National Spinning Co., Inc.

NATIONAL SPINNING CO. National Spinning Company, Inc. and Textile Workers Union of America, AFL-CIO, CLC. Case 1I-CA-3308 February 10, 1969 DECISION AND ORDER BY CHAIRMAN MCCULLOCH AND MEMBERS JENKINS AND BROWN On January 17, 1968, Trial Examiner George Turitz issued his Decision in the above-entitled proceeding, finding that 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. He also found that Respondent had not engaged in certain other unfair labor practices alleged in the complaint and recommended dismissal of such allegations. Thereafter, Respondent and the Union filed exceptions to the Trial Examiner's Decision and supporting briefs. 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 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, the briefs, and the entire record in the case, and hereby adopts the findings, conclusions, and recommendations of the Trial Examiner to the extent they are not inconsistent with the following: The Trial Examiner concluded that Respondent refused to bargain with the Union in good faith prior to the strike of May 4, 1967, and that the strike was caused by the refusal to bargain and was an unfair labor practice strike. We do not agree. The record shows and the Trial Examiner found that Respondent held some 12 negotiating meetings with the certified ,Union during an 8-week period prior to the strike; the negotiations covered all the issues presented by the Union; Respondent furnished all the information requested by the Union, made many concessions, and reached understandings on many of the issues. Significantly, the TX ignored an admission at the hearing by the Union's principal negotiator, Hoyman, that he informed Respondent's negotiator, at the meeting just before the strike, that the latter was trying hard to reach an agreement with the Union. Although the parties continued bargaining during the strike (and Respondent made still further concessions in a written proposal on May 9, and again in a further proposal on May 25), a careful review of the entire record does not satisfy us that there is evidence to support the Union's 379 contention, accepted by the Trial Examiner, that Respondent engaged in dilatory negotiating tactics or broke any commitments either prior to the strike or thereafter. Rather, the evidence indicates that by May 4, the parties had reached a virtual impasse, which the parties thereafter continued' to try to resolve, and the strike was at all times an economic strike neither caused nor prolonged by any unfair labor practice. We are likewise not satisfied that in these circumstances the benefits granted to the employees on May 29, all of which had previously been offered to the Union, constituted unlawful action by Respondent. We shall accordingly dismiss the 8(a)(5) allegation of the complaint. While agreeing that in certain respects Respondent violated Section 8(a)(1) of the Act, we do not find that the strike was an unfair labor practice strike or that Respondent violated Section 8(a)(1) in connection therewith. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that Respondent, National Spinning Company, Inc., Whiteville, North Carolina, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Promising employees wage increases if they get rid of their bargaining representative. (b) Threatening reprisals against employees for enlisting the support of the Union with respect to hire or tenure of employment or terms and conditions of employment. (c) In any like or related manner interfering with, restraining, or coercing employees in the exercise of their rights guaranteed in Section 7 of the Act. 2. Take the following affirmative action which, it is found, will effectuate the policies of the Act: (a) Post at its plant in Whiteville, North Carolina, copies of the attached notice marked "Appendix."' Copies of said notice, on forms provided by the Regional Director for Region 11, after being duly signed by its representative, shall be posted immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken to ensure that said notices are not altered, defaced, or covered by any other material. (b) Notify the Regional Director for Region 11, in writing, within 10 days from this Order, what steps Respondent has taken to comply herewith. 'In the event that the Board' s Order is enforced by a decree of a United States Court of Appeals, the words "a Decree of the United States Court of Appeals Enforcing an Order" shall be substituted for the words "a Decision and Order." 174 NLRB No. 63 380 DECISIONS OF NATIONAL LABOR RELATIONS BOARD MEMBER BROWN, dissenting part: I agree with the Trial Examiner's ultimate conclusions that Respondent violated Section 8(a)(1) and (5) of the Act, and I would view the striking employees as unfair labor practice strikers for remedy purposes. he has also submitted a brief to the Trial Examiner. Upon the entire record and from his observation of the witnesses the Trial Examiner makes the following. FINDINGS OF FACT 1. THE BUSINESS OF RESPONDENT APPENDIX NOTICE TO ALL EMPLOYEES Pursuant to the Decision and Order of the National Labor Relations Board and in order to effectuate the policies of the National Labor Relations Act, as amended, we hereby notify our employees that: WE WILL NOT promise employees wage increases if they get rid of their bargaining representative. WE WILL NOT threaten reprisals against employees for enlisting the support of the Union with respect to hire or tenure of employment or terms and conditions of employment. WE WILL NOT in any like or related manner interfere with, restrain, or coerce employees in the exercise of their rights to self-organization, to form, join, or assist the Union or any other labor organization, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any or all such activities. NATIONAL SPINNING COMPANY, INC. (Employer) Dated By (Representative) (Title) This notice must remain posted for 60 consecutive days from the date of posting and must not be altered, defaced, or covered by any other material. If employees have any question concerning this notice or compliance with its provisions, they may communicate directly with the Board's Regional Office, 1624 Wachovia Building, 301 North Main Street, Winston-Salem, North Carolina 27101, Telephone 919-723-2911. TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE GEORGE TURITZ, Trial Examiner: On charges and amended charges filed by Textile Workers Union of America, AFL-CIO, CLC, herein called the Union, and respectively served on National Spinning Company, Inc , herein called Respondent and, at times, the Company, on May 9, June 9 and 26, 1967, the General Counsel of the National Labor Relations Board, herein called the Board, through the Regional Director for Region 11, on June 30, 1967, issued a complaint and notice of hearing against Respondent. Respondent filed its answer in which it denied all allegations of unfair labor practices. A hearing was held on August 14 to 17, 1967, at Whiteville, North Carolina, before the Trial Examiner named above. The General Counsel and Respondent were represented by counsel at the hearing; the Union was represented by its Southern Regional Director, but he did not participate in the hearing except as a witness. At the conclusion of the hearing counsel for the General Counsel argued orally and Respondent is a New York corporation having its principal office in New York City. It operates plants at various locations, including a