Industrial Wire Products Corp.

328 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Industrial Wire Products Corporation and United Electrical, Radio and Machine Workers of America, Local 1421, United Electrical, Radio and Machine Workers of America (UE). Case 21-CA-8087 June 30, 1969 DECISION AND ORDER On November 18, 1968 , Trial Examiner Martin S. Bennett issued his Decision in the above -entitled case, finding that the Respondent had engaged in and was engaging in certain unfair labor practices and recommending that it cease and desist therefrom and take certain affirmative action, as set forth in the attached Trial Examiner's Decision. Thereafter, the Respondent filed exceptions and a supporting brief, and the General Counsel filed an answering brief. The Board has reviewed the rulings of the Trial Examiner made at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Board has considered the Trial Examiner' s Decision, the exceptions and briefs, and the entire record in this case, and hereby adopts the findings, conclusions, and recommendations of the Trial Examiner, as modified herein. We agree with the Trial Examiner's finding that the Respondent has bargained in bad faith with the Union in violation of Section 8(a)(5) and (1) of the Act. We also find, on the basis of facts as found by the Trial Examiner and supported by the record, that the Respondent contrary to the requirements of Section 8(d) of the Act refused without justifiable reason to execute a written contract containing the substantive provisions of the agreement reached with the Union on June 19, 1968, as outlined by the stipulation which the mediator presented on that date and which was signed by the Union representatives and Marlett, the Employer' s agent, and thereby further violated Section 8(a)(5) and (1) of the Act.' THE REMEDY In accord with the Board's particular duty under Section 10(c) to tailor its remedies to the unfair labor practices which have occurred and thereby effectuate the policies of the Act,' we adopt the 'Borg Compressed Steel Corporation , 165 NLRB No. 55; Beverage-Air Company, 164 NLRB No 156, enfd. in this respect 402 F .2d 411 (C.A. 4); Schell Steel Products, Inc., 161 NLRB 939. In the absence of exceptions by the General Counsel or the Charging Party to the Trial Examiner's recommendation that the Respondent be ordered upon request to execute the June 19 contract, we do not agree with our dissenting colleague that the Respondent should be ordered to execute the May 7 contract. Trial Examiner's recommendation that the Respondent be required, at the Union's option, either to sign a written contract embodying the substantive provisions of the June 19, 1968, agreement, or to bargain in good faith for a new agreement . In the event the Union requests the Respondent to sign the aforesaid written contract, the Respondent shall put its provisions into effect and reimburse the employees, with 6 percent interest per annum thereon, for the loss of any benefits which would have accrued to them under the contract which the Respondent refused to sign. 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, as herein modified, and hereby orders that the Respondent, Industrial Wire Products Corporation, Los Angeles, California, its officers, agents, successors, and assigns, shall take the action set forth in the Trial Examiner's Recommended Order, as herein modified: Amend paragraph 2 by substituting the following for subparagraph b: (b) In the event the Union requests that the contract agreed to on June 19, 1968, be executed, reimburse all employees covered by the aforesaid contract, together with 6 percent interest per annum thereon, for the loss of any benefits which would have accrued to them under the contract which the Respondent refused to sign. MEMBER FANNING, dissenting in part: I join with my colleagues in finding that the Respondent has engaged in bad-faith bargaining with the Union in violation of Section 8(a)(5) and (1) of the Act. I also agree with their conclusion that the parties actually reached agreement on a contract during these negotiations, but, unlike my colleagues, I do not base this conclusion upon the stipulation executed by the parties on June 19.' According to the Trial Examiner's findings, which the majority opinion adopts, the parties reached final agreement on a contract at the May 7 bargaining session when both the Respondent and the Union agreed to accept a modified version of a proposal which had previously been submitted by the Respondent. However, thereafter, when the Union presented the formal document to Respondent for signature, it was advised by Respondent that certain of the previously agreed-upon clauses were unacceptable. The Respondent's repudiation of its May 7 contract with the Union led to the June 19 meeting where under the auspices of a conciliator, the Union agreed to make several concessions on provisions agreed to in 'See H W. Elson Bottling Company, 155 NLRB 714. 'All events occurred in 1968. 177 NLRB No. 56 INDUSTRIAL WIRE PRODUCTS CORP. the May 7 contract. As a result, the parties entered into a stipulation of agreement on some 15 contract items with the qualification that agreement on these items was subject to the final approval of the Respondent's president and ratification by the employees. Several days later, the Union was advised that the Respondent's president would not approve all of the items in the stipulation and as a consequence, no contract was ever executed by the parties. In my opinion, it is unnecessary to look beyond May 7 in determining that the parties have entered into a final and binding contract. The record fully supports the Trial Examiner's finding that a contract was agreed to at the May 7 bargaining session, and by ignoring the significance of this finding and predicating the existence of a contract upon the June 19 stipulation, my colleagues are, in effect, permitting the Respondent to benefit from the commission of its unfair labor practices. By reneging on its contractual agreement, the Respondent was able to force the Union into giving up benefits already won at the bargaining