Monroe

516 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Monroe and Local 432, International Union of Electri- cal, Radio and Machine Workers of America, AFL- CIO Monroe and Thomas Doyle, Sr., Petitioner and Local 432, International Union of Electrical, Radio and Machine Workers of America, AFL-CIO. Cases 22- CA-4001 and 22-RD-268 May 25, 1971 DECISION, ORDER, AND DIRECTION OF SECOND ELECTION BY MEMBERS FANNING, JENKINS, AND KENNEDY On October 23, 1970, Trial Examiner Arthur M. Goldberg issued his Decision in the above-entitled pro- ceeding, finding that the Respondent had not engaged in the unfair labor practices alleged in the complaint and recommending that the complaint be dismissed, as set forth in the attached Trial Examiner's Decision. In addition, the Trial Examiner found that the Respond- ent's conduct prior to the election held in Case 22-RD- 268 was not objectionable and recommended the cer- tification of the results thereof. Thereafter the General Counsel filed exceptions to the Trial Examiner's Deci- sion and a supporting brief. The Respondent filed cross-exceptions to the Decision and a supporting brief, and a brief in answer to the General Counsel's excep- tions. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the Na- tional Labor Relations Board has delegated its powers in connection with these cases to a three-member panel. The Board has reviewed the rulings of the Trial Ex- aminer made at the hearing and finds that no prejudi- cial error was committed. The rulings are hereby affirmed. The Board has considered the Trial Ex- aminer's Decision, the exceptions and briefs, and the entire record in these cases, and hereby adopts the findings, conclusions, and recommendations of the Trial Examiner only to the extent consistent herewith. 1. The complaint alleged that the Respondent vi- olated Section 8(a)(1) and (5) of the Act by granting wage increases and other benefits to employees in the bargaining unit and by threats of economic reprisals if the employees remained members of the Union or gave any assistance or support to it. The Trial Examiner found that the Respondent did not give wage increases and other benefits for the pur- pose of causing the employees to reject the Union. Fur- ther, he found that the Respondent's actions alleged as threats of economic reprisals were within the permissi- ble bounds of campaign rhetoric. Thus he recom- mended that the complaint be dismissed, and objec- tions to the election in Case 22-RD-268, encompassing 190 NLRB No. 100 the same factual issues as in the complaint, be over- ruled, and the results of the election certified. We do not agree with the Trial Examiner. The Trial Examiner relied on the Board's decision in Tennessee Handbags, 179 NLRB No. 161, where an employer had granted benefits to employees during the critical period before an election. Under the circum- stances of that case, the Board found that the prepon- derance of the evidence did not establish that the em- ployer had granted and announced the benefits for the purpose of causing the employees to reject the union, and dismissed the complaint as to that allegation. The Board is not convinced that the circumstances in the instant case are of the same nature as those in Tennessee Handbags, Here the Union has represented a unit of Respondent's production and maintenance employees since 1954, the latest contract between Re- spondent and the Union having expired on September 30, 1969. This contract covered Respondent's em- ployees at its Orange and Clifton, New Jersey, plants. In 1966 the operation at Clifton was made a separate and distinct operating division of Litton Industries, called Automated Business Systems,' with its own management and policies separate from Respondent's Orange plant. This proceeding is concerned only with the employees at Respondent's plant at Orange. Beginning in 1966, Respondent had difficulty in re- cruiting and retaining employees for jobs within the bargaining unit due to its wage structure which com- pared unfavorably with that of other employers in the area utilizing the same type of employees. In 1967, Respondent and ABS entered into negotia- tions with the Union in which the hoped-for goal was separate contracts for Respondent and ABS. Prior to these 1967 negotiations, Respondent had prepared a wage survey which showed Respondent's wage struc- ture to be considerably lower than other employers in the survey. However, these negotiations broke down due to economic issues, including Respondent's failure to offer any wage increases or fringe benefits. In January 1969, while Respondent was still ex- periencing great difficulties in recruiting and retaining employees in many categories, and had in fact subcon- tracted out some work with the agreement of the Un- ion, Respondent and the Union again entered into negotiations for a separation of the unit employees at Orange and Clifton. Although the Union at this time asked for as much as a $1-an-hour increase for some of the skilled unit employees in order to bring their wage level to the average paid for the same jobs in the area, Respondent counterproposed a 3-cent-per-hour in- crease across the board. The parties later settled on an average of a 10-cent-per-hour increase. Also out of ' Herein called ABS MONROE these negotiations came a memorandum of understand- ing separating the units. In April 1969, Respondent again prepared a wage survey similar to the 1967 survey. As with the 1967 survey, this showed that Respondent's wage scale for unit employees was considerably below that of other employers. Its was also below competitive levels in re- spect to benefits. In June 1969, Respondent and the Union began negotiations for a new contract to follow the one due to expire on September 30, 1969. After negotiations had begun, the Petitioner filed a decertification petition, and subsequently filed charges against both the Union and the Respondent. Because of this, negotiations ceased on August 5, after at least three bargaining ses- sions had been held. Although Respondent's manager of employees compensation, Stewart, testified that Re- spondent had already planned that its final contract proposal would encompass the wages and benefits it unilaterally was to grant later in October 1969, we note that the contract proposals submitted by Respondent did not contain these wages and benefits. On October 13, 1969, 13 days after the collective- bargaining agreement expired, Respondent began its granting of wage increases and benefits to the unit em- ployees. In granting these, Respondent held personal interviews with each unit employee. Present at these interviews were Stewart, the employee's immediate supervisor, and such supervisor's supervisor. At these interviews the employees were told that there would be no more checkoff of the union dues; they would be paid biweekly instead of weekly; there would be no more use of a timeclock for recording work hours, but the em- ployees would fill out a weekly timesheet; they were getting an 8-percent wage increase; they were going to be allowed to participate on a contributory basis in Litton Industries' benefit programs not available to them under the collective-bargaining agreement; a merit system would determine future salaries; and they would now be covered under the sick leave plan. The contributory benefits plans offered the employees in- cluded additional life insurance, supplemental life in- surance, major medical insurance, a salary continua- tion plan, and improved retirement benefits. On October 22, 1969, all the parties entered into a Stipulation for Certification Upon Consent Election in Case 22-RD-268, and the date of the election was set as November 13. Thereafter, Respondent sent letters to the employees in the unit on October 31. The letter, which is alleged to contain a threat of reprisal for sup- port of the Union, states in part: We are dedicated to the principle of the dignity of each individual, and I feel very strongly that each employee should share in our programs of in- creased wages, better fringe benefits and pension plans. This will be possible if we have no union. 517 It is well established that Section 8(a)(1) prohibits conduct by an employer "immediately favorable to em- ployees undertaken with the express purpose of imping- ing upon their freedom of choice for or against unioni- zation and is reasonably calculated to have that effect."2 It is also established that the mere timing of the granting of the benefits during the critical period before an election does not make the act a violation of Section 8(a)(1), if the circumstances show that it was not done with the purpose of influencing the employees' choice in the election.' The facts in the instant case make untenable a deter- mination that the Respondent did not grant the benefits in October to influence the employees' choice in the upcoming election. Although Respondent did not know, until it had already begun the interviews to announce the benefits, that the Petitioner's appeals from the Regional Direc- tor's dismissal of the charges against Respondent and the Union had been denied, it had been advised that the Regional Director was going forward with the investi- gation in the representation case, and the Petitioner had requested that the representation hearing be re- opened. Although Respondent did not know just when the election would be held, it had no reason to expect that there would be no election. Further, although Respondent had experienced diffi- culty in recruiting and retaining employees in the unit because of its low wage scale and lack of benefits for better than 3 years, it is clear it did nothing to alleviate this problem while it was bargaining with the Union. Respondent asserts it did not offer wage increases in 1967 because ABS had a veto power over such an offer by Respondent. Although Respondent testified that it was willing to grant wage increases in 1967, its negotia- tor at this time stated that "the companies" were in no position to grant wage increases. Also, the evidence reflects numerous occasions on which either Respond- ent or ABS made separate supplemental agreements with the Union, ABS even having upgraded jobs with raises, without Respondent being affected. Regarding the January 1969 negotiations between Respondent and the Union, Respondent testified that it did not attempt to raise the wages to a competitive level then because it knew that contract negotiations would be coming up soon and the Union would be asking for a big wage increase. This, however, fails to lend cre- dence to the alleged sudden necessity in October to raise wages and grant benefits after years of refusal to do so and shortly before an election, particularly in view of Respondent's omissions of any such proposals in its contract negotiations starting in June 1969. NL R.B. v Exchange Parts Co., 375 U S 405 Tennessee Handbags, Inc, supra 518 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Further, the conclusion that these benefits were off- ered to influence the employees' vote is reinforced by Respondent's October 31 letter which states that the increased wages and better fringe benefits and pension plans "will be possible if we have no union." As the Supreme Court said in Exchange Parts, "Employees are not likely to miss the inference that the source of benefits now conferred is also the source from which future benefits must flow and which may dry up if it is not obliged."" We therefore find that Respondent granted wage in- creases and added benefits in October for the purpose of influencing the employees in their choice of whether or not they wished to be represented by the Union. We also find that Respondent by its letter of October 31 in effect coerced the employees and threatened them with economic reprisals if they assisted or supported the Union. These acts we find were in violation of Section 8(a)(1) of the Act. 2. The objections to the election raised substantially the same factual issues as were raised in the unfair labor practice complaint. The Trial Examiner recommended they be dismissed and the results of the election cer- tified. For the reasons stated before in finding the 8(a)(1) violations, we also sustain these objections to the election, and will set aside the results thereof. 