Letourneau Brothers Construction Co.

LETOURNEAU BROS. CONSTRUCTION CO. 413 Letourneau Brothers Construction Company and Carpenters Local 1792, affiliated with United Brotherhood of Carpenters and Joiners of America. Case 17-CA-4596 December 1, 1971 DECISION AND ORDER BY MEMBERS FANNING, JENKINS, AND KENNEDY engaged principally in the residential construction industry in Sedalia, Missouri. Annually, Respondent has a gross volume of business in excess of $500,000, and a direct inflow in interstate commerce of purchased materials valued in excess of $10,000. Respondent admits, and I find, that it is an employer engaged in commerce,3 and that the Charging Party, herein also called the Union, is a labor organization, within the meaning of the Act. II. THE ALLEGED UNFAIR LABOR PRACTICES A. The Essential Issues On August 6, 1971, Trial Examiner Benjamin B. Lipton issued the attached Decision in this proceed- ing. Thereafter, the General Counsel filed exceptions and a supporting brief, and the Respondent filed a brief in answer to the General Counsel's exceptions. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the record and the Trial Examiner's Decision in light of the exceptions and briefs and has decided to affirm the Trial Examiner's rulings, findings, and conclusions and to adopt his recommended Order. 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 the complaint be, and it hereby is, dismissed in its entirety. TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE BENJAMIN B. LIPTON, Trial Examiner : This case, with all parties participating, was heard before me on June 2, 197 1,1 in Sedalia, Missouri, upon a complaint by the General Counsel2 alleging that Respondent violated Section 8(a)(5) and (1) of the Act. Upon the entire record in the case , with due considera- tion of the briefs filed by General Counsel and Respondent, and from my observation of the demeanor of the witnesses on the stand, I make the following: FINDINGS OF FACT 1. JURISDICTION AND LABOR ORGANIZATION Letourneau Brothers Construction Company, herein called Letourneau or the Respondent, is a partnership 1 All dates are sequentially in 1970 and 1971 except as specifically noted. 2 The charge was filed by the Union , and served on Respondent by registered mail, on March 1, 1971. 3 E.g., United Slate, Tile and Composition Roofers, etc., AFL-CIO, Local The complaint alleges, in substance, (a) that Sedalia Builders Association is an organization of building contractors in the Sedalia area which exists for the purpose, inter alia, of bargaining collectively on behalf of its members, including Respondent; (b) that all carpenter employees of the Association members constitute a single appropriate bargaining unit; (c) that about May 25, 1970, the Union and the Association reopened an existing contract and agreed to a new contract for 2 years effective July 1; (d) that since November, and particularly on January 19 and February 19, the Union requested Respondent to execute , the contract and Respondent refused; (e) since January 1, Respondent failed and refused to abide by the terms of the contract; (f) about February 19, Respondent unilaterally offered its employees increases in wages and fringe benefits; and (g) that Section 8(a)(5) and (1) of the Act were violated. Respondent denies each of these allegations,, and additionally contends that all the operative facts alleged in the complaint occurred prior to the 6-month limitation period in Section 10(b) and are therefore barred as substantive evidence. B. The Alleged Employer Association As noted, the complaint specifically refers to the "Sedalia Builders Association," and asserts that the carpenters employed by the Association' s members constitute a single appropriate bargaining unit. Elsewhere in the record various other names are assigned to an association of building contractors in the Sedalia area. On this disputed issue, it affirmatively appears that there have never been any bylaws, rules, membership lists, dues, stationery, or writing of any kind to reflect the existence of such an association. And the evidence is clear that no association, group, or agency has been authorized by any individual contractor to negotiate on its behalf with any union, or to bind any such contractor in a multiemployer contractual relationship. The particular contractors embraced in the purported association at any given time are nebulously outlined. On the testimony of General Counsel' s witnesses, they appear to comprise all commercial and residential contractors in the Sedalia vicinity. At various points in the record, about 12 such contractors are mentioned by name.4 Over a period of 8 to 10 years, from four to eight contractors, Union No. 57 (Atlas Roofing Co, Inc), 131 NLRB 1267; Hod Carriers, Building & General Laborers' Union of America, Local No. 652, AFL-CIO (Earl C Worley), 147 NLRB 380. 4 Tempel-Callison Co.; William E Yarboro; William Garner; Bill Norman; Heimsoth & Borchers , Eichholtz & Son; Dean Construction Co.; (Continued) 194 NLRB No. 70 414 DECISIONS OF NATIONAL LABOR RELATIONS BOARD unidentified, have met separately on two or three occasions to consult with each other on union contract negotiations. Ostensibly, a president and a secretary of the group are "elected," but the nature of the voting, the contractors present, and the functions and terms of office are obscure. It was testified that the current president, , Melvin Heimsoth, was elected at a meeting in the spring of 1970; but Heimsoth stated that he first became aware of his office in the fall of 1970 when Tempel called and simply told him he was president. Yarboro testified that he has been the secretary of the group for about 5 years. In January or February 1971, Heimsoth attended two meetings with Yarboro, Tempel, and Garner, and