D. J. Eshom Meat Co., Inc.

D. J. ESHOM MEAT CO., INC. D. J. Eshom Meat Co., Inc. and Manuel Galvez. Cases 21-CA-11594 and 21-CA-11714 December 28, 1973 DECISION AND ORDER BY MEMBERS JENKINS, KENNEDY, AND PENELLO On September 12, 1973, Administrative Law Judge James S. Jenson issued the attached Decision in this proceeding. Thereafter, General Counsel filed excep- tions and a supporting brief, and Respondent filed a brief in support of the Administrative Law Judge's Decision. 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 briefs and has decided to affirm the rulings, findings,' and conclusions2 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, D. J. Eshom Meat Co., Inc., Los Angeles, California, its officers, agents, successors, and assigns, shall take the action set forth in the said recommended Order. IT IS HEREBY FURTHER ORDERED that the complaint herein be, and it hereby is, dismissed insofar as it relates to Case 21-CA-11594. 1 We find no merit in the General Counsel's contention that the 10(b) period is to be determined by the filing date of the charge in Case 2I-CA-11594 The unfair labor practices found herein are based on the allegations of the charge in Case 21-CA-11714, filed April 13, 1973. Those unfair labor practices bear insufficient relationship to the charge filed on March 1, 1973, and, consequently, a computation of the 10(b) period for remedial purposes from the March 1 date would be'inappropnate See Hunter Saw Division of Asko, Inc,, 202 NLRB 330; Prince Pontiac, Inc, 174 NLRB 919, 921-922 2 The Administrative Law Judge inadvertently misstates the 10(b) period in the Remedy section of his Decision as running from February 23, 1973, the date of the unlawful layoff, to April 13, 1973, the date of the filing of the charge. Since we agree that reimbursement for lost pay and benefits is proper for the 6-month period prior to the date of the filing and service of the charge in Case 21-CA-11714, it is clear that such reimbursement shall be made for such losses suffered between October 13, 1972, and February 23, 1973, the date of Galvez' layoff DECISION STATEMENT OF THE CASE 41 JAMES S. JENSON, Administrative Law Judge : Pursuant to unfair labor practice charges filed on March 1, 1973, in Case 21-CA-11594 and on April 13, 1973, in Case 21-CA-11714, a consolidated complaint issued on May 7, 1973, alleging that Respondent violated Section 8(a)(3) and (1) of the Act by (1) paying Manuel Galvez a wage rate below that provided for in a collective -bargaining agree- ment because he was not a member of the Union; (2) denying Galvez fringe benefits provided for in said collective-bargaining agreement because he was not a member of the Union; and (3) discharging Galvez because he joined the Union. Respondent denies the commission of any unfair labor practices and contends Galvez was laid off for economic reasons and is subject to recall. The case was tried before me in Los Angeles, California , on July 24, 1973. Briefs were thereafter filed by both Respondent and the General Counsel. Upon the entire record of the case, upon my observation of the witnesses and their demeanor, and upon considera- tion of the briefs , I make the following: FINDINGS OF FACT 1. JURISDICTION Respondent, a corporation, is engaged in the processing and wholesale distribution of meat in Los Angeles, California. During the calendar year 1972, its interstate purchases from suppliers located within California, who purchased and received said goods directly from suppliers located outside California, exceeded $50,000. Respondent is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED Provision House Workers Union Local No. 274, AFL-CIO (herein called Local 274), is a labor organization within the meaning of Section 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES A. Chronology of Events At all times material herein, Respondent and Local 274 have been parties to a collective-bargaining agreement covering, inter alia, apprentice meatcutters.i Galvez was employed by Respondent in September 1971 1 The current agreement runs from October 1, 1973, to October 1, 1973, and contains a union-security clause, wage schedules, and various fringe benefit provisions 208 NLRB No. 29 42 DECISIONS OF NATIONAL LABOR RELATIONS BOARD as a "helper." Although the collective-bargaining agree- ment does not contain a "helper" classification, it is clear from a description of his duties and the testimony of Don Holeman, the business representative for Local 274, that Galvez' classification under the contract was that of apprentice meatcutter. The evidence established that Galvez was paid less than the appropriate contract wage scale and was denied the fringe benefits provided for in the contract during his entire period of employment by Respondent. On February 19, 1973,2 Galvez received an injury requiring emergency hospital treatment. He learned through hospital personnel that the cost of his medical care might be covered by an insurance plan through a union and his employer. On the morning of February 20, Galvez went to the Respondent's plant for the express purpose of finding out whether there was an insurance plan covering his medical expenses. He learned through another employ- ee that Local 274 represented Respondent's employees. He then went to the Union's office and completed union membership application and insurance forms.3 Early in the afternoon he talked to Business Representa- tive Holeman, and informed him that he wanted to join Local 274. Holeman questioned Galvez regarding his length of employment, work record, and work performed and informed him there would be no problem with regard to joining. Holeman