3. The General Counsel seeks a bargaining order under the doctrine set forth in N.L.R.B. v. Gissel Pack- ing Company, 395 U.S. 575. There is no specific evi- dence that the Union represented a majority of Re- spondent's Orange employees, apart from those now in Clifton; nor may it be presumed that it did at the time of the unfair labor practices or the election. Although the Union had been certified as the collective-bargain- ing representative in 1954, the unit has changed sub- stantially since that time. The unit at Respondent's Orange plant which was found appropriate by the Trial Examiner, with whom we concur, is only one segment of the original certified unit, in that it includes em- ployees only at'Orange, and the production operations carried on at Orange in the past have all been trans- ferred out of that plant. The unit certified in 1954 was made up of Respond- ent's employees at its Morris Plains and Orange plants, where Respondent was at that time engaged in manu- facturing. Successive bargaining agreements with the Union followed this certification. Subsequently, the Morris Plains plant was closed and the operations transferred to Bristol, Virginia, and Orange. Later the Orange plant ceased doing any production work, it being transferred to Bristol and Clifton, New Jersey. Further the unit found appropriate herein is not the same as the unit covered by the most recent contract between Respondent and the Union. As noted above, the employees of ABS at Clifton were also represented by the Union under that contract. By agreement of the parties, ABS and Respondent now have separate units, the unit at Respondent's plant being only about one- sixth the size of the unit covered by the 1965 contract. Also, a decertification petition was filed at Respond- ent's,plant in July 1969, and in October 1969, Respond- ent, the Union, and the RD Petitioner entered into a Stipulation for Certification Upon Consent Election. For all of the foregoing reasons , we are not finding a violation of Section 8(a)(5), nor are we issuing a bargaining order. Rather, we will order that a second election be conducted in the unit found appropriate. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondent set forth above, occurring in connection with the Respondent's opera- tions as described in the Trial Examiner's Decision, 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 ob- structing commerce and the free flow of commerce. THE REMEDY Having found that the Respondent has engaged in certain unfair labor practices it will be recommended that it cease and desist therefrom , and take certain affirmative action designed to effectuate the policies of the Act. CONCLUSIONS OF LAW 1. Monroe is an employer engaged in commerce within the meaning of Section 2 (6) and (7) of the Act. 2. Local 432, International Union of Electrical, Ra- dio and Machine Workers of America, AFL-CIO, is a labor organization within the meaning of the Act. 3. By engaging in certain described conduct referred to herein, Respondent interfered with, restrained, and coerced its employees in the exercise of rights guaran- teed to them by Section 7 of the Act, and thereby engaged in and is engaging in unfair labor practices within the meaning of Section 8 (a)(1) of the Act. 4. The aforesaid unfair labor practices affect com- merce within the meaning of Section 2(6) and (7) of the Act. 5. The Respondent has not committed any unfair labor practices other than those found herein. ' NL R.B v Exchange Parts Co, supra. MONROE ORDER Pursuant to Section 10(c) of the National Labor Re- lations Act, as amended, the National Labor Relations Board hereby orders that the Respondent, Monroe, Orange, New Jersey, its officers, agents, successors, and assigns, shall: 1. Cease and desist from unlawfully granting, or an- nouncing the grant of, economic benefits for the pur- pose of undermining the Union; threatening employees with economic reprisal for assistance to, or support of, the Union; or, in any like or related manner interfering with, restraining, or coercing employees in the exercise of rights guaranteed by the Act. However, nothing herein shall be construed to require the Respondent to rescind or discontinue new wage rates or other benefits previously granted. 2. Take the following affirmative action which is necessary to effectuate the policies of the Act: (a) Post at its Orange, New Jersey, plant copies of the attached notice marked "Appendix."5 Copies of said notice, on forms provided by the Regional Director for Region 22, after being duly signed by the Respondent's representative, shall be posted by Respondent immedi- ately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to insure that said notices are not al- tered, defaced, or covered by any other material. (b)Notify the Regional Director for Region 22, in writing, within 20 days from the date of this Order, what steps the Respondent has taken to comply here- with. It is further ordered that the election held on November 13, 1969, in Case 22-RD-268, be, and it hereby is, set aside, and said case is hereby remanded to the Regional Director for Region 22 to conduct a new election. [Direction of Second Election' omitted from publica- tion.] ' In the event that this Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD" shall be changed to read "POSTED PURSUANT TO A JUDGMENT OF THE UNITED STATES COURT OF APPEALS ENFORCING AN ORDER OF THE NATIONAL LABOR RELATIONS BOARD " ' In order to assure that all eligible voters may have the opportunity to be informed of the issues in the exercise of their statutory right to vote, all parties to the election should have access to a list of voters and their ad- dresses which may be used to communicate with them Excelsior Underwear Inc, 156 NLRB 1236, NLRB. v Wyman-Gordon Co, 394 U S 759 Accordingly, it is hereby directed that an election eligibility list, containing the names and addresses of all the eligible voters, must be filed by the Employer with the Regional Director for Region 22 within 7 days after the date of issuance of the Notice of Second Election by the Regional Director The Regional Director shall make the list available to all parties to the election No extension of time to file this list shall be granted by the Regional Director except in extraotdinary circumstances Failure to comply with this requirement shall be grounds for setting aside the election whenever proper objections are filed 519 APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL NOT grant you wage increases or other benefits to discourage you from designating Local 432, International Union of Electrical, Ra- dio and Machine Workers of America, AFL-CIO, or any other union as your representative for col- lective bargaining. However, nothing requires us to discontinue any benefits previously given to you. WE WILL NOT threaten economic reprisals if you assist or support the above-named Union or any other labor organization. WE WILL NOT in any like or related manner interfere with, restrain, or coerce employees in the exercise of rights guaranteed in Section 7 of the National Labor Relations Act, except to the extent that such rights may be affected by an agreement requiring membership in a labor organization as a condition of employment where authorized in Sec- tion 8(a)(3) of the Act. MONROE (Employer) Dated By (Representative) (Title) This is an official notice and must not be defaced by anyone. This notice must remain posted for 60 consecutive days from the date of posting and must not be altered, defaced, or covered by any other material. Any questions concerning this notice or compliance with its provisions may be directed to the Board's Office, Federal Building, 16th Floor, 970 Broad Street, Newark, New Jersey 07102, Telephone 201-645-2100. TRIAL EXAMINER'S DECISION ARTHUR M. GOLDBERG, Trial Examiner: Upon a charge filed on January 12, 1970, by Local 432, International Union of Electrical Radio and Machine Workers of America, AFL- CIO (herein called the Union), the Amended Complaint and Notice of Hearing herein issued on April 14, 1970,1 alleging that Monroe (herein called Monroe or the Respondent) vi- olated Section 8(a)(1) and (5) of the National Labor Relations Act, as amended (herein called the Act), in October 1969, by granting wage increases and other benefits to employees in the bargaining unit spelled out in the Amended Complaint ' The original Complaint and Notice of Hearing issued on March 25, 1970 520 DECISIONS OF NATIONAL LABOR RELATIONS BOARD and by threats of economic reprisal if the employees remained members of the Union or gave any assistance or support to it. Respondent denied all material allegations of the Com- plaint including the appropriateness of the unit set forth in the Complaint. By Order dated March 11, 1970, the National Labor Rela- tions Board (herein called the Board) consolidated for hear- ing with the unfair labor practice complaint certain objec- tions to conduct affecting the results of the election filed by the Union. This action was predicated on the Board's deter- mination that the issues involved in the complaint allegations were the same as those raised by the Union's objections. All parties participated in the hearing in Newark, New Jersey, on July 15 and 22 through July 24, 1970, and were afforded full opportunity to be heard, to introduce evidence, to examine and cross-examine witnesses, to present oral argu- ment, and to file briefs. Oral argument was waived. By Order dated August 11, 1970, rejecting an exhibit offered by Re- spondent the record herein was closed. This delay was occa- sioned by the late receipt of the exhibit file necessary for the above ruling. Briefs were filed on September 16, 1970, by General Counsel and the Respondent. Upon the entire record in the case,' my reading of the briefs, and from my observation of the witnesses and their demeanor, I make the following: FINDINGS OF FACT I THE BUSINESS OF RESPONDENT Monroe, a New York corporation, maintains its principal office and plant at 550 Central Avenue, Orange, New Jersey (herein called the Orange facility), and at various other places of business throughout the United States and Canada, and is engaged in the manufacture, sale, and service of calculators, adding machines, and related products. Respondent's Orange facility is its only facility involved in this proceeding. During a 1-year representative period Respondent in the course and conduct of its business operations manufactured, sold, and distributed at said plant products valued in excess of $50,000, of which products valued in excess of $50,000 were shipped from the Orange facility in interstate commerce directly to States of the United States other than the State of New Jersey. The Amended Complaint alleged, the answer admitted, and I find that Respondent is and has been at all times material herein an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act and meets the Board's standards for assertion of its jurisdiction. i On September 4, 1970, counsel for General Counsel filed a Motion To Correct The Record of the hearing (hereby marked Trial Examiner's Exhibit 3) and, on September 10, 1970, I issued an Order To Show Cause (hereby marked Trial Examiner's Exhibit 4) why the corrections indicated in Gen- eral Counsel's Motion should not be made in the transcript Thereafter, on September 10, 1970, counsel for the Respondent filed a Motion To Correct The Record (hereby marked Trial Examiner's Exhibit 5) in other respects, and, on September 16, 1970, I issued an Amended Order To Show Cause (hereby marked Trial Examiner's Exhibit 6) why the corrections indicated in Respondent's Motion as well as those in General Counsel's Motion should not be made in the transcript On September 17, 1970, General Counsel responded (said response being hereby marked Trial Examiner's Exhibit 7) stating that he had no objection to amending the record pursuant to Respondent's Motion After due consideration it is hereby ordered that the corrections indicated in said Motions be made and that the transcript be corrected accordingly It is further ordered that Trial Examiner's Exhibits 3, 4, 5, 6, and 7 be received as exhibits in this proceeding and be made part of the record herein II THE LABOR ORGANIZATION INVOLVED Local 432, International Union of Electrical, Radio and Machine Workers of America, AFL-CIO, is and has been at all times material herein a labor organization within the meaning of Section 2(5) of the Act. III THE ALLEGED UNFAIR LABOR PRACTICES A. Background At the hearing, on July 22, 1970, all parties entered into the following stipulation of facts: IT IS HEREBY AGREED AND STIPULATED, by and between the undersigned parties, that: Pursuant to a Decision and Direction of Election of the National Labor Relations Board issued on July 22, 1954, in 109 NLRB 314, for a unit composed of all production and maintenance employees at the Em- ployer's office machine plants at Morris Plains and Orange, New Jersey, including timekeepers, truck driv- ers, and cafeteria workers, but excluding expediters, office clerical employees, professional employees, techni- cal employees , watchmen , superintendents, assistant su- perintendents, foremen , assistant foremen, and super- visors, as defined in the Act, an election was held and the I.U.E. was certified as the collective bargaining agent for the above unit on September 13, 1954. At this time Respondent was engaged in a manufacturing operation at both its Morris Plains and Orange plants, and the parties thereafter entered into successive bargaining agreements. Subsequently, over a period of time, the Morns Plains facility was closed, and part of the operation transferred to a plant in Bristol, Virginia, and part to the Orange facility. Eventually all of the production operation was transferred out of the Orange facility, the calculating machine production going to Bristol, Virginia, and the non-calculating machine production to a plant acquired and opened in Clifton, New Jersey, in 1965. On August 25, 1965 the parties entered into a collec- tive bargaining agreement covering the Orange and Clif- ton