table, and as a reward for such unlawful conduct, the majority directs the Respondent, upon request, to execute a document containing the concessions forced upon the Union as a result of the Respondent's unfair labor practices. If, in fact, the parties did agree on a second contract on June 19, it was not the voluntary modification of an existing agreement to which I would give effect. Rather, this so-called agreement served only to detract from the contract previously reached and its very existence was brought about solely as a result of Respondent's unfair labor practices. Furthermore, I would not find the June 19 stipulation binding upon the parties for yet another reason. This stipulation expressly provided that final agreement on the contract items listed was being conditioned upon their approval by the Respondent's president and their ratification by the employees. Because neither of these conditions were met, I would conclude that the stipulation cannot be considered legally binding upon the parties. In sum, I would resolve this issue by concluding that the parties reached agreement on a contract on May 7, and I would order the Respondent to execute this agreement and put its terms and provisions in effect, retroactive to May 7, if so requested by the Union. TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE MARTIN S. BENNETT, Trial Examiner: This matter was heard at Los Angeles, California, on September 4 and 5, 1968. The complaint, issued July 5 and based upon charges filed May 21 and July 5, 1968, by United Electrical, Radio and Machine Workers of America, Local 1421, United Electrical Radio and Machine Workers of America (UE), herein called the Union, 329 alleges that Respondent, Industrial Wire Products Corporation, had engaged in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act. Oral argument was presented by Respondent and briefs have been submitted by the General Counsel and Respondent.' Upon the entire record in the case, and from my observation of the witnesses, I make the following: FINDINGS OF FACT 1. JURISDICTIONAL FINDINGS Industrial Wire Products Corporation is a corporation engaged in the manufacture and fabrication of wire products and maintains its principal place of business at Los Angeles, California. It annually purchases and receives products valued in excess of $50,000 directly from firms located outside the State of California. I find that the operations of Respondent affect commerce within the meaning of Section 2(6) and (7) of the Act. 11. THE LABOR ORGANIZATION INVOLVED United Electrical, Radio and Machine Workers of America, Local 1421, United Electrical, Radio and Machine Workers of America (UE) is a labor organization within the meaning of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. The Introduction; the Issue Respondent's plant was unorganized prior to the events described herein. On January 25, 1968, and all dates hereinafter refer to 1968, the Union was duly certified as the bargaining representative of a unit of its employees. A series of meetings for the negotiation of a contract commenced on January 26 and culminated on July 2. The General Counsel alleges that Respondent agreed on June 19 to all the terms and conditions of a contract, that it thereafter refused to execute this agreement, that Respondent engaged in surface and bad -faith bargaining and that Respondent thereby engaged in the unfair labor practices alleged herein . Respondent contends that no agreement was reached and that it bargained in good faith. B. Appropriate Unit and Majority Representation Therein The complaint alleges, Respondent admits, and I find that all production , maintenance, shipping and receiving employees, and truckdrivers employed by Respondent, excluding office clericals, salesmen, guards, watchmen and supervisors constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. Following an election on January 17, the Union was duly certified on January 25 as the representative of the employees in the above-described unit. I find that the Union was then, and now is, the representative of the 'The General Counsel has moved that ten purported errors in the transcript of testimony be corrected . Respondent opposes proposed corrections 6 and 7. The motion is granted with respect to the other proposed corrections, denied as to those two and the pleading is hereby received in evidence as TX Exh. 1. 330 DECISIONS OF NATIONAL LABOR RELATIONS BOARD employees in said unit within the meaning of Section 9(a) of the Act. C. Sequence of Events The parties met initially on January 26. Representatives Humberto Camacho and Patrick Chaplin represented the Union and present for Respondent were President E. R. Potter, Secretary-Treasurer Joseph P. Rogel and Respondent's attorney, Orville Marlett. This trio represented Respondent at 9 meetings through April 18 and President Potter did not attend 6 meetings held after that date. Marlett did represent Respondent individually at a meeting on March 20 or 21. Marlett was the principal spokesman for Respondent and I find that he was its principal agent for the purposes of engaging in collective bargaining. This meeting was basically introductory in nature and consisted primarily of the Union presenting a list of employees who would participate as members of its negotiating committee. Varying committee members attended subsequent meetings.' The second meeting was held on January 30 and attended by the same group. Chaplin presented a lengthy contract proposal and, according to Chaplin and Camacho, read it in its entirety, although, in several instances, he omitted clauses where the meaning was clear. This provided for a union shop, a dues checkoff, was silent as to duration and contained no wage provisions.' Marlett and Rogel claimed that Chaplin stated the contract was submitted only "for language purposes." Both Camacho and Chaplin testified that this was submitted as a contract proposal. Indeed, Chaplin claimed that the Union admittedly was prepared to sign, if Respondent was willing. I credit Chaplin and Camacho herein. With respect to this and subsequent meetings, Respondent displayed