J. A. Hackney & Sons, Inc.

J. A. HACKNEY & SONS J. A. Hackney & Sons, Inc. and International Chemical Workers Union, AFL-CIO. Case l 1-CA-3682 May 21, 1969 DECISION AND ORDER By MEMBERS FANNING, BROWN, AND JENKINS On January 24, 1969, Trial Examiner Benjamin K. Blackburn issued his Decision in the above-entitled case, finding that the Respondent had engaged in and was engaging in certain unfair labor practices within the meaning of the National Labor Relations Act, as amended, 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 Trial Examiner's Decision and a supporting brief. Pursue nt 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 and the brief, and the entire record in this case, and hereby adopts the findings, conclusions, and recommendations of the Trial Examiner insofar as they are consistent herewith. We affirm the Trial Examiner's conclusion that Respondent violated Section 8(a)(3) of the Act by discharging 41 employees. We believe that the decision to reduce the work force was motivated by the recent union activities of his employees and not by Respondent's economic straits.' We agree with the Trial Examiner's finding of union animus, as is clearly shown by the independent 8(a)(1) violations found by the Trial Examiner, which we are herein adopting. We further find that the Section 8(a)(1) violations were closely related to the mass discharge and constitute substantial evidence as to the motive of Respondent for effecting the discharge. Respondent manufactures steel and aluminum truck bodies for the beer and soda industry. Beginning February 1, the entire glass industry was shut down by a strike, which ended in the latter part. of March 1968. It is undisputed that Respondent's sales were adversely affected by the strike. 'As noted by the Respondent , the Trial Examiner erred in finding that backlog on April 23, 1968, was $1 ,169,539. However, this does not affect our decision herein. 'We find it unnecessary to rely on the Trial Examiner' s apparent further finding that there was a discriminatory selection of the employees discharged. 63 After the Union began the organization of Respondent's production and maintenance employees on May 21, 1968, Respondent engaged in a program of systematic surveillance, making use of employees Chester Webb and James Edwards, who furnished Respondent with various lists containing the names of those who attended union meetings and who signed union-authorization cards. Webb testified that supervisor Boyd asked him to go to the union meetings and remember who attended and signed union cards. Boyd also interrogated Webb concerning specific employees. A statement by Boyd to the effect that "These guys are going to wish that they hadn't never signed that card", and an implied threat by James A. Hackney, Jr., Respondent's president, that he would close the plant in the event that the union was successful, are further evidence that the 41 discharges were discriminatorily motivated. In another instance of surveillance, foreman Ray Winstead wrote down the names of those who were wearing union buttons, informing an employee that the list was to be turned in to James Hackney, III, the executive vice president and general manager of Respondent. Respondent also granted benefits to its employees to induce them to abandon their union activities. On May 23, Hackney, III, immediately after learning of the union organizing campaign, addressed the employees, and informed them that the backlog of orders was down due to the strike in the glass industry, and that if conditions worsened, hours might have to be cut back as a last resort. [Emphasis supplied.] A layoff of any personnel was not foreseen at the time; although Hackney possessed at that time a sales forecast for the coming months which proved to be accurate. On July 11, Hackney III once again addressed the assembled employees. This time, delivering a vituperative speech, containing many indirect, although obvious, references to union supporters, he announced the termination of employment of 41 employees, adding that he was keeping the men who pitched in, rather than those who had complained. Respondent claims that the discharge was directly attributable to a slowdown in production on the part of the employees. Close examination of the record reveals that no such slowdown is evident. Production per man-hour during the period preceding the discharge was at least as high as it had been in previous years for the same period. Thus, we conclude that the alleged slowdown claimed by Respondent was merely a pretext. In view of the foregoing, and upon the entire record, we find, in agreement with the Trial Examiner, that Respondent discharged the 41 employees in violation of Section 8(a)(3). 176 NLRB No. 8 64 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the Recommended Order of the Trial Examiner, and hereby orders that Respondent, J. A. Hackney & Sons, Inc., Washington, North Carolina, its agents, successors, and assigns, shall take the action set forth in the Trial Examiner's Recommended Order. TRIAL EXAMINER'S DECISION FINDINGS OF FACT 1. THE BUSINESS OF RESPONDENT Respondent, a North Carolina corporation, is engaged in the business of manufacturing truck bodies for the beer and soft drink industries . It annually ships goods valued in excess of $50,000 from its plant in Washington, North Carolina, directly to customers outside the State of North Carolina. On the basis of these admitted facts, the complaint alleges, the answer admits , and I find that Respondent is engaged ►n commerce within the meaning of Section 2(6) and (7) of the Act. STATEMENT OF THE CASE BENJAMIN K. BLACKBURN, Trial Examiner: This case began with the filing of a charge by International Chemical Workers Union, AFL-CIO, referred to herein as the Union or the Charging Party, against J. A. Hackney & Sons, Inc., referred to herein as Respondent, on July 18, 1968.' The charge was subsequently amended on August 5, and again on September 5. On September 23 the General Counsel of the National Labor Relations Board , by the Regional Director for Region 11 (Winston-Salem , North Carolina) issued a complaint against Respondent in which he alleged that Respondent had violated Section 8 (a)(1) and (3) of the National Labor Relations Act by discharging 41 named employees on July 11 and had violated Section 8(a)(1) by various other acts. Respondent's answer admitted that the employment of the 41 employees named had been terminated but denied the commission of any unfair labor practices. Pursuant to due notice , hearing was held before me in Washington, North Carolina, on November 12, 13, 14, and 15 . The issues litigated were (a) was Respondent motivated by economic or antiunion considerations in deciding to' discharge 41 out of 112 employees on July 11; (b) if Respondent's motive was economic, was it discriminatorily motivated in selecting the 41 men who were discharged , and (c) did various other incidents, if, in fact, they took place , constitute interference with, restraint, and coercion of Respondent' s employees in the context of the Charging Party's organizing campaign? All parties appeared at the hearing and were given full opportunity to participate, to adduce relevant evidence, to examine and cross-examine witnesses, to argue orally, and to file briefs. Briefs subsequently filed by Respondent and the General Counsel have been carefully considered. Upon the entire record, and from my observation of the demeanor of the witnesses while testifying under oath, I make the following: ' All dates are 1968, unless otherwise specified. 'An issue which engendered some heat but little light at the hearing was whether the 41 had been laid off or discharged . It is undisputed that, whatever its reasons, Respondent considered 35 clearly unsatisfactory employees and 6 borderline . The six were offered jobs as new employees when business picked up in October. Respondent was unwilling to state whether a further upturn in business would cause it to seek out any or all of the other 35. Although I do not think the distinction makes any difference, I find that all 41 were discharged on July 11 since the 35 had and have no reasonable expectation of recall and , while intervening events demonstrate that the 6 had a reasonable expectation of returning to work for Respondent, it was as new employees rather than old. Layoff implies the continuance of an employer-employee relationship, for some reasonable period of time, which will lead to restoration of the employee to his old status and privileges in the event he is recalled to active duty. II. THE LABOR ORGANIZATION INVOLVED The complaint alleges, the answer admits, and I find that the Charging Party is a labor organization within the meaning of Section 2(5) of the Act. 111. THE UNFAIR LABOR PRACTICES A. Undisputed Facts In the fall of 1967 Respondent's prospects were bright. An 8-year record of continuous growth at the rate of approximately 20 percent per year was culminating in a record high sales figure of $2.9 million. Anticipation that the same trend would continue caused Respondent to budget for 1968 on the basis of an estimated $3.1 million in sales. Respondent's customers, bottlers, and distributors of beer and soft drinks, are engaged in what is mainly a seasonal business. Most of their orders for new truck bodies are placed in winter so that the trucks will be ready for use at the beginning of their season. However, in February a strike in the glass industry caused a downturn in the bottling industry which, in turn, caused a marked drop in the number of orders for truck bodies received by Respondent. Consequently, on April 23, Hodges Hackney, Respondent's sales manager , prepared and presented to Respondent's managers a new sales projection based on the altered situation. His study covered the period from April 28 through the end of August.' He pointed out that orders received in the January-April period were down $251,578 from 1967 and that, for Respondent to keep abreast of its original 1968 budget , his salesmen would have to write new orders in the amount of $983,749. He said it was his considered judgment, in light of the situation as it then existed, that they would sell only $673,400 worth. The latter figure was based on his estimate of selling 259 bodies, or an average of 14.5 per week for the 18-week period under review. Respondent's backlog at the time was $1,669,539.' Its production capacity was 30 bodies per week. Hodges Hackney kept a running record of how his projection compared with 'Respondent builds bodies on truck chassis which the customers order from the manufacturer of their choice. There is a long lag between receipt of an order by Respondent and delivery of the finished product. Sometimes construction of the body begins before the chassis is received at Respondent's plant. Sometimes the chassis arrives and is