J. C. Penney Co., Inc.

1108 DECISIONS OF NATIONAL LABOR RELATIONS BOARD J. C. Penney Company, Inc. and Walter Gray Ho- cutt. Case 11-CA-5055 April 12, 1973 DECISION AND ORDER BY MEMBERS JENKINS, KENNEDY, AND PENELLO On January 18, 1973, Administrative Law Judge Joseph I. Nachman issued the attached Decision in this proceeding. Thereafter, Respondent filed excep- tions 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. 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 Respondent, J. C. Penney Compa- ny, Inc., Wilson, N.C., its officers, agents, successors, and assigns, shall take the action set forth in the said recommended Order. 1 The Administrative Law Judge credited employee Walter Hocutt's testimony that Service Manager Joyner told him that he had not received a wage increase because he had been "trying to get the union in " In making this finding, the Judge relied on Joyner's alleged failure to deny making the statement and a similar statement made to employee Page We find the record shows that Joyner did in fact deny the statement attributed to him by Hocutt However, we believe that Page's credited testimony is sufficient to support the Judge's crediting of Hocutt DECISION STATEMENT OF THE CASE JOSEPH I. NACHMAN, Administrative Law Judge: This case, tried before me at Wilson, North Carolina, on November 9,1 with all parties present and duly represented, involves a complaint z pursuant to Section 10(b) of the National Labor Relations Act, as amended, which alleges that J.C. Penney Company, Inc., (herein Respondent or Penney), interfered with, restrained, and coerced its I This and all dates herein are 1972, unless otherwise stated 2 Issued September 29 on a charge filed August 14 3 No issue of commerce or labor organization is presented The complaint alleges and the answer admits facts which establish these jurisdictional elements I find those facts to be as pleaded The Board has since its early days exercised j unsdiction over the operations of Respondent See J C Penney Company, 31 NLRB 877, where the nature of the Company's business is set forth in detail employees in the exercise of rights guaranteed by Section 7 of the Act, and denied employee Walter Gray Hocutt a wage increase because of his assistance to or support of Retail Clerks International Association (herein Union or Retail Clerks), and thereby violated Section 8(a)(1) and (3) of the Act. By answer, Respondent admitted certain allegations of the complaint, but denied the commission of any unfair labor practice. For reasons hereafter detailed, I find the allegations of the complaint sustained by the evidence, and recommend an appropriate remedial order. At the trial, full opportunity was afforded all parties to introduce relevant evidence, to examine and cross-examine witnesses, to argue orally on the record, and to submit briefs. Oral argument was waived. Briefs submitted by the General Counsel and Respondent, respectively, have been fully considered. Upon the pleadings, stipulations of counsel, the evidence, including my observation of the demeanor of the witnesses while testifying, and the entire record in the case, I make the following: FINDINGS OF FACTS A. Background Respondent's store at Wilson, North Carolina, is the only one involved in this proceeding. In connection with and as a part of said store, Respondent operates a service center for the repair of automobiles and the sale of automobile parts and accessories. Ross C. Jenkins is manager of the entire Wilson operation, and Robert Joyner manages the service center, and is responsible only to Jenkins. The Charging Party, Walter Hocutt, was hired- in August 1969 as a "service man," or "associate," at the center at a starting rate of $2 an hour. To guide store managers in granting or withholding wage increases for employees under their supervision, the Company provides them with a personnel manual which states the criteria for action in that regard. In substance, the manual provides that an increase in pay may be granted only for one of two reasons, namely, promotion to a higher paying job, or meritorious performance of present duties. With respect to merit increases, the manual provides that an employee's performance will be reviewed 6 to 12 months after hire, and each 12 months thereafter, with consideration given to various specified criteria; and, if an increase is indicated, such will be granted in an amount of 4 to 8 percent of the employee's then current rate. In preparing the rating sheet, the rating supervisor uses a numerical rating for each category.4 In addition to the rating for the specific criteria, the form calls for a "total performance summary" rating that is arrived at subjective- ly.5 Sometime in April 1970, Hocutt spoke to Joyner about increased pay. Joyner on April 15, 1970, prepared a performance rating sheet on Hocutt, evaluating the latter's 4 Category I indicates that the employee' s performance far exceeds job requirements, category 2 that he exceeds requirements ; 3 that he meets requirements, 4 that he meets minimum requirements only, and 5 that, he fails to meet minimum requirements 5 Store Manager Jenkins testified that the total performance rating is entirely subjective, there being no formula for translating the ratings for individual categories to a total performance rating 202 NLRB No. 167 J. C. PENNEY COMPANY 1109 performance in 23 categories. As to 18 of these he gave Hocutt a 3 rating, and on the remaining 5, a 4 rating; with a rating of 3-minus for a total performance summary. Under comments Joyner wrote that