plants for a unit consisting of all production and maintenance workers, janitors, factory cost clerks, and truck drivers, employed in the Orange and Clifton, New Jersey, facilities, excluding all superintendents, assistant superintendents, foremen, assistant foremen, super- visory employees generally, watchmen, expediters, engi- neering, research and model shop employees, office and clerical employees employed by the Company, the tech- nicians engaged in tests and trouble-shooting on final and sub-assembly. This contract expired on September 30, 1969. In 1966 the Monroe operation at the Clifton plant concerning non-calculating machine products was made a separate and distinct operating Division of Litton In- dustries, called Automated Business Systems. Auto- mated Business Systems had its own management and policies, separate from Monroe. Accordingly, the parties agreed by written memorandum of February 18, 1969 that unit employees employed at the Monroe Orange facility would thereafter constitute a unit separate and distinct from the unit employees employed at the Auto- mated Business Systems Clifton plant. The Monroe Orange plant employed approximately 60 such em- ployees, and there were over 300 such employees at the Automated Business Systems Clifton plant. Negotiations for a new contract for the Orange unit began in June 1969 but terminated in August 1969. MONROE 521 There is presently no collective bargaining agreement for the Orange unit. Pursuant to the RD petition which had been filed in 22-RD-268 on July 11, 1969, the Respondent, the Un- ion, and the RD Petitioner herein entered into a Stipula- tion for Certification upon Consent Election on October 22, 1969, wherein the unit in Orange was referred to as follows. All employees employed the the Employer's Orange, New Jersey, premises including stock clerks, janitors, packers, shippers, electricians, drivers, chau- ffeurs, parts clerks, laborers, painters, plumbers, ma- trons, carpenters, and machinists, but excluding all office clerical and printing and mailing employees, guards, and supervisors as defined in the Act. There are approximately 60 employees in the unit at Orange. There are also approximately 690 non-repre- sented employees at the Orange location who are primarily management, administrative, technical, and office clerical personnel. The Orange facility serves as the Headquarters for the Monroe Division of Litton Indus- tries, and no manufacturing operations are conducted there. Between October 13 and 17, 1969, Hamilton Steward met separately with each of the unit employees at the Orange location. Also present were the employees' im- mediate supervisor and departmental manager. Each employee was advised that he would be given an 8% wage increase retroactive to October 6, 1969, and that a merit review system was being established, whereby each employee would be periodically reviewed in the future to determine if he merited further wage increases. The increases, effective as of October 6, 1969, for each classification, amount to: 1 Stock Clerks 20'/, cents /hr. 2. Janitors 19 cents /hr. 3. Machinists 26% cents /hr. 4. Plumbers 26 cents /hr. 5. Painters 25 cents /hr. 6. Electricians 26% cents /hr. 7. Carpenters 26 cents /hr. 8. Matrons 19 cents /hr. 9. Drivers and Chauffeurs 24% cents / hr. 10. Laborers 20'/, cents /hr. 11. Parts Clerks 19 cents /hr 12 Packer Shippers 29% cents /hr. Each employee was also advised that as of that date, he could accrue 10 days of paid sick leave per year up to a maximum of 65 days and that credit for past service would be given. Each employee was also given a set of booklets with enrollment cards for certain benefit plans which the Re- spondent was making available to the employees at the latters' option. Meetings were held on October 15, 1969 at which these benefits were explained to interested em- ployees. These benefits included major medical insur- ance (which provided for payments for expenses in- curred after enrollment although the original illness or injury was suffered prior to enrollment but not earlier than January 1, 1969), basic and supplemental life insur- ance, salary continuation insurance, and retirement plan. It is further stipulated that the letter of October 31, 1969, which is appended to the Acting Regional Direc- tor's Report on Objections of January 5, 1970, was dis- tributed to all unit employees on or about October 31, 1969. All employees were reviewed pursuant to the Merit Review System in January 1970, April 1970, and July 1970 In January 1970, substantially all employees received a wage increase of 3%-4% In the April 1970 review, of the employees received wage increases of 3%-4%. In the July 1970 review , those not receiving increases in April, received 3%-4% wage increases. B. The Unit The changes in Respondent's operations at its Orange facility which have taken place over the course of the years since the Board's certification issued in 1954 are spelled out in the stipulation of the parties, supra, and to avoid prolixity are not restated at this point. Suffice it to say that of the unit certified, "all production and maintenance employees at the Employer's office machine plants at Morris Plains and Orange, New Jersey, including timekeepers, truck drivers, and cafeteria workers, but excluding expediters, office clerical employees, professional employees, technical employees, watchmen, superintendents, assistant superintendents, fore- men, assistant foremen, and supervisors, as defined in the Act," all that remains of the unit are the Orange maintenance employees and drivers and certain stockmen, packer-ship- pers, and parts clerks who appear to be production em- ployees, although the stipulation of the parties states "[e]ven- tually all of the production operation was transferred out of the Orange facility." The recognition clause of the 1965 collective-bargaining agreement varied slightly from the unit definition of the cer- tification. The classifications of timekeepers and cafeteria workers were omitted and those of janitors and factory cost clerks were added. As to unit definition the February 18, 1969, memorandum of agreement providing for severance of the Orange facility from the Clifton plant of Automated Business Systems (herein called ABS Clifton) stated only: . employees represented by the Union at Monroe's Orange, N.J. plant will be recognized as an appropriate unit for bargaining and will be separated from the appro- priate unit for bargaining for employees who are repre- sented by the Union at the Automated Business Systems plant in Clifton, N.J. When, on October 22, 1969, the parties entered into a Stipulation for Certification Upon Consent Election in Case 22-RD-268, the unit was specified in more detail but within the scope of that contained in the original certification. In the Stipulation for Certification the unit reads. All employees employed at the Employer's Orange, New Jersey premises, including stock clerks, janitors, packer-shippers, electricians, drivers, chauffeurs, parts clerks, laborers, painters, plumbers, matrons, carpenters and machinists, but excluding all office clerical and printing and mailing employees, professional and techni- cal employees, guards and all supervisors as defined in the Act.' At the hearing herein Respondent offered neither evidence nor argument in support of its denial that the unit alleged is an appropriate one for the purposes of collective bargaining. Instead counsel for Respondent stated, "I think the general counsel has the burden of [proving] that this is an appropriate unit and the Board certainly isn't bound by a stipulation of the parties in reaching whether or not it is appropriate." ' For the effect of this Stipulation for Certification Upon Consent Elec- tion in a subsequent proceeding based on charges of refusal to bargain see The Baker and Taylor Co., 109 NLRB 245, 246-247 522 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Counsel added, " ... for the purposes of this hearing, we are taking the position that general counsel has to prove all the essential allegations of the complaint."' What little testimony was adduced on the unit question established that there are over 600 unrepresented employees at Monroe's Orange facility and about 60 who fell within the unit definition. The janitors, maintenance laborers, drivers, and skilled maintenance employees (carpenters, plumbers, electricians, painters, and maintenance machinists) were un- der the jurisdiction of Respondent's office facility department where they reported to the manager of office facilities who in turn reported to the vice president of administration and personnel. The maintenance employees reported to the maintenance office and shop area where they keep their clothes and tools and are assigned their jobs as needed. The janitors work throughout the facility but are generally as- signed to work in specific areas. The stockmen and parts clerks report to the stockroom foreman and work in a different building from the mainte- nance employees. The packer-shippers work under the transportation super- visor in a warehouse separate from the main facility. There, the packer-shippers unload trucks, take machines out of boxes and repack them, and label, weigh, seal, and then load the boxes on trucks for shipment to Respondent's branch offices. The stockmen and parts clerks handle orders for parts for Monroe machines, and are responsible for receipting, storing, and issuing parts to branch offices, dealers, and subscribers throughout the world. The drivers report to the manager of the office facility department. Their duties consist of picking up and delivering mail, packages, and parcels. As well, the drivers spend some 40 to 50 percent of their time driving company executives to and from the airports serving the area and while in the per- formance of their duties the drivers are away from the Orange facility, their trips do not require that they be away overnight. Hamilton Stewart, Respondent's manager of employee compensation, testified that stockmen in the printing and mailing department perform work similar to that done by unit personnel. As noted, the unit spelled out in the Certifica- tion for Consent Election excluded "printing and mailing employees." Stewart agreed that at the time Respondent en- tered into the Stipulation for Consent Election it did not contend that these stockmen in the printing and mailing de- partment should be included in the unit. At the representation hearing held in Case 22-RD-268 counsel appearing for Monroe summed up his description of unit personnel in these words: "The bargaining unit people in Orange are maintenance and service classifications. In other words, it is their function to maintain and service the office building." Unit personnel had their own payroll schedule and were hourly rated.' Until the changes made by Monroe in their working conditions in October, unit personnel used a time- clock to record their hours worked while the unrepresented employees did not. Benefits programs for the unrepresented employees were different from and greater than those enjoyed by unit employees. Stewart testified that the unrepresented employees are what are generally referred to as "white collar workers " When asked if the unit employees were "blue collar," Stewart 4 At the representation hearing held in Case 22-RD-268 Respondent took "the position that the Orange facility of Monroe is the appropriate unit for the purposes of this petition " ' Testimony of Margaret Rutherford, Respondent's supervisor of em- ployee benefits maintained that they were office workers, stating that he would consider a plumber or carpenter who worked for the division headquarters to be an office worker if he was doing maintenance work in an office. The unit as defined in the Complaint and Stipulation for Certification Upon Consent Election conforms to the boun- daries of the original certification issued by the Board' and is as well "based upon [a] definite bargaining pattern." Allbrit- ten Motors, Inc., 87 NLRB 193. No other labor organization seeks to represent a unit different from the one asserted as appropriate herein and the conditions of employment of the employees within the unit were different from those of the unpresented employees prior to the unilateral acts of Re- spondent complained of in the Complaint (use of a timeclock, separate payroll schedules, different benefits programs, and hourly rate of pay). Moreover, as stated by Monroe's manager of employee compensation, the employees and clas- sifications excluded from the unit are "white collar workers." Despite Stewart's unique concept of office employees, I find that the unit employees and classifications fall within the usual definition of "blue collar workers" and therefore do not share a community of interests with the unrepresented em- ployees All things considered, I find the unit alleged in the Com- plaint, spelled out in the language set forth by the parties in their Stipulation for Certification Upon Consent Election, to be an appropriate unit for the purposes of collective bargain- ing within the meaning of Section 9(b) of the Act.' C. The Events Prior to the Wage and Benefits Increases