then called David Eshom, Respon- dent's president, and informed him that Galvez was in the Union's office and that he was "taking him into the Union." Eshom responded that that was all right, but that business had been bad and Respondent might have to lay off some employees, that Galvez might be one of them and that it might look as though ". . . I am laying him off because of his being in the Union." Holeman replied ".. . if you have to lay off some people . . . do it according to classification seniority."4 Holeman then questioned Galvez regarding previous jobs with Respondent, and upon learning that this was his initial job, informed him that Respondent might have to lay off some people and that he might be one of those laid off. After learning that Galvez was not receiving the proper wage, Holeman told him that he would go to Respondent's plant and watch Galvez work in order to determine what his classification and wage rate should be, but that it would be between $5.56 and $4.85 per hour. On February 22, Eshom called Holeman and informed him that, as they had discussed earlier in the week. Respondent was going to have to lay off three employees, and as Galvez would be one of them he was ". . . worried about how it would look so soon after the man had joined 2 All dates are in 1973 unless otherwise stated 3 Galvez, who does not speak English, was accompanied by his wife who interpreted 4 Art. XII, seniority, sec. A, provides in pertinent part The employee shall accumulate seniority standing as follows. The plant seniority shall equal the employee's total length of service with the Employer dating from the first day of his employment. Classificational seniority shall equal the employee's total length of service in the classification in which he is working All promotions or reductions in the working force within classifica- lions shall be made on the basis of classificational seniority when ability is relatively equal In other words, employees holding classifica- tional seniority within a particular job classification in the affected the Union." Holeman said that he should make certain that all employees were laid off ". . . according to classificational seniority as we have outlined in the contract." Holeman then questioned Eshom to see whether Galvez might be entitled to "bump" down in accordance with the contract, and learned that Galvez was the least senior employee cutting meat and was doing the same work he had done from the commencement of his employment, and therefore had no bumping rights. Galvez worked February 21, 22, and 23, and at the end of the day on February 23 was advised, according to Galvez' testimony that, ". . . there was no longer to be any work for me . . . it was going to get slow and that he was not going to need me any more, that he no longer wanted me at work, that he was going to lose some clients." Eshom testified that he told Galvez that, ". . . due to the work load has slackened off . . . we were going to cut back and that he is the less senior man and I would have to lay him off plus two people in the clean-up crew." Eshom testified that he told the same thing to the two cleanup men he laid off at the same time.5 Galvez' wage rate was increased the last 3 days of employment from $3 .85 to $4.475 per hour.6 Approximately a week later, Galvez and his wife went to the union office and inquired, "why he was fired." Holeman indicated he was under the impression that Galvez had been laid off. He called Eshom on the phone and was assured that Galvez was laid off and was subject to being recalled. Within a few days , Holeman found a grievance on his desk from Galvez dated March 1, stating, "Why was I fired from work without no reason at all." He therefore called Eshom, advised him of the grievance, and that he "wanted in writing that he is not fired, is only laid off." After receiving a letter from Eshom , Holeman wrote Galvez on March 6 as follows: Dear Mr. Galvez: In answer to your questior of March 1, you are not fired. You were laid off according to your classifica- tional seniority and you are subject to recall. Approximately 2 or 3 weeks later Galvez and Polanco, a friend who speaks both Spanish and English, went to the union offices. Polanco "wanted to know why Mr. Galvez was fired." Holeman informed Polanco that "Mr. Galvez is not fired, he is only laid off." Polanco then threatened to file charges against Holeman if he didn't get Galvez a job.7 Holeman's response was to "Go ahead and file charges against me. We have 600 unemployed members in this classification shall be laid off in inverse order, The agreement also provides for displacement of less senior employees within the same classification and in lower classifications in which previously employed 5 Several of Respondent's employees , including the two cleanup men, were not members of Local 274 One of the cleanup men was recalled prior to the trial and became a union member as had all of Respondent's employees at trial time 6 The hourly contract rate for an apprentice meatcutter in his third 6 months of employment was $5 24 7 Polanco, although present during the trial, was not called as a witness to refute Holeman's testimony which is credited D. J. ESHOM MEAT CO., INC. Union and when we get them a job, Mr. Galvez will be next on the list." B. Respondent's Defense Witnesses for Respondent testified that a meeting of the officers of the corporation was held in early February at which time the financial statement was reviewed since the profit margin was at a dangerous low; that meat prices had continued to rise resulting in a loss of some accounts; that the meat boycott was "coming on"; and