Hocutt had improved in his performance, could perform additional tasks, and "suggest[ed] a $10 a week [25-cent-an-hour] increase in salary beginning immediately." Joyner's rating of Hocutt was reviewed and approved by Store Manager Jenkins, and the wage increase was made effective as indicated .6 On January 15, 1971, Hocutt's performance was rated again.? Of the 25 categories for which Hocutt was rated on this occasion, he was rated 3 on 22 categories, and 4 on the remaining 2, with a total performance summary rating of 3-minus.8 In connection with this rating, Joyner recom- mended that Hocutt be sent to the next wheel-alignment school and that, upon return from that school, he be given a pay increase of $10 a week. Joyner's recommendation in this regard never became effective. Jenkins testified that he withheld approval thereof because he could not justify spending the Company's money on an employee who demonstrated so little promise of improvement. The basis for this conclusion Jenkins did not explain. On June 23, 1971, the Board conducted an election among Respondent's employees in a unit which included the employees of the service center, on a petition filed by the Union. Hocutt was very active in the Union's campaign. He signed a union card, urged other employees to do so, and acted as an observer for the Union at the election. The Union lost the election. Respondent concedes that it was aware of Hocutt's activities on behalf of the Union. Both Jenkins and Joyner testified that they were unaware of any union activity subsequent to the election. On some undisclosed date in July 1971, Hocutt was rated again. On this occasion, he was rated in 26 categories, on 15 of which he was rated 3, and on the remaining 9 he was rated 4. The total performance summary rating was 4. It may be noted that in six categories in which Hocutt was rated 3 on January 15, 1971, he received a rating of 4 in July 1971.9 In December 1971, Hocutt approached Service Manager Joyner and asked the latter why he had not received a 6 Respondent's action in that regard is not entirely in accord with Jenkins' testimony as to the manner in which the rating system worked He testified that under the personnel manual a merit increase is not permissible if the Total performance summary rating is 3-minus, because that does not indicate meritorious performance, and that if an increase is granted the maximum allowable is 8 percent Under that formula, of course, the maximum increase permissible at Hocutt's then $2 rate of pay was 16 cents an hour, or $6 40 for a 40-hour week, instead of the $10 weekly raise granted him r Why this rating was made at the end of 9 months, instead of the 12 months required by the manual, the record does not indicate 8 The categories in which he received a rating of 4, were "neatness and care of tools and shop area," and "recommends improvements in procedure or products." Why the total performance rating was 3-minus, the record does not explain 9 The six categories referred to were attendance, punctuality , performs work satisfactorily, work meets service productivity, utilization of time, deals effectively with associates , and solicits add-on sales As will hereafter be noted, certain work deficiencies exhibited by Hocutt just prior to this rating, played a part in the less favorable rating 10 Although Joyner denied making a similar statement to employee Page, as hereafter detailed, and testified that he could not remember making such statement to any other employee, he did not specifically deny the statement attributed to him by Hocutt Because of such lack of denial and the fact that raise. Joyner replied that the reason was that Hocutt had been "trying to get the Union in." 10 Dissatisfied with Joyner's response, Hocutt requested and received permis- sion to see Store Manager Jenkins, which meeting, the parties stipulated, occurred on December 17, 1971. Hocutt asked Jenkins why he (Hocutt) had not received a raise. Jenkins told Hocutt that what is past is past, and that he preferred to talk about conditions at the time. Jenkins then referred to an incident when Hocutt was reprimanded for taking considerably more time than necessary to install a set of shock absorbers; to another incident when Hocutt in tuning an engine installed new points and left them closed, and that two other men had to work several hours to locate and correct the trouble.ii After explaining the Company's policy of granting a pay increase only by reason of a promotion or for merit, Jenkins told Hocutt to return to work and, if his performance demonstrated merit, in about 6 months he might be considered for a raise.12 B. The Unfair Labor Practice Alleged On June 13, Service Manager Joyner prepared another performance rating on Hocutt. Although he claimed to be unaware of any union activity in progress at the time, or for that matter since the election in June 1971, Joyner admitted that he discussed Hocutt's union activity with Store Manager Jenkins "pretty often," and did so before he prepared the rating form on June 13.13 Joyner also admitted that in a conversation with employee Page in about March or April, he told the latter that Hocutt would probably solicit him to sign a union card, and that he hoped Page would listen to both sides before he made up his mind whether or not to sign a card.14 On the June 13 rating, Joyner rated Hocutt in 26 categories, fixing a numerical rating of 3 in 20 of those categories, and a numerical rating of 4 on the remaining 6, with a total performance rating of 3-minus. Although Joyner