of October 1969 1. History of representation The Union has represented the employees at ABS Clifton and the unit at Monroe Orange for approximately 18 years succeeding the United Electrical Workers (herein called UE). Prior to the UE the employees were represented from 1937 by a independent union. At one time the-Union represented employees employed by others than ABS Clifton and Monroe Orange, but at all times material herein its membership was limited to employees of those two employers. At the time of the events herein three of the Union's officers were employed by Monroe, Helen Kinney, Betty Kane, and Lawrence Ramella The last collective-bargaining agreement entered into by the parties had a term running from August 1965 until Sep- tember 30, 1969. The contract provided for two 7-cent in- 6 Cf NL R B v Porter County Farm Bureau Co-operative Assn, Inc, 314 F 2d 133, 136 (CA 7) ' Section 9 "(b) The Board shall decide in each case whether, in order to assure to employees the fullest freedom in exercising the rights guaranteed by this Act, the unit appropriate for the purposes of collective bargaining shall be the employer unit, craft unit, plant unit, or subdivision thereof Provided, That the Board shall not (1) decide that any unit is appropriate for such purposes if such unit included both professional employees and employees who are not professional employees unless a majority of such professional employees vote for inclusion in such unit; or (2) decide that any craft unit is inappropriate for such purposes on the ground that a different unit has been established by a prior Board determination, unless a majority of the employees in the proposed craft unit vote against separate representa- tion or (3) decide that any unit is appropriate for such purposes if it includes, together with other employees, any individual employed as a guard to en- force against employees and other persons rules to protect property of the employer or to protect the safety of persons on the employer's premises, but no labor organization shall be certified as the representative of employees in a bargaining unit of guards if such organization admits to membership, or is affiliated directly or indirectly with an organization which admits to membership, employees other than guards " MONROE creases during its 4-year term, the second having been paid to the employees in the spring of 1968. 2. Monroe's difficulties in recruiting and retaining employees Monroe had experienced difficulty in recruiting and retain- ing employees for jobs within the bargaining unit beginning in 1966.8 Hamilton Stewart, Monroe's manager of employee compensation, testified that Respondent's experience in re- cruiting employees "was extremely unfavorable from the time [he] started working for the Company " in November 1966. In 1968, Stewart stated, the situation worsened . Respondent found it very difficult to recruit qualified employees for open jobs and many times requisitions for jobs would remain unfilled for several months before a qualified applicant could be obtained. Most of these problems arose in filling jobs in the skilled maintenance and janitor classifications . Price testified about the trouble Monroe was experiencing in hiring plum- bers and electricians . In one instance a requisition for an electrician went unfilled for 9 months. After a survey of the labor market by Monroe 's personnel department a general requisition for plumbers was withdrawn as it was decided that the jobs could not be filled. Price testified that "For three, four or five years, now, we have been having an awful lot of trouble in placing our jani- tors, of course, the wage scale is so low that I did talk to Mr. Stewart about increasing the wage structure, where we could get a better type of janitor." Stewart replied that they would have to take the matter through channels. Price also spoke to Cummings who handles new placements for Respondent. Price asked Cummings if anything could be done about wages and Cummings also replied that he would have to follow through on channels. As to packer-shippers, Stewart testified that supervisors had registered complaints with him "ever since I have been with the Company about the difficulty in hiring people in that department." Stewart testified that in 1968 the situation with hiring jani- tors became so critical that at a meeting with the Union Monroe proposed hiring an outside contractor to perform the necessary janitorial services . The Union agreed on the condi- tion that Respondent's own janitors worked 5 hours of over- time each week and the outside janitorial contractor was brought in for a 6-month period. As well as contracting for janitorial services Monroe has used a subcontractor for air-conditioning and heating mainte- nance and was doing so when Stewart came to the Company in 1966. Stewart explained that among production and mainte- nance employees the generally accepted figure for employee turnover is 10 percent. However, during the first 6 months of 1969, the turnover rate at Monroe for janitors and packer- shippers was well over 50 percent. This represented addi- tional costs to the Company due to the expense of recruiting and training new employees , the cost of terminating those who left, and the reduced efficiency of new employees who did not do their jobs as well as experienced help. In addition unit employees were working a considerable amount of overtime . In 1968, 30 of the 60 people in the bargaining unit worked an average of 8 hours per week of overtime. During the first 6 months of 1969 unit personnel averaged 3.2 hours of overtime per week. Price testified that he passed on to Stewart employee com- plaints concerning their wage rates. Price told Stewart that Monroe was unable to retain janitors because the wage struc- ' Testimony of Chester Price , Respondent's manager of office facilities 523 ture was too low. Stewart testified that the Union was ap- proached about the matter . The Union had also been receiv- ing complaints from its members, particularly those in the skilled maintenance areas, about the wage levels. However, because any wage adjustments at Monroe would have had to be made at ABS Clifton as well, they were unable to reach agreement. At this same time ABS Clifton was unilaterally making wage adjustments for its job classifications which were differ- ent from those at the Monroe Orange facility. 3. The 1967 wage survey Prior to negotiations among the Union , ABS Clifton, and Monroe in 1967 which Respondent believed would lead to a new contract, Hamilton Stewart prepared a wage survey comparing rates paid by Monroe to employees in unit classifi- cations with those for comparable classifications paid by other employers in the northern New Jersey labor market. This survey is dated October 1967. The wage figures for competing employers were obtained from surveys conducted by the Bureau of Labor Statistics for Newark and Jersey City, the Employers Association of North Jersey, and an unnamed surveying service which makes as a condition for obtaining its statistics a pledge that its identity will remain confidential. In all classifications compared Stewart's survey disclosed that Respondent's maximum wage scale for unit employees was below the weighted mean and weighted maximum wages paid by the employers included in the three surveys utilized. The results of Stewart's survey, omitting the individual re- sults of the three surveys utilized , follow. Explanatory foot- notes have been added.[See Appendix A.] In further explanation examination of the second classifica- tion listed on the survey, plant attendant (janitor ), disclose that the collective-bargaining agreement provided for a three- step wage progression. Employees in this classification were hired by Monroe at $2.16 per hour, advanced to $2.21 after 3 months of employment, and 3 months later reached the top of the job scale $2.26. Of all the employees in the three surveys utilized by Stewart there were 3,916 employees in comparable classifications. Computed on the basis of a weighted average, Stewart determined that the mininum av- erage wage for these employees was $2.20 per hour, the mean wage was $2 .44, and the average maximum hourly rate of pay was $2.64. Thus the top rate paid by Monroe for janitors in 1967 was 18 cents below the mean wage for the 3,916 em- ployees covered by the survey and 38 cents per hour below the average maximum rate. 4. The 1967 negotiation In September 1967 negotiations took place among the Un- ion, Monroe, and ABS Clifton . The purpose and progress of these negotiations were succinctly set forth in notes taken by Hamilton Stewart and in the memorandum of understanding entered into by the parties. In pertinent part these documents are herein set forth. The first meeting took place on Septem- ber 12, 1967• Mr. St. John [represneting Monroe] opened the meeting by explaining to the union the purpose of the meeting. He stated that the companies expressed mutual interest with the union on the possibility of re-opening the exist- ing contract. He advised the union that the companies had discussed the possibility and effects of this before- hand, taking into consideration the problem of resolving those issues which are currently outstanding. It was felt by both managements that these issues might be tabled temporarily with the understanding that they would be re-opened for discussion after contract discussions. He further advised the union that the companies' intention 524 DECISIONS OF NATIONAL LABOR RELATIONS BOARD is to propose separate contracts for Monroe and A.B S. Mr. Powdermaker stated that A.B S. concurred in the position taken by Monroe with respect to the possibility of re-opening the contract. Mr. Blackman [representing the Union] stated that in re-opening the contract and in proposing two separate contracts, he felt a time table should be agreed upon and ground rules set. He asked if there were any suggestions on this issue. Mr. Kenny [representing the Union] suggested that the managements and the union collect their thoughts on their particular ideas and meet jointly for discussion at which time additions or deletions could be made as necessary. It was agreed that a joint meeting would be held on September 26 for this purpose. The two company managements then presented to the union their position with respect to two separate con- tracts and the underlying circumstances which pro- moted this decision set forth as follows by Mr. St. John: 1. Clifton is basically a manufacturing operation; Orange completely a service operation with differ- ent problems. This has become obvious during the general monthly meetings at which the discussion of problems has been those pertinent to one location or have remained unresolved due to unlike circum- stances. 2. Up to this time, Monroe has had a vested interest in the Clifton operation since it was producing primarily Monroe products. This production within the next few months will be totally transferred to Bristol. 3. The creation of a third location by the move of A.B.S. headquarters to Carlstadt has compounded the problems of proper and effective communica- tions between the three parties. 4. The terminology of the existing contract does not meet the specific needs of the two distinct opera- tions. Decisions are frequently made on the basis of past practices or extensive compromise, and prob- lems are resolved by means of a Memorandum of Agreement, as a supplement to the written contract. * * * * * A general discussion was held on the purpose of a con- tract and its usefulness, Mr. St. John emphasized the importance of recognizing the fact that the present con- tract is not applicable to Monroe which is no longer a production facility. Discussion on setting a time table and ground rules was held. Mr. Blackman stated that 60 days is the time al- lowed normally for contract negotiations. He suggested October 1 as the date to commence such discussions. The companies felt this was not sufficient time for prepa- ration and requested a date of November 1 After further discussion, it was agreed that the 60 day period would extend from October 15 through December 15, 1967. Mr. St John advised the union that in addition to the usual representatives, Monroe would have Mr. Lou Lib- hart, who is Corporate Labor Relations Consultant represent both A.B.S. and Monroe * Discussion of the Memorandum of Understanding was then resumed The union stated that a "no strike" provision could be part of the Memorandum of Understanding. However, they requested assurance from the companies that pend- ing issues would not be left unresolved. Mr. Kenny then stated the unresolved issues, namely, the Maintenance Job Classifications and Holiday Pay Calculation. He mentioned the third stage grievance with Monroe on Holiday Pay Calculation, stating that if not resolved, the union will be forced to take it into the fourth stage He further stated that it is the union's desire to have all outstanding issues resolved during the discussions, if possible. The companies agreed that this was their objective also. Mr. St. John stated that the managements could not foresee future problems and if they occur and can not be resolved during contract discussions, the companies would like assurance that they could be resolved at fu- ture meetings. Mr. Blackman stated that the union would go along with this as long as discussions were not dragged on indefi- nitely. Discussion was held with respect to resolving separate issues, i.e., Monroe's problems and A.B.S.' problems, during negotiations. Mr. Stewart stated that the proposed Memorandum of Understanding must clearly state that agreement must be reached mutually by all three parties involved. * * * The point was emphasized by the companies that al- though initial discussions can be with A.B.S.