Jubilee Manufacturing Co.

272 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Jubilee Manufacturing Company and United Steel- workers of America, AFL-CIO. Case 17-CA-4404 March 8, 1973 DECISION AND ORDER On September 9, 1971, Administrative Law Judge Lloyd S. Greenidge (the title of "Trial Examiner" was changed to "Administrative Law Judge" effec- tive August 19, 1972) issued the attached Decision in this proceeding. Thereafter, the General Counsel and the Charging Party filed exceptions and supporting briefs and the Respondent filed a supporting brief. In addition, the Board, by its Acting Executive Secre- tary, invited the United States Equal Employment Opportunity Commission, herein called EEOC, to file a brief amicus curiae. Subsequently, the EEOC filed a brief. On April 12, 1972, the National Labor Relations Board, having determined that the instant case raised issues of substantial importance in the administra- tion of the National Labor Relations Act, as amended, notified the parties that oral argument on the case would be heard by the Board on May 1, 1972. All parties and a representative of the EEOC participated in the oral argument, which was there- after held on the aforesaid date. The Board has considered the record and the attached Decision in light of the exceptions, briefs, and oral argument and has decided to affirm the Administrative Law Judge's rulings, findings,' and conclusions as modified herein, and to adopt his recommended Order. The complaint alleged that Respondent violated Section 8(a)(1) and (3) of the Act by discriminating in granting wage increases and paying wage rates to male employees based solely on the consideration of sex. In addition, the complaint alleged that Respon- dent violated Section 8(a)(5) of the Act by insisting to the point of impasse during collective-bargaining negotiations on a contractual provision on which it was relying as the basis for unilaterally granting wage increases and paying wage rates to its employees on a sexually discriminatory basis. The Administrative Law Judge concluded that the record does not establish that Respondent has developed and practiced a policy of discrimination based on sex. He therefore found it unnecessary to decide whether an employer's policy and practice of invidious discrimination against its employees on the basis of race, color, religion, sex, or national origin interferes with or restrains the discriminated employ- 1 The General Counsel has excepted to certain credibility findings made by the Administrative Law Judge It is the Board's established policy not to overrule such resolutions with respect to credibility unless the clear preponderance of all of the relevant evidence convinces us that the ees in exercising their Section 7 rights in violation of Section 8(a)(1) and (3) of the Act. In regard to the 8(a)(5) allegation, as he found that Respondent did not discriminate on the basis of sex by the aforesaid practices, he concluded that the matter of minimum rates was not an illegal subject and was instead a mandatory topic which could be bargained on to impasse. He further concluded that an impasse was reached but that the Union, not Respondent, created the impasse. In view of the foregoing, the Adminis- trative Law Judge recommended that the 8(a)(1), (3), and (5) allegations relating to alleged sex discrimina- tion be dismissed in their entirety. We agree that these allegations of the complaint should be dismissed but solely for the reasons set forth herein. I. ALLEGED SEX DISCRIMINATION While we have serious doubts about the validity of the Administrative Law Judge's finding of nondiscri- mination, we find it unnecessary to resolve this question, for, in our view, discrimination based on race, color, religion, sex, or national origin, standing alone, which is all that is alleged herein, is not "inherently destructive" of employees' Section 7 rights and therefore is not violative of Section 8(a)(1) and (3) of the Act. There must be actual evidence, as opposed to speculation, of a nexus between the alleged discriminatory conduct and the interference with, or restraint of, employees in the exercise of those rights protected by the Act. In United Packinghouse, Food and Allied Workers International Union, AFL-CIO [Farmers' Coopera- tive Compress] v. N. L. R. B.. 416 F.2d 1126, cert. denied 396 U.S. 903, a panel of the United States Circuit Court for the District of Columbia held that an employer's discrimination against its employees on account of race or national origin is a violation of Section 8(a)(1) of the Act because such discrimina- tion (1) sets up an unjustified clash of interests between groups of workers, thus frustrating the possibility of concerted action; and (2) creates in its victims an apathy or docility which inhibits them from asserting their rights' against the employer- perpetrator of the discrimination. With all due respect to the court, we are unable to agree with this legal conclusion. Although employer discrimination may have the effect of setting group against group, that result is by no means inevitable. A continued practice of discrimination may in fact cause minority groups to coalesce, and it is possible that this could lead to resolutions were incorrect . Standard Dry Wall Products, Inc, 91 NLRB 544, enfd 188 F 2d 362 (C A. 3) We have carefully examined the record and find no basis for reversing his findings. 202 NLRB No. 2 JUBILEE MANUFACTURING COMPANY collective action with nonminority group union members.2 Furthermore, docility is only one of several possible consequences of an employer's discrimination. In light of the increased militancy of minority groups today, it seems apparent that minority groups in different areas of the country, in different situations and at different times, react dissimilarly to discriminatory practices. Nor do we find merit in the contention that a policy and practice of invidious discrimination in the face of a union's ineffective efforts to eliminate such discrimination has the "foreseeable consequence" of discouraging union membership within the meaning of Section 8(a)(3) of the Act, and discouraging the exercise of Section 7 rights within the meaning of Section 8(a)(1) of the Act. Ineffective efforts in other areas, as for example when a union seeks unsuccess- fully to gain a wage increase, may well result in the union's losing face with the employees it represents. Yet, to say that an employer's refusal to give a wage increase violates Section 8(a)(3) or (1) because of this loss of face seems to us beyond the reasonable intent of the Statute. This is not to say categorically that discrimination on the basis of race, color, religion, sex, or national origin is necessarily or always beyond the reach of the statute. Such discrimination can be violative of Section 8(a)(1), (3), and (5) in certain contexts, and we have so held. However, in each of these areas in which we have decided issues involving discrimina- tion there has been the necessary direct relationship between the alleged discrimination and our tradition- al and primary functions of fostering collective bargaining, protecting employees' rights to act concertedly, and conducting elections in which the employees have the opportunity to cast their ballots for or against a union in an atmosphere conducive to the sober and informed exercise of the franchise. Thus, in the context of representation elections, we have held that flagrant and irrelevant appeals to racial prejudice which deliberately seek to overem- phasize and exacerbate racial feelings will be grounds for setting aside an election.3 In addition, we have held that when employees band together to protest their employer's discriminatory practices, whether actual or supposed, their concerted effort is the kind 2 See New Negro Alliance v. Sanitary Grocery Co., 303 U.S. 552; N.L R.B. v. Baltimore Luggage Company, 387 F.2d 744, 745-749 (C.A. 4). 3 Sewell Manufacturing Company, 138 NLRB 66. 4 Tanner Motor Livery, Ltd., 148 NLRB 1402,' 14034M, remanded 349 F.2d I (C.A. 9), original decision affirmed 166 NLRB 551, enfd . 419 F.2d 216 (C.A. 9); Mason and Hanger-Silas Mason Co., Inc., 179 NLRB 434; Washington State Service Employees State Council No. 18, 188 NLRB No. 141. 5 N. L. R. B. v. Tanner Motor Livery, Ltd., 419 F.2d 216, 218 (C.A. 9). 273 of activity which falls within the protection of Section 7 of the Act .4 The reason such activity is protected is that: The desire [for nondiscriminatory employment practices] relates to a condition of employment affecting the entire bargaining unit; it is not personal to [the individual employees involved].5 Therefore, while, as we have held above, discrimi- nation on the basis of race, color, religion, sex, or national origin is not per se a violation of the Act, that is not to say that such discrimination does not directly affect terms and conditions of employment. It clearly does, and concerted activity intended to remedy such discrimination is protected under our Act. Thus, we have found that an employer violates Section 8(a)(5) of the Act by refusing to bargain in good faith concerning the elimination of existings or alleged 7 racial discrimination. Similarly, we have also held that an employer violates Section 8(a)(5) by insisting on bargaining for union acceptance of provisions within a supposed nondiscrimination clause which would prevent the union from fulfilling its duty of fair representation and expose the union to legal liabilities under Title VII of the Civil Rights Act of 1964.8 In addition, we have found that an employer's unilateral elimination of the female employees in its plant at the very moment that the union was negotiating for equal pay for them was an attempt to bypass bargaining with the union and was an unlawful refusal to bargain in violation of Section 8(a)(5) of the Act.9 Finally, in an 8(a)(3) context, we have found that an employer's discharge of female workers was unlawful when the real reason for their discharge was their union's attempt to negotiate better working standards for female employees as a group or individually.10 H. ALLEGED REFUSAL TO BARGAIN While, as mentioned previously, a refusal to bargain over the elimination of actual or suspected discrimination violates Section 8(a)(5) and (1) of the Act, we conclude in the circumstances herein that the evidence does not establish that Respondent refused to bargain about alleged sex discrimination and that, if anything, the evidence shows that it was the Union rather than Respondent who by its intransigence 6 Farmers' Cooperative Compress, 169 NLRB 290, enfd . on this ground 416 F.2d 1126 (C.A.D.C.), cert. denied 396 U.S. 903. r Farmers' Cooperative Compress, 194 NLRB No. 3, fn. 11; Southwestern Pipe, Inc., 179 NLRB 364, modified on other grounds 444 F.2d 340 (C.A. 5). 