plant located at Whiteville, North Carolina, where it is engaged in the manufacture of woolen and synthetic yarns. In the course of its operations at the Whiteville plant Respondent annually sells and ships from said plant products valued at in excess of $50,000 directly to customers located at points outside the State of North Carolina, and annually purchases goods and materials valued at in excess of $50,000 which are shipped directly to said plant from points outside the State of North Carolina. It is found that Respondent is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the National Labor Relations Act, as amended, herein called the Act. II. THE LABOR ORGANIZATION INVOLVED Textile Workers Union of America, AFL-CIO, CLC, is a labor organization within the meaning of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. Issues and Outline of Events The principal issue in this case is whether Respondent's bargaining was in good faith in view of its handling of wage increases and other benefits, its alleged failure to live up to commitments during negotiations, and its position on checkoff, arbitration, and a no-strike clause. Also at issue are the questions of whether various statements by supervisors and Respondent's letter warning strikers of possible permanent replacement were coercive, whether the strike was caused by Respondent's unfair labor practices, and whether one employee was denied rehire for discriminatory reasons. On August 19, 1966, the Union filed a petition in Case I 1-RC-2421 covering the employees at the Whiteville mill. In early September 1966 Respondent instituted a wage increase among the employees of mills it operated at Warsaw and Washington, North Carolina, but not among the Whiteville employees. On October 26, 1966, the election was held among the Whiteville employees and on January 13, 1967, the Regional Director issued a report overruling Respondent's objections to the election and certified the Union. Charges were filed against Respondent on February 24, 1967, and Respondent entered into a settlement agreement, apparently dealing with matters which occurred during the Union's organizational campaign. Respondent posted the notice called for by the settlement agreement and in May 1967 the case was "closed." The General Counsel does not seek to set the settlement agreement aside. Twenty bargaining sessions were held, as follows, all in 1967: March 10, 16, and 22; April 6, 7, 13, 20, 21, 26, and 27; May 3, 4, 16, 25, and 26; June 1, 2, and 28, and July 12 and 13. Shortly after the April 27, 1967, session Respondent placed into effect a further wage increase for the Warsaw NATIONAL SPINNING CO. and Washington employees. Respondent on that date and prior thereto refused the Union's repeated requests to place both wage increases into effect at the Whiteville plant, although Respondent made it clear that it was willing to grant those employees the same increases, but only upon reaching a final agreement. On May 4, 1967, some hours after termination of the bargaining session held that morning, the employees began a strike which, apparently, was still in progress at the time of the hearing. On May 29, 1967, Respondent, over the Union's objection, did place the increases into effect at Whiteville. B. Interference, Restraint, and Coercion: Discrimination Irene Fait, an employee of several years' standing, was an inspector in the shipping department. She became ill on January 24, 1967, and, with authorization from Williams, her acting supervisor, went home From time to time she reported to Williams about her absence by' telephone and through a fellow employee. On February 9 she can3e to the plant and asked Norris, her supervisor, for additional leave because of transportation problems. He replied that she had not sent word about her absence and therefore had no job. Williams was summoned and he said that he had given Norris Pait' s messages about her absence, but this was denied by Norris, who insisted that he had got no word from Pait. Several days later Pait, who had furnished an affidavit supporting Respondent in connection with the investigation of objections to the election, went to the union hall where she was advised to pursue the matter at the plant directly She then spoke to McKiethm, Respondent's personnel director, and told him what had happened. McKiethin said that Pait had not been treated "right" and he promised to investigate and see what he could do. When Pait returned a week later, McKiethin informed her that since she had requested more time, he agreed with Norris that her discharge was proper He added that he felt that Pait had not told him everything, and that he had learned that before approaching him she had gone to the Union for help. Norris testified that McKiethin had nothing to do with hiring employees in his department or with whether or not an employee could return to work there. He also stated that in any event he had no work for Pait, having laid off eight employees in her classification before she had taken sick. On February 14 Pait told McKiethin that when she had requested additional leave, she was accused of having failed to report which she assured McKiethin was not true. McKiethin at that time expressed the opinion that she had not been "treated right,' and Respondent did not explain why those same facts made Norris' treatment of her "right" on February 21. The necessary effect of McKiethin's change of position , in the light of his statement that he had learned that Pait had been to the Union before coming to him, was that he was threatening that Respondent would visit reprisals upon employees who enlisted union support. See Colony Furniture Company, 168 NLRB No. 92. It is found that McKiethin's statement was coercive and violative of Section 8(a)(1). Norris' termination of Pait was plainly uninfluenced by any discriminatory motive since, at the time of the termination, she had not engaged in any prounion activity. The complaint alleges as a violation only the refusal to rehire her. While McKiethin changed his attitude towards Pait upon learning that she had sought help from the Union, the uncontradicted evidence is that the authority to 381 reemploy Pait was Norris', not McKiethin's There is insufficient evidence that, absent his change of attitude, McKiethin would have been able to persuade or compel Norris to reinstate her. She was not needed on her old job and counsel for the General Counsel failed to prove that other jobs were available which she could have filled to which Respondent would normally have assigned her. It is found that the General Counsel has failed to prove that Part was denied rehire for discriminatory reasons.' At various times during the period from about the end of March 1967 to about the middle of April, after bargaining had begun, several employees' who told their supervisors that they would file grievances about various difficulties they were having with their work were told by° the supervisors that the grievances were, or would be, worthless. About the middle of April McKiethm, Respondent's personnel director, during a conversation with Earl Ward about the Union, commented that if the Union got a contract' it would not do the employees any good, ". . . because the same people would be running the mill then that is running it now." There is nothing to indicate that the comments about the worthlessness of the grievances were directed to the bargaining process or the Union's