-Clifton, discussions with the companies must be held on a con- current basis and terminate within the agreed upon period. • A joint meeting was agreed upon to be held on Tuesday, September 26 at 10:00 A.M. at Orange. A confirming memo will be distributed prior to that meeting. Mr. St. John advised the union that Mr. Lou Libhart will be invited by the managements to the September 26 meeting at which time will be introduced to the union. On September 26, 1967, the parties entered into a memo- randum of understanding setting forth the ground rules for their negotiations, providing in pertinent part: 1. Discussions shall be initiated for the purpose of estab- lishing separate Collective Bargaining Agreements cov- ering present bargaining unit employees located at the Monroe International Offices at Orange, New Jersey, and the present bargaining unit employees located at the Automated Business Systems Plant located at Clifton, New Jersey, such separate agreements, when and if ac- cepted by both the Union and the managements con- cerned and duly accepted and ratified, to replace the existing agreement covering the employees at both loca- tions Such agreement will constitute recognition that each of such groups is an appropriate unit for collective bargaining purposes. Such discussions will be conducted in accordance with, and on the terms set forth in this Memorandum of Understanding. 2. Concurrent but independent discussions between the Union and the managements of Monroe International and Automated Business Systems shall commence on or after October 15, 1967 and shall continue until agree- ments have been reached or December 15, 1967, which- ever shall first occur. 3. The discussions to be conducted pursuant to this Memorandum of Understanding shall in no way affect the existing Collective Bargaining Agreement above re- ferred to, nor shall such discussions terminate, modify or MONROE alter the existing Collective Bargaining Agreement or any of its terms and conditions (as supplemented and amended to the date of this Memorandum of Under- standing) unless and until all parties have agreed to terms and conditions for new and separate Collective Bargaining Agreements, which new agreements have been duly executed and ratified by the parties. * * * * * 6. There shall be no limitations on the subjects discussed pursuant to this Memorandum of Understanding except those set forth and agreed to in advance, but the parties will submit to each other, in writing, the proposed addi- tions, changes and deletions to the present Collective Bargaining Agreement encompassing the areas each party desires to modify . Items which are not so pre- sented shall be deemed agreed to as presently set forth in the existing Collective Bargaining Agreement. The circumstances under which the negotiations were ter- minated without the parties having reached agreement are set out below in Stewart's notes of the last meeting on November 6, 1967: The meeting was opened by Mr . Libhart . He reviewed the original objectives and reasoning on the part of Monroe and ABS for initiating contract discussions years prior to its expiration date. He stated that during early discussions between the two companies, considera- tion was given to dealing with this matter through the National Labor Relations Board to determine the appro- priateness of the present bargaining unit . However, after further consideration, both companies preferred to reach mutual agreement directly with the union through con- tract discussions . The companies' primary intent was to split the contract , writing two separate contracts in lan- guage which would be more applicable to the particular locations and more beneficial to the employees. This, he stated, did not seem to be the pnmary issue from the union's point of view . It had become apparent that the union's pnmary objective was economic in nature, and the companies are not financially in the position to grant the economic concessions necessary to reach a mutually satisfactory agreement He advised the union that if they could not agree to continue discussions for the primary purpose of creating two separate contracts rather than on the basis of economics, the companies did not wish to continue discussions. Mr. Blackman responded by stating the union had re- ceived the impression that there was money available. The union had agreed to premature opening of the con- tract based on the companies ' needs with respect to the Clifton Operation. He felt that the union had met the company more than half-way. He referred to previous occasions when the union agreed to a premature opening of the contract that resulted in their settling for less than they normally would have at the normal contract expira- tion . Now, with two more years before the contract ex- pires, the union has agreed again to premature opening of the contract, after agreement from the Executive Board and approval of the membership . He pointed out that the employee reaction if discussions are terminated will be one of disappointment which could be damaging to company-employee relationships . His feeling is that the company was reneging on a commitment. He re- minded the company that if the union had wanted to, they could have forced the strike issue as a tool for collective bargainings. 525 Mr. Libhart stated that he had personally attended the past few meetings and he felt it was impossible to pin- point exactly when the misunderstanding developed or who was to blame. Mr. St. John stated that as far as Monroe was concerned, neither the local nor the International had misrepre- sented their positions at any time during this period. Mr. Blackman then stated that the original intent of the Memorandum of Understanding could no longer be car- reid out and it was better to end discussions at this point. The local would advise their membership and, hopefully, those issues which are presently outstanding would be resolved as quickly as possible. Mr. Libhart advised the union that it was the mutual feeling of the companies that joint meetings between Monroe, ABS and the Local would no longer be advisa- ble. He suggested that Monroe and ABS have separate monthly meetings with the union, as appropriate. Mr. Kenny stated that the union was in agreement with this point, and made references to the current outstand- ing Monroe issues, namely the holiday pay calculation which is in the third step of the grievance procedure, and the skilled maintenance classifications. Mr. St. John reminded the union that , as agreed, these issues if not resolved during contract discussions would be reinstated for discussion and agreement at the end of the contract discussions . However, agreements reached between Monroe and the Local would not necessarily represent agreement between ABS and the Local, and vice versa. Mr. Libhart emphasized again that the reason for dis- continuing discussions on the part of the companies was because there was no mutually advantageous basis for it. Mr. Kenny agreed and felt it was best to end the discus- sions at this time. He referred to the Memorandum of Understanding in which this point was clearly made. He further stated that it was his sincere hope that everyone understood his conduct was in the best interest of the employees. Anthony Corrao, an ABS Clifton employee and president of the Union, testified that prior to the negotiations the Union had brought to management's attention the fact that in- creases in the cost of living had outrun the wage increases provided in the collective -bargaining agreement. Corrao tes- tified that Libhart was chief negotiator for both Monroe and ABS. Further, Corrao stated that company representatives did not offer to raise the wage rates to more competitive levels nor did they offer certain fringe benefits which were granted in October 1969 after the collective-bargaining agreement expired. In all respects Corrao's testimony was corroborated by Stewart's notes of the 1967 meetings. Stewart attributed the breakdown of the 1967 negotiations to ABS Clifton's unwillingness to grant economic improve- ments to obtain separate contracts . Stewart stated that ABS misled "the Union perhaps in the preliminary talks on the basis that they would also be willing to grant economic im- provements." Monroe's position , Stewart claimed, was that it was willing to give wage increases and benefit improvements to the Union to obtain a separation of the unit and its own contract. Stewart explained that the minutes of the meetings did not reflect Monroe's willingness to grant these improve- ments "because those minutes were of the meeting to develop the memorandum of understanding to enter into negotia- tions." Because Monroe and ABS Clifton are separate com- panies, with separate managements , although both are part of Litton Industries, Monroe had no control over ABS in the 526 DECISIONS OF NATIONAL LABOR RELATIONS BOARD negotiations and it was ABS' position, over which Monroe had no say, which led to the unsatisfactory results Stewart's own notes of the meetings raise doubts as to the accuracy of his testimony. Whatever Monroe's and ABS Clif- ton's corporate relationship to each other may be, Stewart's notes indicate they adopted a joint stance in the negotiations, to the point of having Libhart represent them both 9 Stewart's claim that the minutes could not reflect Monroe's willingness to grant economic improvements because "the meeting [was] to develop the memorandum of understanding" is rebuted on two counts by the minutes of the meeting of November 6, 1967. First, the memorandum of understanding had been "developed" and signed late in September and this meeting was not for that purpose at all. Second, at the meeting of November 6, Libhart, speaking for both Monroe and ABS Clifton, stated in Stewart's words in the minutes, " . . the companies are not financially in the position to grant the economic concessions necessary to reach a mutually satisfac- tory agreement " This, coming at a point in time after Monroe was claimed by Stewart to have taken the "position that it was willing to give wage increases and benefit improve- ments to the Union" hardly supports Stewart's claim that Monroe was willing in 1967 to raise the wage and benefit level of the unit employees nor does it support Stewart's claim that it was ABS Clifton alone which would not grant economic improvements in the 1967 negotiations 5. The January-February 1969 negotiations During 1968 ABS Clifton made unilateral wage adjust- ments in certain job classifications found at Clifton but not at Monroe ABS did not make any adjustments in job classifi- cations common to ABS and Monroe In January 1969 Monroe approached the Union with the idea of making adjustments at Monroe comparable to those made at ABS Clifton. Stewart testified that these wage adjust- ments were to be made in the classifications common to Monroe and ABS but would be effective only at Monroe Corrao, the Union's president, testified that the negotia- tions came about at Monroe's renewed request to separate the unit employees at Monroe from those at ABS Clifton. The Union proposed in these meetings that there be a guarantee of transfer rights to the employees at Monroe and ABS Clif- ton to permit them to transfer from one facility to the other on the basis of seniority in the event of a layoff The Union also asked for immediate negotiations for a new collective agreement following execution of an agreement separating the unit As to wages, Corrao testified, the Union told Monroe that for some of the skilled maintenance jobs an increase of $1 an hour was needed to bring the wage level to the average paid for the same jobs in the area " ° This position was based on a survey the Union had conducted. When the Respondent re- plied that it was in no position at that time to offer any increases of that nature the Union pointed out that Monroe was using an outside contractor to do the janitorial work and with a raise in pay the Respondent could hire its own people and do away with the subcontracting. After the Union took the position that without a wage increase it would not agree to splitting the unit the Company proposed a 3-cent-per-hour increase across the board " After further bargaining the parties agreed on a 10-cent-per-hour Minutes of meeting of September 12, 1967 ° Stewart testified that he could not recall the Union asking for a $1 increase, stating, "I don't remember it's too long ago " " As to Corrao's testimony that Monroe's initial wage offer was 3 cents per hour, Stewart commented, "I don't recall that I feel