8 Southwestern Pipe, Inc., supra at 374-376. 9 Edmund A . Gray Co., Inc., 142 NLRB 590. 10 Edmund A. Gray Co., Inc., supra; Bankers Warehouse Company, 146 NLRB 1197. 274 DECISIONS OF NATIONAL LABOR RELATIONS BOARD from the beginning of negotiations prevented any meaningful bargaining about this subject. In this regard, we note that Earl Graham, the Union's staff representative, walked out of the initial bargaining session when told the ,Respondent was firm about retaining the minimum rate provision which the Union alleged was being used to perpetuate sex discrimination. It was also Graham who at the final bargaining meeting did not respond to the Respon- dent's reclassification proposal with a counterpropo- sal but rather declared the Union had nothing further to offer. Furthermore, at no time did the Union during bargaining request a broad nondiscrim- ination clause, ask Respondent to post the material handler jobs, or suggest that Respondent institute an affirmative antidiscrimination policy. In view of the foregoing, we shall order that the complaint herein be dismissed in its entirety. 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 Administrative Law Judge and hereby orders that the complaint be, and it hereby is, dismissed in its entirety. MEMBER FANNING, concurring: I agree with the majority that the complaint in this case should be dismissed. However, I reach this conclusion, as did the Administrative Law Judge, solely on the ground that the General Counsel has not presented sufficient evidence to warrant a finding of discrimination based upon sex. The record shows that the Employer employs a production and maintenance force of 43 employees, 36 women and 7 men. The jobs in the lower classifications are filled by women. The two top paying jobs are filled by seven men and three women. Of the men, five are classified as material handlers, a job requiring unusual physical strength, including the ability to unload boxes weighing several hundred pounds. For some years the Employ- er has had a policy of paying these employees more than the minimum contract rate to attract and retain in its employ individuals capable of performing such duties. The testimony of Vice President Lewis that no female employee had ever asked directly or through her Union to be transferred to material handling is uncontradicted on the record. Nor does the General Counsel allege that any female employee has ever been refused consideration to be so employed. No grievance has ever been filed by, or on behalf of, such an employee alleging that the Employer had refused to employ her as a material handler because of her sex. Obviously, the job of material handler is not suited to all persons, male or female. Many men do not have the physical strength to move heavy objects. It would also seem clear to me that most women are poorly equipped to perform such tasks. In the context of these facts I cannot conclude that this Employer has refused to employ women as material handlers simply because they were women and not men. Unlike the majority, I have found it necessary to resolve the question of discrimination before at- tempting to answer the more complex and difficult legal question of sexual discrimination under our Statute. Having found no such discrimination, it seems to me that this record is an inadequate vehicle to present my views in this important area of labor- management relations. Without a factual setting to support a finding of illegality I am reluctant to state a legal conclusion which would be, at best, mere dicta. I therefore adopt as my own the findings of fact and legal conclusions of the Administrative Law Judge. MEMBER JENKINS, dissenting: Unlike my colleagues, I would find that Respon- dent engaged in a practice of unlawful sex discrimi- nation and that the foreseeable consequences of this practice were an interference with employee rights and the discouragement of union membership in violation of Section 8(a)(1) and (3) of the Act we administer. Also, unlike my colleagues, I would find that Respondent violated Section 8(a)(5) of our Act by insisting to the point of impasse on retaining contractual authority to continue this unlawful discriminatory practice. The relevant facts are simply stated. Respondent employs approximately 43 unit employees, 36 of whom are women. Under Respondent's collective- bargaining agreement with the Union, the jobs held by members of the bargaining unit are divided into 10 classifications-Groups I through X-although, in current practice only the classifications in Groups I through V are used. The higher the group classification, the higher the wage scale for those employees. Since 1959, all employees in the three lowest paid groups have been females. In the second highest paid group, Group IV, all the permanent employees are men; while in the highest paid classification, Group V, both male and female have been employed. Specifically, as of the dates of the hearing, of the 10 top paying jobs (Groups IV and V), 7 were filled by males and 3 by females. Of the male employees (7 out of 7) 100 percent occupy the two top paying groups (IV and V) and only 8.3 percent of the female employees (3 of 36) hold positions in these two groups. As previously noted, no female employees occupy jobs in Group IV. In Group V, three of the JUBILEE MANUFACTURING COMPANY five jobs are held by females; however, these three women all earn substantially less than their male counterparts even though two of the females have greater seniority than the two males. In fact, the senior male employee in Group IV earns the same or more than the two most senior females in Group V. Further evidence of Respondent's employment practices can be gleaned from the manner in which Respondent interpreted and applied the contractual wage scale to attract and retain male employees. Thus, the collective-bargaining agreement provides minimum rates for each of these group classifications and a 4-cent-per-hour increase for employees who have worked over 30 days. It is undisputed that, for more than 5 years, Respondent has been paying the material handlers in Group IV (who are all males), starting rates in excess of the contract's minimum rate for this classification and, in most instances, it exceeded the wage rate to be effective after 30 days' employment.11 A similar practice was being followed when Respondent gave a 10-cent-an-hour increase to the two male employees in Group V making their wage rates substantially higher than those of two more senior female employees in the same- group. These wage increases were granted for the avowed purpose of bringing the wages of these employees in line with the rates paid to material handlers in Group IV and preventing the Group V males from seeking employment elsewhere. From the foregoing, there can be no doubt of Respondent's preference for males in the position of material handler in Group IV and of its policy of granting higher wage rates to male employees even when there were female employees similarly situated. Of course with regard to Group IV, we have no females similarly situated because Respondent ig- nored contractual procedures and filled these posi- tions from the outside. The contract provides that job vacancies are to be filled in order of departmental seniority and if no one suitable is available, the jobs are to be posted plantwide and bid upon by any employee. It is only after this procedure has been exhausted, that the Respondent is authorized to hire from the outside. In practice, however, no female employee was ever offered the job of material handler even though females in the plant generally have more seniority than male employees. Also, Respondent conceded that with respect to material handler jobs it ignored the posting requirements set forth in the contract and filled these vacancies exclusively from the outside and that this constituted 11 Respondent sought to justify this practice on the ground that men were generally "breadwinners" and that this was the only way it could attract and retain them. 12 ..In cases concerning racial discrimination , statistics often tell much and courts listen." Parham v Southwestern Bell Telephone Co, 433 F.2d 421 (C A. 8) Obviously, the same observation may be made with respect to 275 a departure from the manner in which the jobs in other classifications were filled. Merely on the basis of the statistical evidence showing the breakdown in employment and job classifications for male and female employees at Respondent's plant, one must conclude that at least a prima facie case of sex discrimination has been established.12 Of course, as I have indicated, above, the evidence presented here encompasses more than dust statistics. In filling vacancies for the material handlers' classification, Respondent completely ig- nored the bid procedures established in the collec- tive-bargaining agreement and hired exclusively from the outside. Furthermore, it hired only male employ- ees for this classification and started them at a wage rate which exceeded the minimum rate provided for in the contract. As might be expected, no female employee was ever hired at a starting rate higher than her classification's minimum wage rate. The prefer- ential wage policy for male employees was completed when Respondent chose to raise the wage rates of male employees in Group V to bring them in line with the rates being paid to the male material handlers. In order to properly determine the effects of Respondent's employment practices under the provi- sions of our Act, we should first look for guidance in that broad field of law which constitutes our national labor policy. The National Labor Relations Act as a piece of social legislation was not meant to be read and interpreted in a vacuum. Rather, as I indicated in an earlier dissent,13 the Act we administer must be read consistently with other Federal statutes which are a part of this national labor policy.14 The starting point in examining our national policy concerning discrimination in employment based on race or sex must, of course, be the United States Supreme Court's landmark decision in Steele v. Louisville & Nashville Railroad Co.15 There, the Court, in defining a union's obligations under the doctrine of fair representation, stated that discrimi- nations based on race alone are obviously irrelevant and invidious and Congress plainly did not under- take to authorize the employees' bargaining repre- sentative to make such discriminations. Since Steele, racial discrimination in employment, whether by unions or employers, has been unlawful and there is no reason to believe that the principles established in Steele would not apply with equal force to situations where the discrimination in employment has been on the basis of sex, rather than race. It is also well cases involving sex discrimination See also Griggs v Duke Power Co, 401 U S. 424. 