status as bargaining representative rather than to the merits of the grievances themselves. McKiethin's statement to the effect that a Union contract would not make a material difference was an expression of opinion. As none of these discussions were initiated by the supervisors, and as they took place after certification, it is found that the General Counsel has failed to establish that any of these statements were coercive in nature or otherwise violative of the Act Dorothy Evans and William Benton testified that about in the middle of April they were engaged in a conversation about the Union when Johnny Pratt, a supervisor, came up and remarked that Respondent was too big a company for the employees to be able to compel it to grant anything; that "if they wanted to give the employees anything, that they would do so on their own, but they wouldn't be forced." The remark was an expression of opinion as to the efficacy of pressure, not of collective bargaining. There was nothing in the circumstances testified to that gave it coercive meaning. About 2 days before the strike Hausen, a supervisor, asked Edna Ward, an employee, if she thought the Union would strike. Ward's answer was noncommittal Hausen told her that the 18-cent-an-hour increase t hich had been offered was a good offer and should be accepted. Hausen's question called only for Ward's guess or estimate as to what would happen, not for information about the Union's intentions which she might have had which was not readily available to Respondent, or for her point of view. Hausen's own comment was merely an expression of personal opinion and not an attempt to bargain directly with Ward or the employees. It is lound that Hausen's question and comment were not violative of the Act. Distinguish Southern Coach & Body Co., Inc, 135 NLRB 1240, and Lock Joint Pipe Company, 141 NLRB 943, where employers sought information as to strike plans. 'Distinguish Shawnee Industries, Inc, 140 NLRB 1451, enfd 333 F 2d 221 (C.A. 10), where the discriminatees' applications concerned employment generally rather than a specific job 'Earl Ward, Mary McPherson , and Annette Inman 'Ward testified that McKiethin said, " . if the Union got in " As the uncontradicted testimony establishes that the conversation took place after certification, it is inferred that , whatever the words used by McKiethin, he was referring to the eventuality of the Union getting a contract 382 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Early in the strike Carl Chamberlain, Respondent's plant engineer, was returning to the plant from supper when he encountered several hundred persons at a road intersection near the plant. About 8 or 10 of them advanced towards his car, shouting and screaming, and they started to rock the car, a small Volkswagon. Among them was a man who about 2 hours earlier had been arrested during a similar incident with Chamberlain, at which time one of those present had said, "Let's turn this thing over" Chamberlain took out a pistol and pointed it at the people round him, who thereupon retreated. He drove on into the plant property The matter was reported to a patrolman, who went into the plant and relieved Chamberlain of his pistol it is found that Chamberlain's conduct was not violative of the Act On May 5, 1967, a judge of the Superior Court of the State of North Carolina, Columbus County, issued an order against the Union and six indisiduals, and on May 10 issued an amendment thereto, whereby it was ordered, inter alia , that on certain roads adjacent to Respondent's plant, " . . no persons shall picket, stand or move in procession, nor congregate, loiter or gather, on foot or in vehicles, nor park or place any vehicles or other objects thereon - except, however, that a total of as many as eight (8) persons, but not more, may peacefully picket on foot at any one time on the shoulder of the said County Roads, on the opposite side thereof from the Plant property of the National Spinning Company." A copy of the order was posted on the plant gate On some half dozen occasions between May 8 and June 5, 1967, Respondent caused pictures to be taken of employees picketing the plant. On at least one occasion Respondent took a picture of a large number of employees who were gathered on County Road No. 1950 in the area immediately adjacent to its intersection with the side of State Highway No. 130 nearer the plant Similar pictures were taken by other photographers also, and they appeared in local newspapers, as well as in the Union's own newspaper Henry C. Humphreys, the plant manager, testified that he ordered the pictures taken and that the purpose was to have evidence for use in any court proceeding that might be brought for violation of the injunction. This testimony was not contradicted, nor was Humphreys cross-examined about it Counsel for the General Counsel contends that Respondent made no showing that the particular pictures referred to in the complaint were taken for the purpose of contempt proceedings. The area adjacent to the intersection of Route 1950 with Route 130 on the side towards the plant appears to be at least literally within the territory in which congregating was enjoined Moreover it was established that when picketing details changed, more than eight pickets were present at one time opposite the plant gate, if both groups were counted Without passing upon whether either of these facts constituted violation of the injunction, they were arguably violative, and it cannot be found that the pictures were not taken in a good-faith attempt to obtain evidence for possible use in court proceedings The picture taking was not accompanied by threats of retaliation for striking. In view of that fact and of the large number of pictures of pickets taken by newspaper photographers, Respondent's action was not threatening to the employees to such a degree as to require limitation of Respondent's right to protect its interests by the photographing Hilton Mobile Homes, 155 NLRB 873, 874. See also Great Dane Trailers, Inc, 388 U.S 26 Distinguish Preston Feed Corporation, 134 NLRB 629, 643, where the record was devoid of explanation for the picture taking . Distinguish, also, Flambeau Plastics Corporation , 167 NLRB No 102, and Gopher Aviation, Inc , 160 NLRB 1698, where the evidence established that pictures were taken for purposes of surveillance and coercion . It is found that the taking of the pictures of the pickets and the striking employees in the circumstances described above was not coercive and was not violative of Section 8(a)(1) About the middle of April McKiethm , the personnel director, had a conversation with Benton in which the discussion turned to the subject of the Union and wage increases which had been placed into effect the prior September at Respondent' s other two mills in North Carolina. McKiethin said that the Company was as fair as it could be and commented that the employees knew the money for an increase was available since it was already in effect at the other plants . Benton asked why the wage increase could not be placed into effect at the Whiteville mill and McKiethin replied that the Company was "tied up in union activities" and could not put the increase and fringe benefits into effect at Whiteville "until it was settled." He said that all the employees had to do was get rid of the Union , and then they would get their pay increases . McKiethin' s statements were coercive and violated Section 