that was not correct " increase and the Union and Monroe worked out the list of classifications to which the increase would be given with some individual adjustments coming to 21 cents per hour but with most as little as 9 cents, this figure being what was given the janitors. The average increase was the agreed-upon amount of 10 cents. Following agreement on the wage increase, on February 18, 1969, the parties entered into a memorandum of agreement separating the unit. This memorandum, to which ABS Clifton was not a party, was executed by the Union and Monroe was provided, inter alia: 1. Upon commencement of collective bargaining negotiations to amend the present Agreement between Monroe and the Union which was effective August 25, 1965 and which expires September 30, 1969, employees represented by the Union at Monroe's Orange, N. J. plant will be recognized as an appropriate unit for bar- gaining and will be separate from the appropriate unit for bargaining for employees who are represented by the Union at the Automated Business Systems plant in Clif- ton, N J 2 Negotiations to amend the aforesaid agreement which expires September 30, 1969 between Monroe and the Union will be separate and independent from negotia- tions between the Union and A.B.S., Clifton, N. J. 3. If an impasse is reached in negotiations between Monroe and the Union, the impasse will in no way inter- fere with any negotiations being carried on by the Union with A B S., Clifton, N.J. And an impasse in negotia- tions between A.B.S., Clifton, N. J. and the Union will in no way interfere with negotiations being carried on between Monroe and the Union 4. Monroe employees participating in negotiations be- tween Monroe and the Union will be compensated by Monroe for such time lost from work as provided in Article III of the Agreement Monroe will also compen- sate the local Union President for such time lost from work as provided in Article III of the Agreement. All meetings for negotiations will be considered as "in Plant" as referred to in Article III (3). 5 Any seniority rights of both A.B.S. Clifton, N. J employees and Monroe employees provided by the agreement effective August 25, 1965 which provides transfer rights between the Monroe-Orange plant and the A.B.S.-Clifton plant in the case of layoff for lack of work, will be preserved and recognized up to and includ- ing September 30, 1970 This provision shall be consid- ered a part of any collective bargaining Agreement con- cluded between Monroe and the Union. Stewart explained that the 10-cent-per-hour increase was approximately the amount of the adjustments ABS had made in 1968 for the job classifications not found at Monroe. After the first meeting in 1969 at which it was agreed to separate the units, ABS did not participate in the sessions between Monroe and the Union Further, Stewart testified, there was no agreement between Monroe and ABS to limit the amount of the increase granted by Monroe. Stewart testified that in these negotiations Monroe "raised the wages as much as we felt we could without presenting a problem both to the union and ABS, because if we had raised the wages to what you have termed a competitive level the union would have objected because the same classification in Clifton would not get this type of a raise." At another point in Stewart's testimony the following exchange occurred. Question (to Stewart): And the whole philosophy of your approach here was to separate the Orange person- nel from the Clifton personnel for bargaining purposes? MONROE 527 Answer (by Stewart). That's correct Question. So in looking at the wage structure of the Orange people you didn't want to be tied in with the Clifton people? Answer- That is correct We weren't, because after we made the adjustments, our people in the same classifica- tions that exist in Clifton were making a different rate of pay than the Clifton people. At yet another point Stewart stated that Monroe was tied to ABS until execution of the memorandum of understand- ing. Finally, Stewart testified that Monroe gave raises in Janu- ary less than an amount necessary to bring wages to a com- petitive level because "[t]he primary reason was the fact that the adjustments that were granted were simply for the pur- pose of getting a separation of the bargaining unit into two contracts "We also recognized the fact that in a very short period of time we would be faced with the expiration of a four year old contract and we would be faced with demands on the part of the union to grant substantial wage increases in order to get a new contract "We weren't granting the adjustments in February to bring the wages to a competitive level. We were granting them to get the union to agree to separate the two units." 6. The 1969 wage survey As it had done in 1967, in April 1969 Monroe prepared a wage survey comparing the wages paid to unit personnel with those paid for comparable classifications by other employers in the northern New Jersey labor market. As in 1967 the wage figures for competing employers were obtained from surveys conducted by the Bureau of Labor Statistics for Newark and Jersey City, the Employers Association of North Jersey, and the same unnamed private surveying service. In this survey Stewart incorporated suggested pay ranges for each unit job classification, set forth the then effective rate for the job at Monroe, and computed the percentage that the current rate fell below the suggested job rate. Thus, the then current job rate for janitors at Monroe" was $96 36 The suggested starting rate for janitors was set at $93, the job rate at $110, and for the janitor classification Stewart suggested a merit rate of $126.50. On the basis of the then current janitorial job rate, Stewart determined that Monroe was 14.2 percent below what he deemed to be the proper job rate for that classification The results of Stewart's 1969 survey, omit- ting the results of the three surveys utilized, follow: " Incorporating the 9-cent -per-hour increase of February 1969 R E C O M M E N D E D i IONROE % T ANROE `SONROE AVG. RATE QUALIFY- JOB MERIT EMPLOY HOURLY BELOW JOB TITLE ING RATE RATE RATE EES RATE JOB RATE I IAINTENANCE CARPENTER 133.00 162.00 191.00 3 130.93 23.7 MAINTENANCE PAINTER 121.00 147.00 171.50 4 127.00 15.7 MAINTENANCE PLUMBER 127.00 154.00 181.00 1 129.60 18.8 MAINTENANCE ELECTRICIAN 133.00 162.00 191.00 3 135.73 19.4 JANITOR 93.00 110.00 126.50 18 96.36 14.2 MATRON 81.00 95.00 105.00 1 136.40 2.4 I MAINTENANCE .MACHINIST 1'27.00 154.00 181.00 1 136.41 12.9 MAINTENANCE LABORER 101.00 121.00 139.50 4 103.2 17.2 PACKER SHIPPER 111.00 133.00 155.50 8 103.4 22.2 FIELD SERVICE PARTS CLERI: 35.50 100.00 114.50 9 96.8 8.2 DRIVER 101.00 121.00 130.50 2 110.2 .01 FIELD SERVICE STOCK MAN 101.00 121.00 130.50 0 103.2 17.8 528 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Stewart testified that the survey material and information from other employers in the area indicated that unit em- ployees were well below competitive levels in respect to benefits. Unit employees enjoyed only a basic health plan and a very limited retirement plan Monroe's unit employees had no sick leave and their vacation plan as well as the number of holidays they received was below area standards. The in- formation Monroe received disclosed that very few compa- nies of any size in the area did not have major medical or long-term disability plans 7. Midterm modification of the contract The record contains evidence establishing a number of instances of modifications of the terms of the collective-bar- gaining agreement arranged by agreement of the parties As earlier noted the Union agreed to Monroe going outside the bargaining unit to retain the services of a subcontractor to perform janitorial services On March 3, 1968, the Union and Monroe executed a memorandum of understanding set- ting forth their agreement on procedures for subcontracting That memorandum provided It is mutually agreed between Monroe International (the company) located at Orange, New Jersey and Local #432, I U E. (the union) that the company will notify the union prior to any contracts being placed for work in the Orange facility. The company agrees that the present union employees will not be affected by the sub-contracting of work for the Orange facility The company further agrees to contract work only with contractors who utilize union employees to perform the work. The company and the union mutually agree that any differences arising from this agreement will be resolved under Article XIV and Article XVIII of the current collective bargaining agreement. ABS Clifton was not a party to this memorandum of un- derstanding although it constituted a modification of the col- lective-bargaining agreement to which ABS was a party. Hamilton Stewart testified that Monroe had to approach the Union when it wished to grant to the unit employees an additional holiday which was being given to the approxi- mately 600 unrepresented employees. This took place in 1969 when all employees at the Orange facility were given the day off on the anniversary of Martin Luther King's assassination. The same procedure was followed when a day off was given to the employees in return for 100-percent participation in a bond drive Stewart characterized this arrangement for the day off as being in effect a supplemental agreement to the collective-bargaining agreement ABS Clifton which was party to the same collective-bargaining agreement did not give a day off in connection with the bond campaign Anthony Corrao, the Union's president, testified to a num- ber of occasions when the Union and ABS Clifton negotiated the upgrading of jobs at Clifton covered by the contract to provide higher wages for the affected employees One such upgrading involved a job in the maintenance classification, a Although the job was upgraded with a raise in pay at Clifton, the same job at Monroe was not affected. 8 The 1969 contract negotiations Following execution of the memorandum of understanding in February 1969, providing for separation of the Orange and Clifton units, the Union asked for contract negotiations as soon as possible. Hamilton Stewart testified that Respondent replied it would open negotiations at a date earlier than re- quired by the existing collective-bargaining agreement but could not start the discussions immediately Stewart ex- plained that there were only 60 employees in the unit at Orange whereas Monroe employed some 3,000 persons across the country and therefore Monroe had to establish its own priorities for dealing with labor matters at its various facilities The first negotiating session was held in June 1969 This was earlier than the date provided in the collective agreement. Corrao testified that there were three sessions in all with the Union's and Monroe's contract proposals presented and discussed at the second meeting. This session lasted approxi- mately 2 hours. The third and final session, on August 5, lasted less than an hour and was devoted to a discussion of the pending decertification petition and unfair labor practice charges and ended with an agreement to break off negotia- tions until the matters pending before the Board had been disposed of The only mention of economic matters at these three nego- tiating meetings was a proposal by Monroe to eliminate from the contract an incentive wage system contained in the old collective agreement St John, Respondent's spokesman, ex- plained that there was no production being carried on at Orange, Respondent had no plans to resume production at that facility, and therefore an incentive wage provision was no longer appropriate. As well, Corrao testified, there was a reference by Respondent to a desire on its part to meet com- petitive wage levels However, St. John stated that Monroe did not have a wage survey at that time and was not prepared to discuss wages." Corrao testified that there was no discus- sion during the three meetings of possible application to the Monroe employees of the general benefits which Litton In- dustries gave to its employees Stewart first testified that there were nine meetings between the Union and Monroe during June, July, and August Later Stewart stated that he could not recall how many meetings were held Several of these meetings were devoted to develop- ment of ground rules for conduct of the negotiations after which the parties exchanged their demands sometime in July Neither set of contract demands contained proposals with respect to economic improvements Stewart testified that he "would say exactly" that management knew in June what its final contract package proposal would be having formulated its position prior to the first negotiating session with the Union. With minor modifications the improvements unilater- ally granted by Monroe in October 1969 represented the final offer planned by Monroe for presentation to the Union in the contract negotiations However, Stewart testified, the classification common to ABS Clifton and Monroe Orange. " The 1969 wage survey is dated April 1969 MONROE negotiations never reached the stage where the Respondent's final position could be stated to the Union. 