13 The Emporium 192 NLRB No 19 14 Textile Workers Union of America, AFL-CIO v Lincoln Mills, 353 U S. 448. 15 323 U S 192 276 DECISIONS OF NATIONAL LABOR RELATIONS BOARD settled that the Court in Steele was not promulgating a doctrine which had application only to situations arising under the Railway Labor Act, but rather, it intended that the principles enunciated in Steele would apply with equal force in cases arising under the National Labor Relations Act.16 This judicial concept received further recognition with the legisla- tive embodiment of the Steele principles in Title VII of the Civil Rights Act of 1964 which specifically prohibits discrimination in employment based on race, color, religion, sex, or national origin.17 Although, the fair representation doctrine has been a part of our national labor policy since the Court's 1944 decision in the Steele case,18 the National Labor Relations Board has been extremely slow in giving effect to these principles. Although the Board has had jurisdiction over a union's unfair labor practices since the 1947 Taft-Hartley amendments19 to our Act, it was not until its 1962 decision in Miranda Fue120 that the Board found an unfair labor practice in a union's breach of its duty of fair representation. In Miranda Fuel, a majority of the Board held that Section 7 of our Act gives employees the right to be free from unfair or irrelevant or invidious treatment by their exclusive bargaining agent in matters affecting their employment and that Section 8(b)(1)(A) of the Act prohibits labor organizations, when acting in a statutory representative capacity, from taking action against any employee upon considerations or classifications which are irrelevant, invidious, or unfair.21 The Board majority also held that an employer who participates in such arbitrary union conduct violates Section 8(a)(1) and the employer and the union may violate Section 8(a)(3) and 8(b)(2), respectively, when, for arbitrary or irrelevant reasons or upon the basis of an unfair classification, the union attempts to cause or does cause an employer to derogate the employment status of an employee.22 Although the Board's Miranda Fuel decision was denied enforcement by the United States Court of Appeals for the Second Circuit,23 the doctrine was later upheld by the United States Court of Appeals for the Fifth Circuit.24 Any further doubts concern- ing the viability of the doctrine were resolved by the United States Supreme Court's decision in Vaca v. Sipes, when the Court seemingly gave full recognition and approval to the Board's Miranda Fuel doctrine 16 Wallace Corporation v N L R B, 323 U.S 248, Ford Motor Co. v Huffman, 345 U S 330, Humphrey v Moore, 375 U S 335 11 42 U S C §§ 2000e-2(a), etseq 18 The applicability of this doctrine to cases arising under the National Labor Relations Act was announced by the United States Supreme Court on the very day it handed down its historic decision in the Steele case See Wallace Corp v N L R B, supra. 19 Labor Management Relations Act of 1947, 29 US C § 158(b). 20 Miranda Fuel Company, Inc, 140 NLRB 181 and, in fact, criticized the Board for its "tardy" assumption of jurisdiction in these cases.25 As indicated, under our Miranda Fuel doctrine, air employer may itself be guilty of unfair labor practices under our Act when it joins the statutory representative in acting against employees on invidi- ous or irrelevant considerations. But what of situa- tions where the employer is alone responsible for establishing and maintaining employment practices which are based on invidious or irrelevant considera- tions? Are not such practices just as inherently destructive of employees' Section 7 rights as those engaged in by a union and, if so, has not the employer interfered with these employee rights in violation of Section 8(a)(1) of our Act? In United Packinghouse, Food and Allied Workers International Union, AFL-CIO v. N.L.R.B.,26 the United States Court of Appeals for the District of Columbia gave us its- answers to these vexing problems. There the court, in remanding the case to us, held that an employer's maintenance of racial discrimination in his employment practices violates Section 8(a)(1) of our Act because it creates an "unjustified clash of interests" among the employees which tends to reduce their ability to work in concert toward their legitimate goals, and because it creates among its victims "an apathy or docility" which inhibits them from asserting their rights in the employment relation. On remand, of course, the Board was obligated to accept the court's rationale as "the law of the case." However, in resolving the issues open to the Board on the remand, my colleagues concluded that the evidence did not support a finding that the employer had maintained a policy and practice of invidious racial discrimination against its employees on account of their race or national origin. As a consequence of this determination, my colleagues were not required to apply the court's rationale and, in fact, expressed no opinion on it.27 I dissented because, in my view, the evidence established that the employer was discriminating on racial and ethnic grounds in its employment practices and policies and, under the principles laid down by the court, such conduct constitutes a violation of Section 8(a)(1) of our Act. As I indicated in my dissent: It is the divisiveness, induced and fostered among the employees by the "clash of-interests" which the employer's racial discrimination cre- 21 Id at 185. 22 Id at 185-186 23 N L R B v. Miranda Fuel Co, Inc, 326 F.2d 172 (1963). 24 Local Union No 12, United Rubber Workers [Goodyear Tire & Rubber Co J v. N L R B, 368 F 2d 12, cert denied 329 U S 837. 25 386 U.S. 171, 183. 26 416 F 2d 1126, cert denied 396 U S 903. 27 Farmers' Cooperative Compress, 194 NLRB No. 3 JUBILEE MANUFACTURING COMPANY ates, which is the source of the unlawful restraint and interference with the employees' exercise of their concerted rights. The employees are forced to expend their time, effort, and money to eliminate a condition of employment based on invidious differentiation (race) which is unlawful and thus should never have existed. If one were to accept guidance from the principles I have discussed, above, we would of necessity be constrained to conclude on the basis of the evidence before us that Respondent's employment practices were violative of our Act. Certainly, the fact that we are involved here with discrimination based on sex rather than race is of no significance. The same principles apply to all such forms of discrimination as my colleagues readily admit. Unfortunately, my colleagues in the majority are, in my judgment, willing to give only limited application and effect to our national labor policy and they specifically reject the court's interpretation of that policy in the United Packinghouse Workers case, supra. Member Fanning, on the other hand, finds insufficient evidence to establish that Respondent discriminated on the basis of sex and, consequently, he finds it unnecessary, at this time, to pass upon the court's rationale in United Packinghouse Workers. As I understand Member Fanning's concurrence, he accepts Respondent's representation that the job of material handler requires unusual physical strength, including the ability to unload boxes weighing several hundred pounds and, from this, he concludes that the job is one which most women are poorly equipped to perform. While I am willing to concede that in certain employment situations the sex of the individual is a bona fide occupational qualification for the position,28 I do not think it proper to engage in broad generalizations which are too often based on stereotyped characterizations of he capabilities of men and women. In other words, the mere fact that a job involves the use of physical strength does not automatically remove members of the female sex from consideration. Rather, it must be demonstrated that women as a class have been unable to meet the physical requirements of the job and the burden of establishing that sex is a bona fide occupational qualification is upon the party raising it. The principal difficulty I have with Member Fanning's conclusion is that it is based on testimony which is purely conclusionary in nature and drawn from an examination of job classifications which were prepared some 20 to 25 years ago. Perhaps today, the job requirements for material handlers at 28 It is significant that, under Title VII of the Civil Rights Act of 1964, an exception to the overall proscriptions is provided in circumstances where sex is a bona fide occupational qualification reasonably necessary to the 277 Respondent's plant are the same as they were some 20 years ago, but it is just as likely that significant changes have occurred over the years. More impor- tant, in point of fact, we know nothing about the present day job requirements for material handlers at Respondent's plant. Nor do we know whether or not the physical qualifications