stored by, Respondent for a period of time before the body is built. Consequently, while Respondent keeps its sales figures, i.e., income received from completed orders, on a calendar year basis , the sales department works on a September I-August 31 fiscal year basis. Backlog is the amount of unfilled orders on the books at any given moment . The number of truck chassis on Respondent's lot at any particular time is another measure of Respondent's economic health. The record does not reveal how many chassis were on hand on April 23. J. A. HACKNEY & SONS 65 reality. The Union's campaign to organize Respondent's employees began with a meeting on the evening of May 21. Joe Cutler became head of an employee organizing committee, and James Edwards became its secretary. James A. Hackney III, Respondent's executive vice president and general manager, learned of the campaign on the evening of May 22 when employee Guy Edwards called him at home to tell him about the meeting. On May 23 Hackney III assembled Respondent's employees and addressed them at length about Respondent's and their prospects in light of the Union's campaign. Also on May 23 employee Chester Webb informed Holmes Boyd, Respondent's production superintendent, and his assistant, Melville Russ, that the Union was attempting to organize the plant. It was arranged that Webb would attend a Union meeting scheduled for that night and report back. Union meetings were held on May 23, May 30, and June 5. Webb and Edwards reported to Respondent the names of employees attending Union meetings. On May 27, 28, and 29 Hackney, III, addressed the employees in six separate small groups on the subject of unions. He read the same prepared text to each group.' He told them that they should not select a union as their bargaining representative because it was only after their money and the right to speak for their jobs, because they would lose their valuable right to speak for themselves, because only management could grant them increased benefits, because they might have to testify that they had signed an authorization card , because signing an authorization card could submit them to union discipline such as fines, because participation in an economic strike could cost them their jobs through the hiring of replacements, and because strikes can lead to violence, bloodshed, and the rupture of close personal relationships. He told them that they shoud not believe a union organizer who told them that they had to sign an authorization card in order to protect their jobs and assured them that "no employee will receive any special privileges or be treated any differently because he might be serving in some official or unofficial capacity with a union, or is member of a union." He cautioned them against engaging in "conduct which will necessarily result in discharge or other disciplinary action" on the mistaken assumption that their union activities would protect them. He concluded by saying, "We have a good company here and a friendly place to work. We have good wages and benefits here and we have tried to improve these along with working conditions whenever possible. You know us and what we stand for. We are friends that many of you have had for a long time. We have progressed well together. I sincerely hope that if a union does start to work on you, you will remember what I said today and will not allow some stranger to come in here and start us fighting among ourselves and destroy what is now a good friendly family relationship. We know that only by pulling together, in the same direction, can we improve the welfare of all of us." He then invited questions. Employees voiced complaints about their wages and Respondent's job progression plan. On May 7, the date closest to April 23 for which the statistic is available, there were 119. 'The speech was taken from a manual for employers on how to oppose organization . The photocopy which is in evidence is 9 double-spaced pages long. The pages are numbered 71 through 79. At the end is a note which points out that the talk is merely intended as a general outline , should be James A. Hackney, Jr., Respondent's president, ran for county commissioner in a local election held the first week in June. During the last week in May campaign buttons which read "I'm For Hackney" were made available in the plant. Several employees altered the buttons to read "I'm For Hackney Union" and wore them. On June 5 Hackney, Jr., addressed the employees. His subject was the Union's organizing campaign and Respondent's economic situation. During the week ending June 25 Respondent reduced its normal workweek from 50 to 45 hours. On June 28 Hackney, III, decided to discharge enough employees to reduce the complement to the size required to produce approximately 14.5 bodies per week. On that day Hodges Hackney's running record of projected sales versus actual sales showed a projected figure for the week ending June 25 of 130.5 bodies, actual sales of 135 bodies. On July 1 Hackney, III, sent a memorandum to Boyd which reads, in part- Here are the approx. totals by dept. Let me know if it needs to be rebalanced. Levels are based on 10 crews in assembly, which should be exactly right for the 14.4 bodies per week projection from Hodges [Hackney]. Please get with Melville [Russ] and come up with a systematic plan for reducing each department to these quotas. Don't let any word leak out about this. I'd hate to think what some of these guys might do. The target date for the move will be about the end of next week, unless orders pick up dramatically. Since 1965, when Hackney, III, took over from his father as Respondent's operating head, Respondent has rated all of its employees twice a year. The ratings are dated January 1 and July 1. They are actually made by the foremen in the last week of December and June. A form is used on which each employee is rated in eight categories such as quality of work and productiveness on a numerical scale which ranges from four for excellent to zero for poor. The ratings are added to give the man's composite score. The average departmental score for each category and the average composite score are also entered on the sheet so that the man's standing relative to the departmental' average can be ascertained at a glance. The rating foreman's score may be adjusted up or down by his superior, usually Russ, by a maximum of one point. In response to Hackney III's directive, Boyd and Russ recommended, and Hackney III approved, the following systematic plan for selecting employees for discharge: Each man's deviation from the composite departmental average in the two most recent ratings - that is, the ratings made in the last week in December 1967 and in the last week in June 1968 - was noted and the two deviations averaged. An average deviation of -1.2 was arbitrarily selected as a cutoff point. Any man with that rating or lower was automatically selected for discharge. When the results were correlated with the total number of men in each department who would have to be let go in made to "sound like you" and should be checked with advisor or attorney before being used It is obviously designed for use by North Carolina employers since all of the statistics and examples it contains are North Carolina statistics and examples 'This system obtains in the assembly, subassembly, chassis, fabrication, and paint departments but not in the general services department. Since the latter lumps together miscellaneous employees of widely varying duties, a departmental average would have no validity in judging any individual employee. Consequently, in general services , ratings are averaged for each job title. 66 DECISIONS OF NATIONAL LABOR RELATIONS BOARD order to get down to the quotas and job titles enumerated in Hackney, III's July 1 memorandum to Boyd, it was found that an arbitrary -1.2 caught ,only 35 of the 41 required.' The other six were added after conferences of foremen and Boyd and Russ in which the value of each was weighed against the value of other employees who were closer to the departmental average than -1.2. On July 3 Hackney, III, in a speech to all the employees, announced a revised job progression plan and wage increase, effective July 17. He explained the delay since the men voiced their dissatisfaction with the old plan on the ground that considerable time had been spent in devising the new one . He said that, initially, the raise would amount to 5 cents an hour for everyone but that, potentially, the new plan would lead to additional raises ranging from 8 cents to 22 cents an hour in 2 to 4 months steps. He pointed out that the new plan incorporated the employees' own suggestions, utilized a point factor system similar to other companies, was based on having each job graded by four to six men familiar with the job, and called for publication of written job descriptions. He stressed the fairness and impartiality of the new plan. Prior raises had been granted in the late spring and the late fall of 1967, 1966, and 1965. At approximately 4 p.m. on July 11, with no prior warning, the 41 employees previously selected were discharged . On that day Hodges Hackney's running record of projected sales versus actual sales showed a projected figure for the week ending July 19 of 159.5 bodies, actual sales of 148 bodies . Hackney, III, addressed the men at that time. The discharges were effected by giving each man a form provided by the Employment Security Commission of North Carolina in which certain information common to all the discharges such as identification of the employer, last date worked (7/11/68), date separation known (7/11/68), and reason (lack of work) was inserted. However, that part of the form on which the employee is to be identified was left blank. The discharged men had to return to the plant the following day in order to turn in their uniforms, receive their final paychecks, and get an individualized form which they could take to the state agency to obtain unemployment benefits. This was the first mass reduction in Respondent's force for lack of work since, at least, 1960. B. Independent 8(aX1) 1. Spying on union meetings Respondent defends this aspect of the case on the ground that it was merely the recipient of information volunteered to it by willing employees and did nothing to solicit or encourage their activities . The testimony presents many sharp credibility conflicts. Their resolution is less important than would normally be the case since I would find a violation even if the only evidence before me were the admissions of Respondent's wittneses. However, I do not resolve all the conflicts in Respondent's favor. Rather, the facts which follow are a synthesis of the testimony of 'I credit Hackney, III's explanation that he adopted an attrition program as early as April when Hodges Hackney warned him Respondent was in trouble and that