Teamsters Local. No. 688

TEAMSTERS LOCAL NO. 688 Teamsters Local No. 688, affiliated with International Brotherhood of Teamsters , Chauffeurs, Ware- housemen and Helpers of America and Schnuck Markets, Inc. and Independent Brotherhood of Beverage Salesmen, Servicemen, Chauffeurs and Helpers Union, Local 67. Case 14-CE-20 October 13, 1971 DECISION AND ORDER BY MEMBERS FANNING, JENKINS, AND KENNEDY On July 15, 1971, Trial Examiner John F. Funke issued his Decision in the above-entitled proceeding, finding that the Respondents had engaged in and were engaging in certain unfair labor practices and recommending that they cease and desist therefrom and take certain affirmative action, as set forth in the attached Trial Examiner's Decision. Thereafter, only Respondent Teamsters Local 688 filed exceptions to the Trial Examiner's Decision. Respondent Schnuck Markets filed a brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its powers in connection with this case to a three-member panel. The Board has reviewed the rulings of the Trial Examiner made at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Board has considered the Trial Examiner's Decision, Respondent Teamsters Local No. 688's exceptions, Respondent Schnuck Markets, Inc.'s, brief, and the entire record in the case, and hereby adopts the findings, conclusions, and recom- mendations of the Trial Examiner. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the recommend- ed Order of the Trial Examiner and hereby orders that Respondent, Teamsters Local No. 688, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, its officers, agents, and representatives; and Respondent Schnuck Markets, Inc., its officers, agents, successors, and assigns, shall take the action set forth in the Trial Examiner's recommended Order. TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE JOHN F. FUNKE, Trial Examiner : Upon a charge filed April 7, 1971, by Independent Brotherhood of Beverage 701 Salesmen, Servicemen, Chauffeurs, and Helpers Union, Local 67, herein the Beverage Salesmen, against Teamsters Local 688, herein the Teamsters, and Schnuck Markets, Inc., herein Schnuck, jointly as the Respondents, the General Counsel issued complaint alleging that by their interpretation of the contract between the Teamsters and Schnuck, Schnuck has ceased doing business with Pepsi- Cola Bottling Company of St. Louis in violation of Section 8(e) of the Act. (The General Counsel agreed that the contract itself was lawful.) Respondents deny that their construction of the contract violates Section 8(e) of the Act. This proceeding, with all parties represented, was heard by me at St. Louis, Missouri, on May 24, 1971. At the conclusion of the hearing the parties were given leave to file briefs. Upon the entire record in this case and from my observation of the witnesses while testifying, I make the following: FINDINGS AND CONCLUSIONS 1. THE BUSINESS OF SCHNUCK Schnuck is a Missouri corporation having its office and principal place of business in St. Louis County, Missouri. It is engaged in the retail sale and distribution of groceries, meats, and related products. Its stores in metropolitan area of St. Louis are the only ones involved in this proceeding. Schnuck has gross sales exceeding $500,000 annually and causes to be transported to its St. Louis store meats, groceries, and other products directly from outside the State of Missouri valued in excess of $50,000 annually. It is engaged in commerce. II. LABOR ORGANIZATIONS INVOLVED Both the Teamsters and the Beverage Salesmen are labor organizations within the meaning of the Act. III. THE UNFAIR LABOR PRACTICES At the opening of the hearing the parties entered into a stipulation covering facts relating to the issue. This stipulation, signed by Phillip Dexter, Ben N. Messina, Harry H. Craig, and John P. Emde (G.C. Exh. 2), is attached hereto as Appendix A. Also received in evidence was the grocery industry contract with the Teamsters, to which Schnuck was a party, effective January 1, 1969 (G.C. Exh. 3), and the current industrywide contract with the Teamsters, to which Schnuck was also a party (G.C. Exh. 4-a) and the addendum to said contract (G.C. Exh. 4-b). The clauses of this contract which affect the issue, as to their construction only, are: ARTICLE XIII Section 2. (a) All merchandise for resale which is delivered to a retail outlet owned by the Employer ("owned" means more than fifty percent ownership) in the greater St. Louis area, shall be delivered from the 193 NLRB No. 109 702 DECISIONS OF NATIONAL LABOR RELATIONS BOARD warehouse(s) of the Employer covered by the Collective Bargaining Agreement. (d) If the provisions of this Section would require a change in any operations as then being conducted by the Employer, such change need be made by the Employer only after sixty (60) days written notice from the Union specifying the