for employees in one group classification differ in any way'from those in another classification. Simply stated, the record before us contains no specific evidence concerning the physical requirements for the different job classifications at Respondent's plant. What we are left with then is Respondent's undocumented and unsupported assertion that, at present, the job of material handler requires great physical ability and that this consideration necessitates and justifies the hiring of only males for this position. Furthermore, Respondent seems to ask us to assume that the necessary physical characteristics are to be found in all males, because there is no evidence that Respon- dent evaluates the physical attributes or abilities of the males it selects. I think Respondent has clearly failed to meet its burden of establishing that its prima facie discriminatory employment practices are justifi- able in light of the special requirements of the job of material handler. Moreover, even if I were to accept Respondent's representation that this position requires great physical strength, which on this record I cannot, I would be unwilling to conclude on the basis of this evidence alone that females, as a class, do not possess the necessary qualifications to perform the work. Such a conclusion would be valid only if Respon- dent's hiring experience demonstrated that females generally failed to possess the physical qualifications necessary to perform this work. However, no such characterization can be made here because Respon- dent's practice has been systematically to exclude females from consideration for the position of material handler. This also, in large part, explains the failure of the female employees to grieve over Respondent's total disregard of the bid procedures established in the collective-bargaining agreement. When, as here, the discriminatory practice is of longstanding duration and total in its application, employees may well conclude that it would be a futile gesture to insist upon being considered for jobs which Respondent believes they are not qualified to perform. In any event, the absence of any acts of discrimination against any specific individual proves nothing when it has already been established that Respondent's practices constitute and result in discrimination against individuals as a class. Nor normal operation of that particular business or enterprise. See 42 U S C § 2000e-2(e) 278 DECISIONS OF NATIONAL LABOR RELATIONS BOARD does it matter that Respondent may not have intentionally sought to produce such a result. The unlawfulness of the practice is determined by the consequence it produces, rather than by the motiva- tion behind it.29 In sum, then I feel constrained to conclude that Respondent discriminated on the basis of sex with regard to its employment practices and policies and that such conduct is contrary to our national labor policy. Turning now to the arguments raised in the majority opinion, I note, at the outset, that my majority colleagues agree that discrimination on the basis of sex is on an equal footing with discrimina- tion based on race. Also, unlike Member Fanning, they are willing to concede that the evidence before us may very well establish that Respondent's employment practices resulted in discnmination on the basis of sex.30 The majority's unwillingness to find a violation under our Act is based on the theory that there is no direct relationship between the discriminatory practices, which have been described, and the fundamental rights accorded to employees under the provisions of the National Labor Relations Act. In short, they reject the view that employment practices which are discriminatory and unquestiona- bly illegal under Federal law have, of necessity, the inherent effect of interfering with employee rights under our Act. To the "show how he or she was hurt" argument, I readily admit there is very little I can say except to answer that this only proves how wide- spread and successful were the illegal practices. Such a position rejects the Supreme Court's rationale in Griggs, supra, and the court of appeals rationale in United Packinghouse Workers, supra. The majority believes it is by no means inevitable that such discriminatory practices will result in the destruction of employee rights under our Act. To the argument that such practices produce an unjustified clash of interests among groups of employees, they reply that it is just as likely that the effect may be one of causing minority groups to coalesce and unite in common purpose with nonminority group members. That is, they expect the beneficiaries of the unlawful practice to join hands with the victims. Such arguments were made when Congress was considering the enactment of legislation which is now the Civil Rights Act of 1964. The claim was then 29 Griggs v Duke Power Co, 401 U S 424 30 In reaching their conclusions , my majority colleagues find it unnecessary to determine whether or not Respondent's employment practices, in fact, constituted sexual discnmination 31 In other situations, arising under our Act, we presume that an employer's restrictive practices are inherently destructive of employees' Sec. 7 rights without requiring specific evidence as to the effects on individuals of the restrictive practice For example, we will find unlawful and strike down an overly broad no-solicitation rule without regard to its actual application or enforcement , simply because such a rule has a general inhibiting effect on employees in the exercise of their Sec. 7 rights See made that no additional safeguards or protections were necessary because of a general awareness on the part of blacks and other minority groups of their fundamental rights as American citizens and their increasing involvement and willingness to act in concert in defense of these rights . However, the Civil Rights Act of 1964 was enacted into law because of the overwhelming evidence that large segments of our population were being denied fundamental rights that this legislation was designed to protect. The individuals discriminated against cannot and should not be expected to take the steps necessary to establish that Respondent specifically discriminated against each and every one of them.31 For reasons stated, I would find that Respondent's illegal employment practices and policies were inherently destructive of employee rights under Section 7 of our Act and, further, that Respondent by engaging in such practices unlawfully discriminat- ed against its female employees .32 Accordingly, I conclude, contrary to my majority colleagues, that, by such conduct, Respondent has violated Section 8(a)(1) and (3) of our Act. Consistent with the foregoing, I would also find, contrary to my majority colleagues,33 that during contract negotiations Respondent insisted to the point of impasse upon retaining contractual authori- zation to continue its discriminatory practices and by so doing engaged in conduct violative of Section 8(a)(5) of the Act. As the record clearly shows, Respondent interpreted the word "minimum" in the wage clause of the existing contract as permitting it to pay higher wages and grant special increases above the contract rate in order to attract and keep male employees . In other words, Respondent inter- preted the wage clause as permitting the payment of whatever rates it chose, over and above the minimum rates spelled out in the contract. When the Union learned that certain male employees were being paid rates of pay higher than those called for in the contract, it asked Respondent to explain its justifica- tion for such action. Respondent replied by offering its interpretation of the word "minimum" in the wage provision of the existing contract. When the existing contract expired , the Union proposed at the first negotiating session that the word "minimum" be deleted from all future con- Joseph Horne Co., 186 NLRB 754. 32 My majority colleagues' comparison of a situation where a union has failed to eliminate a practice of invidious discrimination with one where the union has failed to gain an economic concession from an employer is curious Of course, both actions may have the foreseeable consequence of discouraging union membership among employees, but the former is the product of an unlawful activity, whereas the latter is based on legal and legitimate considerations 33 Member Fanning does not reach this precise issue because of his conclusion that the evidence does not establish that Respondent engaged in discriminatory employment practices JUBILEE MANUFACTURING COMPANY 279 tracts. Respondent refused and indicated it intended to continue the practice because it felt that it had to pay more money "to attract the men off the street in the first place," and because it felt the "men" were the "breadwinners" in the family. To the Union's accusation that this action was in violation of Federal and state law, Respondent replied "that if there was a law against giving merit raises it was a funny law." The parties had three bargaining sessions, the last two of which were held under the auspices of Federal mediators, but they remained deadlocked over the issue of whether the word "minimum" should be deleted from the contract. Following these meetings, Respondent, at one point, offered to adhere to the minimum rates for a year, but with the added proviso that it would inform the Union if it needed to exceed the rates. This proposal was correctly characterized by the Administrative Law Judge as not a real change of position and the Union made no effort to respond to this proposal. However, the Union did on several occasions attempt to get together with Respondent, but to no avail. Finally during a chance encounter between Union Representative Graham and Respondent's vice president, Lewis, about a month and half after the last bargaining session, Graham proposed to Lewis that the parties meet again to resolve the issues. Lewis replied: "Well, this has went [sic] too far now, I don't see how we possibly could, we have to have the right to give the men more money so that we can get men in the plant." I have already described in detail Respondent's discriminatory employment practices, and it will suffice to point out here