a total of 41 was only decided on at the time of the discharges on July 11. However, there is no indication that any employees left in the interim between the final decision as to which employees would be let go and July 11. Two men, Cheater Webb and one other, quit while the study was being made . Therefore, it is clear that fate did not intervene to save anyone's job once the men to be discharged were selected. all the witnesses and represent my conclusion as to the inherently most likely course of events flowing from the admitted situation and details as to which there is no disagreement. It is undisputed that , first, Chester Webb and, later, James Edwards reported to Boyd and Russ the names of employees who attended various Union meetings. Lists of names which they compiled as well as notes written by Edwards and witnessed by Webb which accompanied them are in evidence. As to specific conflicts between specific witnesses , I have not credited James Edwards in any respect in which his testimony is not corroborated by another witness. Edwards became secretary of the Union's organizing campaign at the outset yet just a few days later he was secretly sending notes containing such sycophantic expressions as "My main concern is to the Company `out of my own free will' to protect this Company with the best of my ability to stay out of the Union" and "I wish to thank you, sirs, with all my heart" and "So, Mr. Russ, I hope you and the Company will not fire me over this mess because I am strictly for my Company." No person, in my opinion, capable of such venality is worthy of belief. Moreover, hospital records and a cancelled check and supporting voucher introduced by Respondent establish that events could not have happened in the sequence and manner testified to by Edwards. Finally, his admissions on the subject when coupled with the check and voucher satisfy me that his effort to explain a routine loan as a payment for his activities as a spy was a deliberate prevarication. Where, therefore, the General Counsel's case depends on the testimony of Edwards alone, I have credited Respondent's witnesses over him. Chester Webb, on the other hand, struck me as a generally credible witness. It is true that he too played a double game, sitting in Union meetings and pretending an interest with his colleagues in organization while betraying their names and interests to Respondent, but he undertook the agent's role from the start and did not, like Edwards, sell out his fellow employees after first enlisting on their side. While spies, in any context, are not generally accorded the highest marks for honor, it does not follow that they are, per se, liars. I have, therefore, credited Webb over Boyd and Russ as to the details of what happened at their admitted meetings since I cannot believe that human beings in the situation faced by Boyd and Russ would have acted with the correctness of properly programmed automatons that they ascribe to themselves and Respondent generally. The first Union meeting was held on the evening of May 21. The next morning just before work Edwards told Webb he had some important news for him. Webb told Edwards he would talk with him later. That evening, when Webb visited Edwards' home, Edwards told him about the Union campaign. The next morning, May 23, Webb asked his foreman, C. D. Jackson, whether he knew what was going on. Jackson said he had heard some rumors but did not know any details. A few minutes later Jackson sent Webb to the office which Boyd and Russ share. Boyd reminded Webb of loans and other help he had received from Respondent on prior occasions when Webb had been in trouble and then asked Webb to help Respondent fight the Union. Webb indicated his willingness to do so. Boyd and Russ questioned him at length about what was going on in the plant. Webb told them that a Union meeting was scheduled for that night. Boyd asked Webb to attend and report back, including the names of any employees who signed authorization cards. Webb agreed to do so. J. A. HACKNEY & SONS 67 The next morning, May 24, Webb gave a list of names of employees who had attended the meeting the night before to Jackson for Boyd.' A few minutes later Jackson sent Webb to Boyd's office. The list was on Boyd's desk. Boyd and Russ asked about various of the names on the list, what the individuals had done at the meeting and whether they had signed a card. When Edwards' name came up, Webb told Boyd and Russ that Edwards had been secretary of the meeting. Boyd asked Webb whether he thought Edwards would help them. That night Webb went to Edwards' trailer and recruited Edwards to spy on the Union for Respondent. On May 28 Webb delivered a note from Edwards to Russ.' This is one of the notes from which I have quoted above in assaying Edwards' credibility. Following the next Union meeting on the evening of May 30, Webb and Edwards repaired to Edwards' trailer where Edwards drafted a second note to Russ. The next morning, May 31, Webb handed Edwards' note to Foreman Jackson. As before, Webb was sent to Boyd's office where Boyd and Russ questioned him at length about the previous night' s meeting . On this occasion Webb wrote out a statement, witnessed by Russ, about being offered "double what the Company had been rumored to offer me" if he would join the Union. Webb continued to report to Boyd and Russ on Union meetings in early June. On one such occasion, June 3, he delivered a third note from Edwards to Russ. I have also quoted from this note above. More importantly, it reads, in part, "Chester D. Webb has advise you on second meeting that took place last Thursday night [i.e., May 231 so I take this time advising on first meeting [i.e., May 211. At first meeting these boys did attend. ..." There follows a list of names, broken down by departments. Boyd and Russ questioned him at length about the names on Edwards' list. On another such occasion, June 6, he delivered a list of employees attending a Union meeting the night before. On one of these occasions Boyd told Webb to tell the men that they should get their cards back from the Union organizer in order to protect their jobs. Webb relayed this message to several employees without indicating that the advice originated with Boyd. The Charging Party's campaign petered out around mid-June. However, a second union, the United Automobile, Aircraft and Agricultural Implement Workers of America, AFL-CIO, became interested, at least to the 'This is the only irreconcilable point on which I have credited Respondent's witnesses over Webb. Webb testified that, on each occasion, he gave the lists and notes directly to Boyd rather than to Jackson, who took them to Boyd , as they testified . I conclude that Webb was mistaken as to this unimportant detail and do not consider the discrepancy as rendering his testimony less reliable in any respect . The important point is that Boyd admitted receiving and perusing lists and /or notes on more than one occasion. 'In making my findings with respect to the times at which, and the sequence in which , various contacts between Webb and Boyd/Russ took place, I have relied on dates which appear on various lists and notes which are in evidence. One list, bearing the date "6/6/68," and the note from Edwards which contains a list, bearing the date "6/3/68," were produced by Respondent at the hearing and admittedly received , although not necessarily on the dates they bear. I find, relying on internal evidence therein , that the letter was written on May 30 although not delivered until June 3. Also in evidence are notes from Edwards bearing the dates "5/28/68" and "5/31/68," as well as a document bearing the date "5/31/68" which Webb testified he wrote in Boyd's office . As to these three, I credit Webb's testimony that he delivered the first two and wrote the third . As to the date noted on each document , I find that the notations were made by Hackney, III, on or shortly after each document was received by Boyd and Russ. extent of holding one meeting of Respondent's employees around July 1. Reporting on that meeting was Webb's last piece of espionage for Respondent. On that occasion Boyd remarked, "Whew, that's a large union. Well, Hackney is already sweating, but it looks like the other union has cooled off. I don't believe we have a whole lot to worry on this, because a lot of employees are scared now from that last union mess." Webb quit on July 5. In his last week at work, when he informed Boyd of his decision, he suggested that Edwards could take his place in reporting to Boyd. Boyd reluctantly agreed since, he said, he was not sure that Respondent could trust the double-dealing Edwards in the same way it had trusted Webb. Boyd told Webb to tell Edwards that, if he agreed to the new arrangement, he had nothing to worry about concerning his job. Webb relayed Boyd's message to Edwards in the hospital. Edwards was hospitalized twice during the period relevant to this case, from June 4 to 6 and again from July 2 through 4.10 When he returned to work the first time, he asked for and received a loan of $50 from Respondent. He made the request to Boyd. Boyd granted his request in conformity with Respondent's longstanding policy of making loans to its employees up to the amount of one week's wages. Edwards had requested and received similar loans on several occasions in the past. This transaction took place on June 14.11 On June 17 Edwards told Boyd and Russ that other employees were accusing him of taking bribes to spy for Respondent. Boyd told Edwards all the employees knew that Edwards had borrowed money from Respondent many times in the past and that the June 14 transaction was just more of the same. On June 27 Edwards complained to Boyd that his foreman, Ray Winstead, had reprimanded him for wandering around his department and talking to other employees. Boyd told Edwards he was sure Winstead had a valid reason for reprimanding him. He assured Edwards he had nothing to worry about as long as he did his work and followed Winstead's directions. On July 5 Edwards complained to Boyd that other employees were cluttering "Edwards testified Webb told him each time he was in the hospital that Webb was going to quit and Boyd said Edwards would not have to worry about his job if he took over from Webb as the spy. As I have indicated, I do not credit Edwards and find, as testified by Webb, that the hospital conversation took place only once, just before Webb quit in early July. This, of course, throws an entirely different light on the money advanced to Edwards by Respondent on June 14. At that time, the only anti-Union service rendered to Respondent by Edwards had been the notes from Edwards delivered by Webb. There is no evidence of any direct contact between Boyd and /or Russ and Edwards prior to June 14. In fact, Edwards' notes to Russ contain such revealing statements as "Please try not to contact if necessary until this matter clear up so I can keep all information coming in" (5/28/68) and "A guy name Walter may speak against me a hell of a lot but what he don't know " (5/31/68). "Edwards places this incident on June 26, and his version of the conversation with Boyd when he received $50 from Respondent forms the basis for allegations in the complaint that Respondent violated Sec . 