that the Christmas bonus was not a mere gratuity , but that it had become a part of the employees ' wages at each of the five plants and thus constituted a term or condition of employment. Accordingly, I reject the Company's conten- tion that it was not required to bargain with the Unions with respect to the elimination of the Christmas bonus. 2. Opportunity to bargain As recognized by the Company in its brief, "The complaint of the General Counsel in this case charges, in substance, that prior to any meetings with the Unions in August and September 1969, the Company had already reached an unalterable decision to revoke the Christmas gift and, therefore, any subsequent discussions between the Company and the Unions with respect to the subject of the Christmas gift were meaningless because the Unions were, at that time, precluded from bargaining on the issue of the elimination of such gift." The Company then argues that "if the complaint is to be sustained it must be sustained solely upon the theory that prior to August 1969, the Company reached an unalterable decision to discontinue the Christmas gift"-citing N.LR.B v. Cone Mills Corp., 373 F.2d 595, 601 (C.A. 4), in which the court held that "Unilateral change of a condition of employment is not unlawful if the Union has had an opportunity to bargain." (The court also observed, at p. 600, "The very reason that unilateral action isprima facie unlawful is in the high degree of probability that it may frustrate bargaining opportuni- ty„) The Company contends, however, that even if it had an obligation to bargain with the Unions , (a) it had not reached a corporate decision, before meeting with the Unions in August and September, "to eliminate the Christmas gift on behalf of the hourly wage employees," (b) it "fulfilled any bargaining requirements " when it met with the Unions "concerning the proposed substitution of insurance for the Christmas gift," and (c) the Unions waived any right they may have had to bargain on the elimination of the Christmas gift. (a) When decision was made As found above under "Credibility Issue," the decision to eliminate the hourly employees' Christmas bonus was not the personal decision of Vice President Moorhead "in the late Fall of 1969." It was the unilateral, unalterable decision of top corporate officials who met as the Company's Retirement Program Committee on June 20-several weeks before the decision was announced to the Unions in August and September. I therefore reject the contention that such a corporate decision had not been made. (b) No bargaining on elimination The Company in effect admits elsewhere in its brief that its offers to the Unions to substitute insurance for the Christmas bonus were not an offer to negotiate on the elimination of the bonus. Thus, when suggesting an explanation for the Company's "line representatives" being HOOKER CHEMICAL CORPORATION informed that the Christmas bonus would not be paid in 1969, the Company argues that such a notice to the line representatives was necessary because if they had "tipped their hand in any way and indicated to the Unions that the gift was available" (i.e., that the decision to eliminate the bonus was not unalterable), this "would obviously have made it very difficult, if not impossible, to attempt to sell the proposed substitution." The Unions at all five of the plants were notified that the Christmas bonus had been eliminated, and a written notice was posted at one of the plants that "it is now the policy" of the Company that the Christmas "bonus will no longer be given to the employ- ees." As held by the Court in N.L.R.B. v. Citizens Hotel Co., 326 F.2d 501, 505 (C.A. 5), "An employer must at least inform the union of its proposed actions under circum- stances which afforded a reasonable opportunity for counter arguments or proposals." Here, the Company made the unalterable decision in June to eliminate the Christmas bonus, without any prior notice to the Unions and without affording the Unions any opportunity for presenting their views, counter arguments, or proposals-on if or when the bonus should be eliminated, whether uniformity of fringe benefits in the various plants would be desirable under the circumstances, whether the wishes of the employees affected should first be ascertained, etc. Unilaterally, the Company made the decision to discontinue the Christmas bonus companywide, then announced the decision to the Unions, giving them only the option of accepting a substitution, or nothing. By acting in this manner, the Company precluded bargaining on the elimination of the Christmas bonus. I therefore find that on and since the dates in August and September when the Company announced its decision to eliminate the Christmas bonus, the Company has refused to bargain collectively with the respective Unions, in violation of Section 8(a)(5) and (1) of the Act. The Company contends in its brief that it acted in good faith. The evidence