change to be made and the provisions of the Section under which the change is required. These provisions also appeared in the 1969 contract and in the addendum to the 1970 contract. The warehouse employees of Schnuck were covered by this contract; the drivers for Schnuck were covered by a contract with a sister local of the Teamsters, Local 610. Schnuck in the course of its business purchases soft dunks from Canada Dry, Coca-Cola, Royal Crown, Pepsi-Cola, Vess, Seven-Up, and Dr. Pepper. On July 28, 1969, the Teamsters sent the following letter (G.C. Exh. 5) to National Tea Company; General Grocery Company; Wetterau Grocer Company; J.F. Conrad Grocer Compa- ny; Tom Boy Stores; S & W Fine Foods; and Schnuck Markets. Your firm purchases soda under various brand names from Pepsi-Cola Metropolitan Bottling Company, Inc., 647 Tower Grove, St. Louis, Missouri (hereafter called "Pepsi-Cola Company"), for resale by your retail outlets. At the present time, all such soda is being delivered directly to your retail outlets by employees of the Pepsi-Cola Company. Under the provisions of Article XIII, Section 2(D) of our collective Bargaining Agreement with you, this Union hereby notifies you that it demands that sixty (60) days after the receipt of this notice, you change the present method of having such soda delivered to your retail stores in the greater St. Louis area, and that from and after sixty (60) days after the receipt of this notice that all soda purchased from Pepsi-Cola Company be delivered to your retail outlets in the greater St. Louis area from your warehouse or warehouses covered by said Collective Bargaining Agreement as required by Article XIII, Section 2(A) of that same agreement. On March 17, 1970, the Teamsters sent the following letter (G.C. Exh. 6) to Schnuck: On July 28, 1969, you were notified by Harold J. Gibbons, Secretary-Treasurer of Teamsters Local Union No. 688, that under the provisions of Article XIII, Section 2(d) of your Collective Bargaining Agreement with Local 688, the Union notified you that it demanded that after sixty (60) days from the receipt of the notice you change the present method of having certain soda delivered to your retail stores in the St. Louis Area, and further demanded that any such soda be delivered to your retail outlets in the St. Louis Area in accordance with the requirements of Article XIII, Section 2(a) of the Collective Bargaining Agreement. We are advised that you still have not complied with our previous demand. You are hereby notified that unless these demands are complied with within thirty (30) days of the receipt of this letter, Local 688 intends to take action to enforce its Collective Bargaining Agreement. Donald Schnuck, president of Schnuck, testified that he made no response to either letter. In late 1970 he received a telephone call from Mr. Kavner, a representative of the Teamsters, in which Kavner told him Pepsi-Cola products would have to be run through the warehouse. Schnuck asked for more time on the ground that a recently completed purchase of the Bettendorf stores had complicat- ed his situation. He was given until February 1. On February 19 Levi Sandford, vice president of the Team- sters, visited Schnuck's office and asked him why he had not put Pepsi-Cola into the warehouse. Schnuck stated he had only agreed to discuss the problem and a meeting was held on March 4. Donald Schnuck, his brother Ted, Forrest Hardin, personnel director and Terrel Vaughn, Schnuck's attorney, represented Schnuck. Kavner and Sandford represented the Teamsters. The Teamsters insisted that Pepsi-Cola be put through the warehouse despite various objections from Schnuck including his protest that Pepsi- Cola probably would not deliver to his warehouse since it was industry practice for the bottling companies to deliver directly to the stores, using their own driver-salesmen. The meeting terminated without agreement. On March 8 Donald Schnuck received a call from Sandford telling him they would have to stock Pepsi-Cola in the warehouse, but that he would give him a further extension until April 1. On March 8 Donald Schnuck talked with Hal Richard- son, sales manager for Pepsi, who told him it was their policy not to deliver to a warehouse and they were not going to start then. A meeting was arranged with a Mr. Wiss, Richardson's supervisor, which took place a week later at which Pepsi-Cola adhered to its refusal to warehouse it products. About March 24 Schnuck instructed his management personnel not to accept deliveries at the stores after April 1. A summary of deliveries prepared by Schnuck shows that there were purchases made from Pepsi-Cola during the week ending March 24. (G.C. Exh. 7.)1 Robert Selvy, a route salesmen for Pepsi-Cola and president of the Beverage Salesmen, testified that the Beverage Salesmen represented about 250 employees of Pepsi-Cola, of whom