Conval-Ohio, Inc.

CONVAL-OHIO, INC. Conval-Ohio, Inc. and Local 908, International Broth- erhood of Boilermakers, Iron Shipbuilders, Black- smiths, Forgers and Helpers, AFL-CIO. Case 8-CA-6488 March 2, 1973 DECISION AND ORDER BY MEMBERS FANNING, KENNEDY, AND PENELLO On August 31, 1972, Administrative Law Judge Maurice S. Bush issued the attached Decision in this proceeding. Thereafter, Respondent filed exceptions and a supporting brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the record and the attached Decision in light of the exceptions and brief and has decided to affirm the rulings, findings, and conclusions of the Administrative Law Judge and to adopt his recommended Order,' as modified herein. 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 Respondent, Conval-Ohio, Inc., Akron, Ohio, its officers, agents, successors, and assigns, shall take the action set forth in the said Order,2 as modified herein. Substitute the attached notice for the Administra- tive Law Judge's notice. 1 In sec. III, par. 10 of the Administrative Law Judge 's Decision, the date in the last sentence should read December 31, 1970. In the fifth paragraph of the section entitled "The Remedy," the Administrative Law Judge stated that Respondent would be ordered to cease and desist from "in any other manner" interfering with the employees' rights. In paragraph 1(d) of his recommended Order, he ordered Respon- dent to cease and desist from "in any like or related manner" interfering with such rights . We believe that "in any like or related manner," as provided in the Order, is appropriate. Respondent has not excepted to the Administrative Law Judge's determination with regard to possible deferral to arbitration , and Members Kennedy and Penello therefore adopt his conclusion on this issue pro forma. 2 In the fifth indented paragraph of the notice to employees, the Administrative Law Judge awarded 6 percent interest from January 1, 1971, to employees who were eligible to receive the cash awards. This interest should be awarded from the date the employees became eligible for the awards . We therefore have made this correction in the notice. APPENDIX NOTICE TO EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government 85 The National Labor Relations Act gives you as employees, these rights: To engage in self-organization, to form, join, or help unions; To bargain collectively through a repre- sentative of your own choosing; To act together with other employees to bargain collectively or for other mutual aid or protection; and, if you wish, not to do any of these things. WE WILL NOT do anything that interferes with any of your rights listed above. WE WILL NOT discontinue, cancel, abrogate, suspend, modify, or withhold payment, in full or in part, of your monetary service award, without first notifying and giving your Union the opportu- nity to discuss and bargain about it with us. WE WILL cancel any changes of benefits or working conditions of our employees which we made on January 1, 1971, or later, and which have resulted in financial or other detriment to our employees. WE WILL pay each eligible person in the following collective-bargaining unit the monetary service award which he or she would have received since January 1, 1971, the same as if we had not unilaterally suspended or withheld payment thereof. The amounts of such payment will be calculated in accordance with the previ- ously established schedule which became effective March 1, 1968, and applied in the years prior to January 1, 1971, and shall have added thereto 6 percent interest from the date it was due to the date of payment. The collective-bargaining unit referred to herein consists of: All production and maintenance employees, only at Machining and Assembly Wads- worth, Ohio, but excluding clerical employ- ees, dispatchers, professional employees, watchmen, guards and supervisors as de- fined in the Labor-Management Act of 1947, as amended; and at the Casting Plant, Orville, Ohio, but excluding clerical employ- ees, dispatchers, production planners, pro- fessional employees, watchmen, guards and supervisors, as defined in the Labor-Man- agement Act of 1947, as amended. WE WILL from now on bargain with Local 908, 202 NLRB No. 16 86 DECISIONS OF NATIONAL LABOR RELATIONS BOARD International Brotherhood of Boilermakers, Iron Shipbuilders, Blacksmiths , Forgers and Helpers, AFL-CIO, concerning any proposed change in our monetary portion of the employee service award program, or concerning any other term or condition of employment. WE WILL continue the payments of the cash awards for longevity of service due to employees as they become eligible therefor under the established employees' service award program until we and the Union have negotiated in good faith to agreement on any proposed changes in the said present program or impasse thereon. CONVAL-OHIO, INC. (Employer) Dated By (Representative) (Title) This is an official notice and must not be defaced by anyone. This notice must remain posted for 60 consecutive days from the date of posting and must not be altered, defaced, or covered by any other material. Any questions concerning this notice or compli- ance with its provisions may be directed to the Board's Office, 1695 Federal Building, 1240 E. 9th Street, Cleveland, Ohio 44199, Telephone 216- 522-3715. DECISION STATEMENT OF THE CASE MAURICE S. BUSH, Administrative Law Judge: In 1969, Conval-Ohio, Inc., became the successor owner and operator of two plants in Ohio under union contract which employ approximately 400 employees. A portion of these are long term employees on their way to the attainment of 30 or more years of continuous employment at the two plants. On March 1, 1968, a predecessor company on its own initiative but with the consent of the Union began to honor such long term employees with cash awards of $100, $150, $200, and $300 on the anniversary of their attain- ment of service records of 30, 35, 40, 45, and 50 years, respectively. These fringe benefits are not covered by or included in the formal collective-bargaining agreements here involved between the Union and Conval-Ohio or its predecessor, but were part and parcel of the established terms and conditions of employment at the two plants when Conval-Ohio took over their operations. Conval-Ohio became the successor owner of the two Ohio plants on November 1, 1969. Starting in April 1970, the Union began protests to the Company over its failure to make the described longevity cash awards of $ 100 to two employees who had attained 30 years of service . In August 1970, the Company after several conferences with the Union on the matter, made retroactive payments of the $100 cash awards to the two employees . Thereafter, Respondent made one more cash award in December of 1970 to the only other senior employee who qualified for such employee service award in the calendar year 1970. But from and after January 1, 1971, the Company has refused and still refuses to make any further cash awards to qualifying senior employees under the established employ- ee longevity service award program . This led to the filing of the charge herein by the Union and the issuance of the complaint. The issue herein , under the pleadings and the above skeletonized but undisputed facts, is whether the Respon- dent unilaterally discontinued an established program of employee service cash awards based on seniority without notice or discussion with the Union in violation of Section 8(a)(5) and ( 1) of the National Labor Relations Act. The Respondent in its brief admits that it unilaterally discontinued the seniority service cash awards but defends its action on the ground that the discontinuance was "discretionary with the Company" and on the further ground that the Union waived its right to protest the discontinuance under the "zipper" or waiver clause of the current collective-bargaining agreement. At the 2-day trial herein, Respondent did not request or in any way indicate that it desired deferral to arbitration of the basic issue of the employees ' continued rights to the service awards under the grievance and arbitration provisions of its collective-bargaining agreement with the Union . In its brief, Respondent for the first time requests and seeks deferral to arbitration of the issue under the authority of Collyer Insulated Wire, 192 NLRB No. 150. Under these circumstances there is a threshold issue here of whether the Respondent is entitled to raise in its brief for the first time the issue of whether it is entitled to the right of deferral or, conversely, whether Respondent's request for deferral to arbitration should be denied regardless of merit because of Respondent's failure to either plead or raise the issue during the trial of the case. The complaint herein was issued on April 18, 1972, pursuant to a charge filed on June 24 , 1971, and duly served on the Respondent . Respondent's answer denies the alleged unfair labor practices. The case was tried before the Administrative Law Judge on June I and 2 , 1972, at Akron, Ohio. Briefs filed by counsel on July 10, 1972, have been carefully reviewed and considered. CONVAL-OHIO, INC. For reasons more fully set forth below, Respondent's request for deferral to arbitration is dismissed