8(a)(1) On May 17, 1967, Respondent distributed a letter to its employees in which it told them about certain contract terms it had offered to the Union , including , among other benefit, , "a wage increase of at least 18 cents per hour for all employees " In the letter the Respondent stated, ". that it is not our intention to yield to strike pressure, and that this strike will not force us to sign any contract terms which we believe would not in the long run work out to the best interests of this Company and of the employees at this Plant"; that the employees had the right to remain on strike or to return to work; and Those who continue to stay away from work on account of this strike are not only losing their pay, they will also draw no unemployment compensation. Moreover, the Company has the right -- and indeed has the duty to its customers to keep this Plant running. In order to do so, the Company definitely has the right to fill the jobs of those who stay away from work on account of the strike And this we are beginning to do. Those whose jobs are filled while they stay out because of this strike will have no right to return to their jobs after that -- or get their jobs back - even when this strike has ended Except for those who have engaged in serious misconduct or violence , jobs are still available to all who are staying away from work on account of the strike This is true as of now. We make no commitment as to how long it will continue to be true Since the strike, as found below, had been caused by unfair labor practices, Respondent did not have the right to fill the jobs of strikers permanently . By informing the employees that those whose jobs were filled while they were on strike would have no right to return to their job,, Respondent threatened to discriminate against them in violation of Section 8(a)(3), thereby violating Section 8(a)(l). See Rice Lake Creamery, Company, 131 NLRB 1270, enfd sub nom General Drivers and Helpers Union, Local 662, 302 F.2d 908 (C.A.D.C.), cert. denied 371 U.S. 827. 'See Dorn's Transportation Company, Inc, 168 NLRB No 68 NATIONAL SPINNING CO. 383 On the day the strike started Charles Fipps, an electrician, remained at work for several hours before joining the strike. He remarked to his supervisor, Carl Chamberlain, "It don't look like we are going to have anybody into work today." Chamberlain agreed and added, "There are a lot of people that are going to lose their jobs on account of this." Chamberlain by his statement threatened that strikers would be permanently replaced and denied their jobs after the strike. As the strike was caused by unfair labor practices, Chamberlain's statement was coercive and violative of the Act See Rice Lake Creamery, supra. C. The Refusal to Bargain The Union was represented in the negotiations by Scott Hoyman, its Southern Regional Director, and a committee of employees Respondent was represented by William Goldman, a resident of New York City, who was its vice president in charge of manufacturing He was assisted by Henry Humphreys, manager of the Whiteville mill. At the March 10 and 16 sessions the Union submitted, in two parts, what purported to be a virtually complete contract proposal - wage provisions were omitted. Hoyman spoke at length about the importance to the Union of provisions for checkoff and arbitration. He said that only with those devices could a union maintain enough strength to enforce a contract effectively and that the Union would therefore never sigh a contract without them. Respondent argued that it wanted employees to take home their full pay, without deductions of dues. It admitted making payroll deductions requested by employees for insurance payments, as well as for the installment repayment of Company loans to employees. The question of arbitration was discussed at length at all three conferences held during the month of March and Hoyman urged that it was an unfair labor practice for an employer to insist upon a no-strike clause while refusing to agree to arbitration At the March 16 session Hoyman proposed that a grievance procedure be instituted even before a contract was agreed upon.. Goldman eventually consented and a procedure was set up. One grievance meeting was actually held shortly prior to the May 4 strike. At the April 6 session Respondent submitted a complete contract proposal. Several of the articles were substantially the same as proposals of the Union and were readily agreed to by Hoyman in the discussions which followed, sometimes with minor modifications. These included the introductory paragraph, the article as to "purpose," the recognition clause, the provisions against discrimination, for union bulletin boards, guaranteeing employees against loss of earnings resulting from transfers for company convenience, and for 4 hours' guaranteed call-in pay, a safety provision, and the provision that payday continue as in the past. Other articles -- or their absence -- were the subjects of substantial differences, which the parties aired at length in the bargaining sessions held on April 6, 7, 13, 20, and 21. On April 7 Hoyman raised question as to allowing the Union access to the mill in connection with grievances and, even in the absence of grievances, in connection with the introduction of new methods or machinery. Goldman said that he did not want a "parade" of union representative, bothering employees at work Hoyman offered to limit the Union's right to a single designated person and to make it subject to the further requirement that visits be on notice to Respondent, which, moreover, would have the right to accompany the union representative. Goldman said that a provision like that would be agreed to by Respondent Respondent's proposed vacation clause made provision for vacation only round Christmas, when the plant was closed for a week, and for payment of all vacation pay at that time. Vacation pay was, by prior practice, a percentage of earnings, varying according to length of service Respondent's proposal ignored the practice whereby most employees took another week's vacation during the summer, without, however, receiving any vacation pay at that time. Hoyman proposed that employees receive half their vacation pay in December and the other half when the second week of vacation was taken. Goldman expressed sympathy with the idea that employees have money when they went on vacation, but he objected to giving vacation pay before it was earned. The matter was discussed at length and on April 20 or sooner Goldman finally said that he agreed with the Union on the principle that vacation pay be split and that the only thing left was the mechanics At the April 20 session the parties discussed the Union's proposal embodied in article IV of its proposed contract, that changes in workload, work assignments, or rates be made only upon detailed written notice to the Union, with the employer having the duty to discuss the change with the Union upon request in an effort to reach agreement. The proposal further provided that in the absence of agreement such changes be instituted for a trial period of 30 days, after which unresolved differences could be referred to the grievance procedure. Goldman agreed on the principle of advance notice and information to the Union, meeting with the Union, and a trial period The April 13 and 21 sessions, which Goldman was unable to attend, were devoted primarily to explanation by Humphreys of Respondent's incentive system