about 88 were driver-salesmen.2 On March 19 Selby was informed by Jerry Gibson, personnel director of Pepsi-Cola, that the Teamsters were applying pressure on Schnuck to have deliveries made to the warehouse rather than to the stores. On March 24, Selby and Berra, secretary-treasurer of the Beverage Salesmen, and Frank Vaughan, vice president, met with Kavner of the Teamsters. Selby informed Kavner that delivery to the Schnuck warehouse would mean the loss of 25 to 30 men at Pepsi-Cola. Kavner told him the Teamsters intended to enforce article XIII of their contract and that they would picket the warehouse and the Schnuck stores if necessary. Kavner also told him that there was no demand that the other soft drink companies would be required to go through the warehouse, the demand applied only to Pepsi-Cola. Kavner told him that if the Pepsi-Cola drivers became Teamsters deliveries could continue to be made through the 2 The Pepsi -Cola Beverage Salesmen contract was received as G.C. Exh i This exhibit does not agree with the testimony which establishes deliveries ceased on April 1 8. TEAMSTERS LOCAL NO. 688 stores. He also informed Selby that on June 1 pressure would be put on National Tea to require Pepsi-Cola products pass through the warehouse. On April 1 the Schnuck stores refused to accept delivery of Pepsi-Cola products. Deliveries were resumed on May 3 following the issuance of a restraining order by a district court. The above, together with the stipulation of the parties, presents the facts upon which the case must be decided. B. Conclusions Section 8(e) in its relevant part reads- It shall be an unfair labor practice for any labor organization and any employer to enter into any contract or agreement , express or implied, whereby such employer ceases or refrains or agrees to cease or refrain from handling, using , selling, transporting or otherwise dealing in any of the products of another employer, or to cease doing business with any other person.. . This section was enacted to close the loophole provided by Local 1976, United Brotherhood of Carpenters v. N.L.R.B, 357 U.S. 93, which held that a strike to enforce a "hot cargo" clause was unlawful but that the mere execution of such a clause or its voluntary observance by an employer was not . The section was aimed directly to end the evasion of the prohibitions of Section 8(b)(4)(A) and (B) by voluntary agreement In the Woodwork Manufacturer's case3 the Supreme Court reviewed at length the legislative history of Section 8(e) and the Congressional intent and established the distinction between conduct designed to preserve the work of the primary employer's employees, which it held lawful, and conduct "tactically calculated to satisfy union objectives elsewhere," which it held was not. The touch- stone, said the Court, was whether the agreement or its maintenance is addressed to the labor relations of the contracting employer vis-a-vis his own employees. Conceding that drawing of the line might present difficulty I do not find the instant case poses any real problem. Here the work of delivering the soft drink suppliers' (including Pepsi-Cola) products from the supplier to Schnuck 's retail outlets had not been performed by the employees of Schnuck but by the suppliers employees and work preservation for the bargaining unit was not the motivating factor. Warehouse deliveries by Schnuck to its stores were confined to food products. The purpose of the new construction of the agreement, implemented by Schnuck's order to his stores to accept no more bottled products from Pepsi-Cola after April 1, was to force the employees of Pepsi-Cola to withdraw from their own union and to join the Teamsters. This was made "abundantly clear" in the conversations between Selby and Berra with Kavner. It was also made clear by the statement that only Pepsi-Cola would be required to deliver to the warehouse, the other bottlers, whose drivers were represented by the Teamsters, would continue as usual I have considered the fact that the request of the 3 Woodwork Manufacturers Association v N L R B, 386 U S 612 + In the event no exceptions are filed as provided by Sec 10246 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, and recommended Order herein shall, as provided in 703 Teamsters would not require that Schnuck's cease doing business completely with Pepsi-Cola but only to change the point of delivery. Such a change would have had required a reduction in the bargaining unit of drivers at Pepsi-Cola and furthered the purpose of the Teamsters request; i.e., a change in the bargaining representative of the drivers at Pepsi-Cola. The Act does not require that a union demand a complete cessation of doing and the Supreme Court has held that such a reading is too narrow. N.L.R.B. v. Local 825, Operating Engineers (Burns and Roe, Inc), 400 U.S. 297. The Respondents offered neither