indicates the contrary. After making the corporate decision in June to eliminate the bonus, the Company adopted the "strategy" of trying to induce the Unions to "ask" for the insurance as a substitution. Then after making it clear to the Unions that its decision to discontinue the bonus was unalterable, it belatedly contended at the trial that no decision had been made to eliminate the hourly employees' Christmas bonus until sometime in late fall after the discussions with the Unions. Moreover, the wording of the minutes of the June 20 Retirement Program Committee (leaving it to the discretion of Vice President Moorhead when to substitute the insurance for the Christmas Gift Program), and Industrial Relations Manager Bosso's stated reason for not issuing a letter at the large Niagara Falls plant concerning the discontinuance of the Christmas bonus (that "he did not think that he could word it in any way that it wouldn't be used against them"), indicate an awareness of the Company's bargaining obligation. After weighing all the evidence and circumstances, I draw the inference that the Company was aware of its obligation to bargain with the Unions before deciding to discontinue the Christmas bonus, but proceeded anyway to make the decision 309 unilaterally, deliberately evading its statutory bargaining obligation. I therefore find that the Company acted in bad faith, being fully aware of its obligation to bargain with the Unions before making the decision to eliminate the bonus. (c) No waiver Without explanation, the Company contends that the waiver principle enunciated in Murphy Diesel Co., 179 NLRB No. 27 (1969), is applicable here, despite "certain factual differences between that case and the one at issue." Finding that case to be completely inapposite, I reject the contention. The Company also contends that the "waiver principle" is "clearly applicable to the Niagara Falls plant where the President of the Union for such plant testified that the subject of the Christmas gift had come up during four or five previous negotiations and that despite the fact that the Union believed that such gift to be wages or a condition of employment, the Company was permitted to bypass the subject on each negotiating session, and the subject was never pursued further by the Union and was never included in the contract." The evidence does not disclose in what connection the Union raised the subject of a Christmas bonus. Even if the Union had been seeking a specific provision in the agreement on the bonus, its failure to pursue the matter-when there was no suggestion that the Company was contemplating any change in its long practice of giving the bonus every Christmas-could not reasonably have been regarded "as acquiescence on the Union's part to any unilateral action which the Company might wish to take with reference to the Christmas checks." General Telephone Company of Florida v. N.L.R.B., 337 F.2d 452, 454 (C.A. 5). It is evident that there had been no "clear and unmistakable" relinquishment of bargaining rights as to this subject. Beacon Journal Publishing Co. v. N.L.R.B., supra, 401 F.2d at 367. D. Bargaining Units The parties agree, and I find, that each of the following- described units is appropriate for bargaining, and that at the time of trial, the Company had a collective-bargaining agreement with the listed Union (the Charging Party in the case), covering the bargaining unit employees for the term shown: Case 7-CA-7515: "All production and maintenance employees employed by the Respondent at its Montague, Michigan plant, but excluding confidential employees, office clerical employees , recorders, chemists , technicians and engineers, gate telephone operators and their relief, janitors regularly assigned to office area , guards, relief shift foremen, head operators and group leaders, and all other supervisors as defined in the Act ." Agreement with Local 820, International Chemical Workers Union, April 3, 1968, through April 15, 1970. Case 7-CA-7515(2): "All production and maintenance employees employed at Respondent 's Jeffersonville, Indi- ana plant, but excluding laboratory technicians, office clerical employees, plant clerical employees, office custodi- an, and all guards, professional employees, and supervisors as defined in the Act." Agreement with Local 696, 310 DECISIONS OF NATIONAL LABOR RELATIONS BOARD International Chemical Workers Union, April 28, 1969, through April 28, 1971. Case 7-CA-7515(3): "All production and maintenance employees employed by the Respondent at its Tacoma, Washington plant, but excluding office clerical employees, guards, laboratory employees, technical employees, store- room employees, operating engineer leadmen, operating engineers A, operating engineers B, pan operators A, pan operators B, chlorine operators A, and supervisors as defined in the Act." Agreement with Local 110, Interna- tional Chemical Workers Union, June 1, 1968, until midnight May 