a curious penchant for describing ostensible contract proposals, including those it prepared, not as offers but rather as "language provisions for negotiation purposes." Marlett, as a witness herein, was asked to distinguish these and came up with an explanation tailored to the different versions of the parties. The simple answer in well established industrial relations parlance is that any contract proposal is negotiable and perforce contains provisions for negotiating purposes. Yet, it is equally an offer to which the parties may or may not agree or bargain upon. Stated otherwise, contrary to Respondent, I deem its position to be contrary to the realities of collective bargaining and unsupportable. I do find, however, that Marlett expressly pointed out to the union negotiators that inasmuch as Potter was the sole owner of Respondent, he, Marlett, was expressly reserving to Potter the right to approve or reject any final agreement. Chaplin claimed, and I find, that he presented this as a one year contract proposal and Camacho agreed, although testifying that there was no discussion of the topic. Marlett conceded only that at a meeting prior to April 18 'In treating with ensuing meetings, I deem it unnecessary to set forth proposals and counterproposals in full as, in my view, a consideration of this history in several specified areas, particularly union security, dues checkoff and term of the contract , is dispositive of the case 'Camacho testified that wages were deliberately omitted, pending clarification of job classifications in the shop . Marlett admitted that the Union was "pushing for . . labor classifications" and, further , that the Union requested and was granted a tour of the plant so as to evaluate job functions prior to submitting wage proposals with union negotiator Smith, who appeared on the scene February 28, the prospect of a 1-year contract had been discussed. Rogel claimed that this was discussed in March and April and that Respondent had sought a 3-year contract. The next meeting was held on February 28 with one change on the part of the Union. Chaplin having been transferred to another assignment, he was replaced by Alfred Smith. Smith commenced reading through the contract previously presented by Chaplin and covered some 10 to 15 pages. He testified, and I find, that Marlett stated the union shop language was unacceptable. He further testified that Marlett indicated, "Possible agreement on some form of maintenance [of] membership." Potter voiced no disagreement. According to Camacho, Smith asked if Respondent would consider maintenance of membership and Marlett responded that Respondent probably would.' I find that Respondent offered to accept a maintenance of membership plan on this occasion. When Smith read language calling for a checkoff of dues pursuant to authorizations from employees, Rogel objected on the ground that this presented additional tasks for the payroll department; no objections were predicated upon the principle as such. Smith then proposed that the Union collect the necessary data, submit it to Respondent and that only one monthly checkoff be made. According to Camacho, Rogel replied that this was more likely of acceptance.' As for duration, Camacho testified, and I find, that Smith spoke in terms of a 1-year contract. Smith testified that a one year duration was touched upon at just about all the meetings. According to Marlett, there had been discussions at early meetings of the prospect of a I-versus a 3-year contract and the testimony of Rogel was that during March and April these two alternatives were discussed. As will appear, the three year contract concept arose at later meetings. And Marlett, it may be noted, claimed that at the first two or three meetings, the representatives of Respondent merely listened and took no position on matters. At the close of the meeting, Smith commented that the proposal under discussion was unduly lengthly and intricate and suggested that he present a shorter contract. All agreed that this was desirable and Smith did so at the next meeting. On March 4, Smith presented and read part of a ten-page contract proposal. This contained the customary union-shop and dues-checkoff clauses. Marlett refused to accept the union-shop clause but stated, according to the uncontroverted testimony of Camacho and Smith, that Respondent would present modified proposals based upon some form of maintenance of membership. Smith and Camacho agreed that Rogel again voiced his objections to a provision that Respondent deduct dues pursuant to employee authorizations. According to Camacho, Marlett stated he would present a proposal that only one deduction per month be made. On March 5, the parties met again and Smith continued the reading of the new contract proposal. On either March 4 or 5, according to Camacho and I so find, Smith stated that this was a 1-year contract proposal and 'Rogel testified that in March and April Respondent "suggested . I think we inaugurated the fact of a modified [maintenance of membership] plan." 'Rogel testified generally that , at one point in the negotiations, he agreed that this procedure was feasible INDUSTRIAL WIRE PRODUCTS CORP. 331 no objection was voiced. Smith testified to this same general effect. Rogel testified generally that in March and April the parties discussed both 1 and 3-year terms. Marlett's testimony was similarly vague, testifying that at a meeting prior to April 18 he and Smith discussed the possibility of a 3-year versus a 1-year contract. I find that Respondent's representatives voiced no objection to a 1-year contract on these occasions and that Respondent offered to come forward with modified provisions on maintenance of membership and dues checkoff. The next meeting was held on March 14." According to Camacho, and I so find, Smith asked Rogel for wage classifications, pointing out that the Union had prepared a wage proposal, but was holding it in abeyance. After Rogel complained of difficulty in classifying the employees, Smith agreed to drop the issue. Marlett stated that they were almost in agreement on a contract, but that he would