that it was decided it would be necessary to do the following: (1) Reduce labor costs by laying off at least three employees; and (2) eliminate the smaller marginal profit accounts. A review of the accounts was thereafter made by one of the officers and the marginal accounts eliminated; and on February 23, three employees, including Galvez, were laid off as planned. Analysis and Conclusions Respondent's Failure to Pay Galvez the Wage Rates and Deny Him Fringe Benefits Provided for in the Collective-Bargaining Agreement It is clear from the evidence that Galvez was employed as an apprentice meatcutter throughout his entire period of employment with Respondent, and that the apprentice meatcutter's classification has been included in the wage schedule contained in the collective-bargaining agreement which the parties agreed has been in effect at all times material herein. It is further clear that Galvez has never been paid in accordance with the contract wage schedule, nor has he been covered by any of the fringe benefit provisions in the contract. It is likewise clear the reason he has not enjoyed contract coverage is because he was not a union member.8 Respondent contends "... to find that the employer violated the law when it was merely following the interpretation of the contract placed on it by itself and the Union is unwarranted and unfair." In Rockway News Supply Company, Inc., 94 NLRB 1056, 1059, the Board stated: ... aside from the legality or illegality of their agreements, the Respondents, by granting more advan- tageous working conditions to the union-member employees, unlawfully discriminated against nonunion employees. Section 8(a)(3) of the Act makes it illegal for an employer to discriminate, on the basis of union membership, in regard to hire or tenure of employment or any other term or condition of employment of his employees. To hold that because a collective bargain- ing agreement purports to establish terms and condi- tions of employment for union members only, an employer may refuse to give his nonunion employees equal terms and conditions, would not only be contrary to the plain meaning of Section 8(a)(3) of the Act, but 8 After Holeman informed Eshom on February 20 that Galvez had applied for union membership and he " . -. was taking him into the Union," Galvez received an increase in pay from $3 85 to $4 475 per hour. The latter figure was the contract rate effective October 1, 1970, to October 4, 1971, 43 would also violate the spirit and intent of the entire Act. In The Radio Officers' Union v. N.L.R.B., 347 U.S. 17, the United States Supreme -Court considered three cases because they all involved encouragement of union mem- bership by employers. In the Gaynor News case, the employer granted retroactive wage increases to union members but not to nonunion employees in ' the same bargaining unit . The Supreme Court stated at page 46: In Gaynor, the second circuit also properly applied this principle. The court there held that disparate wage treatment of employees based solely on union member- ship status is "inherently conducive to increased union membership." In holding that a natural consequence of discrimination, based solely on union membership or lack thereof, is discouragement or encouragement of membership in such union, the court merely recognized a fact of common experience-that the desire of employees to unionize is directly proportional to the advantages thought to be obtained from such action. No more striking examples of discrimination so foreseeably causing employee response as to obviate the need for any other proof of intent is apparent than the payment of different wages to union employees doing a job than to nonunion employees doing the same job. As noted above, the House Report on Section 8(3) of the Wagner Act emphasized that such disparate treatment was impossible under the Act. 7, We express no opinion as to the legality of disparate payments where the Union is not exclusive bargaining agent since that case is not before us. We do not hold that in the circumstances of this case, the Union being exclusive bargaining agent for both its members and nonmember employees, the employer could not, with- out violating Section 8(aX3), discriminate in wages solely on the basis of such membership even though it had executed a contract with the Union prescribing such action. Statements throughout the legislative history of the National Labor Relations Act emphasize that exclusive bargaining agents are powerless "to make agreements more favorable to the majority than to the minority." Such discriminatory contracts are illegal and provide no defense to an action under Section 8(a)(3). [Citations omitted.] Accordingly, I conclude and find that Respondent's refusal to pay Galvez the same benefits and compensation which it gave its union employees, because of his lack of union membership, was discrimination in regard to terms and conditions of employment which reasonably tended to for an apprentice meatcutter with less than 6 months' experience According to the wage schedule effective after October 2, 1972 (G.C. Exh. 4, addendum 1(b) an apprentice meatcutter with 12 months ' experience was entitled to $5 24 per hour. 44 DECISIONS OF NATIONAL LABOR RELATIONS BOARD encourage membership in Local 274, and that Respondent thereby violated Section 8(a)(3) and (1) of the Act.9 The Alleged Unlawful Discharge The General Counsel contends Galvez was discharged because he joined Local 274, and as a consequence Respondent was going to have to pay him union scale. Respondent, on the other hand, contends Galvez was laid off along with two other employees for economic reasons and is si.