31, 1970. Case 7-CA-7515(4): "All production and maintenance employees employed at Respondent's Grand Island, New York plant and in Areas 1, 2 and 3 of Respondent's Niagara Falls plant including kitchen and cafeteria employees but excluding confidential, supervisory, office, clerical and salaried employees, relief shift foremen, subforemen and group leaders, technicians, office janitors and janitresses, laboratory assistants, pilot plant operators, guards and gatemen." Agreement with Niagara Hooker Employees' Union, October 1, 1968 until midnight September 30, 1970. Case 7-CA-7515(5): "All employees of Respondent at its Tacoma, Washington, plant in the classifications of operating engineer leadman, operating engineer A, operat- ing engineer B, pan operators A, pan operators B, chlorine operators A, but excluding all production and maintenance employees, office and plant clerical employees, office custodian, professional employees, guards and supervisors as defined in the Act." Agreement with Operating & Stationary Engineers Local 286, International Union of Operating Engineers, AFL-CIO, June 1, 1968, until midnight, May 31, 1970. Case 7-CA-7515(6): "All production and maintenance employees employed at Respondent's North Tonawanda, New York plant excluding office clerical employees, professional employees, and supervisors and guards as defined in the Act." Agreement with Local Lodge 2112, International Association of Machinists and Aerospace Workers, AFL-CIO, June 3, 1969, until June 3, 1971. CONCLUSIONS OF LAW By announcing to the Unions , without prior notice or consultation, its unalterable decision to cancel the annual Christmas bonus to employees in the respective bargaining units, the Company unilaterally changed the emoluments of the employees and thereby engaged in unfair labor practices affecting commerce within the meaning of Sections 8(a)(5) and (1) and 2(6) and (7) of the Act. THE REMEDY Having found that the Respondent has committed certain unfair labor practices, I shall recommend that it be ordered to cease and desist from such conduct and from any like or related invasion of its employees' Section 7 rights, and to take certain affirmative action, which I find necessary to remedy and to remove the effect of the unfair labor practices and to effectuate the policies of the Act. As found, the Respondent deliberately evaded its statutory bargaining obligation by unilaterally deciding in 1969 to eliminate the $25 Christmas bonus being given the employees at many of its plants (at an annual cost of about $250,000). The Respondent then precluded bargaining on the elimination of the bonus by announcing its unalterable decision, and offering the option of accepting a substitution of insurance, or nothing. Having voted not to accept the substitution, the employees represented by the six Unions at five plants involved in this proceeding received neither the customary Christmas bonus, nor the insurance. ( In lieu of the bonus, the Respondent began providing insurance to the salaried employees on September 1, and to hourly employees in various plants whenever the substitution was accepted.) Thus the Respondent, acting in bad faith, decided unilaterally to eliminate the Christmas bonus, companywide, for 1969 and the future, without affording the Unions any opportunity to present their views, counterarguments or proposals. Now, having attained such a goal-of complete elimination of the Christmas bonus-the Respondent contends that if a violation is found, "the Board should merely order the Company to bargain over such elimination." Under the circumstances, and as a result of the expense and inconvenience of this litigation, it would be ignoring the realities of the industrial world not to expect the Respondent now to have a less flexible bargaining attitude toward the Christmas bonus. I find that bargaining on that subject at this time-without the prior restoration of the Christmas bonus program for the employees in the six bargaining units, and without prior payment of the 1969 Christmas bonus which was unlawful- ly withheld-would likely be a preordained exercise in futility. Failure even to attempt to restore the status quo, in order to give collective bargaining some semblance of the same opportunity as before to succeed, would tend to encourage such unilateral actions in the future, and to foment industrial strife. Having acted in bad faith, having unlawfully withheld the 1969 Christmas bonus, and having used its unilateral, unalterable decision never to pay the bonus again as a leverage to force the Unions to accept the substitution of insurance, the Respondent inappropriately cites Beacon Journal Publishing Co. v. N.L.R.B., 401 F.2d 366 (C.A. 6); General Telephone Company of Florida v. N.L.R.B., 337 F.2d 452 (C.A. 5); N.L.R.B. v. Citizens Hotel Co., 326 F.2d 501 (C.A. 5); and New Orleans Board of Trade, Ltd, 152 NLRB 1258 (1965), as precedent for not ordering a reimbursement