He read part of Respondent's wage policy manual and Hoyman made extensive notes, telling Humphreys that he wanted parts of the manual in the contract. Humphreys said that that made sense Attached to Respondent's proposed contract submitted on April 6 was a schedule of wage rates providing for wage increases ranging from 8 to 18 cents an hour, which Goldman said was the same increase that the Company had granted at the Washington and Warsaw plants in the early part of September 1966. At each bargaining session thereafter prior to the strike the Union requested immediate retroactive institution of that wage increase, with bargaining to continue for a further increase. Respondent refused, adamantly taking the position that it would not grant the increase until a complete contract was signed On April 13, with Goldman absent, Hoyman proposed an additional increase of 15 cents per hour, 3 cents of which was to be used for the correction of inequities, but Humphreys said that the Union should submit a complete proposal. At the April 20 bargaining session, when the Union again raised the question of placing Respondent's proposed increase into effect immediately, Goldman said that completion of the negotiations could be accelerated if both parties would make drafts of their respective proposals and then, together, reach agreement on a final draft On the basis of the discussions which have been described the Union drafted new proposals5 governing wages (article III), workloads and work assignments 'G C Exh 4. 384 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (article IV), leaves of absence (article XII), vacations and vacation pay (article XIII), and union access to the mill (article XIV) Article III, by far the most extensive of the new proposals, consisted of 9 subarticles, A to I, the last of which had 10 separate sections. Sections 1 and 2 described standards for setting incentive rates or hourly rates on jobs formerly on incentive. The remaining eight sections were almost in their entirety direct quotations from Respondent's wage policy manual. On April 26, when Hoyman went through his new proposals for article III, Goldman said that he "reserved" as to sections I and 2 of subarticle I but made no comment on the eight remaining sections, thus indicating acquiescence On article IV Goldman "reserved" on section 1, providing for a fatigue allowance, but said that Respondent was in general agreement on the other two sections of the article which set out the procedure to be followed when changes were to be made in workloads, work assignments, or rates, i e., detailed notice to the Union, opportunity for discussion, a trial period in case of disagreement, and submitting disagreements to the grievance procedure. The new vacation clause proposed by the Union on, April 26, article XIII, provided for a summer vacation and a Christmas vacation. For the summer vacation the eligibility date was June 1, and the base earnings period for computing vacation pay was November 1 through May 1; for the Christmas vacation the eligibility date was December 1 and the base earnings period May 1 to November 1. The article also included provisions as to the amount of vacation pay, which were more generous than Respondent's prior practice. Goldman refused to agree to the percentages of earnings proposed but stated that he was in general agreement with the clause so far as the "splitting" features were concerned. The Union's new proposal as to access to the mill, article XIV, followed the lines previously agreed upon by Goldman and Hoyman and already described. Hoyman testified that the provision had been "tailored" to meet Goldman's objections to the Union's original proposal. On April 26 or 27, when the parties went through the new proposals, Goldman said that it was "okay" in principle. There was disagreement by Goldman as to a number of the proposals submitted by the Union on April 26. Hoyman asked Goldman for his drafts of the various clauses being discussed. Goldman said that he had none at that point, but that the Company had a proposal to make which would accelerate the negotiations He thereupon proposed a 10-cent-per-hour wage increase in addition to the 8- to 22-cent increase already offered, a paid holiday in addition to the one already in effect, and an insurance plan which increased benefits and reduced employee contributions. He stated that the offer was conditioned upon the Union accepting a contract with a no-strike clause and without checkoff, arbitration, additional shift differentials, or retroactivity for the wage increases. The Union took the matter under consideration. The above findings as to Respondent's agreement with various union proposals are based upon Hoyman's testimony, which the Trial Examiner has, for the most part, credited over the denials of Goldman and Humphreys Except with respect to cumulative downtime and leave of absence those denials were not persuasive.6 The focus of Humphreys and Goldman's testimony was usually not on the question of whether agreement had been reached in principle but rather upon whether there was final and complete agreement on an entire article. Thus, Humphreys testified with respect to the split vacation plan advanced by the Union, "In my opinion we are not in agreement yet." A comparison of article XI of Respondent's May 25 proposal with article XIII of the Union's proposal of April 26' establishes that both had substantially the same provisions so far as concerned the splitting of vacations and vacation pay, the parties' difference was as to amount. Humphreys also testified as follows Q All right, at the April 20th meeting, did Mr. Goldman have any suggestions as to procedures to be followed to firm up what the parties had agreed to from time to time9 A. Yes Q What was his suggestion? A. That we take the Articles that we both felt that we were in disagreement on, and that we each work on those Articles and embody them in a full contract. Q At that time, were there any outstanding oral agreements which were not in writing? A. As far as I was concrned, there were no oral agreements. Q Had- Mr. Goldman said anything on that subject? A. Many, many times Q What had he said? A. He said the Company would be bound by only what is put into the written contract. On Sunday, April 30, at a meeting held in a public square, the employees voted to reject Respondent's new wage offer but to continue negotiations "as long as progress was being made " At the May 3 meeting Respondent still did not have its written proposals to present but said that they might be ready for the following week. Hoyman complained that by tying "a sub-standard contract . . to a very substantial wage increase" Respondent was not bargaining fairly. Informed that the new increase proposed on April 27 had since been placed into effect at the Washington and Warsaw plants, Hoyman repeated his protest that Respondent was discriminating against the Whiteville employees because they had elected to bargain collectively, and he told Goldman that the employees were disturbed by Respondent's delay in installing the proposed increases and by its dragging its feet in the negotiations. The May 3 session extended into the afternoon and much of the time was spent discussing arbitration and checkoff. On Thursday morning, May 4, the negotiations continued. Goldman made a definite commitment to have a written proposal the following week. The Union requested further meetings for that