9. The decertification petition and unfair labor practice charges Set forth below in chronological order is the tortuous path by which the decertification petition filed on July 11, 1969, finally came to an election on November 13 of that year: July 11, 1969-Thomas Doyle, Sr., filed his petition for decertification election in the unit set out in the contract. (Case 22-RD-268.) Monroe was advised of the filing by the Regional Office that same day. July 17, 1969-Notice of Representation Hearing was mailed by the Regional Office setting the hearing for July 28. July 25, 1969-Regional Office advised Respondent that Doyle had filed a charge of unfair labor practice against it (Case 22-CA-3363) alleging that Monroe had unlaw- fully dominated and interfered with the operation and administration of the Union in violation of Section 8(a)(1) and (2) of the Act. July 25, 1969-The Regional Office postponed indefi- nitely the hearing on the decertification petition August 4, 1969-The Regional Office advised the parties that Doyle had filed a charge of unfair labor practice against the Union (Case 22-CB-1536) alleging that the Union had unlawfully requested and Respondent had unlawfully afforded recognition to the Union despite the existence of a question concerning representation August 29, 1969-The Regional Office advised Doyle that it was refusing to issue complaint based on either of his charges. September 5, 1969-The Regional Office issued an order setting the representation hearing on the decertification petition for September 11. September 8, 1969-Norman Bruck, an attorney repre- senting Doyle, requested an extension of time from the Office of Appeals of the General Counsel of the Board for the purpose of appealing from the Regional Direc- tor's dismissal of Doyle's charges against Respondent and the Union. September 10, 1969-The Regional Office postponed the date for the representation hearing to September 23, 1969. Postponement was granted at the request of coun- sel for the Petitioner. Counsel for the Respondent did not object to the postponement. Counsel for the Union did object September 10, 1969-Bruck wrote to the Office of Ap- peals confirming the fact that he had been granted a 10-day extension for the purpose of filing his appeal. September 11, 1969-The Office of Appeals by telegram to Bruck confirmed his extension of time. September 17, 1969-Bruck wrote to the Regional Di- rector requesting that the representation hearing be post- poned from September 23. September 18, 1969-The Regional Director denied Bruck's request for postponement of the representation hearing September 19, 1969-Bruck filed with the Office of Ap- peals in Washington, D C, his appeal from the Regional Director's dismissal of Doyle's charges. September 23, 1969-Representation hearing held in Case 22-RD-268. At the hearing counsel for the Peti- tioner asked that the hearing be held open pending deter- mination of his appeal from the Regional Director's dis- missal of Doyle's charges. This motion was denied Thereafter counsel for Monroe joined in Petitioner's mo- tion to hold in abeyance the Decision and Direction of 529 Election until Bruck's appeal had been acted upon. This motion was referred to the Regional Director for ruling. September 24, 1969-Counsel for the Union filed with the Office of Appeals an opposition to Bruck's appeal. September 25, 1969-The Regional Office advised the parties that Doyle had filed a charge of unfair labor practice against the Union (Case 22-CB-1567) alleging that the Union had attempted to restrain and coerce Doyle by authorizing and threatening to conduct mass picketing at his home. September 30, 1969-Bruck petitioned the Regional Office to reopen the hearing in Case 22-RD-268 In his brief supporting this petition Bruck stated that "The record does not reflect the fact that Petitioner has reason to believe that approximately 20% of the bargaining unit is composed of craftsmen with no community of interest with the balance of the unit. In addition, Petitioner him- self, is a chauffeur to executive personnel and feels that he has no community of interest with the rest of the bargaining unit and therefore should be excluded there- from." September 30, 1969-The collective-bargaining agree- ment between Monroe and the Union expired. October 10, 1969-The Regional Director issued an Or- der Remanding Proceeding For Further Hearing in Case 22-RD-268 and set October 17 as the date for the re- opened hearing. October 10, 1969-The Regional Director advised Bruck that he was refusing to issue complaint based upon Doyle's second charge against the Union (Case 22-CB-1567) October 10, 1969-The Office of Appeals advised Bruck that his appeal from the dismissal of Doyle's charge against Monroe and his first charge against the Union had been denied. October 14, 1969-The Regional Director postponed the reopened hearing in Case 22-RD-268 until October 24 at the request of Monroe's counsel. Counsel for Doyle, the Petitioner, did not object to the postponement Counsel for the Union objected. October 22, 1969-All parties entered into a Stipulation for Certification Upon Consent Election providing for an election to be held in the unit hereinabove found to be an appropriate one for the purposes of collective bar- gaining. Novermber 13, 1969-The election was held resulting in 22 votes being cast for retention of the Union as bargain- ing representative and 36 votes against the Union November 20, 1969-The Union filed objections to con- duct affecting the results of the election. January 5, 1970-The Acting Regional Director issued a Report On Objections finding that "the objections raised substantial and material issues with respect to conduct affecting the results of the election" and recom- mending that the election be set aside and a new election be held January 22, 1970-Monroe filed with the Board in Washington Exceptions To Report On Objections March 11, 1970-The Board issued its Order Directing Hearing on the Union's objections and directing that said hearing be consolidated with the hearing in Case 22-CA-4001. 530 DECISIONS OF NATIONAL LABOR RELATIONS BOARD D The Employee Interviews of October 13, 1969, and the Grant of Benefits Beginning at 8 a.m. on Monday, October 13, 1969, each employee in the unit was called to the personnel conference room at the Orange facility in order of seniority to a meeting with Hamilton Stewart, Monroe's manager of employee com- pensation, the employee's immediate supervisor, and that supervisor's supervisor The same format was followed in each such interview with Stewart following a written outline he had prepared These interviews were conducted pursuant to a manage- ment decision made the previous week at a meeting attended by Stewart and St. John among others, at which it was de- cided to go ahead and grant wage increases and install certain benefits because Monroe could not see any prospect of im- mediate resolution of the various matters pending before the Board, including the decertification petition and a possible reopening of the hearing therein as well as the unfair labor practice charges The Union was not given notification of Monroe's intent to hold these interviews and to grant eco- nomic improvements to the unit employees. The three union officers employed by Monroe were among the first employees interviewed. Therefore, Stewart testified, Respondent "didn't feel it necessary to notify the Union officially" of the action it was taking At each interview the first thing told the employee was that on advice of legal counsel Respondent was discontinuing withholding union dues from the pay of the employees. The employees were then told that because of the uncer- tainty of the legal situation facing Respondent Monroe planned to go ahead and make certain changes in the em- ployees' conditions of employment The changes would be explained and any questions the employees might have would be answered The first such change was a switch in the time of wage payment from a weekly to a biweekly period. This change was to take place 1 month from the date of the employee inter- view Next, the employees were told that they would no longer use a timeclock to record their time and instead would henceforth fill out a weekly timesheet like all other Monroe employees and would be on their honor to accurately report when they arrived and when they left The employees were then told that because of economic conditions Respondent did not think it fair that they be penal- ized because of the current legal entanglements and that Monroe was going to grant them an 8-percent wage increase Each employee was told what the increase would be for his individual classification and the effective date of the raise. Then the employees were told what the Company's policy would be for the vacation year beginning June 1, 1970, and how each would be treated in regard to his vacation eligibil- ity. Stewart then told the employees "that we are going to offer them on a contributory basis certain benefits they had not received under the collective bargaining agreement." Each employee was given a set of booklets explaining each of the benefit programs and a set of enrollment cards and was told to read the booklets and that there would be a meeting later in the week at which Respondent's benefits manager would answer any questions regarding the benefits programs. The employees were told that the benefit plans were contributory and that it was optional on the part of each employee as to whether he enrolled in any or all of the plans '° Each of the booklets explaining the benefit plans states that the program is available to eligible employees of Litton Industries Under the "General Information" section of the booklet explaining the Additional Basic Life Insurance program appears the following. WHO MAY ENROLL All full-time employees who are not covered under a Collective Bargaining Agreement, unless such agree- ment specifically provides for participation in the plan, are eligible to enroll Each of the booklets distributed to the employees during these interviews contained a similar limitation. Stewart testified that "[w]e explained the company sick leave plan that is available to all employees at Orange except those who were covered under the collective bargaining agreement, and we advised each employee that they would now be covered under the sick leave plan." The details of the sick leave plan under which an employee may accrue 10 days of paid sick leave per year up to a maximum of 65 days were explained and each employee was told how much accrued sick leave he was then entitled to based upon his length of service. Stewart testified that "the explanation was given the em- ployees that in order to maintain competitive rates of pay and competitive benefit levels this was the purpose of granting this increase and these benefits." Stewart further explained "that the employees of that particular group of employees had become accustomed to receiving an increase and benefit im- provements at that period of time, at the expiration of the contract " Finally the employees were told that Monroe would con- sider each employee's job performance and that his future salary would be determined by the merit system. Stewart explained that Monroe's philosophy of determining an em- ployee's salary was based on paying a fair and competitive rate of pay and was based on the merit system; i.e., on how each employee performed on the job to which he was as- signed. Stewart testified that quite a few of the employees asked questions. Two or three asked what would happen if an elec- tion was held and the Union won In answer Stewart stated that if the Union won a "fair election" Monroe would negoti- ate in good faith from the position at the start of the negotia- tions Stewart denied having said that the benefits then being granted would be taken away if the Union won an election Accepted Rejected Additional life insurance 27 34 Supplemental life insurance 18 43 Major medical insurance 60 1 Salary continua- tion plan 49 12 Improved retire- ment benefits 51 10 '° As to each of the benefit plans the unit employees exercise their right to enroll in the following numbers MONROE Stewart testified that at the time the interviews were started Bruck's appeal from the dismissal of Doyle's first two charges was pending in the Office of Appeals in Washington and the Regional Office had not disposed of Doyle's second charge against the Union. The notice from the Regional Office stat- ing that it was refusing to issue complaint based on Doyle's second charge against the Union was received by Monroe at or about 11 a.m. on October 13 after about 10 interviews had been conducted. The letter from the Office of Appeals advis- ing that Bruck's appeal from the dismissal of the first two charges had been denied was received by Monroe at or about the same time on October 14, after some 35 to 40 of the total of 60 interviews had been held. E. McMahon's Letter to the Employees On October 31, 1969, as part of Monroe's campaign to defeat the Union in the upcoming decertification election, Respondent's president, Donald A. McMahon, sent a letter to all unit employees reading: I appreciated the opportunity to meet and talk with you on October 