because it is untimely and the Respondent is found in violation of the Act substantially as alleged in the complaint. Upon the entire record in the case and from my observation of the witness, I make the following: FINDINGS OF FACT 1. JURISDICTIONAL FINDINGS Respondent Conval-Ohio, Inc., an Ohio corporation, is engaged in the manufacture of industrial and commercial valves, with its principal office and assembly plant located at Wadsworth, Ohio, and a foundry located at Orrville, Ohio. The Company, in the course and conduct of its business operations, annually receives goods, materials, and supplies, valued in excess of $50,000 at its places of business in Wadsworth and Orrville, Ohio, directly from points located outside of the State of Ohio. The Company is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. The above-captioned Union is a labor organization within the meaning of the Act. 11. THE REQUEST FOR DEFERRAL TO ARBITRATION As heretofore indicated, the Respondent makes its request for deferral to arbitration of the issue here involved, under the grievance and arbitration articles of its collective-bargaining agreement with the Union, for the first time in its brief addressed to and filed with the Administrative Law Judge more than 30 days after the close of the hearing in the case. The request for such deferral is not affirmatively pleaded anywhere in Respon- dent's answer. The issue of deferral was not raised or litigated during the course of the 2-day hearing. The opening statement of counsel for the Respondent at the trial does not contain even a suggestion for deferral to arbitration. Throughout the trial there was no reference to the Board's landmark decision in Collyer Insulated Wire, supra, dealing with and establishing a policy favoring deferral to arbitration of contract disputes. Although the collective-bargaining agreement between the Company i In the event the Board on exceptions disagrees with the above findings and conclusions and holds that the plea for deferral for arbitration was or is properly before the Administrative Law Judge for decision despite its belatedness, the Administrative Law Judge finds on the merits that the dispute as to whether the Respondent has the right to unilaterally discontinue the established cash awards for longevity of service is not in any event subject to the grievance and arbitration provisions of the collective- bargaining agreement here involved This is because the established longevity service cash award program is entirely dehors the agreement and thus not a part of the agreement and because under the agreement itself a grievance will not lie on a claimed right outside the contract but must be based on "a claimed violation of the rights of employees as established by this Agreement "(Emphasis supplied) (Joint Exhs I and 2, art XI) Thus under the terms of the agreement the Union could not invoke the grievance and arbitration procedure of the agreement for the Company's failure to make cash awards to eligible employees under the established employee longevity service award program This is candidly recognized by Respon- 87 and the Union contains an article providing for "Arbitra- tion," the agreement was not introduced in evidence for the purpose of showing that the issue here involved was subject to arbitration, but was received i' evidence, insofar as it related to specific articles therein, only for the articles dealing with management rights and waiver of the parties to claim rights not found within the terms of the agreement. Discussion and Conclusion As there is no affirmative plea in Respondent's answer that the Board should defer the issue in the case to arbitration and as the Respondent did not raise the issue of deferral at the trial, the Administrative Law Judge finds and concludes that the issue of deferral is not before him, that the Respondent's plea for the first time in its brief for deferral to arbitration is untimely, and that accordingly the belated plea for deferral should be and is denied, irrespective of merit or lack of merit. I iiI. THE UNFAIR LABOR PRACTICES The two Ohio plants here involved have been in operation under several corporate owners for decades. The plants have been operating under collective-bargaining agreements with the Union from at least February 11, 1968, and probably for many years prior thereto. The appropriate bargaining unit in the two plants consists of all production and maintenance employees with the usual exceptions.2 Approximately 400 bargaining unit employees have been employed at the 2 plants at all times here pertinent. Respondent, Conval-Ohio, Inc., purchased and took over the two plants from the previous owner, OIC Corporation, on November I, 1969, which was then under contract with the Union. (Joint Exh. 1) On October 31, 1969, Conval's president, Howard Deem, met with the Union's Bargaining Committee and union officers to advise them of Conval's proposed takeover of the two plants as of the next day, asked their cooperation with the new management, and told them that Conval would adopt and take over their then current collective-bargaining agreement with the OIC Corporation, as was subsequently carried out by formal written agreement. (Joint Exh. 5) In addition the credited testimony of four of the unit employees present at the meeting as officials of the Local shows that Deem also told the entire unit delegation that dent's able counsel in his brief where he states, "Not being covered by the specific contractual language, the strict reading of Collyer Insulated Wire would preclude the application of its deferral doctrine here" Respondent, however, argues for an expansion of the Board's "deferral to arbitration" policy to include disputes "concerning the existence or nonexistence of benefits which are claimed to be due employees through the operation of past practice" based on the general language in the Collyer decision favoring arbitration But, as any reading of the Collyer decision shows that the sine qua non for deferral to arbitration is the existence of grievance and arbitration machinery for the settlement of disputes, the requested expansion of the policy favoring deferral to arbitration here cannot be allowed because the collective-bargaining agreement does not provide the machinery for the arbitration of disputes not arising under the term of the agreement 2 The precise definition of the appropriate unit will be set forth in the Conclusions of Law below 88 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Conval as the new owner would recognize and accept all other commitments and obligations of OIC to the Local.3 With these pledges, the union people unanimously promised full cooperation to the new management. At the time that Deem as president of Conval made his blanket commitment to the union representatives present at the meeting not only to adopt the then current collective-bargaining agreement but also to recognize and accept all other obligations OIC had to the Local, the employees in the unit were entitled to certain fringe benefits under OIC's and predecessor programs of employ- ee service awards which the employees received under established practice and not under the terms of collective- bargaining agreements. Prior to OIC's acquisition of the two plants, the predecessor firm for many years had awarded service emblems in the form of pins to employees for each increment of 5 years of service. The record does not disclose whether the pins were embellished with jewels. As of March 1, 1968, OIC at its own suggestion and without the request of the Local, but after full discussion with and consent of the Local, modified and greatly liberalized the then established employees service award program which as seen, existed apart from the collective- bargaining agreement. Under the modified program OIC continued the practice of awarding service pins for each 5- year increment of service. Whether the practice of adding precious jewels to the pin emblems was new or not, under the modified program the pin for 10 years of service had one ruby, the pin for 15 years of service had two rubies, and for each additional increment of 5 years of service, the jewels increased in either number or value or both. Under the modified program, OIC also continued the practice of awarding a watch to employees who attained 25 years of service, but, after discussion with and consent of the Union, updated the styles of the watches for the award. But more importantly, as directly related to the issue herein, OIC under the modified plan began for the first time a program of making cash awards to employees on their anniversaries of 30, 35, 40, 45, and 504 years of service in the amounts of $100, $150, $200, $250, and $300, respectively. The day before OIC's modified program became effective, OIC notified its employees of the liberalized revision by a press release in its house publication. (Joint Exh. 3) The modified employees service 3 The above finding is based on the composite testimony of Oscar Ellison, Paul Dobbins, James Waggamon, and Maurice Knecht, president, vice president, secretary-treasurer, and trustee of Local 908, respectively, all of whom are also long time unit employees at one or the other of the two plants Mr Deem did