testified that the normal procedure was for him to make a recommendation on the rating form that the rated employee be given or not given a wage increase, he made no recommendation in that regard at the time. He did make the following notation on the rating form, "There has I find Joyner made a similar statement to Page , as hereafter related, I credit Hocutt in this regard 11 The record shows that the incident about the points occurred on July 30, 1971, the exact date of the shock absorber incident is not shown in the record, but appears to have occurred about the same time To this point the testimony of Hocutt and Jenkins is not in dispute . In addition, Jenkins testified that he also referred at this time to the incident when Hocutt allegedly in putting on a set of seat covers installed the front seat backwards putting the Company to the expense of having another man spend the time necessary to correct the error, and an incident when Hocutt allegedly failed to report for work because of intoxication The first of these incidents allegedly occurred on July 28, and the second on April 13, both in 1971 Hocutt denied that Jenkins mentioned either of these two incidents to him However, he did not deny that they occurred. I do not consider it necessary to resolve this credibility issue. 12 The General Counsel does not contend that anything said in the meeting of December 17, 1971, constituted a violation of the Act 13 Why he considered it necessary to discuss this with Jenkins when there had been no union activity for about a year, Joyner did not explain 14 Joyner gave no testimony as to the time of this conversation Page testified that it occurred in March or April 1972, and I so find With respect to this incident also Joyner gave no explanation as to why he deemed it necessary to initiate such a conversation with Page 1110 DECISIONS OF NATIONAL LABOR RELATIONS BOARD been a noticeable improvement in Mr. Hocutt's work in the past few months." Additionally, Joyner admitted that on the basis of the June 13 rating, he regarded Hocutt as a satisfactory employee, but that this did not necessarily mean that a pay increase should be granted, and that the final decision on this would have to be made by Jenkins. The testimony also shows that on June 5, Joyner called to his office part-time employee, Page, and told the latter that he was receiving a 10-cent-an-hour wage increase effective the following week, and that, if he continued to do as well as he had, he would probably get a full-time job when he finished school. After thanking Joyner, Page remarked that Hocutt had worked for Respondent some 3 years and had never gotten a raise, and asked Joyner why this was so. Joyner replied that the chief reason Hocutt had not received a raise was because of his pushing the Union. There was no further conversation on the subject.15 Learning from Joyner on June 13 that the latter was not going to ,recommend him for a raise, Hocutt sought and obtained an audience with Jenkins, seeing the latter that day. Hocutt reminded Jenkins that the 6 months since their last conversation had passed, and he was again asking about the raise.16 Contrary to Joyner, Jenkins testified that on the basis of the June 13 rating, Hocutt was not a satisfactory employee because of the six criteria on which he was rated 4, and the overall performance rating of 3-minus. He also admitted that had Hocutt's performance been satisfactory he would have granted the latter an increase of 4 to 8 percent. C. Contentions and Conclusions Having found upon the credited testimony of Page that the latter was told by Joyner that Hocutt was denied a wage increase because he had been pushing the Union, it is clear that said statement violated Section 8(a)(1) of the Act. It plainly was a threat that Respondent would retaliate against an employee who engaged in union activity by withholding wage increases, and constituted the interference, restraint, and coercion proscribed by Section 8(a)(1) of the Act. I so find and conclude. On the second aspect of the General Counsel's case, namely, the failure to grant Hocutt a wage increase, the critical issue is, of course, Respondent's motive in denying Hocutt a wage increase. If, as Respondent contends, its action in that regard was nothing more than an exercise of its business judgment uninfluenced by Hocutt's union activity, plainly no violation of the Act occurred. On the other hand if, as the General Counsel contends, Respon- dent denied Hocutt a wage increase in June 1972, because of his activity on behalf of the Union, then a violation of 15 Based on the credited testimony of Page Joyner admits that Page asked the question above-indicated , but claims that his only reply was that Hocutt knew why he had not received a raise This presents the one credibility issue of any consequence requiring resolution I have credited Page for several reasons In the first place , Page impressed me as an honest, straightforward witness, while Joyner gave me the impression that he was holding back Secondly, Page no longer works for Respondent, having been inducted into the Army in October There is nothing in the evidence to indicate whether under the facts Page will have reemployment rights following his discharge from the service If he does, then he is in the position of having testified against his employer , if he does not have such rights, then he has no self-interest There is no showing that Page has any animus against Respondent, or that he and Hocutt are particularly friendly, and Section 8(a)(3) and (1) of the Act is clear because it was discrimination which had the effect of discouraging membership in the Union. Upon consideration of the entire record, I find and conclude that in June 1972, Respondent denied a wage increase to Hocutt because of his activity on behalf of the Union. I do so for the following reasons: 1. Joyner's statement to Page, that Hocutt was denied a wage increase because of his pushing the Union, being an admission, is sufficient standing alone to establish that Respondent's action in that regard was motivated by Hocutt's assistance and support of the Union. But my decision need not, and does not, rest solely on that narrow ground, because there is additional evidence which leads to the same conclusion. 