propose some language. Smith suggested to Potter that he authorize Marlett to meet with Smith and complete the technical language of the contract; Potter agreed and the meeting was set up for Marlett's office. Smith corroborated Camacho that they met on March 14, worked from the Union's shorter contract proposal and that it was arranged that Marlett would meet with Smith. Potter agreed that Marlett was his agent, that they could meet and initial agreed upon paragraphs and also that the parties could then get down to wages. Marlett and Rogel did not testify concerning this meeting. On March 20 or 21, Smith and Camacho met with Marlett in the office of the latter. They discussed a contract brought to the meeting by Marlett which is in evidence as G.C. Exh. 4. This contained, paradoxically, union shop language that Respondent did not recognize a union shop, that Respondent would recognize a union shop if the Union obtained 100 percent membership in the bargaining unit, that all new employees were to join in 30 days and that present employees were not required to join. As for dues, Respondent was to make one deduction per month, based upon a list of employees furnished by the Union. According to Camacho, Smith pointed out that the language that Respondent did not recognize a union shop was contrary to previous discussions. They agreed to insert language that any employee hired after January 25, 1968, the date of the Union's certification, would be required to join. Marlett agreed that this would be a 1-year contract from January 25, 1968. The Union accepted the language relating to the collection of dues. Marlett agreed to present a full contract plus a company wage proposal at the next meeting. Here as well, Marlett claimed that this was presented not as an offer but as language provisions for negotiating purposes only; this Smith flatly denied. Marlett also told them that Potter and Rogel had not seen this document and that they would have to concur, particularly as to union security and dues provisions; he added that he, Marlett, would recommend approval of the document to them. I do not credit Marlett where his testimony is in conflict with that of Camacho. As previously found, Potter agreed with Smith on March 14 that Marlett and Smith would meet and complete the technical language of the contract. And, as indicated, I do not accept Marlett's attempted explanation of the distinction between an offer and language provisions for negotiating purposes only. Finally, Marlett ultimately admitted that his contract proposal was intended to reflect prior discussions at meetings and that "All we had done was to agree in principle as to what I was to put in this document. And then I was to work out details." The next meeting was held on April 8. Marlett presented for consideration a document in evidence as G.C. Exh. 5 which he allegedly prepared in order to have "everything in one document for negotiating purposes again." This also contained language that a union shop would be honored only when the Union obtained 100 percent membership in the bargaining unit. When reminded that he had agreed that this be stricken from the proposal he brought to the previous meeting, Marlett again agreed that it be stricken. It set forth union security language previously agreed to, namely, that all employees hired after January 25, 1968, would become union members after 30 days of employment and that no employees as of the effective date of the contract were required to join. It also set forth the same dues checkoff language prepared by Marlett in G.C. Exh. 4 which had been accepted previously by the Union and it was again accepted. Respondent made a wage proposal which was rejected by the Union. Smith proposed that the contract be put into effect and that the wage issue be resolved at a later date; Marlett refused. On April 18, the parties met again with only Camacho present for the Union. Marlett claimed that Potter was present only for introductory remarks and then departed. Camacho disputed this, contending that Potter had been present throughout the meeting. Marlett ultimately conceded that he did not have detailed minutes of these meetings. He also admitted, in his pretrial affidavit to the General Counsel, that Potter was present and had made some remarks to Camacho. He then testified that Potter may or may not have been present during the meeting as such. I credit Camacho. According to Camacho, Marlett made an oral proposal on wages for leadmen and shift differentials which was agreed to by the Union which then withdrew its request for labor classifications. Rogel stated that he had some questions about union security and the dues checkoff. Camacho responded that he did not intend to renegotiate matters previously agreed upon. Marlett then suggested a 3-year contract and Camacho responded that this was a possibility if Respondent would agree to a full union shop. Marlett testified that he and Rogel advised the Union at this meeting that Respondent would insist upon a complete open shop and no dues checkoff. Camacho protested that Respondent was taking "the guts" out of the contract and, according to Marlett, this was the key problem at the meeting. Marlett admittedly raised the possibility of a 3-year contract. Smith was advised by Camacho that he believed Respondent was reneging on union security and dues checkoff. Smith duly telephoned Marlett early in May, as he testified, and Marlett advised him that Respondent would not go along with any agreement on union security and dues checkoff. Smith promptly accused Marlett of reneging on their agreement in these two areas. Chaplin reentered the picture at this time and he and Camacho met with Marlett and Rogel on May 7. Potter did not attend this or any subsequent meeting. According to Chaplin, a clear and forthright witness whom I credit, he pressed the parties to clear up all differences and arrive at a final contract. He went through G.C. Exh. 5, Respondent's last offer, and offered to accept a 3-year contract if there were wage reopenings in the second and 'At one point the transcript erroneously places this as March 5. third years of the contract. 