not testify at the trial The only management man present at Deem's meeting with the Local's representatives, called upon to testify herein, was Leo Ryan, then manager of Labor Relations for IOC before Conval took over (He continued in the same capacity for Conval for a period of time ) Ryan merely testified to the undisputed fact that Deem informed the Local's representatives that Conval would take over the then current collective-bargaining agreement that the Local had with OIC. Ryan did not deny the testimony of the four above-named witnesses that Deem also told the union people at the meeting that Conval would recognize and accept all other commitments and obligations OIC had to the Union The only other person to testify as to what Deem told the union people at the meeting was Don Meager, then chief steward for OIC but now part of Conval's management personnel Like Ryan, Meager testified that Deem promised the union people that Conval would take over their collective-bargaining agreement with OIC but did not deny the testimony of the aforementioned four officials of the Local that Deem also told the union people that Conval award program, as before the modification, is not covered by any part of the collective-bargaining agreement. In the spring or early summer of 1970, two of Conval's unit employees became entitled to cash awards of $100 each upon their anniversaries of 30 years of service under the modified employees service program established by OIC as described above. Conval, whether by design or oversight, did not make the awards to the two employees on the anniversary dates of their services in the plants then owned and operated by Conval. Protests were made by the Union to the Company over its failure to make the two cash service awards. The matter came to a head on July 13, 1970, tangentally as an offshot of a fourth-step grievance meeting concerning matters totally unrelated to the service awards. At that meeting, Conval's then manager of industrial relations, Bruce Coen, announced that the Company would make retroactive payments of the cash awards to the two employees. The credited testimony of a number of employee union representatives at that meeting shows that Coen also informed the union representatives that the Company would in the futures continue to make the employee cash service awards on the anniversary service dates of the employees. In August, in accordance with Coen's an- nouncement, the Company made retroactive service award payments of $100 to each of the two mentioned employees. In late December 1970, it made another cash award of a $100 to another employee who had attained 30 years of service. These three employees were the only employees in the plant who became entitled to longevity service awards from the time the Conval took over the two plants on November 1, 1969, through 1970. On January 1, 1971, Conval, unilaterally and abruptly without notice to or discussion with Local 908, discontin- ued the described employee cash service awards as well as the grants of watches to employees who attain 25 years of service. As the Union does not challenge the discontin- uance of the watch award, there is no issue in the case with respect to the watch award discontinuance. Thus, the only issue in the case relates to Respondent's unilateral discontinuance of the cash awards for longevity of service. By stipulation, it is established that the Company has not made any employee cash service awards since December 31, 1971. The collective-bargaining agreement Conval took over would recognize and accept all other obligations OIC had to the Local If the testimony of Ryan and Meager can be construed to mean that Deem made no commitments other than the promise to take over the current collective-bargaining agreement, the Administrative Law Judge does not credit such testimony The testimony of Ryan and Meager as a whole show them to be unreliable witnesses 4 Rather surprisingly, the record indicates that there are some employees in the unit with or approaching 50 years of continuous service 5 The testimony of Leo Ryan, Conval's then manager of labor relations, that Mr. Coen told the Local's representatives that the award payments would be reinstated "for now" is not credited insofar as it implies that the reinstatements of the awards was to be temporary The testimony of four union witnesses, Ellison, Knecht, Dobbins, and Waggamon, leaves no doubt that Coen indicated that the Company would continue the service awards indefinitely into the future As will be seen below in another connection, Ryan is found not to be a reliable witness Moreover, Respondent in its own brief admits (at p 5) that Mr. Coen at the July 13, 1970, meeting told the union people that the Company "would pick up all back awards and would continue the program " (Emphasis supplied ) CONVAL-OHIO, INC. from OIC had an expiration date of February 11, 1971. (Joint Exh. 1.) On or about December 14, 1970, Conval and the Union commenced negotiations for a new collective- bargaining agreement . The negotiations continued until March 26, 1971, when a new 3-year contract was executed, effective as of February 11, 1971. (Joint Exh. 2.) Both the new and old contract contain a so-called "zipper clause" in identical language. In effect the zipper clause states that all agreements between the Company and the Union are contained in the collective-bargaining agreement and further states that ". . . all matters subject to collective bargaining have been bargained upon, whether or not such matters are included, and they may not be made the subject of collective bargaining during the term of this Agreement."6 Notwithstanding the zipper clause, OIC, predecessor to Conval, initiated the above-described cash awards pro- grams for senior employees attaining service records of 30, 35, 40, 45, and 50 years of service, even though there was no provision for same in its collective-bargaining agree- ment with the Union. Similarly, Conval, notwithstanding the same zipper clause, in the contract it took over from OIC, continued OIC's established practice of making cash employee service awards to eligible senior employees from the date (November 1, 1969), it took over OIC's two plants through December 31, 1970, after some initial balking as described above. However, as shown above, the Respondent unilater- ally discontinued the practice from and after January 1, 1971. As in the case of the old collective-bargaining agreement, the new agreement is silent on the subject of the employee cash service awards established by OIC and recognized by the Respondent for some 14 months or up until about 6 weeks before the labor contract it took over from OIC expired. All written proposals submitted by both the Union and the Respondent during the bargaining negotiations leading to the new contract are likewise silent on the 6 In Joint Exh. 1, the zipper clause is in par. 216; in Joint Exh . 2, it is in par. 213. r The meeting that Leo Ryan, the aforementioned then manager of Labor Relations for Respondent, claims in his testimony he had with Oscar Ellison and Coy Sutton, president and chief steward of Local 908, respectively, in his office on some unremembered date in January 1971 prior to January 21, 1971, on the subject of the employees' cash service award program, was not a contract negotiation meeting . This is evident from Ryan's own description of the alleged meeting with Ellison and Sutton which he describe`f as an "informal meeting in my office" of the kind he had because this position, "practically on a daily basis and sometimes more than twice a day" Ryan testified that at his claimed meeting with Ellison and Sutton on the unremembered date in January prior to January 21 he notified them upon instructions from his superior, Joseph Laterza, director of industrial relations, that the Company would no longer be making the employees' cash service awards for longevity of service. Ellison and Sutton flatly denied Ryan's testimony that there had been such a meeting. Their denial is fully credited. The record shows that the Union consistently at all times made it clear to management that it would reject any and all attempts by the Company to take away from the employees the established cash service awards. Thus it is a virtual certainty that the Union would have brought up Ryan's alleged notice of the Company's discontinuance of the employees' cash service at a contract negotiation meeting long before the January 21 meeting, if in fact it had been so notified by Ryan. It was evident from the demeanor of Ellison and Sutton at the trial during their testimony that they had never heard of Ryan 's claimed meeting with them on some day in January before January 21, 1971, until the second day of the 89 subject of the employee cash service awards. Negotiations for the new contract came to a deadlock over terms and conditions of employment wholly unrelated to the cash service awards. (Tr. 140) The deadlock resulted in a strike which commenced on February 11, 1971, when the old contract expired, and ended on March 2, 1971, when the parties apparently reached an oral agreement on the terms and conditions of employment, later reduced to writing in the new collective-bargaining agreement, which in turn became