oral argument nor a brief to support their positions. Under the circumstances I think further comment unwarranted. Upon the foregoing findings I make the following: CONCLUSIONS OF LAW 1. By reaching agreement on or about April 1, 1971, whereby article XIII of the contract between Schnuck and the Teamsters should be construed, interpreted and applied so as to require Pepsi-Cola to deliver its products to the warehouse of Schnuck rather than to its retail stores, Schnuck ceased and refrained from handling, using, selling, and transporting or otherwise dealing with the products of Pepsi-Cola the Respondents violated Section 8(e) of the Act. 2. The aforesaid labor practices are unfair labor practices within the meaning of the Act. THE REMEDY Having found the Respondents Schnuck and Teamsters engaged in certain unfair labor practices I shall recommend that they cease and desist from the same and take certain action necessary to effectuate the policies of the Act. Upon the findings and conclusions of law and upon the entire record in this case, I issue the following recommended: 4 ORDER Respondent Teamsters Local 688, affiliated with Interna- tional Brotherhood of Teamsters, Chauffeurs, Warehouse- men, and Helpers of America, its officers, agents, and representatives, and Respondent Schnuck Markets, Inc., its officers, agents, successors, and assigns, shall: 1. Cease and desist construing, interpreting, applying, or giving any effect to article XIII of their contract effective June 1, 1970, and expiring May 31, 1973, or to any addendum or modification thereof, which would require Pepsi-Cola Bottling Company of St. Louis to deliver its products to the warehouse of Schnuck's Markets, Inc., rather than to the retail stores operated by Schnuck's Markets Inc. or require Schnuck's Markets Inc., to cease or refrain from doing business with Pepsi-Cola Bottling Company of St. Louis by requiring Pepsi-Cola to deliver its products to its warehouse. 2. Take the following affirmative action: Sec 102 48 of the Rules and Regulations, be adopted by the Board and become its findings, conclusions, and Order, and all objections thereto shall be deemed waived for all purposes 704 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (a) Respondent Teamsters Local No. 688, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America shall post at all its meeting halls in St. Louis, Missouri, copies of the attached notice marked "Appendix B."5 Copies of the notice, on forms to be furnished by the Regional Director for Region 14, shall, after being duly signed by a representative of Respondent Teamsters, Local No. 688, be posted immedi- ately upon receipt thereof, and be maintained for 60 consecutive days thereafter, in conspicuous places, includ- ing all places where notices to members are customarily posted. Reasonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. (b) Respondent Schnuck's Markets, Inc., shall post at its stores, warehouses and all its other places of business in St. Louis, Missouri, copies of the attached notice marked "Appendix C."6 copies of said notice, on forms to be furnished by the Regional Director for Region 14, shall, after being duly signed by an authorized representative of Schnuck's Markets, Inc., be posted immediately upon receipt thereof, and be maintained 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 ensure that the notices are not altered, defaced or covered by any other material. (c) Respondents Teamsters Local No. 688 and Schnuck's Markets, Inc., shall notify the Regional Director for Region 14, in writing, within 20 days from the receipt of this Order, what steps have been taken to comply herewith.? 5 In the event that the Board's Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall be changed to read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board " 6 Fn 5, supra 7 In the event that this recommended Order is adopted by the Board after exceptions have been filed, this provision shall be modified to read "Notify the Regional Director for Region 14, in writing, within 20 days from the date of this Order, what steps the Respondent has taken to comply herewith " APPENDIX A STIPULATION IT IS HEREBY STIPULATED AND AGREED by and between Teamsters Local No. 688, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America (herein called Respondent Local 688), Schnuck Markets, Inc. (hereinafter called Respondent Schnuck), Independent Brotherhood of Beverage Salesmen, Servicemen, Chauffeurs and Helpers Union, Local 67 (herein called Charging Party), and the General Counsel of the National Labor Relations Board, that: 1. Prior to April 1, 1971, all soft drinks sold by national brand bottling companies in the St. Louis metropolitan area, including Canada Dry, Coca Cola, Pepsi-Cola, Royal Crown, Dr. Pepper, 7-Up, and Vess were delivered directly by employees of the bottling companies to the individual stores of Respondent Schnuck. 