8(a)(l) of the Act on June 26 when Holmes Boyd interrogated employees, "promised and granted benefits to employees to spy upon and report to Respondent the union activities of fellow employees . [and] . .threatened to discharge prounion employees...." As indicated, I find that no words were spoken by Boyd on this occasion that related in any way to the union activities of Respondent's employees . Also, I consider it a matter of no significance that the "James Edwards" appearing as acknowledgement of a $50 loan to one James Edwards on June 14 on a voucher supporing the $50 check admittedly received by Edwards on that day is not Edwards' signature . It is followed by "(BLC)" and was obviously placed there by the clerk who drew up both check and voucher and whose initials, apparently, are B.L.C. 68 DECISIONS OF NATIONAL LABOR RELATIONS BOARD up his work area. Boyd said that was probably a natural reaction if the employees knew that Edwards was turning in information about their union activities and promised to try to prevent any further harassment . On July 8 Bbyd asked Edwards to cut some material for him. While they were engaged in this activity Edwards volunteered to Boyd that he was worried about losing his job, that he knew which employees had signed Union authorization cards, and that he had enough influence over them to insure their support of Respondent rather than the Union.': On the basis of the foregoing, I find that Respondent violated Section 8(a)(1) of the Act when, on May 24, Production Superintendent Holmes Boyd and his assistant, Melville Russ, solicited Chester Webb to spy upon the union activities of his fellow employees and thereafter utilized his and Edwards' services in such spying. Respondent's contention that it is blameless because both Webb and Edwards acted voluntarily must fail because, even absent any showing that Boyd and Russ took the initiative in the beginning or overtly encouraged Webb as time went by, the mere fact that they continued to accept and profit from the fruits of Webb's and Edwards' spying in incident after incident is sufficient to constitute solicitation and encouragement of the spying. While the fact that an informant has volunteered information to an employer on one occasion, as in the July 8 conversation between Boyd and Edwards, may preclude a finding that the employer interrogated the employee or sought to enlist him as a spy, the continuing relationship between Webb and, indirectly, Edwards on the one hand and Boyd and Russ on the other is another situation entirely. Since I have found that Boyd and Russ did and said much more than they themselves admit in their dealings with Webb during this period, the conclusion I have reached with respect to the spying becomes inescapable. By the same token, I also find that Respondent violated Section 8(a)(1) when Boyd and Russ interrogated Webb about the union activities of its employees on various occasions during late May, June, and early July. Finally, I find the General Counsel has failed to prove that Respondent promised and granted benefits to employees to spy upon fellow employees or threatened to discharge prounion employees." 2. The button episode This incident also presents a credibility problem. Billy Tyre testified that his foreman, Ray Winstead, told him and others to take off the "I'm For Hackney" buttons "The testimony of Edwards on these episodes was offered by the General Counsel in support of allegations in the complaint that , on June 27, Winstead ". . . promised and granted benefits to employees to spy upon and report to Respondent the union activities of fellow employees . . ." and that, on July 8, Boyd interrogated employees and " ..threatened to discharge prounion employees... ' As indicated, I find that no such words were spoken by either Winstead or Boyd on these occasions. "The complaint alleges that an agent of Respondent named Keefe Hackney also committed each of these violations as well as threatened to close the plant if the employees brought in a Union . In addition, an allegation that Hackney, III, on July 8, attempted to interfere with employees' right to attend union meetings is also predicated on words allegedly spoken by Keefe . Keefe Hackney is another son of James A. Hackney, Jr. He was working for Respondent as a timestudy engineer during the period relevant herein . The General Counsel had no other evidence to offer to establish Keefe's agency or supervisory status. Consequently, I sustained Respondent's objection to testimony relating to incidents involving Keefe . The General Counsel's offer of proof indicates that the only witness who would have testified about such incidents in the presentation of his case was James Edwards. which they had altered to read "I'm For Hackney Union," saying, "It don't look very nice. I think you ought to take them off or even do away with the union part." Later, according to Tyre, he saw his name and the names of others who had been wearing the buttons on a pad in Winstead's hand. When Tyre asked what was going on, Winstead told him that he had to take down the names of all those wearing the pins and turn them into James A. Hackney, III. Tyre then saw Winstead take the list to the office. Winstead, on the other hand, while admitting that he saw some employees wearing the altered button and that he had talked to Tyre about it, denied telling Tyre to take the button off or taking down the names of those who wore them. I credit Tyre over Winstead and find that Respondent, by Winstead's actions on this occasion, violated Section 8(a)(1) of the Act. 3. Hackney, Jr.'s threat to close the plant Four employees testified that James A. Hackney, Jr., Respondent's president, spoke extemporaneously on May 23 at the conclusion of the speech which his son, James A. Hackney, III, read to them that day. Each said, in substance, Hackney, Jr., made the point that he had enough money for himself and would padlock the plant if the Union came in . Hackney, Jr., testified that he did not make any such statement on that occasion, asserting that his business records show he was in New York that day. I credit his explanation and further find that, as he claimed, his only contribution to Respondent' s campaign to defeat the Union' s organizing campaign was a speech he read to the assembled employees on June 5. The text of that speech is in evidence. It reads, in part: ... Some years ago, we had an approach by a union representative, and he talked to a number of our employees. At that time, we were small, my sons were in college, my other children in grammar school. We had a plant meeting and discussed the matter frankly, above board, and man-to-man. The employees told me that the union representative had told them, and I quote to the best of my memory, "Mr. Hackney is well-to-do and can pay you better wages." At that time, I explained to the men that it was true that I was in a financially secure position and was, by standards of Beaufort County, reasonably well-to-do. I pointed out, however, that it was the business that they were working for and not me personally and that their demands for increased wages or any other demands would have to be made against the business as I certainly would ,be take my hard-earned personal assets and simply contribute to the business to insure that everyone connected with it was more prosperous and happier. However, I told them at that time that if they decided to work and continue working for the business that I would make them a promise that just as fast as the business earned profits, I would plow the profits back into the business and increase their wages, their fringe benefits, and their working conditions as long as the business was profitable - that the philosophy of the business would be profit returned to the business for growth and opportunity for leadership for everyone that worked. Gentlemen, I have lived up to that condition as well as I could. I have maintained my end of that bargain, and the philosophy of J. A. Hackney & Sons has been exactly as I stated some 10 or 12 years ago . . . Hackney, Jr., admitted that he departed from his prepared text twice. In one deviation he expanded the J. A. HACKNEY & SONS 69 passage just quoted thus: . I pointed out that I owned stock in Hackney Brothers Body Company in Wilson, North Carolina, Carolina Telephone and Telegraph Company and Wachovia Bank & Trust Company and that I thought I was well enough to do to hunt and fish the rest of my life... The Wachovia and the hunting and fishing references are common to the testimony of the four employee witnesses. Therefore, I find that they were mistaken in attributing Hackney, Jr.'s remark about padlocking the plant to a May 23 incident but were, in fact, remembering what Hackney, Jr., said when he deviated from his prepared text on June 5. 1 find that what Hackney, Jr., actually said on that occasion was- I explained to the men that it was true I was in a financially secure position and was, by standards of * Beaufort County, reasonably well-to-do. I told them that I owned stock in Hackney Brothers Body Company in Wilson, North Carolina, Carolina Telephone and Telegraph Company and Wachovia Bank & Trust Company and that I thought I was well enough to do to padlock the plant and hunt and fish the rest of my life .. . Although couched in terms of what Hackney, Jr., said to other employees on the occasion of another union's effort to organize Respondent, these words clearly imply that Respondent will close its plant if this Union is successful in its efforts in this campaign. Since they are an implied threat, they are violative of Section 8(a)(l). 