that it was through Respondent's interpretation and implementation of the wage provision in its contract that it was able to effectuate these discriminatory policies. Therefore, when, during negotiations, Respondent adamantly insisted upon the retention of the minimum wage clause, it was in fact insisting upon the right to continue its discriminatory practices. To such a condition, the Union could not legally agree because the Union would itself then be equally responsible for perpetrating sex discrimination.34 Moreover, by agreeing to such a condition, the Union would be violating its statutory obligation of fair representa- tion toward all unit employees.35 It is not surprising, then, that the Union found no legitimate basis on which it could agree to Respon- dent's proposal. The Union offered no counterpropo- sal, but, again, one would be hard pressed to devise a proposal which would be acceptable to one who insists upon the "right" to discriminate. In any event, it was at this juncture that the Union abandoned any further formal meetings with the Respondent and my majority colleagues are quick to point to this as the crucial event in the bargaining negotiations. They might be correct if the evidence indicated any softening of its position by Respondent. However, the evidence is quite to the contrary. At the conclusion of the formal negotiations, Respondent was still adamant about retaining the right to continue its illegal practices. Following this, Respon- dent made only one change in its proposal which the Administrative Law Judge found constituted no real alteration of its position. On the other hand, the Union made several efforts to resume the negotia- tions only to be rebuffed by the final comment that Respondent considered its interpretation of the minimum wage provision necessary to its continued operations. In such circumstances, I can only conclude that Respondent insisted to the point of impasse upon retaining the right to continue its discriminatory practices and that it also failed to accord the Union the full recognition to which it is entitled under the Act. Such conduct constitutes a refusal to bargain within the meaning of Section 8(a)(5) of the Act.36 In conclusion then, I would reverse the Adminis- trative Law Judge and find the 8(a)(1), (3), and (5) violations which are predicated upon the Respon- dent's practice of sex discrimination. In all other respects, I would affirm the Administrative Law Judge's dismissal of the allegations of the complaint. 34 Vaca v. Sipes, 386 U.S. 171. 35 Steele v. Louisville & Nashville Railroad Co., 323 U.S. 192; Miranda Fuel Co., 140 NLRB 181, enforcement denied 326 F.2d 172 (C.A. 2). 36 Southwestern Pipe, Inc., 179 NLRB 364, modified on other grounds 444 F.2d 340 (C.A. 5). TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE LLOYD S. GREENIDGE, Trial Examiner: This proceeding with all parties represented was heard on May 18 and 19, 1971, at Omaha, Nebraska, on the complaint of the General Counsel issued on March 26, 1971,1 and the answer of Jubilee Manufacturing Company, herein called the Respondent or Company. In issue are questions whether the Respondent, in violation of Section 8(a)(1), (3), and (5) of the National Labor Relations Act, as amended, maintained a policy and practice of granting wage increases and paying wage rates to male employees based solely upon the consideration of sex; refused to bargain with the Union by insisting to impasse during bargaining negotiations upon retaining a contract provision which it had used as a basis for unilaterally granting wage increases and paying wage rates to its employees on a sexually I The complaint is based on original and amended charges filed by United Steelworkers of America, AFL-CIO, herein called Charging Party or the Union, on August 12, 1970, and March 18, 1971, copies of which were duly served on the Respondent by registered mail on August 12, 1970, and March 19, 1971, respectively. 280 DECISIONS OF NATIONAL LABOR RELATIONS BOARD discriminatory basis; unilaterally changed existing terms and conditions of employment; and advised employees that it would not hold plant committee meetings until a contract was signed because of the trouble the Union had caused. On June 28, briefs were received from the General Counsel, the Respondent, and the Union in support of their respective positions. By letter of the same date, June 28, Respondent requested permission to file a reply brief because the case in its main aspect is one of "first impression." The request was unopposed and, on July 7, Acting Chief Trial Examiner Charles W. Schneider granted each party until July 19 to file a final memorandum in the nature of a brief. On July 19, a memorandum was received from the Respondent. Upon the entire record,2 including my observation of the demeanor of the witnesses, and after due consideration of the arguments advanced by the parties, I make the following: FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT Respondent, a Nebraska corporation, is engaged in the manufacture and distribution of automobile horns and burglar alarms at its facility located in Omaha, Nebraska. Annually, in the course and conduct of its business, Respondent sells and distributes products valued in excess of $50,000 directly to customers located outside the State of Nebraska. It is conceded, and I find, that the Respondent is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED The Union is a labor organization within the meaning of Section 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES A. Introduction For about 20 years, the Company has recognized the Union as the bargaining representative of the production and maintenance employees at its Omaha plant. Through- out this period, the parties have entered into numerous annual contracts and have enjoyed a friendly and harmonious collective-bargaining relationship. Except for modifications in wage schedules, there have been few changes in contract terminology. Among contract provi- sions which have remained substantially unchanged for many years is the following: Section IV Wages (a) Job classifications and minimum rates of pay within 2 At the close of the General Counsel's case, the Trial Examiner granted a motion by the Respondent, unopposed by the General Counsel, to dismiss par 11(b) of the complaint which alleged interrogation of employees in violation of Sec 8(a)(1) of the Act. 3 The evidence is without substantial conflict However , where there is conflict as to any relevant fact the Trial Examiner will set forth the resolution of the credibility issue the bargaining unit shall be as set forth in Exhibit "A" attached hereto and by this reference made a part hereof. The most recent collective-bargaining contract between the parties was effective for the period July 1, 1969, to June 30, 1970. In 1970, the Company employed from 44 to 48 unit employees about two-third's of whom were female employ- ees. Under the 1969 contract, employees are classified by groups. The groups are in fact job classifications and reflect wage rates in ascending order from Group I through Group X. In practice, however, Groups I through V are the only classifications utilized. Since about 1957 the fobs in Groups I, II, and III have been filled by female employees, those in Group IV by male employees, and positions in Group V by both male and female employees. B. The Evidence3 1. Alleged policy and practice of paying wage rates and granting wage increases upon consideration of sex The facts disclose clearly enough that, for the past 10 years, the contract language with respect to minimum rates of pay has remained substantially the same and that, for at least the past 5 years, the Company has been paying rates in excess of the minimum to material handlers or floor boys? Vice President Lewis testified that, at a bargaining session prior to 1967, a company spokesman explained to Floyd Pieper, staff representative of the Union,5 that the Company had been unable to fill job positions requiring manual labor and advised that in order to attract employees to the plant the Company had instituted a practice of paying material handlers above the minimum rates. According to Lewis, it was commonly known at the negotiating meetings that the Company was paying these employees in excess of the minimum, and the Union acceded to what the Company was doing rather than attempt to reclassify everyone in the bargaining unit. Lewis also testified that a job vacancy is filled on the basis of seniority but if there are no applicants it is posted. He was uncertain whether the job of material handler had ever been posted but acknowledged that a female employee has never been offered the job. I found Lewis to be a candid and forthright witness entitled to full credence and I credit his testimony. Graham and Bessie Bates, a retired employee and past president of the local, denied that the Company had ever told the Union it was paying the material handlers above minimum rates and averred that they first learned of the practice in April 1970 or later.6 I cannot accept this testimony of Graham and Bates. To begin with, it is unreasonable to believe that in a unit which in past years has only fluctuated between 35 to 48 employees, the bargaining representative would not have known the actual earnings of each member of the unit, 4 Exit A attached to the 1969 contract contains a listing of minimum starting rates for the various classifications covered by the contract and, opposite each, the pay increase after 30 days. The practice pursued by the Company was to grant material handlers the 30-day increase upon hire 5 Pieper retired in about 1966 and was succeeded by Earl Graham 6 According to a stipulation of the parties, Pieper was not called as a witness because of "advanced age and relative infirmity." JUBILEE MANUFACTURING COMPANY 281 particularly since contracts were negotiated annually and, as shown below, since the information was readily available to the Union. Further, Eileen Johanek, a witness for the General Counsel and Charging Party, testified that she had never applied for but would welcome a transfer to the job of material handler because it pays more than her present position. In this regard, Lewis