2. I do not credit Jenkins' testimony that the total performance rating of 3-minus given Hocutt on June 13 precluded granting him a wage increase because a rating of less than 3 meant that Hocutt did not meet the require- ments of the job, a condition precedent to granting an increase. I do so because the record evidence shows that in April 1970, Jenkins himself approved Joyner's recommen- dation that Hocutt be granted an increase of $10 a week (25 cents an hour on a 40-hour week), when the rating sheet showed a rating of 4 in 5 of the rated categories, and a total performance rating of 3-minus. Jenkins gave no explanation of this. And it may be noted that the increase granted at that time was 4 1/2 percent greater than what Jenkins claimed was the maximum permissible under the manual. 3. Having rejected Jenkins' reason for withholding of a wage increase from Hocutt in June 1972, it is reasonable to infer, as I do, that he was motivated by, some other consideration which he has purposely failed to reveal, and the only motive apparent from this record is antipathy for Hocutt's union activity. This is made abundantly clear, I find, by Joyner's admission that he discussed Hocutt's union activity with Jenkins just prior to preparing the June 13 rating. At that time, the election had been over for about a year, and both Jenkins and Joyner admit that no union activity was in progress. As the Court of Appeals for the Ninth Circuit stated the principle in Shattuck Denn Mining Corporation v. N.L.R.B., 362 F.2d 466, 470: If he [the trier of fact] finds that the stated motive for a discharge is false, he certainly can infer that there is another motive. More than that, he can infer that the motive is one that the employer desires to conceal-an unlawful motive-at least where, as in the instant case, the surrounding facts tend to reinforce that inference.17 Accordingly, for the reasons stated, I find and conclude that he did what he did as part of some plan or scheme to hurt Respondent or to assist Hocutt 16 Here again a credibility issue is presented, but one I do not consider necessary to resolve According to Hocutt, the question he put got sidetracked, he became angry and walked out, but he did not get the raise. According to Jenkins, he explained to Hocutt that while his job performance had improved in the past 2 or 3 months, and if it continued he would certainly be considered for a wage increase, his performance at the time did not warrant an increase 17 Although Shattuck Denn, supra, involved a discriminatory discharge, I regard the principles there stated equally applicable to any other form of discrimination where motive is the determinative factor. J.C. PENNEY COMPANY that Jenkins withheld a wage increase from Hocutt in June 1972 to retaliate against the latter for his support of and assistance to the Union, and that by such conduct Respondent violated Section 8(a)(3) and (1) of the Act. Upon the foregoing findings of fact and the entire record in the case, I state the following: CONCLUSIONS OF LAW 1. Respondent is an employer within the meaning of Section 2(2) of the Act, and is engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. The Union is a labor organization within the meaning of Section 2(5) of the Act. 3. By Joyner's statement to Page that Hocutt had been denied a raise because of his pushing the Union, Respon- dent interfered with, restrained, and coerced its employees in the exercise of rights guaranteed by Section 7 of the Act, and thereby engaged in, and is engaging in, unfair labor practices proscribed by Section 8(a)(1) of the Act. 4. By denying Hocutt a wage increase because of his concerted and union activities, Respondent discriminated against Hocutt in regard to his hire and tenure of employment, discouraging membership in a labor organi- zation, and interfered with, restrained, and coerced employees in the exercise of rights guaranteed by Section 7 of the Act, and thereby engaged in, and is engaging in, unfair labor practices proscribed by Section 8(a)(3) and (1) of the Act. 5. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. THE REMEDY Having found that Respondent interfered with, re- strained, and coerced its employees in the exercise of their Section 7 rights, I shall recommend that it be required to cease and desist from such conduct and take certain affirmative action designed and found necessary to effectuate the policies of the Act. The unfair labor practices found being of a character which goes to the very heart of the Act, an order requiring Respondent to cease and desist from in any manner infringing upon employee rights is warranted, and I shall so recommend . N.L.R B. v. Entwistle Mfg. Co., 120 F.2d 532 (C.A. 4); California Lingerie, Inc, 120 NLRB 912, 915. Having also found that Respondent discriminatorily denied Hocutt a wage increase, and as Hocutt is no longer employed by Respondent for reasons not related to this case, it will be recommended that Respondent be required to make him whole for any wages he lost by the reason of 18 The record before me is inadequate to make a determination as to the amount of increase Hocutt would have received had Respondent acted nondiscriminatonly Would it have been 25 cents an hour as was the case in 1970 or would it have been the minimum of 4 percent, or the maximum of 8 percent provided in the manual, or perhaps some figure in between With all applicable records of Respondent before him, the compliance officer should have little problem in determining the amount of the increase Hocutt would have received had Respondent acted nondiscriminatorily, and then compute the amount due In making such determination, compliance must, of course, give due consideration to the limitations imposed by law under the program for stabilization of wages in effect on June 13, because Respondent cannot be required to pay any amount in violation of law the discrimination against him, in the period between June 13, 1972, and the date his employment terminated, with interest at the rate of 6 percent per annum as provided in Isis Plumbing & Heating Co., 138 NLRB 716.18 The computations necessary in this regard can best be made at the compliance stage of this proceeding. To facilitate such computations, it will be recommended that Respondent be required to preserve and, upon request, make available to authorized agents of the Board, all records necessary or useful in determining compliance with the Board's Order, or in computing the amount of backpay due. Upon 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 recommend- ed: ORDER 19 Respondent, J.C. Penney Company, Inc., Wilson, North Carolina, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Telling employees that it withholds wage increases from employees because they assist or support a labor organization. (b) Withholding wage increases from employees because they have assisted or supported a labor organization. (c) In any other manner interfering with, restraining, or coercing employees in the exercise of their right to self- organization, to form, join or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any, and all such activities. 2. Take the following affirmative action found neces- sary and designed to effectuate the policies of the Act: (a) Make whole Walter Gray Hocutt for the wages he lost by reason of its failure to grant Hocutt a wage increase on June 13, 1972, to be computed in accordance with the section hereof entitled "The Remedy." (b) Preserve and, upon request, make available to the Board and its authorized agents for examination and copying, all records necessary or useful in determining compliance with the provisions of this Order, including, but not limited to, social security payment records, timecards, personnel records, and reports. (c) Post at its retail store operation at Wilson, North Carolina, copies of the attached notice marked "Appen- dix."20 Copies of said notice, on forms provided by the Board's Regional Director for Region 11 (Winston-Salem North Carolina), shall, after being signed by an authorized representative be posted as herein provided immediately is 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 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 20 In the event the Board's Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board " 1112 DECISIONS OF NATIONAL LABOR RELATIONS BOARD upon receipt thereof, and be so maintained for a period of 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken to insure that said notices are not altered, defaced, or covered by any other matenal. (d) Notify the Regional Director for Region 11, in writing, within 20 days from the date of receipt of this Decision, what steps it has taken to comply herewith. APPENDIX NOTICE TO EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government After a full trial in which both sides had the opportunity to present their evidence , the National Labor Relations Board has found that we, J.C. Penney Company, Inc., Wilson, North Carolina, violated the National Labor Relations Act, and ordered us to post this notice. We will carry out the Order of the Board, the Judgment of any court based thereon, and comply with the following: The Act gives all employees these rights: To organize themselves To form, join, or help unions To act together for collective bargaining or other mutual aid or protection To refuse to do any or all these things. WE WILL NOT do anything to interfere with you in the exercise of said rights , and all our employees are free to become or remain a member of any union, or not to become or remain a member of any union. WE WILL NOT tell employees that we denied a wage-- increase to another employee because the latter assisted or supported a union. WE WILL NOT refuse to grant an employee a wage increase because he assisted or supported a union. As it has been found that we violated the law when we refused to grant Walter Gray Hocutt a wage increase because he assisted or supported a union, WE WILL make up to him the pay he lost with interest at the rate of 6 percent per annum. Dated By J. C. PENNEY COMPANY, INC. (Employer) (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 matenal. Any questions concern- ing this notice or compliance with its provisions may be directed to the Board's Office , 1624 Wachovia Building, 301 North Main Street, Winston-Salem, North Carolina, 27101, Telephone 723-9211.