4. Other allegations William T. Tetterton, III, testified to a conversation in early July with Melville Russ. Russ asked whether Tetterton had been approached by the Union. When Tetterton replied that he had, Russ asked how Tetterton felt about it. Tetterton replied that he was undecided, ". . . that I wanted to hear both sides of the story first, but if a man had a chance to better himself, he was a fool not to do it." Russ admitted to such a conversation with Tetterton but denies any interrogation. According to Russ, the conversation began with his statement that he had heard there was a union campaign going on and would appreciate Tetterton's support of Respondent. Tetterton then volunteered his opinions and information about his activities. I credit Tetterton since it is inherently more credible that a conversation of this nature in the context of an industrial plant and workmen unversed in the intricacies• of labor law started in the manner related by Tetterton rather than Russ. I find that Russ' interrogation of Tetterton on this occasion constitutes a violation by Respondent of Section 8 (a)(1). The final' ° bit of independent 8(a)(1) pits Douglas Mack Bell against his foreman, Cecil Sullivan. Bell testified that, during the course of a general discussion of the campaign a week before his discharge on July 11, Sullivan told Bell he knew Bell was for the Union. Sullivan admitted that he had discussed the Union's campaign at various times with various employees, probably including Bell. He could not recall any specific conversation with Bell and denied categorically ever making the statement attributed to him by Bell. Bell also testified to a conversation with Sullivan on July 12 when he returned to the plant to complete the discharge process. According to Bell, he asked Sullivan where Sullivan thought Bell could find another job and Sullivan replied the best thing for Bell to do was to leave town. According to Sullivan, Bell was in an overwrought state and spoke of committing suicide because he had lost his job. Sullivan tried to calm him by telling him there were plenty of jobs to be had around town and all Bell had to do was go look for one. I am convinced from my observation of Bell on the witness stand that he is the sort of personality who might well react in a semihysterical manner to the loss of his job and misunderstand or misinterpret words spoken to him under such stress. Consequently, I credit Sullivan over Bell. Since there is no evidence that Sullivan spoke any words on the first occasion which are proscribed by the Act and since the words which he did speak on the second occasion are only friendly advice and in no way contain an implied threat that Bell had been blackballed in Washington, North Carolina, because of his union activity, I find that Respondent did not violate Section 8(a)(1) on either occasion. C. Motive For The Discharges This issue requires a detailed look at the words which James A. Hackney, III, admittedly used in critical speeches to Respondent's employees on May 23 and July 11. There can be no dispute on this point because, on each of these occasions, he read his speech, and a copy of each is in evidence. On May 23, immediately after learning of the Union's organizing campaign, he said, in part: . Our backlog of orders at this moment compared with last year at this time is substantially down. This by no means means that it is down sufficiently for us to push the panic button or to take drastic action. However, our backlog is low enough that the rate of arrival of orders will determine whether or not we will continue our present level of production. For the present time there has been no decision, and I will repeat, NO DECISION, to reduce production - either through layoffs or through reduction in our present 50-hour work week, rumors to the contrary notwithstanding. .This is the first time in four years that our backlog has been low at this point in the season. if I had to give you a single reason why it is lower now, it would have to be UNIONS. The nation experienced two major strikes in a row which severely affected our customers' businesses, and therefore severely affected ours. . Fortunately, we had experienced a very successful early fall, and our backlog of orders for the late fall and winter remained high in spite of the Ford strike. As a result, we were able to operate at 50 hours per week through the entire fall and winter, which was the first time in our company's history that we have done this . on February 1 of this year a second union, the Glass Bottle Blowers' Union, delivered what turned out to be a devastating blow. From Feb. 1 until March 22 the Glass Union was out on strike. ... We are now at the point where orders received are approximately equalling our production each week. "Allegations that the July 3 wage increase and Hackney, III's July II speech violated Sec. 8(a)(I) are dealt with below in connection with the motive for the discharges . An allegation that Respondent ". . harassed discharged prounion employees at their new places of employment" is supported only by the testimony of James Edwards about various alleged incidents in late July and early August at a Zipmart where he was employed as a clerk. Even if I believed Edwards , the episodes are too trivial to be worth further consideration. 70 DECISIONS OF NATIONAL LABOR RELATIONS BOARD So, our backlog level in holding at a reasonably constant figure. As long as it does, our present level of production will be maintained. However, as I mentioned earlier, we have to wait and see. To put this in terms of what the present outlook means to you , there is a prospect that we may have to cut back to 45 hours per week in the foreseeable future. If we do, it should be for only a short time. A cutback of this type is not unusual . We cut back to 45 hours in the summer of 1964 and 1965. We cut back to 45 hours in the fall of 1966. This cutback is the rule rather than the exception. 1967 was the only year in the history of our company that we never worked less than 50 hours per week, except in conjunction with some holidays. We have generally considered 45 hours per week, or five nine-hour days, to be a reasonable minimum work week here at Hackney. Therefore, we do not plan to cut back below that level. We do not foresee a layoff of any personnel. I can assure you that a cutback in the number of working hours would be extremely distasteful to me as it would be to you. I am aware of your unhappiness now at not making as much overtime this year as last year. A cutback therefore will be used only as a last resort, if absolutely required to reduce our level of production to that required to take care of existing orders. Our present reduced backlog is something over which neither you nor I have any control. Our salesmen are out working as hard as they can to keep orders coming in . There is nothing more that we can do that we are not already doing. The reason for a cutback, if it becomes necessary , should be apparent . If the orders which we are receiving week to week reach a level low enough that we only need the same number of men working at 45 hours to produce them, rather than 50 hours we will have to cut back to 45 hours. We cannot continue paying the cost of 50 hours of work when there is only 45 hours of work to turn out. To do so would mean that we would lose money, which would seriously affect the job security of each employee of the company. No person, and no organization, can change this basic situation . If we had a union here, our job in cutting back production would be much easier. We would just tell the union how much cutback was required and they would take care of it, probably by laying off the number of employees necessary to reduce the production level. This is one of the functions of a union . We would not need to come to you and explain what the outlook is. In fact, the presence of a union would probably end this type of communication between you and us. We could simply sit back and let you get the "shaft" from the Union without our having to worry about your welfare.... I move now to the second point which I mentioned earlier, and that is one of productivity and efficiency. The most human and natural thing to consider at this moment is probably the one thing that would be the most disastrous . I refer to the idea that it would be simple to slow down your pace of work so that you are producing less in the same hours as you are working now. If this idea has occurred to you, please do not consider it further. Let me show you a slide showing where we stand this year in terms of efficiency, as compared with last year at the same point.... In other words, our labor cost compared with last year is up 9.6%. This loss of labor though lower efficiency is costing exactly the same as a wage increase of 18.5 cents per hour.... We have promised you repeatedly in the past few years that improvements in productivity would be repaid to you in the form of wage increases. What do we mean by this, and how do these changes come about? Let me show you another slide which would answer these questions.... Our efficiency should be independent of the size of our backlog. The same number of hours are required to do a specific job, whether we have two weeks or twenty weeks of backlog. Accordingly, your wage rate is not related to the amount of backlog. What about a wage increase? We want to give one, and in the past we have given some on the prospect for future improvement, rather than on a past history which was less encouraging. Normally by early May during the past few years we have been able to determine enough of a trend of progress to make a decision on a wage increase . As you have seen, this year there has been no such trend. Quite the contrary, our performance this year has been somewhat disappointing. We all know that we have devoted much manpower to building our new facilities and to moving into them. This is one reason we did not become concerned about the trend earlier. We took this into account and patiently waited for the time that our move would be complete and we could begin earning the benefits of increased efficiency. Well, our move is now complete, and I hope there will be a substantial improvement in the near future. I am not saying that there will not be a wage increase this spring. I am saying that we will require more time to determine if a trend of improvement exists that will permit us to give a wage increase. A decision will be made later with respect to this.... In summary, let me stress again the following points: 1. We do not intend to reduce working hours from 50 to 45 unless absolutely necessary. 2. We will reduce the work week if necessary, rather than lay off personnel. We feel that each employee is a valuable member of our production team, and we do not want to lose anyone. 3. The outlook for the future is not dismal. Our slump should be temporary. 4. We must gain back our loss in efficiency. When we do, a prompt decision will be made regarding a wage increase. 