reported that none of the female employees had asked to be transferred to the work. Johanek went on to confirm an earlier statement of Lewis to the effect that the material handler's job had been discussed at negotiating meetings. It is a reasonable inference from this testimony of Johanek that such discussions centered on the fact that the job paid more than the minimum rate . As to Bates, the witness was confused about the starting and termination dates of her employment with the Company, vacillated and was uncertain as to whether the 1969 contract contained a funeral leave provision (it did), and generally gave the impression of one hampered by a faulty memory. In view of the foregoing, as well as demeanor, I regard the testimony of Graham and Bates as unreliable and do not credit their denials of Lewis' testimony. Sometime in early April 1970, Johanek and Esther Sousa, treasurer and financial secretary of the local committee, respectively, told Graham that Paul Klaczinsky and Wasyl Gryshka would or had each received a 10-cent raise. Graham confirmed the reports in conversations with the beneficiaries of the raises and then instructed Johanek and Sousa to file a grievance with the company alleging a violation of the recognition clause of the contract. Significantly, Graham's initial complaint was not that the Company had exceeded the minimum rates but had violated the recognition provision. On or about April 13, a grievance was presented to and rejected by the Company and, shortly after this, the local's officials reported the result of their effects to Graham. Graham promptly called Plant Manager Joseph Davis and requested a meeting. In response, Davis advised that he saw no need to meet as the Company had the right to give raises whenever it desired. Ten or 15 minutes later, Vice President Lewis called Graham and, elaborating on Davis' reply, declared that, under the wording "minimum rates of pay" in section IV of the contract, the Company had the right to grant raises at will. Graham insisted on a meeting and Lewis promised to contact his attorney. Eventually, Graham agreed to defer further discussion of the grievance until the start of contract negotiations. As to this aspect of the allegation, Lewis testified, credibly and without contradiction, that in early spring 1970 he heard rumors to the effect that Klaczinsky and Gryshka, a spray painter and material handler in Group V, respectively, were unhappy about their rates of pay because they were about the same as those of material handlers recently hired; that both were valuable employees 7 Corroborated in this regard by Sousa. 8 Julia Degen and Lewella Watson. 9 Degen. 10 Sousa. 11 Initially, the operator of this press was required to unload steel and handle other heavy materials. In time , the Company dropped these requirements and opened the job to women. 12 Respondent objected to the introduction of statements by Lewis with many years of satisfactory service; and that the Company gave each a 10-cent-per-hour wage increase to retain them as employees. Continuing Lewis testified that the jobs are not classified on the basis of sex; 7 that in April 1970 two female employees8 were in Group V, one9 of whom was being paid above minimum rate about the time Klaczinsky and Gryshka received their increases; and that another female employee 10 was recently promoted to the position of Verson press operator also in Group V.11 2. Alleged refusal to bargain in good faith during negotiations In response to the Union's request, the Company by letter dated April 20 furnished a seniority list which showed, among other things, the anniversary dates and rates of pay of the bargaining unit employees. The Union presented its contract proposals sometime prior to June 10; bargaining meetings were held on June 10, July 16 and about July 26. The last two were arranged by a Federal mediator and were held in his office. The progress of the negotiations may be summarized as follows: a. The meeting of June 10 At the outset of the meeting, the parties discussed the seniority list the Company had provided in advance of the meeting. After this the Company reviewed the Union's proposals and, about this point, the meeting centered on item 2 therein which was a demand for the elimination of the word "minimum." Company Attorney Soren Jensen stated that he could not understand the demand, that the Company had given increases under the contracts for a long time and did not intend to change the minimum rates provision. Graham then asked if it was the position of the Company that the word "minimum" gives it the right to pay increases at will and, if so, whether it intended to continue the practice in the future. Lewis answered in the affirmative and went on to explain that the word establishes a floor as far as pay rates are concerned and the Company was thus free to grant merit increases if it desired to do so. Continuing Lewis advised that the Company had to pay above minimum rates to attract male employees to available job and had given Klaczinsky and Grychka merit increases because they were "breadwinners" and in order to retain them as employees. About this juncture, Graham declared that, in his lights, the Company's practice constituted a violation of federal and state equal employ- ment opportunity statutes and the National Labor Rela- tions Act as well. Lewis retorted that only the Company can give merit increases and he did not intend to surrender the right, and that if there is a law against paying such increases it is a "funny law." 12 At some time, Jensen told Graham that he had one of two alternatives, to arbitrate the disputed contract provision or to negotiate with regard characterizing employees who had received merit increases "breadwinners" and any law which restricts his right to give such increases a "funny law" on the ground that they were privileged expressions under Sec. 8(c) of the Act and, therefore, may not be used as evidence of an unfair labor practice. At the hearing, the General Counsel represented that the statements were offered for background purposes only. I now affirm my ruling admitting into evidence the quoted remarks. As the Board emphasized in Darlington Manufacturing Company, 165 NLRB 1074, 1079: (Continued) 282 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to the word "minimum." In the end Graham announced that, if the statements of Lewis and Jensen reflected the Company's position, the meeting was over and, turning to the members of the local committee, said "Come on, let's leave" and they left. b. The meeting of July 16 At the beginning of the July 16 meeting, the Union reviewed its proposals, the Company made a brief statement and, following this, the parties were separated by the Federal mediator for independent discussions with him. When they met again, Robert Andersen, another company attorney, stated that the fringe benefits in the Union's proposals totaled about 24 cents per employee and that this was too much for the Company. He then offered to pick up an additional insurance premium payment and to give a wage increase of 4 cents per hour across-the- board with no fringe benefits. The proposal was rejected by the Union. At this point a company spokesman asked Graham where he would start and he suggested 10 cents per hour. This time the proposal was rejected by the Company. Pursuant to a suggestion by the mediator, the Company proposed, and the Union did not oppose, a reclassification of all jobs covered by the contract. Finally, Lewis restated the Company's basic position, namely, that the phrase "minimum rates of pay" establishes a floor or the basic rates and the Company was at liberty to exceed the rates at will. The explanation prompted Graham to remark "it [minimum ] has to come out of the contract now that you've interpreted it that way." c. The meeting on or about July 26 At the outset of this meeting, the third and last bargaining session, the Company presented its reclassifica- tion proposal and then stated that it would adhere to the minimum rates therein but, if it ever became necessary to exceed the rates to keep the plant in operation, it would advise the Union of the changes. Graham rejected the proposal on the ground that it allegedly constituted a violation of the Civil Rights Act of 1964. The parties were again separated and, 20 or 30 minutes later, the mediator met with the union committee at which time he advised that the Company's position was firm on all matters and that unless the Union was prepared to make a counterproposal there was no place to go. Graham inquired whether the Company still sought to retain the word "minimum" and the mediator responded in the affirmative. Graham then said, "Well, as far as we are concerned it isn't our move, and we have nothing further to offer at this point, based on the fact that the Company is insisting upon the word minimum." This brought to an end the last formal bargaining meeting. During a fortuitous encounter in a local shopping center on or about September 11, Graham proposed to Lewis that The legislative background also makes clear, however, that this section [8(c)] left unrestricted the Board's right to consider employer statements for purposes for which they would be ordinarily admissible in courts of law Thus, it is firmly established that statements protected under Sec 8(c) are nevertheless admissible to show background, motivation, or context See also Edwards Brothers, Inc, 95 NLRB 1451, 1452 In 2; Cf US. Rubber the parties meet again to resolve the issues. Lewis replied that the matter had gone too far and that the Company had to have the right to pay above the minimum rates to attract employees to the plant. 