30th. It is my sincere hope that I was able to communicate to you your company's feeling about each employee, and also how I personally feel about every member of the Monroe team. We are dedicated to the principle of the dignity of each individual, and I feel very strongly that each employee should share in our programs of increased wages, better fringe benefits and pension plans. This will be possible if we have no union. Seniority and job security are two items that we believe in and practice, union or no union. Because we are not a manufacturing company in Orange, we do not have production increases or decreases that result in layoffs. We value you as an employee, and I know that you will vote the way you feel is best. Hamilton Stewart testified that McMahon's letter of Octo- ber 31 was written in response to union leaflets of October 27 and 30. The full text of those documents is set forth below. October 27, 1969 Dear Member: On November 13, 1969, the National Labor Relations Board will conduct an election in the cafeteria of our plant. For the first time in 30 years, the security and progress we have enjoyed have been put in jeopardy by a few individuals who are doing the company's bidding. As you all know by now, the N L.R.B. has dismissed all of the charges filed by Doyle. It was easy to see the close relations that existed dur- ing the N.L.R.B. hearings, between Doyle and the com- pany. After months of unnecessary delays by Doyle and Monroe, the election was finally set for November 13th. LOCAL 432 DELIVERS The wage increase put into effect by the company is far below what IUE Local 432 has won in the Clifton plant. For example, wages were increased by the union at Clifton by 11% in the first year and an additional 8.5% in the second year. These raises-guaranteed by contract-amount to 47 cents per hour in exactly 18 months. Certain jobs like the maintenance men will go up 53 cents an hour. In addition, the union has been able to put all jobs on automatic progression including the skilled tool makers. At Monroe, on the other hand, the company has put all of the people on merit instead of automatic progres- sion, so instead of going forward at this plant as we are 531 doing in Clifton, the company feels free to turn back the clock. Another step backwards, the company has now changed weekly payroll to a bi-weekly basis, a definite saving to Monroe, but a great hardship to the workers. OTHER BENEFITS WON BY LOCAL 432 In addition to the wage increases and automatic progression mentioned above, Local 432 at the Clifton plant negotiated a fifth week vacation for all members over 24 years and 10 months of service. The Monroe Company has made it clear that there will be no im- provements in vacation. This would deprive 30 Monroe employees of a fifth week vacation, except that after IUE wins the election, we will move to get this important vacation improve- ment as well as four weeks for 19 years and 10 months service, into the contract-the same as in Clifton. The company has also made it clear that there will be no improvements in holidays. Contrast this with the additional holiday, the day after Thanksgiving, which Local 432 members will enjoy this November 28 at Clif- ton Very important also, Local 432 was able to negotiate a new severance clause granting severance pay up to five weeks, a benefit which the Monroe workers will not enjoy until Local 432 IUE wins the election. These facts prove that Monroe workers need the IUE Local 432 more than ever before. They need union pro- tection to safeguard their seniority and to make sure that they're not laid off or fired without union representation. The company will undoubtedly make all sorts of promises to the Monroe workers in order to try and defeat the union, but if there ever was a plant that needed Local 432 IUE to win the benefits we have proved we can win and to protect your service and your jobs, this is the plant where the need is the greatest. Fraternally, Local 432 IUE-AFL-CIO [Signatures omitted.] REMEMBER: Ony when wages and benefits are spelled out in a signed union contract are they guaranteed. 30 October 1969 Dear Member: On Thursday, November 13, you will be voting in an election that will be one of the most important votes you will ever cast. We are very concerned with our years of service (many of us with much greater than 20 yrs) to this company. We raise the following questions: What will happen without a Union Contract if the company just decides to lay-off the workers without re- gard to seniority? (You know what happened to many of the senior workers in the Salaried Group without a Un- ion Contract in the past). What will happen if the company decides through some phony efficiency program to speed up the work and get nd of what they would term the dead wood? What will happen to the workers if some disagreement takes place on their job? What will happen to the workers if the company just decides to lower the pay rates or reduce the benefits or for that matter, change any conditions that affect us in any way? The answers to the above questions are easy-without a Union Contract, the company can do as it pleases. 532 DECISIONS OF NATIONAL LABOR RELATIONS BOARD This is why we believe it is important to us to work under a Union Contract to provide the protection against these things happening. Yes, under a Union Contract, the Wages and Benefits will be clearly spelled out and above all, our seniority will be protected and this, we believe, is one of the most important reasons for the Union. Isn't it strange, now after all these years of fighting and struggling so hard with this company, to gain what we have, that now all of a sudden, the company is treat- ing us kindly and making Pie in the Sky promises to us. It is no secret to us that these tactics are being used to attempt to have us lulled to sleep and give up our most treasured possession-A Union Contract that protects our livelihood. Vote for Local 432 IUE-AFL-CIO and continue to work with dignity, protection, and above all security!!! Fraternally, Local 432 IUE-AFL-CIO [Signatures omitted ] REMEMBER: Only when wages and benefits are spelled out in a signed union contract are they guaran- teed!! F. Conclusions and Findings In Tennessee Handbags, Inc., 179 NLRB No. 161, the Board stated: It is well established that Section 8(a)(1) prohibits con- duct by an employer "immediately favorable to em- ployees undertaken with the express purpose of imping- ing upon their freedom of choice for or against unionization and is reasonably calculated to have that effect."5 There can be no doubt that the wage increase and certain of the benefits granted by Respondent during the October 1969 interviews with the employees were "immediately favor- able" to them. The 8-percent wage increase was retroactive to October 6, 1969, and as noted in the stipulation of the parties set forth in this Decision, ranged from 19 cents to 29-% cents per hour. The sick leave plan with maximum accrual of 65 days of sick leave was put into effect with credit given for past service. Additionally, certain of the contribu- tory plans had retroactive features. Thus, the major medical plan provided for payment of expenses incurred after enroll- ment due to injury or illness suffered prior to such enrollment but after January 1, 1969. Under this provision employee Ramella was able to collect some $750 from the insurance carrier for medical bills incurred by his wife during the year 1969 for a condition which preexisted the date of his enroll- ment in the major medical plan. However, "[u]nder the circumstances of this case," I am constrained to find "that General Counsel has [not] estab- lished, by a preponderance of the evidence, that Respondent granted and announced the benefits for the purpose of caus- ing the employeees to reject the Union." Tennessee Hand- bags, Inc., supra. As in Tennessee Handbags the Respondent, although faced with the possibility of an election, did not know when, if ever, it would be held. Although Monroe did not protest Doyle's tactics which frustrated expeditious pro- cessing of the petition and was itself responsible for some of the delays, there is no allegation or evidence linking Respond- ent to the decertification petition. The representation hearing had been held but the Petitioner's motion to reopen the hear- ing had been granted by the Regional Director and the resumed hearing was scheduled for October 17 Moreover, the position stated by the Petitioner, questioning his own inclusion in the unit, was such as to raise reasonable doubts that an elections would be conducted based upon his petition Further, as in Tennessee Handbags, there is evidence of only one possible unfair labor practice committed by Re- spondent during the period in question, that being the state- ment in McMahon's letter of October 31: We are dedicated to the principle of the dignity of each individual, and I feel very strongly that each employee should share in our programs of increased wages, better fringe benefits and pension plans. This will be possible if we have no union. In the context of the bitterly waged election campaign I find that this statement did not exceed the permissible bounds of campaign rhetoric and shall recommend dismissal of this allegation of the complaint Moreover, this statement must be viewed in light of Stewart's unrebutted testimony that, when he was asked during the course of the October interviews what effect a union election victory would have, he replied that in such an event Monroe would negotiate from the posi- tion at the start of such negotiations. Without restating the evidence hereinabove set forth detail- ing the economic justification for large wage increases to and improved benefit programs for the unit employees to enable Respondent to recruit and retain employees in the job classifi- cations included in the unit, I conclude that such justification did in fact exist Monroe's failure to grant such increases during the 1967 and January-February 1969 negotiations "is not of itself sufficient to overcome a demonstrated substantial business purpose for a particular act " NL.R.B. v. Gotham Industries, Inc., 406 F 2d 1306, 1313 (C A. 1). While his own notes indicate that Stewart was not entirely candid in his claim that Monroe was prepared to grant increases during the 1967 negotiations there is no evidence to rebut his claim that ABS Clifton retained veto power over any desire that Re- spondent might have had to grant increases at that time. As to Monroe's failure to give more than a 10-cent increase as the price of obtaining severance of the units in 1969, I find convincing Stewart's explanation that Respondent held back at that time from raising wages by an amount its own wage surveys indicated was necessary to bring its employees' com- pensation up to competitive levels because Monroe was look- ing ahead to the negotiations which would be held in a few months to obtain a new collective-bargaining agreement and Monroe's expectation that during those negotiations the Un- ion would demand and expect large increases. Accordingly, I shall recommend dismissal of the complaint. IV REPORT ON OBJECTIONS As previously noted, the Board, having found that certain of the Union's objections to the election raised substantially the same issues as were raised by the allegations of the Com- plaint herein consolidated the representation and complaint proceedings for the purpose of hearing, findings of fact, and recommendations to the Board as to the disposition of said objections Having found that the Respondent in the period prior to the election did not interfere with, restrain, or coerce its employees in violation of Section 8(a)(1) of the Act, I recommend that the Board dismiss the Union's objections to the election and that it certify the results thereof. RECOMMENDED ORDER NL R B. v Exchange Parts Co, 375 U s 405, 409 It is recommended that the Complaint herein be dismissed. APPENDIX A PROPOSED PRESENT RATE RANGE a/ SURVEYS-WEIGHTED AVERAGES NO. OF JOB TITLE CLASS CLASS I CLASS III CLASS I EMP . c/ 11IN . MEAN MAX. MATRON-ELEVATOR OPERATOR 2.15 2.10 2.05 641 2 . 2 2.4 2.60 PLANT ATTENDANT b/ A 2.26 2 . 21 2.16 391 2.2 2.4 2.64 FIELD SERVICE ORDER FILLER J .26 2.21 2.16 217 2.3 2.4 2.57 MAINTENANCE LABORER-YARDMAD J 2.42 2 . 37 2.32 678 2 . 2 2.6 2.88 FIELD SERVICE STOCK MAN 2.42 2.37 2 . 32 195 2 . 41 2.6 2.84 SHIPPER-RECEIVER 2.42 2 . 37 2.32 2841 2.3 2.5 2.69 DRIVER 2.82 2.76 2.71 227 3 . 0 3.5 4.05 MAINTENANCE TRADES HELPER 607 2.5 2.7 2.83 MAINTENANCE PAINTER 2.955 2.875 2.805 335 304 3.4 3.74 MAINTENANCE PLUMBER 3.005 2.945 2.895 2 . 835 684 3.1 3.5 3.55 MAINTENANCE UTILITY MAN 3.015 2 . 995 2 . 905 2 . 845 771 2.9 3.2 3.37 MAINTENANCE CARPENTER 3.045 2 . 955 2.935 2.875 604 3 . 1 3.5 3.76 MAINTENANCE ELECTRICIAN 3.115 3 . 045 2 . 965 2 . 905 175 3.2 3.61 3.75 MAINTENANCE MACHINIST J 3.115 3.045 2.965 2.905 411 3 . 2 3.5 3.74 a/ The collective-bargaining agreement provided for progression within each job classification to the maximum contract rate for the job over a stated period of time. b/ Janitor c/ Total number of employees emcompassed in three surveys utilized by Stewart within each classification.