5. Whatever happens, we will come directly to you and tell you. DO NOT BELIEVE RUMORS. They destroy morale, and they are seldom accurate. [Emphasis supplied.] Most revealing is what he said to all the employees on July l l as he discharged 41 of them. Any omissions would impair the full flavor of Hackney, III's state of mind and the message he intended to convey to retained employees. Therefore, the document is reproduced here verbatim: It seems that in recent times we have had a problem in communicating. Perhaps this was my fault; I spoke nice and gently and didn't quite use language you understand. Well, today I don't intend to make that mistake. You're going to get the message loud and clear, in terms that even the thickest of you will understand. We've been awfully patient recently. We have been more patient that we have ever been before, or than we are every going to be again. It seems like all I have done is listen to some of you bitching and bellyaching for months. Don't misunderstand me. I don't consider J. A. HACKNEY & SONS our small group meetings as bitching and bellyaching? I went into these meetings honestly trying to find out your problems and what could be done about them. I intend to hold these meetings again, as they are needed. I thought I had found out a lot of your problems. The one thing that you all seemed to agree on was that revisions were needed in our job progression plan. You said that it had a lot of areas where it wasn't completely fair, and that there was no logical system for grading jobs. And, you were right. You also wanted a raise, and many of you deserved one. A hell of a lot of you didn't, but we couldn't really single you out and withhold it. So, Holmes and Melville and I set out to correct some of your complaints with action. Since the job progression plan was unfair, that meant that some jobs were graded too high and some were graded too low. That's what YOU told ME. To improve this we had to take care of both cases. We also wanted to give you a raise, even though at the time the company can't really afford it. So, we worked our asses off to come out with a revised job progression plan that did everything you told me you wanted: provided a fair, uniform and impartial system for grading jobs, and at the same time incorporated a raise for everyone. We made one big mistake, though. We thought the raise was important to you, so we rushed things so you would get your raise, and we didn't get every single detail down to a gnats eye. We figured you would be happy with the raise and would go along with us until we could straighten out the final details. So, did we make you happy? Hell no. Why the hell do you think we made any changes at all in the job progression plan? Not because I wanted it. I was happy with it the way it was. Why, then? Because YOU asked for it. Where do you think we got the new system for grading jobs? We simply took a time tested, time proven point-factor plan right out of a good personnel handbook. This is exactly the same type plan that big companies like General Motors and IBM use. Most of the sample plans had eight or more grades, but we figured five were as many as we could live with right now. I'm damn glad we didn't use more. We have enough problems as it is. The new plan had quite a few advantages going for it. It let us grade each job fairly, without letting any one person's opinion of the job or the man performing it enter into the decision. And, it's a plan we can use and build on in the future. But, apparently a lot of you didn't like the flavor of the ice cream you ordered. In five minutes you forgot that you had just gotten a raise. You were either bitching because your buddy got more, or if you were that buddy who got more you were bitching because you didn't get it soon enough. So now everything is in an uproar and production is gone to hell because YOU didn't even know what you wanted. I have a hell of a lot more problems than your unhappiness. Since I have listened to your problems, maybe you ought to listen to one of mine that concerns you. Thanks to some of you, production has been lousy. In the last two weeks, production has been fifty thousand dollars below our break even point. Do you know what that means? That means we are losing money each and every week we operate like this. We also need more orders, and I needed to spend more time helping to develop sales to help us all, but there have been so many problems in production that I haven't had time. Well, fellows, in good times I can be awfully patient and take a lot of crap. But when hard 71 time come, I know that the only chance we got is to all pull together, and suffer and sacrifice a little together, and pull through it. Unfortunately, there are some of you who never quite got the word. All you did when things got tough was work your jaw instead of your back. You bitched and griped to anyone that would listen. You loafed, you goofed off, and you tried to get others to do the same. I figure that by doing that you stabbed me in the back, and you stabbed your fellow workers in the back, too. Well, when that happens I'm not too patient anymore. In fact, I can be a real son of a bitch. Some of you guys didn't know when you were well off. You've gotten so many raises and new benefits in the last few years that you don't even notice them anymore. It's got to be something really spectacular to even get your attention. A lot of you haven't worked many other places, so you didn't really have a comparison. Someone told you that things were easier and better somewhere else, and that you were underpaid, and you believed him. Well, man, have you been sold a line of bullshit. We had a real hot dog quite a few weeks back who believed that line of crap, and in one week he asked for his job back. You see, he found that the world outside was cold and hard, and that money didn't really grow on trees after all. And some of you are just about to find that same thing out. We had a decision to make. Work is slack, and we were faced with the choice of whether to cut hours or to cut people. But, some of you made that decision for us. You managed to drag your feet and slow down and goof off, until production was already down anyway. Well, we are now at the point where we are a hell of a lot better off without you. I think some of you thought we were such stupid jerks that we wouldn't catch on. Well, that's lust a hell of a bad mistake on your part. The day of reckoning has arrived. Effective this afternoon at five o'clock, we are reducing our work force by 41 people. That means that 41 of you are going to get last week's paycheck and a layoff notice by five o'clock this afternoon. For those of you who get it, you are through. There's no need to punch in tomorrow morning. And there's no point in crying to me that you are really one of the good guys. When you play with fire, you get burned. Since you have worked eleven months since last vacation we are going to give you 11/12 of your year's vacation pay. You can pick up this check and the check for your two days this week when you turn in your uniforms, clear your charge accounts, get squared away on your tools, and turn in your ID card. This can done any time after 1:00 tomorrow afternoon in my grandfather's office in the front building. I would damn well rather work together with a few good men, and run a small, profitable business, than have a big, unprofitable business with a group of bastards in it that makes life miserable for the rest of us. A lot of us are in this for a career. We enjoy our work, and we want to continue to enjoy it. We want to be part of a winning team, with every man here on that team. When the team has problems, we want to talk about them and pitch in and solve them together, rather than running around and bitching and spreading rumors to make everyone else think he has more problems than he does. When times are tough, we expect everyone to be a little more patient than normally and to work harder until times get better. So, we are going to trim down to the men we think share this feeling. If we have 72 DECISIONS OF NATIONAL LABOR RELATIONS BOARD misjudged you, and you aren' t one of the ones who gets it this afternoon, and you think all this work-together stuff is a lot of bullshit, it's still not too late for you to submit your resignation. No one has ever been forced to come here, and no one has ever been prevented from leaving. But I can tell you one thing. With the men we have left we can produce more work than the whole bunch of you has been producing for the last two weeks, and we are going to be happier doing it. Now I'd like to say a word that is strictly for those people who are going to be left. We are going to have a meeting sometime tomorrow about the changes in the job progression plan. I have some information that I have had mimeographed that will explain it a lot better, and I think that the biggest problem is that you don't understand it. But, I want to assure you that we are going to solve the problems. All of you have been here long enough to know that we will get things squared away. We always have. If we can't solve the grading problems we will make other arrangements to provide you a place where you will be satisfied. There are a lot of opportunities that will be available as soon as work picks up, and you are the people who are going to get them. So, all I ask is that you bear with me long enough to explain the plan, to hear your objection, and to work on doing something about them. I'll let you know about the time tomorrow. For the rest of you guys, Adios. The meeting is adjourned, and there's a half-hour of work left today. [Emphasis supplied.] The only deviation from this prepared text came at the end when Hackney III looked at his watch and announced the precise number of minutes left in the work day. The "real hot dog [who] quit a few weeks back [and] who believed that line of crap" is Joe Cutler, the original head of the Union's in-plant organizing committee. I find that the discharges of July 11 violated Section 8(a)(3) and (1) of the Act because Hackney, III, when he made his decision on June 28 to reduce the work force, was motivated by the recent union activities of his employee' s in seeking to organize themselves for collective-bargaining purposes under the Charging Party's banner and not by Respondent's economic straits. On May 23, when he first talked to the employees about unionization and Respondent's plight, he had had Hodges Hackney's dire prophecies for a month. Yet at that time he stressed Respondent's uninterrupted record of not discharging employees when work became scarce but reducing hours instead. He assured them that Respondent had no intention of resorting to discharge in its current hard times. He lectured them about the importance to their welfare of efficient work, pointing out that a wage raise was possible even if Respondent's backlog continued low. His state of mind at that moment was that he would order a cutback in the number of working hours "only as a last resort , if absolutely required to reduce our level of production to that required to take care of existing orders." A month later, just a few days before June 28 and at a moment when Hodges Hackney's prediction was all but right on the nose , Hackney III invoked the last resort required to take care of existing orders, reducing hours from 50 to 45 as Respondent had always done in prior slack periods. On June 28, so soon after resorting to Respondent's traditional last resort