332 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The parties agreed on a union shop clause providing that all new employees join the Union but giving present employees the option to join or not. Rogel again came forward with his oft repeated claim that that the dues checkoff would require too much work and that the payroll checks lacked a box to reflect same. Chaplin proposed, and they agreed, that the Union would provide Respondent with a monthly list of its members and that Respondent would make one monthly dues deduction. The meeting was adjourned with the understanding that Chaplin would prepare in final form a contract embodying all changes that had been made and that this would be forwarded to Marlett for editing as to minor corrections. Chaplin did so with copies to Rogel and Potter. This was a 3-year contract with second and third year wage reopenings, as Chaplin had previously agreed to, and provided that all new hires after January 25, 1968, would join the Union in 30 days and that employees on the effective date of the contract, January 25, 1968, were not required to join. It also provided for one dues checkoff per month based upon a list to be supplied by the Union. Camacho supported Chaplin in most respects. He agreed that Chaplin was to prepare a contract reflecting what was agreed upon at this meeting. He did not recall any discussion of union security but did remember a discussion concerning the dues checkoff, consistent with the testimony of Chaplin. The versions of Respondent's witnesses differ considerably. According to Rogel, they discussed a 3-year contract and Respondent took the same position it had previously, namely, that it should be an open shop and that it refused to agree to a dues checkoff. The only agreement that Chaplin was to prepare was a contract reflecting certain unit exclusions. Rogel's testimony patently goes too far. For he previously testified, as noted above, that during March and April, as found, although Potter insisted upon an open shop Respondent's representatives had come forward with a proposal for a modified maintenance of membership plan. Stated otherwise, on the face of his own testimony, Respondent reneged on May 7 from its previous proposal on union security. Indeed, even the testimony of Marlett, Respondent's chief negotiator, does not go as far as that of Rogel. He testified that the discussion on May 7 centered on union-security and checkoff provisions. Marlett stated that Respondent would do nothing to perpetuate the Union's existence and, it "would have to earn its own way with the employees," perhaps a realistic appraisal of its approach to these negotiations . Marlett expressed his personal view that Respondent would be better off with the dues checkoff, although pointing to Potter's aversion to the concept. The meeting ended with agreement that Chaplin would draw up a contract to submit to Respondent for consideration. Chaplin, Camacho, and Smith were experienced negotiators and Potter and Rogel were not. Marlett, although handling labor matters, is primarily engaged in corporate practice. While this is not dispositive of the matter, it perhaps explains the intellectual quibbling engaged in by Respondent's representatives in these negotiations as noted above . And, as stated, Marlett and Rogel do contradict each other. Accordingly, their testimony here, as elsewhere, is not credited where in conflict with that of the union representatives. On May 20, Marlett advised Chaplin, according to the latter, that, inter alia, the union-security and dues-checkoff clauses were unacceptable to Respondent. Chaplin protested that this was the second or third time that agreement had been reached and that Respondent had reneged. This led to the filing of the instant charge on the following day. The parties met on June 6 and thereafter under the auspices of the Federal Mediation and Conciliation Service, with Chaplin representing the Union and Marlett and Rogel present for Respondent. Chaplin testified that he contended a final agreement had been reached and that Respondent had refused to sign. Marlett explained that Potter refused to accept this contract. Another meeting was held on June 13. According to Chaplin, Marlett objected to wage reopening clauses in the second and third years of a 3-year contract and claimed that the collection of dues was the Union's province. Union security was not discussed. Rogel again contended that collection of dues would be a burden upon Respondent. The union representatives protested that an agreement had previously been reached on union security and dues checkoff. Smith and Chaplin met again on June 19 with Marlett and Rogel. Ultimately, the conciliator outlined a settlement stipulation of 15 items which was signed by Marlett, Smith and Chaplin. Inter alia, it incorporated G.C. Exh. 6, previously identified; provided for a 3-year contract term from the certification date; provided for maintenance of membership;' provided that the Union would collect its own dues on company premises 1 day a month; and, as item 15, provided that the stipulation was subject to ratification by President Potter and the employees. Chaplin and Smith testified that Marlett agreed to prepare a final contract reflecting G.C. Exh. 6 as modified by the stipulation executed on that date, G.C. Exh. 7. According to Marlett, the mediator came up with the maintenance of membership and dues provisions described above and Marlett "felt this was a good compromise." He and Rogel did point out that they were under instructions from Potter not to accept any form of union security or dues checkoff.' They attempted to reach Potter by telephone but were unable to do so. Marlett and Rogel thereafter met with Potter and explained what they had agreed to. Potter refused to ratify the maintenance of membership and dues collection clauses. On June 24, the parties met again, with Marlett stressing that he had not prepared a contract incorporating G.C. Exh. 6 and 7. According to Chaplin, Marlett was asked for the new contract and responded that his secretary had been too busy to prepare it. Chaplin denied that the company representatives announced that Potter refused to approve the stipulation insofar as it related to union security and dues collections. Smith agreed that Marlett said that he had been too busy to prepare a contract, but ultimately admitted that he did not recall whether a reference was made to the secretary being too busy and whether Marlett said there was no contract because Potter had not approved the union security and dues collection clauses. I deem it unnecessary to resolve this conflict. Marlett testified, and Rogel agreed, that when the Union asked for his contract proposal on June 24, he replied that Potter had not approved the stipulation and, 'All employees who signed union cards after the date of the agreement were to maintain union membership . Present employees were not required to join. 