effective as of February 11, 1971, for a period of 3 years. Between the time the negotiations for a new contract began in mid-December 1970 and the execution of the contract on March 26, 1971, the Union and the Company had more than 20 collective-bargaining negotiation meet- ings. The only such negotiation meeting at which the matter of the employees cash service award program was discussed or mentioned was the meeting held on January 21, 1971.7 At that meeting the Company was represented by Joseph Laterza, its director of industrial relations, as spokesman, and his subordinate, Leo Ryan, manager of labor relations, and other management personnel. At the same meeting the Union was represented by George Sepelak, International representative as chief spokesman, the aforementioned Oscar Ellison as president of the Local, James Waggamon as a secretary-treasurer of the Local, and Maurice Knecht, as trustee of the Local, among other union representatives. Although the witnesses for both the Company and the Union are agreed that the subject of the employees cash service award program came up for discussion at the bargaining meeting of January 21, 1971, in a sort of peripheral fashion because it was not on the agenda for discussion,8 they are not agreed on what Laterza as the company spokesman said on the subject. The matter came up in connection with a union proposal that the Company continue to reimburse employees for safety shoes just as it was required to do under the then expiring contract. In this connection Sepelak, because of rumors that the Company hearing herein some 18 months later. Even after the new contract had been executed, the Union continued to protest the Company's failure to keep up the cash service award program as soon as it became aware of such failure which was not until after the new contract had been executed. The Company's stock response to these protests through its personnel director, Meager was, "We are checking on it . Joe [Laterza, Director of Industrial Relations ] is handling that. We will get back to you ." The fact that the Respondent from sometime in April 1971 to sometime in June 1971 was still considering whether to continue or discontinue the employees' cash service award program is still another indication that the meeting that Ryan claimed he had with Ellison and Sutton prior to the collective-bargaining negotiation meeting of January 21. 1971, on the subject of the service awards, never in fact took place. Laterza's testimony, seeking to corroborate Ryan's story of notice to Ellison and Sutton in January prior to January 21, 1971, of the Company's discontinuance of the employees cash service award program. is not credited, especially in view of Laterza's own initial positive testimony that the matter of the service awards came up for discussion with union officials for the first time on January 21 , 1971. The charge herein by the Union against the Respondent was not filed until June 24 , 1971. This is still another indication that Ryan did not some 6 months prior thereto notify the Union of the Company's alleged decision to discontinue the service awards. 8 As heretofore noted, none of the proposed contracts submitted by the Company and the Union for discussion at the negotiation meetings contained any provisions pertaining to the employees' cash service award program. The only items for discussion and bargaining at the negotiation meetings were the items in the parties' proposed contracts. 90 DECISIONS OF NATIONAL LABOR RELATIONS BOARD was going to discontinue such reimbursements, wanted assurances from the Company that it would not back out from reimbursement for safety shoes just as it had "reneged" on the employees cash service awards. It is evident from the testimony of the witnesses herein for both the Company and the Union, and so found, that the word "renege" was a reference to the Company's temporary discontinuance of the awards in 1970 which it reinstated later in the year as heretofore shown. (The Company's unilateral action in discontinuing the cash awards as of January 1, 1971, was not known to the Union until after the new contract was executed.) Laterza testified that at that point in the January 21, 1971, bargaining session he told the union representatives that the Company intended to do away with the monetary and watch awards for longevity of service and to redesign the pin emblems. Laterza's testimony was based primarily on his memory. The contemporaneous notes kept by union representatives Sepelak, Knecht, and Waggamon, and by Laterza (Tr. 174), however, show that Laterza merely informed the union representatives that there would be changes in the service awards for longevity of service without spelling out what these changes would be. The Administrative Law Judge credits these contemporaneous notes, including Laterza's, as against Laterza's above-noted testimony. Thus it is found that Laterza merely told the union people that there would be changes in the employees' service awards without telling them what the changes would be. Sepelak responded that the Union would not stand for any unilateral changes in the established employees' service award program and that the Union "will have to have an understanding with you [Company] before an agreement is reached." (Tr. 71-72, 112, 118) Laterza responded by telling Sepelak that, "This is not a negotiable item." Respondent takes the same position, among other de- fenses, in its brief. Summarizing, the record shows, as found above, that the matter of the employees' service award program came up for discussion for the first and only time, in the more than 20 contract negotiation meetings leading to the execution of the new contract, at the meeting of January 21, 1971. Similarly, the record as found above shows that at the precontract nonnegotiating meeting of July 23, 1970, the Respondent agreed to reinstate without condition or reservation the established employees' cash service awards which it had previously unilaterally discontinued. As shown, the matter of the service awards at the January 21 negotiation meeting came up peripherally to another bargaining item as it was not on the agenda of that meeting or any other negotiation meeting because the proposed contracts of both the Company and the Union were completely silent on the subject of the employees service awards. The record further shows that at the January 21 9 The following testimony is the basis for the above evidentiary findings TRIAL ExAMINER- Did the Union at any time say or indicate to you directly or indirectly that they were waiving this matter of their entitlement to the cash awards') WITNESS LATERZA Not directly. We resolved all issues when we signed the contract [The last remark is a reference to the zipper clause in the new collective-bargaining agreement I (Tr •176) a s MR POWERS (counsel for the General Counsel) But it is clear that meeting the Company took the position that the matter of the employees' service awards program was a nonnegotia- ble item whereas the Union maintained that it was a negotiable item . The record also shows that while the Company at the January 21 meeting told the Union that it contemplated making changes in the service award program, it' never at any time during the contract negotiations submitted to the Union for discussion any proposed changes in the program on the ground that it was not a negotiable item . The record further shows by Respondent's own admissions that the Union never at any time gave the Company any reason to believe that it was abandoning or waiving the rights of the unit employees to the cash awards for longevity of service, (Tr. 176, 177) but on the contrary shows that the Union at all times vigorously maintained that the Company could not take away the established monetary awards for longevity of service by unilateral action .9 The events relating to the employees' service award program subsequent to the execution of the new contract on March 26,' 1971, are as follows. In early April 1971, the Local's president, Ellison, learned for the first time that an employee, who had attained 30 years of service on January 2, 1971, had not received the $100 cash award under the established employees' service award program although the Company had just previously made such a cash award to another employee in late December 1970. The Company similarly failed to pay cash awards to five other employees who had become entitled to awards between January 2 and 21, 1971. Starting in April after the first complaint of a nonpay- ment of the cash service award and continuing through June 22, 1971, various union officials on numerous occasions took the matter of the nonpayment of the cash service awards up with Laterza and with Don Meager, now product manager but then personnel manager. The credited composite testimony of Union Representatives Sepelak, Ellison, Dobbins, and Waggamon show that Laterza seriously entertained their protests about the discontinuance of the cash service awards and that he sought the authority of his superiors to restore the cash award program. Their testimony shows that they pressed Laterza for an answer before their statutory 6-month period to file an unfair labor practice charge expired and that Laterza on June 