2. The employees of said bottling companies who make deliveries directly to the individual stores of Respondent Schnuck are, except for Pepsi-Cola employees, represented by Respondent Local 688. The employees of Pepsi-Cola making said deliveries are represented by Charging Party and have been since 1941. 3. That Respondent Local 688 presently represents employees in the warehouse bargaining unit of Respondent Schnuck, and that Local 610 of the Teamsters represents those employees of Schnuck presently employed to make deliveries of food products from Schnuck's warehouse facilities to the individual retail stores. 4. That Respondent Local 688 initially demanded, by letter dated July 28, 1969, in accordance with Article XIII, Section 2(d), of the collective-bargaining agreement, that all Pepsi-Cola products thenceforth be delivered to and handled through Respondent Schnuck's warehouse facili- ties in accordance with the requirements of Section 2(a) of said article, and that said demand was renewed by letter dated March 17, 1970, the original letters having been received by Respondent Schnuck. 5. That the demand did not include, and no equivalent demand was made at any time with regard to, any of the other national brand soft drinks sold and delivered to Schnuck's individual stores by the bottling companies in the metropolitan St. Louis area. 6. That immediately prior to April 1, 1971, Respondent Schnuck was purchasing from the St. Louis bottling companies an average of approximately 20,500 cases a week, of which the purchases from Pepsi-Cola were averaging approximately 8,400 cases, and that between 85 and 95 percent of these purchases by Schnuck from all bottling companies were in returnable containers. 8. That it is the policy of the Pepsi-Cola Bottling Company of St. Louis not to sell and deliver its products directly to a central warehouse of a supermarket chain for subsequent redelivery to the individual stores, and Pepsi- Cola has never made deliveries to the warehouse facilities of Respondent Schnuck. 9. Pepsi-Cola is a leader in soft drink sales in Respondent Schnuck's stores in the St. Louis area, it being a highly advertised product on a national basis. 10. That if required to deliver to a central warehouse instead of directly to retail outlets, there would be a loss of income to Pepsi-Cola employees represented by Charging Party, there would be a possible loss of jobs in the Local 67 bargaining unit, and Pepsi-Cola would lose desirable display space in the individual stores of Respondent Schnuck. 11. That National Tea Company, doing business as National Food Stores in the metropolitan St. Louis area, has a contract with Respondent Local 688 which contains an identical Article XIII. 12. That Respondent Local 688 has made demand upon National Tea Company that said company change its policy and require Pepsi-Cola products to be delivered only to its central warehouse facilities instead of directly to the individual stores. 13 At all times material herein, Pepsi-Cola employees have been and are delivering Pepsi-Cola products directly TEAMSTERS LOCAL NO. 688 705 to the individual National Food Stores and not to central warehouse facilities of that company. APPENDIX B NOTICE To MEMBERS POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL NOT construe, interpret, apply, or give any effect to article XIII of our collective-bargaining contract with Schnuck's Markets, Inc., which would require Schnuck's Markets, Inc , to stop doing business with Pepsi-Cola Bottling Company of St. Louis by requiring that company to make deliveries of its products to Schnuck's Markets warehouse instead of to its stores TEAMSTERS LOCAL 688, AFFILIATED WITH INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS OF AMERICA (Labor Organization) Dated By This is anyone. an official (Representative) (Title) notice and must not be defaced by 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, 210 North 12th Boulevard, Room 448 , St. Louis, Missouri 63101, Telephone 314-622-4142. APPENDIX C NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL NOT construe, interpret, apply, or give any effect to article XIII of our contract with Teamsters Local No. 688 which will require us to stop doing business with Pepsi-Cola Bottling Company of St. Louis, Missouri, unless that company delivers its products to our warehouse. WE WILL continue to accept deliveries of Pepsi-Cola products at our retail stores and we will not make any request or demand that it deliver its products to our warehouse. WE WILL rescind any and all orders to our store managers and other employees not to accept delivery of Pepsi-Cola products at our retail stores. SCHNUCK'S MARKET, INC. (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, 210 North 12th Boulevard, Room 448, St. Louis, Missouri 63101, Telephone 314-622-4142.