'As noted, the stipulation merely allowed the Union to enter Company premises once a month to collect dues. INDUSTRIAL WIRE PRODUCTS CORP. 333 therefore, he had no contract with him. The parties met again on July 2 . Marlett stated, according to Chaplin, that although he believed that the union representatives would not be enamored of his product, a realistic observation, he had prepared a document which was not a proposal and not an agreement but merely "proposed language for an agreement." This document, in evidence as G.C. Exh. 8 , provides for an open shop, expressly states that there will be no checkoff of dues and provides that the Union was to collect dues outside company premises . It also provides for a 5-year contract term. Chaplin immediately protested that the parties had a different agreement and that it was pointless to continue making agreements that Respondent would not sign. As is readily apparent , this proposal was contrary to the language in G.C . Exh. 6 and 7 calling for maintenance of membership and permitting the union to visit company premises once a month to collect dues . It also proposed a 5-year contract term based upon this altered language, in conspicuous contrast to the earlier discussions of a I- or 3-year contract predicated upon terms of employment more favorable to the Union. D. Conclusions A consideration of this course of conduct by Respondent impels the conclusion that it has been remiss in its obligations under the Act. The net result is that Respondent sent forth negotiators clad with ostensible authority who were nothing more than a conduit, that it in effect attempted to engage in shadow boxing to a draw, that it reneged on contractual commitments and that it ultimately came forward with what it aptly termed as a "conservative" proposal, wherein it not only reneged on prior agreements but actually retrogressed to a proposal containing less than what it had previously agreed to; indeed, in this proposal, it sought a 5-year term in contrast with prior agreements for a shorter term for contracts more favorable to the Union . This is not to say that a party must make concessions in bargaining . It is to say that one must approach the bargaining table with an open mind not hermetically sealed against making concessions. The purpose of bargaining is to produce an agreement and not talk merely for the purpose of going through the motions. Mere discussion with a fixed resolve not to enter into an agreement in certain areas does not satisfy one's obligations under the Act. N.L.R.B. v. Highland Park Mfg. Co. 110 F.2d 632, 7 (C.A. 4); Stuart Radiator Core Mfg. Co. Inc., 171 NLRB No. 27; and Warehousemens Union Local 17, IL WU, 171 NLRB No. 160. (1) Perhaps a cornerstone of Respondent's approach to collective bargaining was its insistence, noted above, that ostensible contract proposals were presented for language purposes only, language for negotiating purposes only or language for further consideration. Needless to say, any contract proposal is put forth presumably for discussion and consideration and this attempted distinction is meaningless . In short, Respondent's position is perforce that it refused to consider any document it came forward with in the course of negotiations as a contract proposal. This reflects its bad faith and indeed this view is fortified by an inspection of the one document it designated as a contract proposal, namely its retrogressive proposal of July 2. Moreover, in testifying about a March meeting, Marlett admitted that the parties had agreed that the document he had prepared was to reflect what they had agreed upon "in principle." (2) Despite the foregoing, Marlett raised the possibility of agreement on a maintenance of membership provision at the February 28 meeting. And, on March 4, Marlett announced that he would present such a proposal . Indeed, in testifying about March and April meetings, Rogel conceded that although Respondent preferred an open shop, it had come forward with a proposal for a maintenance of membership clause in lieu of any union shop. (3) Marlett's concept of a maintenance of membership provision is reflected in a contract he presented at a meeting on March 20 or 21. This contained a proposal providing in part that Respondent would recognize a union shop only after the Union had achieved 100 percent membership in the bargaining unit. When his attention was directed to prior discussions in this area , he retreated to language requiring new hires to join the Union after the date of its certification. (4) At the May 7 meeting, Union Negotiator Chaplin went through the document presented by Respondent at the April 8 meeting and offered to accept it , providing there were wage reopeners in the second and third years. He agreed that the Union would provide the list for dues checkoff and it was also agreed that Chaplin would prepare a final document . Chaplin did so. This contained the wage reopening provisions agreed to, a requirement that new hires after the certification date join the Union, and a provision for a dues checkoff once a month . But, on May 20, Marlett advised the Union that, inter alia, the union-security and dues-checkoff clauses were unacceptable. This clearly was reneging upon a prior agreement and led to the filing