22 informed them that it was the Company's final decision that it would not for financial reasons reinstate the cash awards for longevity of service.io The Union filed its unfair labor charge with the Board 2 days later, just short of the deadline. Between the Company's discontinuance of the cash service awards on January 1, 1971, and February 11, 1971, the date of the expiration of the extant collective-bar- gaining agreement, nine employees became eligible for the the Union did not drop this matter after negotiations . that they continued to press the Company with regard to the monetary portion of the service award, isn't that correct LATERZA Yes (Tr 177) IS Laterza admits that he took up the Union' s request for the reinstatement of the cash service awards with his supervisors The Company's final answer of "No" in June came more than 2 months after the Union's initial protests in early April Laterza's testimony that the Company's decision was "No" from the start is not credited CONVAL-OHIO, INC. 91 awards, some for the $100 award and some for the $150 award. But between January 1, 1971, and the opening of the trial herein on June 1, 1972, a total of 48 out of the approximate 400 employees in Respondent's two plants became eligible for the cash awards for service records of 30, 35, 40, and 45 years of service. Collectively they would have been entitled to approximately $5,400 if the Respon- dent had continued making the cash service awards from January 1, 1971, until the time of trial herein on June 1, 1972, as it had prior to January 1, 1971.11 Discussion and Conclusions As the record is undisputed that the Respondent on January 1, 1971, without prior notice to or any discussion or consultation with the Union and without affording the Union any opportunity to bargain on the matter, unilater- ally discontinued the established employees' cash award program for longevity of service, as established by its predecessor firm and as recognized, adopted, and main- tained by Respondent as successor employer for a period of 14 months prior to its discontinuance of the cash awards, there can be no doubt that Respondent is in violation of Section 8(a)(5) and (1) of the Act by such conduct unless one or more of its asserted defenses lie. As shown above, this established employees' service cash award program was put into effect by the predecessor company in 1968 by practice and usage as a modification of a longstanding employees' service award program, dehors and independent of the then existing collective- bargaining agreement, but existing side by side with the terms and conditions of employment of the agreement, not withstanding the agreement's "zipper" clause which states that the parties to the contract "have set forth their entire understanding [therein] on all matters which are or may properly be subjects for collective bargaining." Respondent's first defense to the dropping of the cash awards for longevity of service is that the predecessor employer, OIC, came to the Union on its own initiative with the proposal for inaugurating the employees' service cash awards as detailed in the findings above; that the Union did not request or initiate bargaining for the program; and that when OIC presented the service cash award proposal, as well as other modifications of the then existing and long-established employees service program, to the Union for its approval, the Union readily and without quibble consented to the cash longevity service awards and all other modifications (in pins and watches) of the existing employees service award program. From these undisputed factual premises, the Respondent contends that the employees' cash service awards were "not negotiated" by the Union and thus, not having been negotiated, they are in the nature of "discretionary bonuses or gifts," and that accordingly they may be withdrawn at 11 The motion of counsel for General Counsel at the end of the hearing to conform the pleadings to proof is hereby granted As there is no proof that Respondent at the meeting of January 21, 1971, notified the Union, as alleged in par 8 of the complaint, "of its decision made and implemented on or about January 1, 1971" to drop the employees service cash award program, that part of par 8 is dismissed for failure of proof and in lieu thereof par 8 under the motion is deemed amended to show the facts as found above any time by management unilaterally at its own discretion and without notice to or bargaining with the Union. The Respondent's contention that the cash service awards were "not negotiated" simply because they were proposed by OIC and readily consented to by the Union is without merit. Respondent seeks to make the term "negotiation" the equivalent of haggling over the terms of a proposal, but negotiation can take place without any haggling or bickering over terms as it frequently does over the bargaining table where either party may simply say "Agreed" to numerous noncontroversial items presented by the other. The mere fact that an item proposed by one side is accepted by the other side without hesitation or even with alacrity does not prevent that item from having been a negotiated item. In the instant case, OIC proposed cash awards of fixed amounts for longevity service records of 30, 35, 40, 45, and 50 years of service, respectively. The fact that the Union quickly and gladly accepted the proposed cash awards program for such longevities of service, without seeking more than the Company proposed, does not rob the transaction of its negotiated character. Respondent has not cited any authority to the contrary. Respondent's attempt to bolster its contention that the cash awards for longevity of service are discretionary in character by reference to what it apparently claims Mr. Laterza told the union representatives in July 1970, after agreeing to reinstate the cash service awards under persistent demands therefor from the Union, is likewise without support in the record. Respondent's brief seeks to convey the impression that Laterza at that time told the Union that although it was reinstating the cash service awards, it "retain[ed] the right to discontinue the same on January 1, 1971, which it did." 12 The record leaves no doubt as found above that in July 1970 when the Respondent agreed to reinstate the cash service awards that it did so without any conditions or reservations whatever. The Respondent's further attempt to equate the cash longevity service awards here involved to gratuitous bonuses is also without merit. The cases cited by Respondent, Vogt Machine Company, 190 NLRB No. 13, and N.L.R.B. v. Wonder State Manufacturing Co., 344 F.2d 210, deal with Christmas bonuses. Christmas bonuses are frequently tied into company profits and these can vary decidedly from year to year depending upon the Employ- er's profit experience. But even with respect to such bonuses the Board has long held "that Christmas bonuses which are not gratuities and which have been paid with regularity over extended periods of time are not only an integral part of the wage structure, but also constitute a mandatory subject for bargaining." (Emphasis supplied.) Gravenslund Operating Co., 168 NLRB 513. In the Vogt Machine Company case, supra, cited by the Respondent, the Board made an exception to this general rule where "the 12 In its brief under "Summary of Testimony," the Respondent shows that at a meeting with the Union on July 13, 1970, the Company "reported to the Union that it would pick up all back awards not made since the time of acquisition and would continue the program " ( Emphasis supplied) This is followed by the sentence- "How long the program would be continued is the subject of disputed testimony " The findings above show, based on the credited testimony of union witnesses , that the Company did not indicate any cutoff date for the resumed cash service awards 92 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Christmas bonus payment was intermittent and not uniform in amount or basis over the years." It held that in such situations the payment of the bonus becomes a discretionary matter as to which bargaining is not a custom or practice. The court in the Wonder State Manufacturing Co. case, supra, with more explication, held to the same effect. Under the cited cases the critical test is whether a bonus paid by an employer to an employee is a gift. If the bonus is a gift, its giving is a discretionary matter with the employer, not subject to mandatory bargaining which the employer can give or take away at will. The cash service awards here involved are obviously not in the same genre as a Christmas bonus as they are not in any sense gratuties because they are essentially awards or payments for staying with Company for stated long periods of time. It is significant that they are not even called bonuses. They are designated and known as employees' service awards. They are, in other words, awards for longevity of service. They are thus definitely and positively tied into the working service of the employee and as such are part of an employee's compensation for continuous service for periods in excess of a quarter of a century. The cash awards are fixed in amount, depending only upon the length of service and accordingly do not