3. Alleged interference, restraint and coercion Janet Bolan, employed by the Company about 3 years and president of the local since July 1970, testified that in the past it had been the practice for the shop committee to discuss employee grievances with the foreman concerned, then with the plant superintendent, and finally to file a written grievance if the matter was still unresolved. Sometime the latter part of August, Bolan requested a meeting with Superintendent Davis to discuss a plant problem. According to Bolan, Davis agreed to meet with the shop committee but, in the afternoon of the scheduled meeting, canceled the meeting. Queried as to the reason for his action, Davis replied, according to Bolan, that it was "because of all the trouble Mr. Graham had stirred up and that we had not signed a contract and he would not hold any committee meetings. The only meetings he would hold would be safety committee meetings." Bolan acknowl- edged, however, that the grievance was later reduced to writing and promptly handled by the Company to her satisfaction. In Davis' version, Davis inquired as to nature of the problem but Bolan refused to respond so he told her to put the complaint in writing as required by contract.i3 He also testified, without contradiction, that, shortly after becoming plant superintendent in February 1970, he announced to the entire shop that it would be his policy not to hold committee meetings during production time. Further, Davis specifically denied telling Bolan that Graham had created a problem, that there would be no contacts with the Union until a contract was signed, or that he would only hold safety committee meetings. As to the latter, Davis went on to say that he told Bolan it was not necessary to reduce a request for a safety committee meeting to writing. I credit Davis' version of the episode over that of Bolan as it contains a fair amount of corroborative detail which tends to buttress his account. Accordingly, I shall dismiss the allegation in paragraph 11(a) of the complaint to the effect that Davis told employees the Respondent "would not hold any more plant committee meetings until the contract was signed because of the trouble the Union had stirred up" for the reason that it is not substantiated by the credible evidence. As stated above, Respondent's unopposed motion to dismiss paragraph 11(b) of the complaint alleging an unlawful interrogation of employees concerning their union activities was granted at the hearing. In his brief, the General Counsel argues that certain remarks of Lewis to the Union's negotiating committee in which the terms "breadwinners" "funny law" were employed, related in detail above, contained implied Company, 93 NLRB 1232, 1233 In. 2, Axelson Manufacturing Company, 88 NLRB 761, 765-766 13 Sec VI(c)(2) therein provided that "If a satisfactory adjustment of such grievance shall not be reached in step 1, the grievance shall be presented to the Company's designated representative in writing, and a copy furnished the Union Grievance Committee JUBILEE MANUFACTURING COMPANY 283 threats of reprisal, were coercive in nature and, inferential- ly, are violative of Section 8(a)(1). During the hearing, the General Counsel represented, as noted, that the said statements were being offered for background purposes and not as a basis for a finding of an unfair labor practice. The representation was relied on by the Respondent and the Trial Examiner. No explanation is offered for the change in position and the Trial Examiner will not speculate as to the reasons therefor. In any event, it is patent, and I find, that no threat or coercive purpose is indicated by these statements of Lewis. 4. Alleged unilateral change in existing terms and conditions of employment Under section XV of the collective-bargaining contract, which as noted expired on June 30, 1970, the Company agreed to continue a group hospitalization and surgical fee insurance for the term of the basic contract; to pay all premiums on the said insurance for full-time employees; and to pay $1.60 per month toward the cost of a group health and accident insurance plan for such employees who elect to participate in the health and accident insurance plan. The prime carrier of both insurances was Blue Cross-Blue Shield and the Company paid the premiums on both policies to Blue Cross. However, Blue Cross had subcontracted the health and accident insurance to Northwestern National Life Insurance Company. Sometime in the summer of 1970, Paul J. Novak, a contact man with Blue Cross, told Lewis that Blue Cross was changing the carrier of the health and accident insurance from Northwestern National to The Standard of America Life Insurance Company, that the coverage would probably be the same but, if different, Blue Cross would honor a claim filed under the old policy, and that the premiums would be reduced. In point of fact, there were significant changes in coverage as follows: the period of payment of accident and sickness benefits was reduced at age 60 from an aggregate of 26 to 13 weeks and all benefits terminated at age 65. Further, William F. Ryan, secretary and general counsel for Blue Cross, testified that a claim filed under the old policy by a covered employee over 60 would not be honored by Blue Cross. On August 26, the Company posted the following: NOTICE TO ALL EMPLOYEES Effective October 1, 1970, the monthly cost of H & A insurance will be decreased by fifty five cents ($ .55). The new cost per employee will be $3.90 per month instead of $4.45. Same coverage as before. Any eligible employee who wishes to enroll in this Health & Accident plan, should do so immediately. Concededly, Lewis never communicated directly with Graham or any officer of the local about the change in insurance carrier. Indeed, as late as the date of his appearance as a witness in this proceeding, Lewis had not examined the new policy. C. Concluding Findings 1. With regard to discrimination in employment The complaint alleges, and the answer demes, that "the Respondent has maintained, and is maintaining, a policy and practice of granting wage increases and paying wage rates to male employees . . . based solely upon the consideration of sex"; that it has engaged in the aforemen- tioned conduct in spite of the Union's efforts to stop it; and that a foreseeable consequence of the Respondent's conduct is to discourage employee support of the Union, all in violation of Section 8(a)(3) and (1) of the Act. In his brief, the General Counsel contends that the Respondent has granted wage increases and paid above mimmum rates to male employees for arbitrary or irrelevant reasons and on the basis of an unfair classification; that it pursues a policy and practice of sex discrimination despite efforts by the Union, pursuant to its 9(a) obligation of fair represen- tation, to resist them; and that such adamancy on the part of the Respondent "demonstrates to the unit employees the Union's ineffectualness in such statutorily obligatory efforts." 14 The General Counsel does not contend that the Respondent has discriminated against its female employees in the bidding for or filling of job vacancies and, in fact, concedes the absence of any evidence of discrimination in this regard. Admittedly, there is no legal precedent for the proposi- tion that an employer violates the Act by sex discrimina- tion. The General Counsel relies, however, on a holding by the United States Court of Appeals for the District of Columbia Circuit with regard to discrimination on account of "race or national origin." 15 In Farmers' Cooperative Compress, i6 the Board found, inter alia, that the Employer had violated Section 8(a)(5) and (1) by refusing to bargain in good faith over the terms and conditions of employ- ment, including the conditions of racial discrimination, and ordered the Employer to cease and desist therefrom and to take certain affirmative action to remedy the unfair labor practices. The Board's Order was enforced on appeal.17 However, Judge J. Skelly Wright, speaking for the circuit court, held that an employer's policy and practice of invidious discrimination against its employees on account of race or national origin interferes with or restrains the discriminated employees from exercising their Section 7 rights in violation of Section 8(a)(1) of the Act and remanded the case to the Board to determine whether the Employer has such a policy and practice and, if so, to devise an appropriate remedy. As of this writing, the Board has not found that the Employer in Farmers' Cooperative Compress violated Section 8(a)(1) and, while the circuit court recognized that such a violation could exist, it did not so find. The General Counsel's contentions stand the case on its head because central to his thesis, assuming validity therein for the purpose of discussion only, must be the underlying fact of discrimination an element conspicuous by its absence in this case. The General Counsel insists, however, 14 Citing Miranda Fuel Company Inc, 140 NLRB 181, enforcement (C A D.C.), cert. denied 396 U.S 903 denied 326 F.2d 172 (C.A 2) 16 169 NLRB 290 15 United Packinghouse, Food and Allied Workers International Union, AFL-CIO (Farmers' Cooperative Compress) v. NLRB, 416 F.2d 1126 17 See fn. 15, supra 284 DECISIONS OF NATIONAL LABOR RELATIONS BOARD that the evidence is sufficient to sustain a finding of discrimination and in support of his position points to copies of dues checkoff lists for the months of February and April 1971 which show that 15 fewer employees had their dues checked off in April than in February. In this regard, Local President Bolan testified initially that employees whose names were left off the April list were still employed by the Respondent though no longer union members.18 However, on cross-examination, Bolan admit- ted that at least two employees on the February list were not employed by the Respondent as of April 1.19 Further, Bolan acknowledged that she has not received a letter of resignation from any employee , and has not talked to and does not know why any of the 13 remaining employees dropped out of the Union. In view of the self-contradiction and the confusing state of Bolan's testimony, I must find the inference the General Counsel invites from the checkoff lists and Bolan's testimony, namely, that Respon- dent's practice of paying male employees above minimum rates and granting them wage increases has resulted in a diminution of employee support of the Umon, to be unwarranted. In sum the following is revealed by the record: the Respondent and the Union have enjoyed an amicable bargaining relationship over a period of about 20 years; in the past 5 years, the Respondent has followed a practice of paying its material handlers, all male employees, above