of the charge in the instant proceeding. (5) There is still another example of reneging on the part of Respondent. Despite the existence of a contract previously agreed to, the parties met on June 19 under the auspices of a conciliator and entered into a stipulation containing 15 items . In some respects, the Union yielded and made concessions detracting from what had been agreed to previously in its favor . This stipulation provided for a 3-year term, maintenance of membership for all hires after the date of the date of the agreement, no checkoff, and that the Union would collect its own dues. Marlett agreed to propose a new contract incorporating these modifications but failed to do so, explaining that Potter had refused to approve the maintenance of membership clause and the language permitting the Union to collect its own dues once a month on company premises. As noted, on July 2, Respondent came up with a 5-year calling for an open shop, rejecting any checkoff and forbidding any dues collections on company premises by the Union. (6) Respondent has relied upon the express reservation to Potter on June 19 of the right to approve the new contract. Obviously, there is nothing wrong with this provision as such . But such a provision may not be utilized as a device to undermine collective bargaining. Initially, I note that this is not a case where final approval or ratification has been reserved to one not privy to the negotiations. President Potter personally participated in all meetings through that of April 18. Thereafter, as Marlett testified, he and Rogel personally filled in Potter fully and immediately as to what was taking place at each subsequent meeting . He was also fully aware of the content of the various documents presented by the parties and ultimately agreed to in negotiations. 334 DECISIONS OF NATIONAL LABOR RELATIONS BOARD It would be a travesty upon the right of ratification to permit one whose agent has agreed to a contract to exercise a right of disapproval under these circumstances. This is all the more so where the agent comes forward with proposals in the area of union security and gives a labor organization reason to believe that agreement can be reached in this area, as indeed it was. Perhaps the final straw was Marlett' s admission that his instructions from Potter prior to June 19 were to hold firm and not depart from an open shop and no dues checkoff. And, as Rogel put it, Potter never changed his mind in these two areas. In fact, Marlett admitted that in agreeing on June 19 to the stipulation on maintenance of membership and dues checkoff clauses, he had acted in express derogation of his authority from Potter . And, Potter had been aware of the union-security and dues-checkoff language agreed to in the earlier proposals, but sat back and permitted the negotiations to proceed with the Union assuming that there was agreement in these areas . This type of sandbagging is a far cry from a good-faith reservation of the right to approve contract terms and connotes rather bad faith. Viewed from another angle, Respondent presented and endowed with ostensible authority a representative who lacked authority to enter into binding clauses in certain areas, sat back quietly while this agent did enter into agreements beyond his designated authority , permitted the Union, with justification, to assume that a meaningful and final contract had been arrived at and then, when presented with this agreement and the moment of truth, decided to reject the contract. This is perhaps underlined by Marlett's comment at the May 7 meeting that Respondent would do nothing to perpetuate the Union 's existence and that it would have to earn its own way with the employees . Respondent's interpretation of this amounted to reneging upon prior commitments, particularly on June 19, and it then came forward with a contract proposal on July 2 which retreated from language previously agreed upon. This approach to collective bargaining can only be termed as superficial and entirely in derogation of the principles of good-faith bargaining. In view of the foregoing considerations, I find that Respondent has bargained in bad faith with the Union, has violated and rejected the principles of good-faith collective bargaining and has thereby engaged in unfair labor practices within the meaning of Section 8(a)(5) and, derivatively, Section 8(a)(1) of the Act. Associated Transport Co. of Texas, Inc., 173 NLRB No. 23.' IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of Respondent set forth in section III, above, and occurring in connection with its operations described in section I, above , have a close, intimate, and substantial relationship to trade , traffic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow thereof. desist therefrom and take certain affirmative action designed to effectuate the policies of the Act. It has been found that Respondent refused to bargain with the Union as the duly designated representative of its employees in an appropriate unit, and further, that Respondent reneged on the agreement arrived at on June 19, 1968. I shall therefore recommend that Respondent, upon request by the Union, execute said contract and put its provisions into effect for a 3-year term, from January 25, 1968, as provided therein, or, if no such request is made, bargain in good faith with the Union and, if an understanding is reached, embody such understanding in a signed document. I shall also recommend that Respondent make whole its employees for any losses suffered by reason of its failure to sign and honor said agreement of June 19, including unpaid wages or other benefits, with interest at the rate of 6 percent per annum. See N.L.R.B. v. Beverage-Air Co., 402 F.2d 411 (C.A. 4); N.L.R.B. v. Strong, 386 F.2d 929 (C.A. 9), cert. granted May 27, 1968, and N.L.R.B. v. Hyde's Supermarket, 339 F.2d 568 (C.A. 9). Upon the basis of the foregoing findings of fact, and upon the entire record in the case, I make the following: CONCLUSIONS OF LAW 1. Industrial Wire Products Corporation is an employer within the meaning of Section 2(2) of the Act. 2. United Electrical, Radio