the addition of Norman on the second occasion. These contractors met to consider the formation of an organization which would have binding authority on its members to negotiate with unions. The proposition was not adopted. As particularly pertinent, the evidence indicates that Respondent never attended any contract bargaining meetings between contractors and the Union before the negotiations in question in 1970, infra. C. The Bargaining History It was broadly testified that, in the past, the Sedalia contractors negotiated only with the Union and the Cement Finishers. The purpose was to negotiate "the basis for the contracts and the contracts were executed with the individual contractor." There is no testimony concerning any particular bargaining meeting between the contractors and the Union before 1970. The only prior existing contract in evidence, effective from January 1, 1968, until December 31, 1970, is signed by only three contractors-Cramer, Yarboro, and Gentry Patterson. The agreement itself ambiguously states that it shall be in effect between the Union "and the Contractors Association and/or the Individual Contractors of-Sedalia."5 I find this was in fact a contract between the Union and each of the three signatory contractors, rather than a contract with an association binding on other contractors who did not sign. General testimony was given by Union Agent Middleton, based on information he had received from union members, that the terms of this contract were followed by other Sedalia contractors. Without identification of particular contrac- tors or a showing of actual knowledge by Middleton, such testimony cannot quite be regarded as probative evidence. However, it may be inferred from the record that some of the nonsignatory contractors recognized and largely adhered to the rates provided in the Union's contract as reflecting the prevailing wage in the area. As to this contract, Respondent's testimony is that it tried to pay union scale or better; as for example, it paid 25 cents an Cramer Construction Co , Gentry Patterson; Charles Patterson; Potts; and Letourneau Brothers Construction Co Business Agent Richard C Middleton testified that, in November 1970, he made a list of 10 to 12 member contractors verbally given to him by Yarboro as secretary of the "Builders Association." 5 On a separate slip of paper stapled to the exhibit there appears a typewritten and handwritten statement listing eight named contractors, including Respondent, as "members Sedalia Contractors Association." The list was not offered or admitted as being part of the contract, and was otherwise not identified as to source. 6 The letter itself was not produced in evidence. 7 The testimony of Letourneau and General Counsel's witnesses Tempel and Yarboro is consistent in this regard. I am unable to accept the version hour above the contract rate to its foreman and certain other carpenters. In other respects, Respondent did not conform to specific contract provisions, e.g., payment of a higher wage rate on commercial, as opposed to residential, jobs; and the Union never protested that Respondent failed to abide by the contract. In Respondent's experience, the only union contract it ever signed was with the Laborers Union in 1968 covering one employee of a subcontractor. Thus, it seems entirely clear that there was no bargaining history, based on contract or practice, between the Union and any of the Sedalia contractors which would justify the finding of an associationwide or multiemployer bargaining unit prior to the 1970 negotiations-more especially as would be binding on Respondent. D. The 1970 Negotiations and Subsequent Events About April 1970, Yarboro received a letter from the Union's business agent, John Stanton, requesting a reopening of the contract, which was due to expire December 31, 1970.6 Yarboro then made arrangement for meeting with the Union. It is found that two meetings were held at the union hall between certain contractors and the Union approximately in May and June 1970; and one intervening meeting was held among certain contractors alone, in Tempel's office, relating to contract negotiations. Leo Letourneau first appeared at the separate contractors' meeting, and was present only at the second meeting with the Union .7 Apart from Letourneau, the contractors who met with the Union were-Yarboro, Garner, Tempel, and Borchers .8 In attendance for the Union were five or six representatives, including Middleton and Montgomery. At the first bargaining meeting, the parties were concerned mainly with the Union's request for an increase in wage rates. Certain other fringe benefits were discussed, and the contractors agreed to contribute 2 cents an hour into a joint apprenticeship fund. The existing contract contained separate wage rates for commercial and residential work (e.g., $4.60 an hour for commercial, and $4.35 for residential). Some of the contractors were considered primarily commercial (Tempel and Borchers), and some primarily residential (Garner and Letourneau).9 The Union proposed a wage increase (apparently for commercial jobs) of $2 per hour to be effected in 6-month stages during a 2-year contract. 10 The contractors agreed to increase the rate differential between commercial and residential jobs. of Richard C. Middleton and Ivan Montgomery, officers of the Union, who placed Letourneau at both meetings with the Union. In any case, the final result would not be affected 8 Borchers represented the firm of Heimsoth & Borchers. Heimsoth, who was included by Yarboro as one of the participants, testified that he never attended any meeting with the Union. 