vary from time to time; they are in no way tied to the profit experience by the initial employer when it established the cash service awards. Having been established by the predecessor employer, they were paid by the predecessor to qualifying employees without interruption as long as it remained the employer. As found above, the Respondent as successor employer assumed the employees' service award program as part of its commitment not only to take over the then extant collective-bargaining agreement but also all other commitments to the Union. Although the Respondent at first balked at keeping up the employees service cash awards despite its commitment to take over all commitments to the Union, it carved on the program of the cash awards for longevity of service (after protest from the Union for nonpayment) for a period of 14 months which covered the period from the day of its takeover until January 1, 1971, when it unilaterally and without notice to the Union or even its knowledge discontinued making the cash awards. In summary, the Administrative Law Judge finds and concludes that the Respondent is in violation of Section 8(a)(5) and (1) of the Act by its unilateral conduct of January 1, 1971, in discontinuing during the life of its assumed collective-bargaining agreement the established employees' cash award program for longevity of service without notice to or any discussion with the Union and without affording it the opportunity to bargain on the matter. The above conclusion of violation of the Act is confined for the moment to Respondent's conduct between Novem- ber 1, 1969, when it took over the extant collective- bargaining agreement, and February 11, 1971, the date of the agreement's expiration. During that period, the Respondent adopted both the extant collective-bargaining agreement and the historical usage of the established employees' service award program. During the same relatively short period, as shown above, nine of Respon- dent's employees became eligible for the awards in varying amounts depending upon their length of service. The status of the employees' service cash award program from and after February Il, 1972, is on an entirely different footing.13 This is because the Respondent and the Union executed a new 3-year contract on March 26, 1971, effective as of February 11, 1971, and in the negotiations leading to the new agreement the Respondent had the opportunity for the first time to bargain, in contrast to its former adoption of the cash service awards, over the question of whether the usage of the service cash award program established by the predecessor firm and honored by itself for a period of 14 months, should or should not be continued over into the life of the new collective-bargain- ing agreement. In this connection, the Respondent con- tends that the Union has waived and is therefore estopped from claiming the right of the prior established employees' service cash awards program for its members by a combination of three factors. The first of these factors is that at the one and only negotiation meeting on January 21, 1971, at which the subject of the service cash awards was discussed, the Union allegedly "unequivocally stated that unless there was some agreement on the continuation of the Service Award Program, there would be no collective-bargaining agreement." The second factor is that the new collective-bargaining agreement is silent on the subject of the service award program. The third and final factor relied upon by Respondent is that the new contract has the same "zipper" clause as the previous contract and this clause in combination with the other two factors now estops the Union from now claiming the service award program for its members. The first of these factors requires close analysis. For the position of the Union on the matter of the cash service awards at the meeting of January 21, the Respondent relies on the statement made by Sepelak, the International's representative and spokesman for the Local, at that meeting. In its brief under the heading of "Summary of Testimony," the Respondent sets forth Sepelak's response to Laterza's announcement at the January 21 meeting that there would be changes in the service award program, as follows, "Mr. Sepelak responded that there would have to be an understanding on the continuation of the Service Award Program prior to the signing of any agreement." As will be shown below, the above is not an accurate statement of Sepelak's response. At best it is an approxima- tion of Sepelak's remark. In the argument section of its brief, Respondent changes Sepelak's response as set forth in its "Summary of Testimony" into meaning, "It is virtually undisputed that the Union's chief spokesman at those negotiations stated to the Company that there would be no agreement at all if there were no agreement on the Service Award Program." In a still later point in its argument, the Respondent again even more sweepingly changed Sepelak's response into meaning that, "the Union unequivocally stated that unless there was some agreement 13 This difference in footing between the old and new contracts is not discussed in either General Counsel's or Respondent's briefs CONVAL-OHIO, INC. 93 on the contention of the Service Award Program, there would be no collective-bargaining agreement." Contrary to the above versions of Sepelak's response, the record shows, as found above, that Sepelak's reply to Laterza's announcement that there would be changes in the service award program, was as follows, ". . . we will have to have an understanding with you before an agreement is reached." The above finding was abstracted from Sepelak's contemporaneous notes of the negotiation meeting of January 21, 1971. The full text of Sepelak's notes on the matter 14 places the above quotation in its proper context and more clearly sets forth the tenor of Sepelak's response. The full text reads: We don't feel you have the right to unilaterally change the service award. You did not propose a change in these negotiations [for a new contract] and neither did the Union and I want to refer to paragraph 216 [the zipper clause]. We feel since you brought it up, we will have to have an understanding with you before an agreement is reached. We will have to have an understanding that the present service award remain as is for the duration of the new agreement or any other privilege that we have enjoyed in the past. The Administrative Law Judge finds that Sepelak's statement "that we will have to have an understanding with you [on proposed but unidentified changes in the employ- ees service award program] before an agreement is reached" was merely bargaining table hyperbole and not a statement of "unequivocal" position. The absence of the alleged unequivocal position (which Respondent contends Sepelak took on Laterza's proposed but unidentified changes in the employees service award program) is reflected by the contemporaneous notes on the meeting kept by two other union representatives in attendance at the meeting. Thus the notes of Union Trustee Kneckt shows that Sepelak only told Laterza that "if he intended to change anything, we will probably lock horns on this subject, such as awards or anything that we now enjoy." (Emphasis supplied.) Similarly, and even more mildly, the notes of Union Official Waggamon show that Sepelak merely stated to Laterza that "he wanted to make it clear that we [the Union ] are not proposing any changes [in the service award program], nor will we accept any changes." From these contemporaneous notes, it is found that the Union put the Respondent on clear and unambiguous notice that it would not accept any unilateral changes in the established employees' service award program. More- over, as found above, the Respondent itself admits that the Union did not, directly or indirectly, at any time before, during, or after the negotiations leading to the execution of the new contract waive the entitlement of its members to the established employees' service cash awards, except for Respondent's claim that the Union indirectly waived the cash awards through the operation of the zipper clause in the new contract. The latter, however, is a matter for the Administrative Law Judge, not the Respondent, to decide. Another basic difficulty with Respondent's claim that the Union waived the cash service award program at the January 21 meeting is that the credited testimony of a number of union witnesses show that Laterza at that meeting merely announced that there would be changes in the general service award program without indicating in any way that the Company not only proposed but actually had discontinued the cash awards as of January 1, 1971. Under these circumstances, the Union obviously cannot be held to have waived the rights of its members to something, the cash service awards, that had not even been mentioned by Laterza at the meeting. Even Laterza's own notes on the January 21 meeting show that he merely announced at the meeting that there would be changes in the employees' service award program without spelling out what those changes would be. The record leaves no doubt that if the Union had been put on any kind of notice during the negotiations that the cash award part of the