that no new economic data were added to the situation that caused him to reduce hours, he decided on a mass discharge , ostensibly for economic reasons. What options did he have at that moment? What was his state of mind at that moment9 When he decided to discharge employees Hackney, III, had three courses of action open to him. He could have done nothing He could have further reduced hours. He could have reduced the work force. If he had chosen the first, this case, in all likelihood, would never have arisen. No further consideration of it is required. To state that he could have further reduced hours is not to attempt to substitute my judgment for his as to the course he should have followed in the situation which confronted him. The whole history of Respondent's last resort was a reduction to 45 hours and no further. He said as much in his May 23 speech, thus, "Therefore, we do not plan to cut back below that level." There is no doubt that the administrative process has no power to compel any employer to take or not take any specific action other than in those situations where the employer's motive for what he has done or left undone falls within the narrow ambit of the Act's proscriptions. But on June 28 Hackney, III, had this option open despite his reluctance to use it. He decided, instead, to discharge 41 employees. Why? His state of mind, of course, is laid bare by his July I1 speech. "In recent times" the men's "bitching and bellyaching" had caused Respondent to try to satisfy them by revising its job progression plan. The complaints had been voiced in the context of the Union's organizing campaign as the men responded to Hackney, III's invitation to ask questions when he gave them the canned antiunion speech on May 27, 28, and 29. Yet the efforts to satisfy the complainers were for naught, and Hackney, III, in his July 11 diatribe, equated the good guys with those who could contribute to a small, efficient operation, and the bad guys with the bitchers and bellyachers whose services were no longer required because they did not have Respondent's interest at heart. But the bitchers and the bellyachers were linked in Hackney, III's mind with the men who had flirted with the Charging Party, as his reference to the hot dog, Joe Cutler, and other quotes too numerous to mention make clear. Therefore, he decided on a mass discharge not because Respondent was in financial difficulties. He had just taken the only step he had in mind at the beginning of the Union's campaign for coping with that problem. But events which had transpired since May 23, namely, the activities of his employees in that campaign, had gotten him riled and he expressed his real reason along with his anger when he spoke on July 11. He decided on a mass discharge in order to rid Respondent of prounion troublemakers. The "systematic" method used by Respondent to select the 41 men discharged separated the bad guys from the good guys with singular efficiency." The ratings made in December 1967 were prepared at a time when no union troubled the relations between workers and management. The ratings made in June 1968 came in the midst of the troubles stirred up by the Union. Two lists of names of men who attended Union meetings turned in to Respondent by Webb and Edwards contain 37 different names . Because the lists are only semiliterate, it is possible to identify only 30 with names on evaluation records for December and June which are also in evidence. Of these, 20 were discharged, 10 were not. Of "in making this finding, I do not rely on James Edwards' facile statement that he personally told Respondent that each and every one of the 41 men discharged was prounion I do rely on Chester Webb's carefully considered testimony that he did not specifically name only 12 of them in his reports to Boyd and Russ, plus the admitted fact that the Union's campaign was common knowledge in the plant and the subject of much discussion between supervisors and employees J. A. HACKNEY & SONS the 10 who were not, the names of 9 appear on only l list, that is, insofar as these reports by the spies on 2 different meetings reveal , these 9 attended only I meeting and not the other. Of the 20 who were , 14 names appear on both lists . A comparison of the ratings made in December 1967 with those made in June 1968 reveals the following: Of 41 men discharged, 32 were rated both times. Of 71 men retained , 62 were rated both times . The other 18 were rated only in June because they had not been employed at the time of the December ratings. Of the men discharged, 4 received a higher rating in June than in December, 28 received a lower . Of the former, one went from a rating below his departmental average to a rating at or above it. Of the latter, seven went from a rating at or above their departmental average to one below it . Of the men retained , 60 men received a higher rating in June than in December, 2 received a lower . Of the former, 27 went from a rating below their departmental average to a rating at or above it. Of the latter , none went from a rating at or above his departmental average to one below it . Finally, if the selections had been based solely on the December 1967 ratings, 18 of the 41 men would not have been discharged. For the reasons stated , and on the basis of the record considered as a whole , I find that Respondent violated Section 8(a)(3) and ( 1) of the Act by discharging 41 employees on July 11 for engaging in union activities. I further find that Hackney, III's July 11 speech warned employees that their union activities had caused serious and adverse consequences and thus violated Section 8(a)(1). Finally, I find that the July 3 announcement of a revised job progression plan and wage increases constituted a granting of benefits to employees in order to induce them to abandon their interest in and support of the Union and thus also violated Section 8 (a)(1). The finding is made despite the fact that the July 3 benefits fall into the pattern of semiannual raises of 3 years' standing because, as Hackney , III's July 3 and July 11 speeches make clear , the 1968 benefits were granted as a result of the discontent expressed by employees in the context of the organizing campaign. CONCLUSIONS OF LAW Upon the foregoing findings of fact , and on the entire record in these cases, I make the following conclusions of law: 1. J. A. Hackney & Sons, Inc., is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. International Chemical Workers Union , AFL-CIO, is a labor organization within the meaning of Section 2(5) of the Act. 3. By discharging the 41 employees whose names are set forth in the notice which is marked Appendix and attached hereto on July 11, 1968 , because of their union activities and the union activities of other employees, Respondent has discriminated with respect to their hire and tenure of employment , discouraging membership in the above-named labor organization , and thereby has violated Sections 8(a)(3) and 8 (a)(1) of the Act. 4. By interrogating its employees about their union activities , by soliciting an employee to spy upon the union activities of its employees and thereafter utilizing his services and the service of another employee in such spying, by threatening to close its plant if its employees became organized for purposes of collective bargaining, by refusing to permit its employees to wear union buttons in 73 its plant and recording the names of employees who did so, by warning its employees that their union activities had caused serious and adverse consequences, and by granting benefits to its employees in order to induce them to abandon their union activities, Respondent has interfered with, restrained , and coerced its employees in the exercise of the rights guaranteed to them by Section 7 of the Act and thereby has violated Section 8 (a)(1) of the Act. 5. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. 6. The allegations of the complaint that Respondent violated Section 8(a)(1) of the Act by Foreman Cecil Sullivan's interrogating of employees on or about June 26, 1968, by promising and granting benefits to employees to spy upon and report the union activities of other employees , by threatening to discharge prounion employees, by harassing discharged prounion employees at their new places of employment , by warning prounion employees that the best thing they could do was to leave town, and by attempting to interfere with its employees' right to attend union meetings have not been sustained. THE REMEDY Having found that Respondent has engaged in unfair labor practices, I will recommend that it cease and desist therefrom and take certain affirmative action which will effectuate the policies of the Act. Six of the forty-one discriminatees were offered employment in October . However, as I have indicated above in another context, the offers were to return as new employees and thus are not tantamount to the sort of offer of reinstatement required to remedy a violation of Section 8(a)(3) of the Act. Therefore , I will recommend that Respondent offer to all 41 reinstatement to their former or substantially equivalent positions without prejudice to their seniority or other rights and privileges and make each whole for any loss of earnings he may have suffered as a result of his discharge by paying to him a sum of money equal to that which he normally would have earned as wages from July 11, 1968, to the date of Respondent's offer of reinstatement, less his net earnings during such period, with backpay and interest thereon to be computed in the manner prescribed in F. W. Woolworth Company, 90 NLRB 289, and Isis Plumbing & Heating Co., 138 NLRB 716. I have also found the Respondent' s business was somewhat depressed at the time it made a substantial reduction in its work force in July, although that was not the moving cause for the discharges. By October, shortly before the hearing herein was held, business had picked up enough to cause Respondent to attempt to reobtain the services of six of the men caught in that reduction . It may well be that, at the time my recommendation is complied with , business will have continued to improve to a level which requires a work force as large or larger than it was before the reduction . Then again, it may well not, and only time can tell. If, at the time my recommendation is complied with, Respondent still needs only a work force substantially smaller than it was just prior to July 11, 1968, in order to handle the work it has at that time , it would be manifestly unfair to require Respondent to discharge employees who survived the July reduction in force and have continued in its employ ever since in order to reinstate all the discriminatees. The same consideration would not apply to persons who have gone to work for Respondent since. The 74 DECISIONS OF NATIONAL LABOR RELATIONS BOARD two