minimum rates for a good business reason and not for the purpose of discriminating against its employees on basis of their sex; the practice was known to and accepted by the Union ; it was discussed at negotiating meetings yet neither the Union nor any female employee has ever made a request to the Respondent that female employees be transferred to the job of material handler and it does not appear that the Respondent has had any reason to believe that its female employees were available to do the work; about the time Klaczinsky and Grychka received wage increases Respondent was paying female employee Degen above the minimum rate ; and, finally, female employee Sousa occupies a position in Group V which at one time was held by a male employee. I am persuaded, and thus find, that the record does not preponderate in favor of a finding that , by paying material handlers in excess of the minimum rates and granting long- time male employees wage increases , the Respondent has developed and practiced a policy of discrimination against its employees on account of their sex. Accordingly, I conclude that the record does not support, and I will therefore dismiss, the allegations of the complaint that the Respondent in violation of Section 8(a)(3) and ( 1) of the Act has discriminated against its employees by maintaining a policy and practice of granting wage increases and paying wage rates to male employees upon the considera- tion of sex. 2. With regard to refusal to bargain and unilateral change in existing terms and conditions of employment The complaint alleges, in substance , that the Respondent in violation of Section 8(a)(5) and (1) of the Act has refused to bargain with the Union by insisting to the point of impasse upon the retention of a provision in the contract which it had used to grant wage increases on a sexually discriminatory basis and unilaterally changing an existing term and condition of employment by procuring an insurance policy covering the unit employees different from the one in effect under the 1969 agreement. More specifically the General Counsel and the Charging Party contend that the Respondent has used the minimum rates of pay provision in the 1969 contract to perpetuate sex discrimination-an illegal act under Federal and state statutes-and, by obstinacy in its resolve to retain the provision, has sought to condition an agreement with the Union upon its acceptance of a nonbargainable subject. I do not agree. Section 8(a)(5) of the Act provides that it shall be an unfair labor practice for an employer "to refuse to bargain collectively with the representative of his employees e m p l o y e e s . Section 8(d) of the Act defines collective bargaining as requiring the parties to a collective -bargaining relationship to meet at reasonable times and confer in good faith "with respect to wages, hours, and other terms and conditions of employment ...." It is well settled that an employer acts in derogation of his bargaining obligation under Section 8(d), and hence violates Section 8(a)(5), when he insists on the inclusion of a nonmandatory subject as a precondition to an agreement even though the parties may voluntarily reach a lawful agreement on the matter .20 However, as it has been found that the Respondent did not, at any time material herein, have a policy and practice of discrimination against its employees on account of their sex, the matter of minimum rates of pay was a mandatory topic and could be bargained upon to impasse. As set forth above, negotiating sessions were held on June 10, July 16, and on or about July 26. At the first, the Company reviewed the Union's contract proposals and after this the discussion focused on the Union's demand that the word "minimum" not be included in the new contract . Graham inquired whether the Company con- strued the word as giving it the unfettered right to pay above contract rates and Lewis answered in the affirmative with an explanation . During the course of the meeting, Attorney Jensen told Graham that he (Graham) was confronted with one of two alternatives, to arbitrate or negotiate . Finally, Graham stated that if this was the Company's position the meeting was over and he left taking the local's negotiating committee with him. At the second session, the parties exchanged economic proposals to no avail. At some point, the Federal mediator suggested that the Company reclassify its job positions. The suggestion was accepted by the Company and not opposed by the Union. Near the close of the meeting, the Company is The 1969 agreement did not contain a union-security provision 20 N L R B v. Wooster Division of Borg-Warner, 356 U S. 342. 19 J Reed and B Reed. JUBILEE MANUFACTURING COMPANY 285 once again declared that the minimum rates of pay provision must be retained and the Union just as strongly demanded that it be eliminated. The third and final bargaining session was held about July 26. At this meeting, the Company presented a reclassification proposal and advised that it would adhere to the rates therein but that if it became necessary to exceed them it would advise the Union of its action. Although the Company proposed to alter the phrasing of the disputed provision in an attempt to get the Union to accept it, the change was one of semantics not substance as the Company would still retain the right to pay above the minimum rates at will with notice to the Union only after the fact. The proposal was, of course, rejected. The parties were then separated and sometime later the mediator reported to the Union that the Company was steadfast in its position and unless the Union was willing to make a counterproposal the parties were deadlocked. Graham's only response to all this was a statement that the next move was not the Union's and the Union had nothing further to present. In the view of the Trial Examiner, an impasse was reached about July 26. Management insisted on inclusion of the disputed provision and the Union was equally emphatic that it was unacceptable. However, contrary to the General Counsel and the Charging Party, I believe the Union not the Respondent created the impasse. Thus, it was Graham who walked out of the initial meeting when told the Company was firm in its determination to keep the provision and who at the final meeting failed to respond to the Company's reclassification proposal with a counterpro- posal of his own but instead declared that the Union had nothing further to offer. Graham and Lewis met perchance in September and, on that occasion, the former requested a meeting not for full- scale bargaining for an entire new contract, but only to resolve the issues. Lewis' response was that the matter had gone too far and he again stated that the Company must have the right to pay above the minimum rates. Since an impasse on the minimum rates issue was reached on or about July 26 and since there is no evidence of any substantial change in circumstances which would have revived the Respondent's duty to meet or any indication that the Union was more amenable to compromise on the issue, I find that the Respondent was not bound to meet and bargain with the Union.2i The Charging Party points in its brief to the Board's majority holding in Moore of Bedford, Incorporated22 that the Employer there violated Section 8(a)(5) when it insisted to the point of impasse that the Union agree to change a contract provision providing for a grievance arbitration procedure the effect of which would have granted the Employer unilateral control over wages paid to incentive pay employees.23 In finding the 8(a)(5) violation in Moore 21 Cf Transport Company of Texas, 175 NLRB 763. 22 187 NLRB 721. 23 Citing Tex-Tan Welhausen Company, 172 NLRB 851 24 The statement in the notice that there would be no change in coverage of Bedford, however, the Board's majority stressed, inter alia, that at no time did the Employer express a desire to negotiate over the "earnings level." I distinguish the instant case from Moore of Bedford in that critical respect. Conversely, the cases are in harmony in that in each there was an established history of amicable bargaining wherein the disputed provision had become a recognized part of the contractual relationship. In the total circumstances surrounding the dispute with respect to the minimum rates of pay provision, I find that Respondent did not violate Section 8(a)(5) and (1) of the Act by its insistence that the provision be retained in any new contract with the Union. Accordingly, I shall dismiss this allegation of the complaint. Nor do I find an evidentiary support for the allegation that the Respondent unilaterally changed an existing term and condition of employment. It is true that the health and accident insurance policy was changed to the detriment of the unit employees but the action was taken by Blue Cross when it switched from Northwestern National to Standard of America not by the Respondent. Moreover, after the conversation with Novak, Lewis posted, or caused to be posted, a notice of the change on the plant bulletin board. The notice was posted approximately 5 weeks before the change was to take place and most if not all of the officers of the local were employed in the plant. It is therefore reasonable to infer, and I do, that the Union was aware of the change well in advance of its effective date.24 Accordingly, having found that the Respondent did not engage in any of the alleged violations, I shall dismiss the complaint. CONCLUSIONS OF LAW 1. Jubilee Manufacturing Company is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. United Steelworkers of America, AFL-CIO, is a labor organization within the meaning of Section 2(5) of the Act. 3. Jubilee Manufacturing Company has not engaged in unfair labor practices within the meaning of Section 8(a)(1), (3), and (5) of the National Labor Relations Act, as amended. Upon the basis of the foregoing findings of fact, conclusions of law, and the entire record in the case, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: ORDER The complaint is dismissed in its entirety. was contrary to the fact, but it does not appear that it was a deliberate misrepresentation calculated to mislead employees with respect to their rights under the Act