^blect to recall. The General Counsel argues that Respondent was quite willing to employ Galvez for 17 months at wages below union scale, but when it learned he had joined the Union and would be faced with paying him union wages, it terminated him. The General Counsel then argues that Respondent's failure to produce a financial statement reflecting a poor profit margin warrants the adverse inference that if the document were produced, it would be contrary to Respondent's position. The burden of proof rests, of course, upon the General Counsel. The issue is not whether the business considera- tions which Respondent advances to support its defense were or were not adequate to justify Galvez' layoff. The Act imposes no requirement that an employer exercise good business judgment and exacts no penalty because he exercises bad judgment. What the General Counsel must establish is that Respondent's decision was not motivated by business considerations, but rather to discriminate against its employee because he joined Local 274. Speculation and surmise are not sufficient. The General Counsel must establish by affirmative evidence that a motivating reason for the termination was proscribed by the Act-here, retaliation against Galvez for joining Local 274 or engaging in other protected, concerted activity. In the absence of such evidence, lack of economic or business justification would not in and of itself justify a finding of motivation proscribed by the Act. In the present case, we have an employer and a union in contract relations. While the collective-bargaining agree- ment contained a union-security clause, neither the agreement nor the Act places a burden upon the employer to notify the employee of his union obligations under the contract. That obligation rests upon the union involved. The employer's obligation, as found above, is to apply the same terms and conditions of employment to all employees within the collective-bargaining unit regardless of union membership. It is clear from the testimony of both Eshom and Holeman, that it is not unusual for employers within the jurisdiction of Local 274 to have employees working at jobs covered by the contract for substantial periods of time-in excess of 2 years-before they become union members. Thus, it was established that cutting department employees Villalobos and Garcia had worked for Respon- dent approximately 3 years before they became union members, and Legg, who had worked for approximately 2- 1/2 years, did not become a union member until after Holeman contacted the employees at Respondent's plant after Galvez alerted him to the fact that not all of Respondent's employees were union members. Whether, during the interim, they were paid in accordance with the collective-bargaining agreement was not established. After careful review of the evidence, I conclude and find that the General Counsel has failed to establish the absence of economic motivation for Galvez' layoff. Respondent's economic defense finds support in Holeman, a witness for the General Counsel, who testified that he didn't think it unusual for Respondent to be laying off employees in February "Because of the situation of the meat business this year. Everybody practically is laying off and were laying off at that time. We had approximately 600 union members unemployed at that time due to layoff. The largest unemployed membership that we ever have had." Further, his concern upon being informed that Respondent might have to lay off employees was that "classificational seniority," as provided for in the contract, be applied in the case of all employees. The evidence established that Galvez was the least senior employee in the meatcutter classification. Of further significance is the fact that no replacement has been hired for Galvez, and the employer has notified Local 274 and stated at the trial of this matter that he is subject to recall. I have also noted that two other employees, both nonunion, were laid off at the same time Galvez was laid off, one having been recalled and having become a union member at the time of the trial. And Legg, a nonunion meatcutter with more classificational seniority than Galvez, was not laid off or terminated although he has since become a union member. In sum, and on all the evidence of record, I conclude and find that the General Counsel has not established that the layoff of February 23 was discriminatorily motivated and designed as a retaliation against Galvez because he joined Local 274 or engaged in other protected concerted activity. A violation of Section 8(a)(3) and (1) of the Act in this regard has not been proved. Accordingly, I recommend that this allegation of the consolidated complaint be dismissed. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondent set forth in section III, above, occurring in connection with the operations of Respondent described in section I, above, have a close, intimate, and substantial relation to trade, traffic, and commerce among the several states and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that Respondent has engaged in certain unfair labor practices, I shall recommend that it cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act. Having found that Respondent violated Section 8(a)(1) and (3) of the Act by failing to pay Galvez they wage rate provided for in the collective-bargaining agreement and by 9 The fact Local 274 has been lax in policing the collective-bargaining agreement is no defense D. J. ESHOM MEAT CO., INC. denying him the fringe benefits provided for in said contract, because he was not a member of Local 274, I shall recommend that Respondent