afternoon and for Friday, Saturday, and Sunday, but Goldman refused because of family engagements and he left for New York. Meetings of the first and second shift employees were convened and the employees, alter receiving reports about the progress of the negotiations voted to strike The motions passed were "that we strike against the Company's unfair labor practices." Picket lines were set up and Goldman returned immediately to Whiteville On May 9 Humphreys left Respondent's second contract proposal at union headquarters S The proposal retained those portions of its April 6 proposal as to which the Union was in agreement. In addition it conceded part, 'in crediting these denials of Goldman and Humphreys the Trial Examiner does not intend to indicate lack of confidence in Hoyman's truthfulness. The nature of the discussions was such that two participants could derive different impressions as to the extent of agreement The Trial Examiner has made allowance for this possibility and has made findings that agreement was reached only in those instances where his appraisal of the testimony of all three witnesses led convincingly to that result 'G C Exhs 6 and 4, respectively 'G.C Exh 5 NATIONAL SPINNING CO. though not all, of the Union's proposals in a number of areas, including leave of absence to attend union conventions or conferences, but it adhered to Respondent's refusal to grant leave of absence to one employee to act as a union representative. It adopted the fatigue allowance of 12 percent proposed by the Union but provided for a different computation. The contract included Respondent's proposal for insurance provisions more favorable to the employees and for a second paid holiday. It also provided that if a grievance was not settled satisfactorily through the grievance procedure, the Union had the right to strike with respect to such grievance, subject, however, to narrowly limiting conditions On the other hand the proposed contract omitted the wage policy manual regulations as to the incentive system embodied in sections 3 to 10 of article III, subarticle 1, of the Union's April 26 proposal, and it omitted provision for splitting vacation pay. As to workload changes, it provided for discussion in case of dissatisfaction after their installation, but did not provide for advance notice, for trial periods, or for subjecting the changes to the grievance procedure. Finally, it provided that Respondent make facilities available in its offices where union representatives could confer with employees for the purpose of investigating and adjusting grievances, but it made no provision for a union representative to visit the plant proper to investigate changes in operations or even to investigate grievances. On May 9 the Union filed the original charge in this proceeding alleging a refusal by Respondent to bargain in good faith. The charge was served on Respondent on that day by registered mail. On May 16 the parties met and Hoyman pointed out the respects in which Respondent's May 9 proposal diverged from agreements reached, as well as provisions which the Union would not agree to. Goldman noted Hoyman's comments. On May 25 they met again and Respondent presented its third contract proposal. In general the clauses in its old proposals agreed on with the Union were again adhered to. For the first time Respondent's proposal included provisions as to downtime, computation of incentive pay, and setting of incentive rates, although these did not meet the Union's proposals in full The proposal accepted in large part, although not entirely, proposals of the Union as to the beginning of the workweek and as to disciplinary action. Respondent adhered to its refusal to agree to a leave of absence for an employee as representative of the Union, to a checkoff, or to arbitration, and it adhered to its previously proposed clause against strikes or lockouts. The proposed contract included the extracts from Respondent's wage policy manual proposed by the Union as sections 3 to 10 of article 111, subarticle I of its April 26 proposal with a number of additions. It included provisions for splitting vacations and vacation pay which were substantially the same as the Union's proposal; the amount of vacation pay remained different. It provided that a union representative be permitted to see operations inside the plant when necessary to secure information to enable the Union to discuss a grievance, subject to conditions similar to those in the Union's proposal, but not providing for investigating new procedures or machinery in the absence of a grievance. Its previous workload-change proposal, with no provision for advance notice to the Union, trial period, or grievances, was also retained At the May 26 meeting Goldman said that he proposed to place the wage offers he had previously made into 385 effect immediately, explaining that he did not want to deny the employees the benefit of the increase any longer. Hoyman replied that it was, wrong for Respondent to reverse its prior position of refusing the Union's request for immediate installation of the wage increase until he got a complete contract. He commented that the only effect now would be to bribe strikers and others to cross the picket line. Goldman said that the increase would be placed into effect the following Monday That day Respondent issued an announcement to all employees that on May 29 the wage increases, as well as improvements in hospital insurance and holiday benefits, would be placed into effect. Bargaining continued, but no agreement was reached. Concluding Findings as to the Refusal to Bargain On the basis of the certification issued on January 13, 1967, it is found that all production and maintenance employees of National Spinning Company, Inc., at its Whiteville, North Carolina, plant, including laboratory employees, pilot-plant employees, section men, and head overhaulers, but excluding office clerical employees, guards and supervisors as defined in the Act, constitute a unit appropriate for purposes of collective bargaining within the meaning of Section 9(b) of the Act; and it is further found on the basis of said certification and of the secret-ballot election on which it was based, that the Union is, and at all times since October 26, 1966, has been, the exclusive representative of all the employees in such unit for the purposes of collective bargaining in respect to rates of pay, wages, hours of employment, and other conditions of employment. An employer may not grant nonstrikers higher wages or better working conditions than he had offered strikers through their bargaining representative. While the wage increase, insurance benefits and additional holiday placed into effect on May 29, 1967, were superficially the same in amount as had been offered to the Union on April 6 and 26, there Was an important difference- When the offers were made to the Union, they were conditioned upon the execution of a complete contract without retroactivity, added shift differentials, or certain other terms. The removal of this condition on May 26, 1967, had two important practical effects First, Respondent's insistence upon the condition prior to the strike meant that the employees at that time, as a quid pro quo for the wage increase, had to be ready to give up their efforts to obtain improvements in their working conditions. The net advantage of the increase offered the Union was thus pro tanto less than that which Respondent gave to the employees who crossed the picket line, who received the full benefit of the wage increase without condition Second, apart from the question of surrendering on other issues, the installation of the increase for the benefit of the nonstrikers before completion of bargaining had a substantial monetary value which Respondent had adamantly refused to grant to the Union. The Respondent was thus giving to employees who worked during the strike a higher reward than what was until then the normal scale of pay. Such differentiation of treatment as between nonstrikers and union adherents by its very terms is discriminatory and discouraging of union membership. See N.L.R.B. v Erie Resistor Corp , 373 U.S. 221. Respondent offered no economic or other justification for its action which would negate its destructive impact upon employees' rights See N.L.R.B. v. Great Dane Trailers, Inc., 388 U.S. 26. 