9 Letourneau stated that generally 5 to 10 percent of his work is commercial. io The sequence and substance of the wage proposals and counterproposals are not clear or consistent in the testimony of General Counsel's witnesses. The conflicts, however, are not of material consequence, in view of the basic positions stated on each side and the terms of the contract ultimately reached. LETOURNEAU BROS. CONSTRUCTION CO. 415 At the subsequent meeting of the contractors themselves,ii Letourneau indicated that he could not agree to a reopening, as he had no contract, and that he could not profitably operate with the Union's requested raise and would not go along. At the second meeting with the Union, Contractor Garner counterproposed a 2-year contract with wage increases of $1.33 for residential jobs, as follows: 25 cents on July 1, 1970; 35 cents on January 1, 1971; 35 cents on July 1, 1971; and 38 cents on January 1, 1972. This offer was accepted by the Union, together with a total increase of $1.90 in the commercial rate over the contract term. Letourneau firmly stated his opposition to the raise affecting residential jobs, but indicated he would pay the commercial rate if he performed such work.12 It was not until November 1970 that the Union had the contracts printed and that various contractors were asked to sign. When approached, Letourneau refused to sign, and he requested a separate (i.e., different) contract for his firm, which the Union declined. Only four contractors executed the contract, each on an individual basis: Yarboro and Eicholz on November 16, 1970; Garner on March 8, 1971; and Tempel on or about February 1, 1971. In signing the latter contract, Tempel wrote and initialed the following language: "Subject to approval by the Sedalia Contractors Association." The other executed contracts contain no such entry. As a witness, Tempel did not explain the meaning of this addition. There is no evidence that the contractors subsequently met as a group to approve the contract as written.13 On July 1, 1970, Letourneau did not pay the first rate increase in the contract. In mid-July, after he was approached by a carpenter employee to pay the prevailing wage, he granted the increase effective as of July 1. Throughout the summer of 1970, Letourneau performed work on a commercial job, but did not pay the commercial rate. Nor does it appear that he contributed to the point apprenticeship fund. As of the present, he is paying some of his carpenters above the union scale. An employee testified that, on December 31, 1970, at a New Years' party held in the Letourneau home, the employees were told by Letourneau that he could not pay the increase due under the contract on January 1, 1971, and that "if anybody doesn't like it, they could find work some place else." General Counsel alleged in the complaint as an independent violation of Section 8(a)(1) that Letourneau had said, in this context, he was "going non-union." The allegation will be dismissed. On January 19, 1971, the Union arranged and held a 11 Tempel, Garner, Borchers, Patterson, and Letourneau. 12 Middleton testified that at one of the negotiating sessions (he was not sure which one), Letourneau proposed a raise of 65 cents over 2 years, and that this was rejected by the Union at the following meeting Tempel and Yarboro gave no such testimony. Whether Letourneau made such a proposal at the single bargaining meeting he attended, I find it immaterial in the disposition of the ultimate issues 13 As earlier shown, Heunsoth had been designated president of the contractors group in the fall of 1970 His firm did not sign the 1970 contract, nor any previous contract. 14 This was testimony of the job steward, which I construe to mean that Letourneau could not operate, as in the past, by paying the contract union scale in residential work. 15 It is unclear which meeting on February 19 preceded the other, but it meeting with Letourneau and six of his carpenters at the union hall. Letourneau refused again to sign the contract, and said that he would consider signing if the Union organizes all the other residential contractors. He asked to negotiate a separate contract, and was refused, assertedly because it was contrary to the Union's bylaws. Middleton testified that Letourneau then indicated that unless he could get such a contract, he would "go CIU" or "go non- union." The outcome of the meeting was that the Union "would give Letourneau and his employees 30 days." On February 19, 1971, there was a further meeting at the union hall, with generally the same parties present. The Union indicated it would begin picketing Letourneau on February 22 if he did not adhere to the contract. Letourneau replied that he "didn't give a damn" about the contract. He would pay $6 an hour for his better men, and let some men go. He further stated the proposition that he would pay his carpenters $240 a week, guarantee 24 months of work, establish a pension program of $30 a month upon retirement age of 62, and institute a profit-sharing policy, such as a bonus, for those who worked for him Monday, February 22. These proposed terms were put into writing and signed by both Letourneau brothers. Also on February 19, four carpenter employees were at the Letourneau home, near the jobsite, to obtain their regular paychecks. Letourneau told them he could not pay the contract wage increase; there was too much competition from nonunion builders; he would either operate nonunion or go broke;14 and he did not feel that all his carpenters were equal or should be paid the same wage. He offered the employees the same wage and fringe proposal, described above, which was put into writing at the union hall that day. His admitted purpose was to induce the carpenters to stay with the firm while it was being picketed.15 Whether the terms of this offer were actually put into effect is not indicated. E. Concluding Findings Stated for the purposes of this case, the test of a multiemployer bargaining unit is whether the employers in question "have indicated from the outset an unequivocal intention to be bound in collective bargaining by group rather than individual action." 