for the loss of the 1969 Christmas bonus. In each of those cases, the facts are clearly distinguishable, and the employer acted in good faith. Finding that an effectual remedy in the present case must so provide, I shall recommend that the Respondent be ordered to restore the previously existing Christmas bonus program for all employees in each of the six bargaining units heretofore found appropriate, and to make the employees whole by paying them the 1969 Christmas bonus which was unlawfully withheld, with interest at the rate of 6 percent per annum, as prescribed in Isis Plumbing & Heating Co., 138 NLRB 716, and Zelrich Company, 144 NLRB 1381. Leeds & Northrup Co. v. N.LR.B., 391 F.2d 874, 879-880 (C.A. 3); American Fire Apparatus Co. v. N.L.R.B., 380 F.2d 1005, 1006 (C.A. 8); N.L.R.B. v. Exchange Parts Co., 389 F.2d 829, 831-832 (C.A. 5); HOOKER CHEMICAL CORPORATION N.L.R. B. v. Central Illinois Public Service Co., 324 F.2d 916, 909 (C.A. 7); Stark Ceramics, Inc. v. N.L.R.B., 375 F.2d 202, 207 (C.A. 6); Century Electric Motor Co., 180 NLRB No. 174 (1969); and Gravenslund Operating Co., 168 NLRB No. 72 (1967). Accordingly, on the basis of the foregoing findings and conclusions, and on the entire record, I recommend pursuant to Section 10(c) of the Act, issuance of the following: ORDER Respondent, Hooker Chemical Corporation, a wholly owned subsidiary of Occidental Petroleum Corp., its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Refusing to bargain collectively with the respective Unions with respect to the Christmas bonus or any other term or condition of employment, by unilaterally changing or eliminating bonus payments or any term or condition of employment of its employees in the six respective appropriate bargaining units in derogation of the rights of the Unions as the exclusive bargaining representatives of the employees. (b) In any like or related manner interfering with the rights of employees guaranteed in Section 7 of the Act. 2. Take the following affirmative action necessary to effectuate the policies of the Act: (a) Restore in each of the six appropriate bargaining units the Christmas bonus program as it existed before 1969. (b) Pay to all its employees in the six bargaining units the amounts due them for the 1969 Christmas bonus, plus interest as set forth in the section of the Trial Examiner's Decision entitled "The Remedy." (c) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, Social Security payment records, time- cards, personnel records and reports, and all other records necessary to analyze the amounts due under the terms hereof. (d) Post at each of its six plants, listed in the section of the Trial Examiner's Decision under the title "Bargaining Units," copies of the attached notice marked "Appendix," 2 after appropriate insertions have been made. Copies of the notice, on forms provided by the Regional Director for Region 7, after being duly signed by an authorized representative of the Respondent, shall be posted by the Respondent immediately upon receipt thereof, and be maintained for 60 consecutive days thereafter, in conspicu- ous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. (e) Notify the Regional Director for Region 7, in writing, 311 within 20 days from the date of the receipt of this Decision, what steps the Respondent has taken to comply herewith.3 2 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 here 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 National 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 " 3 In the event that this recommended Order is adopted by the Board, this provision shall be modified to read "Notify the Regional Director for Region 7, in wasting, within 10 days from the date of this Order, what steps the Respondent has taken to comply herewith " APPENDIX NOTICE To EMPLOYEES NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL RESTORE to our employees in the bargaining unit described below the bonus program we had before 1969. WE WILL PAY to our employees in the bargaining unit described below the 1969 Christmas bonus, plus 6 percent interest thereon. WE WILL NOT refuse to bargain with [insert the name of the appropriate union] by changing or eliminating the Christmas bonus unilaterally in the future. The bargaining unit is: [Insert the appropriate bargaining unit as described in the section of the Trial Examiner's Decision entitled "Bargaining Units."] HOOKER CHEMICAL CORPORATION A WHOLLY OWNED SUBSIDIARY OF OCCIDENTAL PETROLEUM CORP. (Employer) Dated By (Representative) (Title) This is an official notice and must not be defaced by anyone. This notice must remain posted for 60 consecutive days from the date of posting and must not be altered, defaced, or covered by any other material. Any question concerning this notice or compliance with its provisions, may be directed to the Board's Office, 500 Book Building, 1249 Washington Boulevard, Detroit, Michigan 48226, Telephone 313-226-3200.