38 6 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Respondent's purpose went deeper. In early September 1966, when the petition for the Whiteville employees came on for hearing, the employees in Warsaw and Washington received a wage increase which those in Whiteville did not receive. Shortly after April 26, 1967, the same process for the benefit of Warsaw and Washington employees was repeated with respect to the further increase Now, after 3 weeks of striking, Respondent caused the Whiteville employees to see the nonstrikers receive the increases which they themselves had requested but had been denied. Respondent offered no evidence justifying its change of position. Goldman's statement during the negotiations that he did not think "the employees" should be denied the increase "any longer" was a misrepresentation of his motives The reason for Respondent's change of position was the change which had taken place as to the persons to be benefited, not the mere lapse of time, as indicated by Goldman's statement. It was the personnel director's statement to Benton that truthfully embodied Respondent's policy as to the wage increase, namely, that it was there for the asking if the employees got rid of the Union. Plainly Respondent, by placing the increases into effect on May 29, was emphasizing the lesson that Respondent had earlier given when it denied the Union-represented employees the increases granted the Warsaw and Washington employees, i.e., that Respondent had it in its power to cause the employees to lose more than they could gain by relying upon the Union for betterment of their working conditions. Moreover, while the withholding of the wage increase before the strike could have been an effective and permissible bargaining tactic, appraisal of Respondent's entire course of conduct leads to the conclusion that Respondent used it not to obtain a contract on terms more favorable to itself, but rather to weaken the Union It must be inferred that the same illegal reason motivated Respondent in withholding institution of the wage increases before the strike as motivated it in instituting it for the benefit of the nonstrikers An employer may use the withholding or granting of benefits to a labor organization representing his employees as a quid pro quo for concessions or for legitimate business considerations; he may not use them for the purpose of weakening a labor organization, or undermining the employees' confidence in the bargaining process or their bargaining representative. See N L R.B. v. Kentucky Utilities Company, 182 F.2d 810, 812-814 (C A 6), enfg. as modified 76 NLRB 845 See also N L.R.B. v. Exchange Parts Company, 375 U.S. 405. The fact that the action taken by Respondent would have been proper if taken for legitimate purposes does not legitimize it when taken for discriminatory purposes. It is noteworthy that what Goldman did was merely announce that the wage increase was to be placed into effect. He did not offer it as a concession to induce termination of the strike, or to advance bargaining or, in any true sense, as part of negotiations for a contract. The proposal to institute the holiday and insurance benefits was not even mentioned to the Union. The reason for these things is that Respondent was not interested in negotiating a contract but in undermining the Union. ".. . respondent was not really endeavoring to obtain the union's assent to a wage increase, but was seeking to place the union in an unfavorable light and capitalize on the situation " N.L R.B. v. Agawam Food Mart, Inc., d/b/a The Food Mart, 386 F.2d 192 (C.A. 1), enfg. 158 NLRB 1294. Respondent's anti-union and retaliatory fame of mine was manifested in another area of negotiations. Just as Respondent was ready to give substantial wage increases, so, too, it was ready to institute improvements in other working conditions. Among other concessions to the Union, it agreed to split vacations and vacation pay, to access to the mill by union representatives in connection with the introduction of new methods or machinery, to written notice to the Union of changes in workload and a trial period in case of disagreement, and to the inclusion in the contract of various extracts from Respondent's wage policy manual. Respondent also proposed that each side draft clauses embodying their respective proposals. However, on April 26, and May 3 and 4 it disclosed that it had failed to draft clauses of its own on those and other subjects; and even on May 9, when it presented a proposed contract, it omitted provisions in the areas just described as to which agreement had been reached. The point is not that Respondent refused to execute a contract after all terms had been fully agreed upon, as was the case in H.J. Heinz Company v. N.L.R.B., 311 US. 514. Respondent's unfair labor practice lay in the fact that it thus demonstrated to the employees how it could delay completion of the negotiations and enjoyment of the wage increases even where the parties' differences had been eliminated, while the Warsaw and Washington employees received first the September 1966 wage increase, and then the increase offered on April 27 Ultimately, that is, on May 25, Respondent did submit proposed clauses on those subjects, although not entirely as agreed to with the Union. It is unnecessary to meet the question of whether Respondent's failure to submit that material prior to the strike and its submission of a contract proposal on May 9 with the material omitted would, in isolation, have supported an allegation of refusal to bargain in good faith. What actually happened was that this conduct of Respondent was engaged in while the wage increases it had instituted in Washington and Warsaw and was ready to grant at Whiteville were simultaneously withheld by it for the purpose of undermining the Union. The lesson intended for the employees could not be, and was not, lost. On May 3 Hoyman told Goldman that the employees were disturbed by exactly those considerations, i.e., Respondent's dragging its feet in the negotiations while it delayed installing the proposed increases it intended to grant It is found that Respondent did not bargain with the Union in good faith and that its conduct was violative of Section 8(a)(5) of the Act. The complaint alleges that Respondent failed to bargain also by insisting upon a no-strike clause while refusing to agree to arbitrate grievances. Respondent did offer a no-strike clause so modified as to allow strikes on grievances in lieu of arbitration. Without meeting the general principle advanced by