employees' service award program had been or was to be discontinued that it would indeed have balked at signing a new contract without a showdown on the issue of the elimination of the cash awards. It was not until after the new contract was executed in late March 1972, that the Union learned for the first time that the Company had unilaterally discontinued the cash awards part of the service award program as of January 1, 1972. It then sprung into immediate action to get the Company to restore the cash service awards program by back payments to the nine employees who had become entitled to such awards between January 1, 1972, and February 11, 1972 when the` old contract expired. This vigorous but unsuccessful effort by the Union to get the cash awards reinstated and the numerous meetings the Company had with the Union in that connection is obviously antithetical to Respondent's claim that the Union had consciously and knowingly waived the employ- ees' rights to the established cash longevity service awards simply by the provisions of the zipper clause in the new contract. Of all the facts and circumstances negativing Respon- dent's claim that the Union waived the rights of its members to the established cash award program for longevity of service under the zipper clause of the new contract, perhaps the most telling is the openly admitted fact that the Company at the meeting of January 21, 1971, point blank refused to enter into negotiations with the Union on the item of its proposed but unidentified changes in the service award program on the ground that such changes were not negotiable items for bargaining but were solely within the direction of the Company. (The Company still maintains this position on brief which the Administra- tive Law Judge found without merit above.) The Union through its spokesman at the meeting, as found above, stoutly denied that contention and steadfastly maintained that any changes in the service award program was subject to negotiation. In view of the Respondent's refusal to even discuss with the Union the unilateral changes it had in mind to make in the service award program on the ground of nonnegotiabil- ity and the Union's admitted open, vigorous, and continu- ing opposition to any unilateral changes in the established program, it would not be in accord with reality to find that 14 Sepelak's contemporaneous notes on the January 21, 1971, meeting, the findings above to avoid duplications here and that of other union representatives shown below, were not set forth in 94 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the Union had waived the right to the cash service awards simply because the new contract contained the same zipper clause the old contract had, dunng the term of which the employees not only received the emoluments for their services set forth in the old agreement but also the cash longevity service awards established by independent usage and practice and dehors the old agreement. The record further shows that there was a strong element of deceit on the part of the Respondent during the negotiations leading to the new contract as the Company never notified the Union at the contract negotiation meeting of January 21, 1971, or at any other meeting 15 of the action the Company had unilaterally taken on January 1, 1971, to discontinue the cash awards for longevity of service. The Union was completely unaware of this development until some days after the execution of the new contract on March 26, 1971, when it learned for the first time that nine of its members who had become entitled to the cash longevity service awards between January 1 and February 11, 1971, when the old contract expired, had not received the awards. The Administrative Law Judge infers and finds that the Respondent kept the fact that it had taken secret unilateral action to cut off the cash awards, as a sleeper throughout the negotiations leading to the execution of the new collective-bargaining agreement, in order to avoid a direct confrontation on the issue with the Union. The Administrative Law Judge finds and concludes that this deceptive conduct by the Respondent is sufficient in itself to relieve the Union of the effects of the zipper clause in the new contract under the rationale of a recent court decision as adopted by the Board. N.L.R.B. v. Southern Materials Company, Inc., 447 F.2d 15 (C.A. 4, 1971); Southern Materials Company, 198 NLRB No. 43. But in a broader sense the Administrative Law Judge finds and concludes that the Respondent is also in violation of Section 8(a)(5) and (1) of the Act in connection with the negotiations of the new collective-bargaining agreement 16 under all the circumstances of the case as manifested by its secret unilateral action of January 1, 1971, in discontinuing the established service cash award program and by its absolute refusal to bargain with the Union on any aspect of the employees' service award program at the only meeting at which that subject came up, not directly but peripherally,17 during the more than 20 negotiation meetings that led to the execution of the agreement. During that entire period the Respondent was under notice from the Union and had admitted knowledge that the Union opposed any change in the established employees' service award program without its consent or agreement. Accordingly, it is found that the Union has not consciously or knowingly waived the rights of the unit employees here involved to the established cash service awards under the zipper clause of the new collective- 15 The Administrative Law Judge in the findings above totally discredited the testimony of Mr. Ryan, Respondent's then manager of labor relations, that he had notified Union Representatives Ellison and Sutton on an unremembered date in January 1971 at a routine noncontract business meeting poor to the contract negotiation meeting of January 21, 1971, that the Company had dropped the cash awards for longevity of service 16 For the reasons heretofore stated, the footing of the established service cash award program dunng the existence of the collective-bargaining agreement the Respondent took over from the predecessor firm is different bargaining agreement and that the zipper clause has no application to the established employees' service award program which has always had an independent life apart from the existing collective-bargaining agreements. In final summary, the Administrative Law Judge finds and concludes that the Respondent is in violation of Section 8(a)(5) and (1) of the Act under both the old and new contract by its unilateral conduct of January 1, 1971, in discontinuing the established employees cash award program for longevity of service without notice to or any discussion with the Union and by its absolute refusal to bargain with the Union on the matter. The Administrative Law Judge further finds and concludes under all the facts and circumstances of the case that the Union did not waive the rights of its members to the established employees ' service cash award program under the zipper clause of the new collective-bargaining agreement. Upon the basis of the foregoing findings of fact and upon the record as a whole, the Administrative Law Judge makes the following: CONCLUSIONS OF LAW 1. Respondent, Conval-Ohio, Inc., is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. Local 908, International Brotherhood of Boilermak- ers, Iron Shipbuilders, Blacksmiths, Forgers and Helpers, AFL-CIO, is a labor organization within the meaning of Section 2(5) of the Act. 3. The following constitutes a unit of Respondent's employees appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act: All production and maintenance employees, only at Machining and Assembly, Wadsworth, Ohio, but excluding clerical employees, dispatchers, professional employees, watchmen, guards and supervisors as defined in the Labor-Management Act of 1947, as amended, and at the Casting Plant, Orrville, Ohio, but excluding clerical employees, dispatchers, production planners, professional employees, watchmen, guards and supervisors, as defined in the Labor-Management Act of 1947, as amended. 