and Machine Workers of America, Local 1421, United Electrical Radio and Machine Workers of America (UE) is a labor organization within the meaning of Section 2(5) of the Act. 3. All production, maintenance, shipping and receiving employees and truckdrivers of Respondent, excluding office clericals, salesmen, guards, watchmen and supervisors, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 4. United Electrical, Radio and Machine Workers of America, Local 1421, United Electrical Radio and Machine Workers of America (UE) has been at all times since January 25, 1968, and now is, the exclusive representative of the employees in the aforesaid appropriate unit, within the meaning of Section 9(a) of the Act. 5. By refusing on and after June 19, 1968, to bargain with the Union as the exclusive representative of its employees in the aforesaid appropriate unit, Respondent has engaged in and is engaging in unfair labor practices i within the meaning of Section 8(a)(5) of the Act. 6. By the foregoing conduct, Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(1) of the Act. 7. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. RECOMMENDED ORDER V. THE REMEDY Having found that Respondent has engaged in certain unfair labor practices, I shall recommend that it cease and 'There are other items demonstrating Respondent 's bad faith, but I believe they would be cumulative Upon the basis of the foregoing findings of fact and conclusions of law, and upon the entire record in the case, it is recommended that Respondent, Industrial Wire Products Corporation, Los Angeles, California, its officers, agents, successors, and assigns, shall: INDUSTRIAL WIRE PRODUCTS CORP. 1. Cease and desist from: (a) Refusing, upon request by United Electrical, Radio and Machine Workers of America, Local 1421, United Electrical Radio and Machine Workers of America (UE), to execute a written agreement embodying the terms and conditions of employment agreed upon with said Union on June 19, 1968, and refusing to put into effect its provisions for a 3-year term, from January 25, 1968, or, if no such request is made, refusing to bargain in good faith with said Union as the exclusive representative of its employees in the above-described appropriate unit with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment and, if an understanding is reached, to embody same in a signed agreement. (b) In any like or related manner interfering with, restraining, or coercing employees in the exercise of the right to self-organization , to form labor organizations, to join or assist the above-named or any other labor organization, to bargain collectively through representatives of their own choosing, to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection, and to refrain from any or all such activities, except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment. 2. Take the following affirmative action designed to effectuate the policies of the Act: (a) Upon request of the aforesaid Union, forthwith execute the contract agreed to on June 19, 1968, and put into effect its provisions for a 3-year term, from January 25, 1968, or, if no such request is made, bargain collectively with said Union as the representative of the employees in the above unit and, if an understanding is reached, embody same in a signed agreement. (b) Make whole all employees covered by the aforesaid contract for the loss of any benefits which would have accrued to them under the contract it refused to sign, with interest at 6 percent per annum thereon. (c) Post at its plant at Los Angeles, California, copies of the attached notice marked "Appendix."'" Copies of said notice on forms furnished by the Regional Director for Region 21 shall, after being duly signed by Respondent, be posted immediatley upon receipt thereof and 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 by Respondent to insure that said notices are not altered, defaced or covered by any other material. (d) Notify the Regional Director for Region 21, in writing, within 20 days from the receipt of this Decision, what steps it has taken to comply herewith." "In the event this Recommended Order is adopted by the Board, the words "a Decision and Order" shall be substituted for the words "the Recommended Order of a Trial Examiner" in the notice. In the further event 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." "In the event this Recommended Order is adopted by the Board, this provision shall be modified to read : "Notify said Regional Director, in writing, within 10 days from the date of this Order, what steps the Respondent has taken to comply herewith." APPENDIX NOTICE TO ALL EMPLOYEES 335 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: WE WILL, upon request, by United Electrical, Radio and Machine Workers of America, Local 1421, United Electrical Radio and Machine Workers of America (UE), sign the written contract reached with that Union on June 19, 1968, and put its provisions into effect for a 3-year term, from January 25, 1968, or, if no such request is made, we will bargain collectively with said Union as the representative of our production, maintenance, shipping and receiving employees and truckdrivers, excluding office clericals, salesmen, guards, and supervisors and, if an understanding is reached, embody same in a signed agreement. WE WILL make whole all employees covered by the aforesaid contract for the loss of any benefits accrued thereunder, with interest at 6 percent per annum. WE WILL NOT in any like or related manner interfere with, restrain, or coerce employees in the exercise of their right to self-organization, to form labor organizations, to join or assist the above-named or any other labor organization, to bargain collectively through representatives of their own choosing, to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection and to refrain from any or all such activities, except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment. INDUSTRIAL WIRE PRODUCTS CORPORATION (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, 849 South Broadway, Los Angeles, California 90014, Telephone 688-5229.