the General Counsel, namely that Congress in developing the National Labor policy, looked upon a no-strike clause as a quid pro quo for an arbitration clause, see Textile Workers Union of America v. Lincoln Mills of Alabama, 353 U.S. 448, the Trial Examiner therefore does not find that Respondent's position with respect to the no-strike and arbitration clauses showed bad faith in the negotiations. The complaint also alleges that Respondent did not bargain in good faith concerning union security, in this case a checkoff The checkoff is a mandatory subject of bargaining and there is no principle of good-faith bargaining that requires that it be granted in all cases See McLane Company, Inc., 166 NLRB 1036, fn. 2. Distinguish United Steelworkers of America (H K. Porter) v N.L.R.B., 363 F.2d 272 (C.A.D.C.), enfg. 153 NLRB NATIONAL SPINNING CO. 1370, where collecting dues was, as the employer knew, an especially difficult problem , his purpose in refusing the checkoff was to avoid giving aid and comfort to the employees' bargaining agent, and, with only three issues remaining in the negotiations , it had been specifically found - see the court' s decision, fn. 16 - that the employer was refusing the checkoff "for the purpose of frustrating agreement with the Union . ..'" Distinguish, also, Roanoke Iron & Bridge Works , Inc., 160 NLRB 175, enfd. 290 F.2d 846, (C.A.D.C.), where it was found that the employer's refusal of the checkoff was based on its belief that such refusal would cause the employees' bargaining agent to suffer and probably to leave the scene. In the present case numerous issues were before the parties, so that there was still much room for give and take in the negotiations . The discussions as to checkoff had had a bad start when the Union announced that it would "never" sign a contract without such a provision. However just as that statement did not necessarily impede reaching an agreement , so, too, Respondent' s adamant position against the checkoff has not been shown to have impeded agreement . Nor has the General Counsel demonstrated by evidence that Respondent 's position as to this particular issue was taken for purposes of destroying or weakening the Union . The Trial Examiner therefore does not find that Respondent failed to bargain in good faith concerning the particular issue of union security. D. Conclusions as to the Strike On May 4, the day the strike started, negotiations had not reached an impasse and there is nothing in the record to suggest that the employees struck over any particular subject or subjects of the bargaining. What disturbed the employees and caused them to strike was Respondent's failure to live up to its commitments which would have furthered the progress of the negotiations, while at the same time because the employees refused to get rid of the Union as Respondent advised through its personnel director, it withheld wage increases which the Washington and Warsaw employees already had. While the Trial Examiner, in finding that Respondent bargained in bad faith, has relied upon the May 29 wage increase which so plainly discriminated in favor of nonstrikers, that does not mean that until May 29 or May 26 Respondent was bargaining in good faith. That action simply made plain what Respondent had been doing all along - certainly since April 20 -- namely, delay completion of the negotiations while it manipulated its wage scale for the purpose of undermining the Union and destroying the employees' confidence in the collective-bargaining process. It is found that the strike, from its inception, was caused by Respondent's unfair labor practices. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE It is found that the activities of Respondent set forth in section III, occurring in connection with its operations described in section I, 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 of commerce. V. THE REMEDY 387 As it has been found that Respondent has engaged in certain unfair labor practices, it is recommended that the Board issue the Recommended Order set forth below requiring Respondent to cease and desist from said unfair labor practices and to take certain affirmative action which will effectuate the policies of the Act. It has been found that the strike which commenced on May 4, 1967, was caused by Respondent's unfair labor practices. It is, accordingly, recommended that, upon their application, Respondent offer all its employees who joined the strike reinstatement to their former or substantially equivalent positions without prejudice to their seniority or other rights and privileges previously enjoyed: It is further recommended that Respondent make said employees whole for any loss of pay they may suffer by reason of Respondent's refusal to reinstate them in accordance with the Recommended Order if such refusal eventuates, by payment to each of them of a sum of money equal to that which he would normally have earned as wages from a date 5 days after the date on which he applies for reinstatement to the date of Respondent's offer of reinstatement, less net earnings during said period, with interest thereon at 6 percent per annum in accordance with the Board's usual practices. See F W. Woolworth Company, 90 NLRB 289, and Isis Plumbing & Heating Co., 138 NLRB 716. The deliberate character of the unfair labor practices in which Respondent has engaged is such as manifests a disposition to thwart the purposes of the Act by interfering with the employees in the exercise of the rights therein guaranteed For this reason it is recommended that Respondent be required to cease and desist from infringing in any manner upon those rights. CONCLUSIONS OF LAW 1. Respondent , National Spinning Company, Inc., is engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. Respondent is, and at all times material has been, an employer within the meaning of Section 2(2) of the Act. 3. Textile Workers Union of America, AFL-CIO, CLC, is a labor organization within the meaning of Section 2(5) of the Act. 4. All production and maintenance employees of National Spinning Company, Inc., at its Whiteville, North Carolina, plant, including laboratory employees, pilot-plant employees , section men , and head overhaulers, but excluding office clerical employees, guards and supervisors as defined in the Act , constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 5. At all times since October 26 , 1966, the Union has been, and it still is, the exclusive representative of all the employees in the appropriate unit for the purposes of collective bargaining in respect to rates of pay, wages, hours of employment , and other conditions of employment, within the meaning of Section 9 (a) of the Act. 6. By refusing to bargain collectively with the Union as the exclusive representative of all its employees in the appropriate unit, Respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8(a)(5) of the Act. 7. By interfering with, restraining, and coercing employees in the exercise of rights guaranteed in Section 7 388 DECISIONS OF NATIONAL LABOR RELATIONS BOARD of the Act, the Respondent has engaged in unfair labor 9. Respondent has not engaged in unfair labor practices practices within the meaning of Section 8(a)(1) of the Act. within the meaning of the Act by refusing to rehire Irene 8. The unfair labor practices described above are unfair A. Pait. labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. [Recommended Order omitted from publication.]