4. Local 908, International Brotherhood of Boilermak- ers, Iron Shipbuilders, Blacksmiths, Forgers and Helpers, AFL-CIO, at all times material herein, has been and is now the exclusive representative for the employees in the aforesaid appropriate unit for the purposes of collective bargaining within the meaning of Section 9(a) of the Act. 5. By its action on or about January 1, 1971, unilateral- ly and without prior discussion with the Charging Party (Union) as the duly authorized and exclusive collective- bargaining representative of Respondent's employees in from the footing of the same program under the new contract negotiated by the Respondent under the negotiations of which the Respondent had the opportunity to open up bargaining on the program but adamantly declined to do so 17 As heretofore noted the matter of the established employees' service award program came up peripherally dunng the negotiations of the new contract because it was never on the agenda of either the Company or the Union as reflected in their proposed agreements which were the subjects of negotiations dunng the negotiation sessions CONVAL-OHIO, INC. 95 the above unit appropriate for collective-bargaining pur- poses, withdrawing, suspending, eliminating, or discontinu- ing payment of its established program of employee service cash awards, Respondent failed and refused to bargain collectively with said Union, thereby engaging in an unfair labor practice in violation of Section 8(a)(5) of the Act. 6. By its said action described in Conclusion of Law 5, supra, and its nonpayment of said service cash awards under said circumstances, Respondent has interfered with, restrained, and coerced, and is continuing to interfere with, restrain, and coerce, its said employees, in violation of Section 8(a)(1) of the Act. 7. By its failure and refusal to bargain collectively with said Union at any time on or since January 1, 1971, concerning its unilateral action described in Conclusion of Law 6, supra, Respondent has failed and refused and is continuing to fail and refuse to bargain collectively with said Union, in violation of Section 8(a)(5) and (1) of the Act. 8. The aforesaid unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. THE REMEDY It having been found that Respondent engaged in certain unfair labor practices in violation of Section 8(a)(5) and (1) of the Act, it will be recommended that it cease and desist therefrom and take certain affirmative action designed to effectuate the purpose of the Act. As the record stands undisputed that the Respondent has since January 1, 1971, unilaterally discontinued the established and assumed employees' cash award program for longevity of service and by such conduct has defaulted in the payments of hundreds of dollars due to numerous employees under the program, an order will be issued directing the Respondent to restore the status quo ante of all employees who have become entitled to the cash service awards under the program since January 1, 1971, by making payments with interest to them in accordance with the previously established schedule as set forth in the Findings of Fact above. Leeds & Northrup Co., 162 NLRB 987, 988, enfd., 391 F.2d 874, 879-880 (C.A. 3). As the Respondent's default on the payments due its employees under the established employees' service cash award program is virtually equivalent to a unilateral reduction of an agreed wage, no less than the indicated order is required to effectuate the policies of the Act. As a further aid to the restoration of the status quo ante of the established employees' service award program, the Respondent will also be required to cancel any changes in the monetary portion of the service award program which have resulted in financial or other detriment to employees, and to continue the payments of the cash awards for longevity of service to employees as they become eligible thereto under the terms of the program until the Respon- dent and the Union have negotiated in good faith to agreement on any proposed changes in the present program or to impasse thereon. In addition an order will be issued requiring the 18 In the event no exceptions are filed as provided by Sec 102 46 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, and recommended Order herein shall , as provided in Sec Respondent to bargain concerning future proposed changes in the employees' service award program , but, as the Union is not contesting Respondent's presently proposed changes in the pin emblems and wrist watch items in the service award program, no order will be issued with respect to such heretofore proposed changes. Finally, because of the character of the unfair labor practice herein found , in order to effectuate the policies of the Act, the Respondent will be ordered to cease and desist from in any other manner interfering with , restraining, and coercing employees in the exercise of their rights guaran- teed by Section 7 of the Act. Upon the foregoing findings of facts , conclusions of law, and the entire record, and pursuant to Section 10(c) of the Act, the following is recommended.18 ORDER Respondent, Conval-Ohio, Inc., its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Unilaterally discontinuing, abrogating, canceling, suspending, modifying, or withholding payment in full or in part or the monetary portion of the employees' service award program which has been in effect since 1968, involving Respondent's employees in the following de- scribed unit: All production and maintenance employees, only at Machining and Assembly, Wadsworth, Ohio, but excluding clerical employees, dispatchers, professional employees, watchmen, guards and supervisors as defined in the Labor-Management Act of 1947, as amended, and at the Casting Plant, Orrville, Ohio, but excluding clerical employees, dispatchers, production planners, professional employees, watchmen, guards and supervisors, as defined in the Labor-Management Act of 1947, as amended. (b) Refusing or failing to bargain collectively in good faith with Local 908, International Brotherhood of Boiler- makers, Iron Shipbuilders, Blacksmiths, Forgers and Helpers, AFL-CIO, as an exclusive collective-bargaining representative of Respondent's employees in the unit described in paragraph 1(a) of this Order, with regard to or concerning the subjects, referred to in said paragraph 1(a) of this Order. (c) Taking any other unilateral action on or affecting said employees service award program or any other term or condition of employment without prior consultation and bargaining with said Union. (d) In any like or related manner interfering with any effort of said Union to bargain collectively on behalf of said unit employees; or interfering with, restraining, or coercing said employees in their rights and efforts to bargain collectively or to assert and enjoy their rights guaranteed under Section 7 of the National Labor Relations Act, as amended. 2. Take the following affirmative action which will effectuate the policies of the Act: (a) Make whole each and every person employed since 102.48 of the Rules and Regulations, be adopted by the Board and become its findings, conclusions, and Order, and all objections thereto shall be deemed waived for all purposes 96 DECISIONS OF NATIONAL LABOR RELATIONS BOARD January 1, 1971, in the bargaining unit described in paragraph 1(a) of this Order for any loss which he or she may have suffered by reason of Respondent 's unilateral cancellation, suspension, withholding, or failure to pay the monetary service award, by payment thereof to each such person forthwith in accordance with the previously established schedule in effect since March 1 , 1968, in the manner set forth in the "Remedy" section of the Decision in this proceeding, together with interest thereon at the rate of 6 percent per annum from January 1, 1971, to the date of payment in accordance with this Order . This order shall also apply to all eligible employees who have retired since January 1, 1971. (b) Upon request, bargain collectively in good faith with Local 908, International Brotherhood of Boilermakers, Iron Shipbuilders , Blacksmiths, Forgers and Helpers, AFL-CIO, as the statutory representative of Respondent's employees in the above-described unit, concerning any proposed change in the monetary portion of the service awards program in effect for said employees since March 1, 1968, and concerning any other term or condition of said employees' employment. (c) Cancel any changes of benefits or working conditions of its employees in said Union made on January 1, 1971, or later, which may have resulted in financial or other detriment to said employees, and continue the payment of the cash awards for longevity of service to our employees as they become eligible thereto under the terms of the program until the Respondent and the Union have negotiated in good faith to agreement on any proposed changes in the present program or impasse thereon. (d) Post in Respondent's plants located at Wadsworth, and Orrville, Ohio, copies of the attached notice marked "Appendix." 19 Copies of said notice, on forms provided by the Board's Regional Director for Region 8, after being signed by Respondent's authorized representative, shall be posted by Respondent immediately upon receipt thereof and maintained by it for a period of 60 days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to ensure that said notices are not altered, defaced, or covered by any other material. (e) Notify the Regional Director, for Region 8, in wasting, within 20 days from the date of receipt of this Decision, what steps have been taken to comply there- with.20 The complaint is dismissed insofar as it alleges that Respondent engaged in any unfair labor practices other than those found herein. 19 In the event that the Board's Order is enforced by a Judgment of a 20 In the event that this recommended Order is adopted by the Board United States Court of Appeals, the words in the notice reading "Posted by after exceptions have been filed, this provision shall be modified to read Order of the National Labor Relations Board" shall read "Posted pursuant "Notify the Regional Director for Region 8, in writing, within 20 days from to a Judgment of the United States Court of Appeals enforcing an Order of the date of this Order, what steps the Respondent has taken to comply the National Labor Relations Board " herewith