16 More specifically, as the issues are framed in the complaint, the immediate questions are whether Respondent was bound to the terms of the 1970 contract by virtue of (1) its inclusion in a prior existing association or multiemployer bargaining unit, or (2) by the independent evidence of its conduct in the 1970 contract negotiations. As already indicated, the evidence is consider- ably deficient to support a finding on the first ground. may be inferred, particularly from the reference to the picketing, that the meeting at the Letourneau home occurred later in the day. 16 E.g., Weyerhaeuser Company, et a!., 166 NLRB 299. Cf. The Kroger Co. 148, NLRB 569, 573-holding that in multiemployer bargaining a union and an individual employer member of the group are not automatically precluded from negotiating separately on limited matters of peculiar concern to the individual employer. Where the employer member has indicated the requisite intention to be bound in collective bargaining by group action, the multiemployer unit is appropriate even though the employer may not have specifically delegated to an employer group the authority to represent it in collective bargaining, or given the employer group the power to execute agreements on its behalf, or where some contracts have not been signed by all members of the group. 416 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Regarding the 1970 negotiations, it is essentially shown that Respondent attended a separate meeting among several contractors, participated in the second of two bargaining meetings with the Union, but that it stoutly voiced its refusal to accept the proposed terms, and declined to execute the contract when proffered. As to Respondent, or indeed any of the amorphous group of Sedalia contractors, it could scarcely be held on this record that there was an unequivocal intent to be bound by group bargaining. Of the 12 Sedalia contractors named in the record at one point or another, only 4 individually signed the negotiated 1970 contract, and only 3 were shown as party to any prior contract. Entirely too much reliance is placed by the General Counsel on evidence, of a highly generalized character, that some nonsignatory contractors, including Respondent, tended to adhere to prevailing wage rates reflected in the Union's contract in the area. Even assuming the prior existence of a multiemployer or association unit, it is not sufficient to bind nonmember employers solely on a showing that they have adopted the terms of a contract negotiated by the multiemployer group.17 All that is really evident here is that some of the Sedalia contractors, in varying combinations, informally associated themselves at different times merely for the sake of convenience in bargaining with the Union, without any intention to be bound contractually as a group.is The complaint allegations that Respondent violated Section 8(a)(5) by refusing the Union's requests since November, and particularly on January 19 and February 19, to execute the 1970 contract, and by refusing, since January 1, to abide by the terms of such contract-must be dismissed as devoid of merit. That Respondent orally consented, in the course of the bargaining discussions, to pay an increased commercial wage rate, and that it subsequently failed to make such payment, is not alleged 17 See, e.g, Moveable Partitions, Inc, 175 NLRB No. 149. 18 E.g., Council of Bagel and Bialy Bakeries, etc, 175 NLRB No. 148 19 While a serious question would arise from Respondent's defense and certainly cannot be found as a violation, absent Respondent's commitment to the full 1970 contract. There remains the further allegation that Respondent, on February 19, unilaterally offered its employees increased wages and fringe benefits. Under the complaint, General Counsel has proceeded solely on the premise of a single appropriate bargaining unit consisting of all carpenters employed by members of the Sedalia Builders Association, which purportedly includes Respondent. The existence of such a unit was plainly not established. It generally appears, although the question was not specifically litigated, that a majority of Respondent's carpenters were members of the Union. Assuming an appropriate unit confined to Respon- dent as a separate employer, a refusal-to-bargain violation would not he under the facts presented herein. The Union did not seek recognition or bargaining in such a unit. And it rejected Respondent's request for a separately negotiated contract limited to Respondent's carpenters. It was Respondent's practice to deal with its, carpenters individu- ally in hiring and arranging conditions of employment. On February 19, Respondent made the same offer directly to employees which it specified at a meeting with the Union the same day in the presence of employees. The Union could reasonably have viewed Respondent's proposal as a basis for negotiating an individual contract with Respon- dent. However, such a course of bargaining had been ruled out by the Union and rendered futile as to Respondent. It therefore cannot, in any event, be held that Respondent unlawfully sought to bypass the Union or to derogate from its representative status by dealing directly with its carpenter employees in such circumstances. RECOMMENDED ORDER Accordingly, it is hereby recommended that the com- plaint be dismissed in its entirety.19 predicated on the 6-month limitation period under Section 10(b), it is not necessary to reach or pass on such issue in view of the substantial failure of the General Counsel to sustain the factual allegations of the complaint.