cases differ because the former group of employees went through an elaborate , ostensibly nondiscriminatory selection process and retained their jobs in July. To penalize them now because the system used by Respondent at that time was rigged in their favor so as to discriminate against prounion employees would be to punish them unduly for Respondent's wrongdoing. However, there is nothing unfair in now requiring them to go through a truly nondiscriminatory selection process which pits them against the discriminatees, insofar as the group as it existed in July can be reconstituted now. New employees , on the other hand , became employees after Respondent's wrongdoing and are unfortunate victims in the same boat as any persons hired by an employer to take the place of employees against whom he has discriminated. Therefore, I will further recommend that, if, for economic reasons , Respondent does not need a work force large enough to accommodate all the discriminatees who accept his initial offer of immediate reinstatement, Respondent may elect to solve the dilemma in which my recommendation places it in the following way: Respondent may use a nondiscriminatory, systematic plan of its own choosing such as seniority or evaluation ratings made prior to June 1968 to determine which persons in a group composed only of discriminatees who desire immediate reinstatement and employees who went through the July reduction in force and have continued to work for Respondent ever since will be employed immediately. Discriminatees who do not qualify for immediate reinstatement under the plan used will be placed on a preferential hiring list and recalled to their former or substantially equivalent positions without prejudice to their seniority or others rights and privileges as jobs become available and before the recall or hire of any other person. Finally, I conclude that the unfair labor practices committed by Respondent are of such a nature and scope as to demonstrate disdain for the rights of its employees and a likelihood that violations will be repeated in the future. Therefore, I will recommend that Respondent be ordered to cease and desist from interfering with those rights in any manner. Upon the foregoing findings of fact and conclusions of law and the entire record , and pursuant to Section 10(c) of the Act, I hereby issue the following: RECOMMENDED ORDER J. A. Hackney & Sons, Inc., its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Discharging its employees or, in any other manner discriminating against them in order to discourage membership in International Chemical Workers Union, AFL-CIO, or any other labor organization. (b) Interrogating its employees about their union activities. (c) Spying on the union activities of its employees. (d) Threatening to close its plant if its employees became organized for purposes of collective bargaining. (e) Refusing to permit its employees to wear in its plant buttons or other insignia which demonstrate their prounion sentiments. (f) Recording the names of employees who wear such buttons or other insignia in its plant. (g) Warning its employees that their union activities have caused or will cause serious and adverse consequences. (h) Granting benefits to its employees in order to induce them to abandon their union activities. (i) In any manner interfering with , restraining, or coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act. 2. Take the following affirmative action which is necessary to effectuate the policies of the Act: (a) Offer to the 41 men whose names are listed on the notice marked Appendix attached hereto immediate reinstatement to their former or substantially equivalent positions without prejudice to their seniority or other rights and privileges and make each of them whole for any loss of pay suffered as a result of Respondent's discrimination against him in the manner set forth above under "The Remedy." In the event that the condition of Respondent's business precludes immediate utilization of the services of all discriminatees who accept such offer without discharging employees who survived the July 11, 1968, reduction in force and have continued in Respondent's employ ever since, Respondent may select from the total group composed of discriminatees and retained employees those persons it will employ immediately by use of a nondiscriminatory, systematic plan of its choice. If Respondent elects this option, place and names of all discriminatees who do not qualify for immediate reinstatement on a preferential hiring list and recall them to their former or substantially equivalent positions without prejudice to their seniority or other rights and privileges as jobs become available and before the recall or hire of any other person. (b) Notify any of the 41 men whose names are listed on the notice marked "Appendix" attached hereto who are presently serving in the Armed Forces of the United States of his right to full reinstatement upon application in accordance with the Selective Service Act and the Universal Military Training and Service Act, as amended, after discharge from the Armed Forces. (c) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all records, social security payment records, timecards, personnel records and reports, as well as all other records necessary to analyze and compute the amount of backpay due under the terms of this Recommended Order. (d) Post at its plant in Washington, North Carolina, copies of the attached notice marked "Appendix."'• Copies of such notice, on forms to be provided by the Regional Director for Region 11, after being duly signed by an authorized representative of Respondent, 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 placed . Reasonable steps shall be taken by Respondent to insure that said notices are not altered, defaced, or covered by any other material. "In the event that the Recommended Order is adopted by the Board, the words "this notice is posted by order of the National Labor Relations Board after a trial at which all sides had the chance to give evidence, the National Labor Relations Board found that we, J. A. Hackney & Sons, Inc., violated the National Labor Relations Act, and ordered us to post this notice," shall be substituted for the words "Pursuant to the Recommended Order of a Trial Examiner of the National Labor Relations Board and in order to effectuate the policies of the National Labor Relations Act we hereby notify our employees that," in the notice. In the further event that the Board's order is enforced by a decree of the United States Court of Appeals , the words "this notice is posted by order of the United States Court of Appeals" shall be substituted for the words "this notice is posted by order of the National Labor Relations Board." J. A. HACKNEY & SONS (e) Notify the Regional Director for Region 11 in writing, within 20 days from the date of receipt of this Decision, what steps Respondent has taken to comply herewith.' I FURTHER RECOMMEND that the complaint be dismissed insofar as it alleges that Cecil Sullivan interrogated employees on or about June 26 , 1968, and that Respondent promised and granted benefits to employees to spy upon and report the union activities of other employees, threatened to discharge prounion employees, harrassed discharged prounion employees at their new places of employment, warned prounion employees that the best thing they could do was to leave town, and attempted to interfere with its employees' right to attend union meetings. "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 11 , in writing, within 10 days from the date of this Order, what steps Respondent has taken to comply herewith." APPENDIX NOTICE TO ALL EMPLOYEES Pursuant to the Recommended Order of a Trial Examiner of the National Labor Relations Board and in order to effectuate the policies of the National Labor Relations Act, as amended, we hereby notify our employees that: The Act gives all employees these rights: To engage in self-organization To form, join, or help unions To bargain collectively through a representative of their own choosing. To act together for collective bargaining or other aid or protection; and To refrain from any or all of these things. WE WILL NOT do anything that interferes with these rights. WE WILL NOT ask you questions about your union activities. WE WILL NOT spy on your union activities. WE WILL NOT threaten to close our plant if you decide you want International Chemical Workers Union , AFL-CIO, or any other union to represent you in bargaining with us. WE WILL permit you to wear union insignia in our plant and WILL NOT keep any record of who does or who does not. WE WILL NOT tell you that your union activities have caused serious and adverse consequences. WE WILL NOT increase your wage rates or grant you any other benefits in order to induce you not to engage in union activities. WE WILL immediately offer to reinstate each of the following named persons to the job he held on July 11, 1968, or one substantially equivalent to it without any 75 change in his seniority or other privileges he enjoyed before we discharged him and WE WILL pay to each of them any money he lost as a result of our discrimination against him , with interest at 6 percent: Eddie Earl Alligood Paul Hobbs Wayne D. Barrett Bert Guy Hodges Henry Marshall Beachman Larry W. Hodges Douglas Mack Bell Louis W. Martin Wayne Berry Amos Ray McLawhorn Lacy R. Boyd, Jr. Johnny McRoy Allen Brooks, Jr. Phillip F. Payne Bobby Ray Buck Clifton Lee Peartree William Carlton Clark Eddie C. Peartree James L. Cox Carlton Roebuck Terry W. Cutler Robert A. Slusher Walter G. Davenport Dewey Harold Spruill Billy Dixon Ronald T. Tetterton Reuben Ederon William T. Tetterton, III James T. Edwards Billy L. Tyre Leland Ellis Randol Williams Grady Engalls Phillip Wiggins Robert Lee Garnett Leroy T. Woolard McDonald Gautier, III Heber Wallace Larry Harris Bobby Woolard Ferel Rowe If there are not enough jobs immediately available to take care of all the men on the above list who accept our offer, WE WILL prepare a preferential hiring list containing the names of those who do not return to work right away and WE WILL recall all of the men on that list before we recall or hire anybody else for jobs which men on the list can perform. WE WILL inform any of the men on the above list who are presently serving in the Armed Forces of the United States of their right to full reinstatement upon application in accordance with the Selective Service Act and the Universal Military Training and Service Act, as amended, after discharge from the Armed Forces. All of our employees are free to become or refrain from becoming members of International Chemical Workers Union, AFL-CIO, or any other labor organization. Dated By J. A. HACKNEY & SONS, INC. (Employer) (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, Telephone 723-2303.