make Manuel Galvez whole for any loss of pay and benefits he may have suffered by reason of Respondent's discrimination against him as aforesaid. Said loss of pay and benefits shall be calculated back from April 13, 1973, the date of the filing and service of the charge in Case 21-CA-11714, the charge upon which the unfair labor practices are founded, to February 23, 1973, the date of Galvez' layoff.10 Said backpay shall be computed on a quarterly basis in the manner established by the Board in F. W. Woolworth Company, 90 NLRB 289. The interest on backpay shall be computed in the manner set forth in Isis Plumbing & Heating Co., 138 NLRB 716. It is also recommended that Respondent be ordered to make available to the Board, upon request, all payroll and other records to facilitate checking the amounts due. Upon the foregoing findings of fact and upon the entire record in the case, I make the following: CONCLUSIONS OF LAW 1. D. J. Eshom Meat Co., Inc., is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. Provision House Workers Union Local No. 274, AFL-CIO, is a labor organization within the meaning of Section 2(5) of the Act. 3. By discriminating in regard to the terms and conditions of employment of Manuel Galvez, thereby encouraging membership in the above Union, Respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8(a)(3) of the Act. 4. By such discrimination, 'Respondent has also inter- fered with, restrained, and coerced its employees in the exercise of rights guaranteed in Section 7 of the Act, and is thereby engaged in and is engaging in unfair labor practices within the meaning of Section 8(a)(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. Upon the foregoing findings of fact, conclusions of law, and the entire record, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: ORDER i i D. J. Eshom Meat Co., Inc., its officers, agents, successors, and assigns, shall: 1. Cease and desist from encouraging membership in Provision House Workers Union Local No. 274, AFL- CIO, or any other labor organization of its employees, by discriminating in regard to the hire and tenure of employment, or any term or condition of employment, of any of its employees because of their nonmembership in such organization, or by any like or related conduct interfering with, restraining, or coercing employees in the exercise of rights guaranteed them by Section 7 of the Act. 2. Take the following affirmative action: (a) Make whole Manuel Galvez for any loss of pay and benefits he may have suffered by reason of Respondent's 45 discrimination against him in the manner set forth in the section herein titled "The Remedy." (b) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social security payments records, time- cards, personnel records and reports, and all other records necessary to analyze and determine the amount of backpay due under the terms of this recommended Order. (c) Post at its office in Los Angeles, California, copies of the attached notice marked "Appendix."12 Copies of said notice, on forms provided by the Regional Director for Region 21, after being duly signed by an authorized representative of Respondent, shall be posted immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, includ- ing all places where notices to employees are customarily posted. Reasonable steps shall be taken by Respondent to insure that said notices are not altered, defaced, or covered by any other material. (d) Notify the Regional Director for Region 21, in writing, within 20 days from the date of this Order what steps Respondent has taken to comply herewith. IT IS FURTHER ORDERED that the consolidated complaint be, and it hereby is, dismissed insofar as it alleges that Respondent discriminatorily terminated the employment of Manuel Galvez on February 23, 1973. 10 The General Counsel contends backpay should be computed back from the date of filing and service of the charge in 21-CA-11594, while the Respondent contends it should be predicated on the date of filing of the charge in 21-CA-11714 I have found the unfair labor practice allegation in 21-CA-11594 to be without merit The unfair labor practice findings herein are based solely upon allegations contained in the charge in 21-CA-11714 Accordingly, the 10(b) period shall be computed from the date of the filing and service of the charge in 21-CA-11714. 11 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 12 In the event that the Board 's Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board." APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL NOT refuse or fall to pay any employee in the bargaining unit covered by our collective-bargain- ing agreement with Provision House Workers Union Local No. 274, AFL-CIO, the proper wage rate provided for in said agreement, because he is not a member of Local 274. WE WILL NOT,refuse or fail to grant to any employee in the bargaining unit the fringe benefits provided for in any collective-bargaining agreement with said union. WE WILL make Manuel Galvez whole for the loss of pay and other benefits which he suffered as a result of our discrimination against him. 46 DECISIONS OF NATIONAL LABOR RELATIONS BOARD D. J. ESHOM MEAT Co., This notice must remain posted for 60 consecutive days INC. from the date of posting and must not be altered, defaced, (Employer) or covered by any other material. Any questiojis concern- ing this notice or compliance with its provisions may be Dated By directed to the Board's Office, Eastern Columbia Building, (Representative) (Title) 849 South Broadway, Los Angeles, California 90014, This is an official notice and must not be defaced by Telephone 213-688-5229. anyone.