Stumpf Motor Co., Inc.

STUMPF MOTOR COMPANY Stumpf Motor Company, Inc. and General Drivers and Dairy Employees Union Local No. 563 affiliated with the international Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of Ameri- ca. Cases 30-CA-2098 and 30-RC-1773 January 16, 1974 DECISION, ORDER, AND DIRECTION OF SECOND ELECTION By CHAIRMAN MILLER AND MEMBERS FANNING AND PENELLO On April 25, 1973, Administrative Law Judge Sidney Sherman issued the attached Decision in this proceeding. Thereafter, Respondent filed exceptions and a supporting brief, and General Counsel 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 conclusions of the Administrative Law Judge with the exceptions and modifications set forth below. 1. The Administrative Law Judge found that Respondent's service manager, Friebel, had individu- al conversations with about 20 of the 31 unit employees during the pendency of the Union's representation petition and that during these conver- sations Friebel made certain statements to employees which General Counsel alleged in his complaint were unlawful. For purposes of analysis, the Administra- tive Law Judge characterized the various alleged unlawful statements made by Friebel to individual employees as falling into the following six general categories: (1) That collective bargaining would probably result in loss of profit sharing. (2) That, if it had to deal with the Union, Respondent did not have to continue to extend "shop privileges" to the employees. (3) That any negotiations between Respondent i Respondent excepts on procedural grounds to the Administrative Law Judge's solicitation of a supplemental position from the General Counsel after the close of the hearing. It claims that the Administrative Law Judge's action was not authorized by the Board's Rules and Regulations. However, the issues the Administrative Law Judge sought clarification on were fully litigated at the hearing and Respondent was provided an opportunity to, and did, respond to General Counsel 's supplemental statement of position We therefore find it unnecessary to determine whether or not the Administrative Law Judge acted within the scope of his authority . since it is clear here that Respondent was not in any way prejudiced by the 431 and the Union might result in the elimination of overtime work. (4) That, if Respondent had to deal with the Union, benefits would start from zero. (5) That, if Respondent had to deal with the Union, all benefits would be negotiable. (6) That, if Respondent had to deal with the Union, all benefits would be negotiable, and if Friebel were in the employees' position, he would hate to lose certain benefits as a result of such negotiations. The Administrative Law Judge interpreted all six types of statements as containing "the implication therein that Respondent would seek to deal more harshly with the employees through a union than it otherwise would," and that they thereby constituted threats of reprisal against the employees if they selected the Union. He accordingly found all six statements to be in violation of Section 8(a)(1) of the Act. Respondent excepts to these findings, contend- ing that its statements were all privileged under Section 8(c) of the Act. Having carefully examined the record, we find that it does not support the Administrative Law Judge's summary categorization of the various conversations involved. Consequently, we base our conclusions in each instance on the particular conversation taken in context. Statement 1: General Counsel called five employ- ees to the stand to testify as to statements made to them by Friebel during the pendency of the election. Four of these employees testified that Friebel told them, in the course of individual discussions, that collective bargaining would probably result in the loss of profit sharing. The fifth employee, Kahnt, testified Friebel told him that he, Friebel, would hate to lose the profit-sharing plan and that Stumpf, Respondent's president, would fight the Union all the way. The Administrative Law Judge credited all five employees. We agree with the Administrative Law Judge that Friebel's statement to Kahnt was unlawful, since, as found by the Administrative Law Judge, it implied that unionization would ipso facto result in the loss of an important benefit. However, when Friebel spoke to the other employees about the loss of profit sharing, he stated it would be as a result of supplemental statement . Accordingly, we find no merit in Respondent's contentions 2 The Respondent has excepted to certain credibili ty findings made by the Administrative Law Judge It is the Board's established policy not to overrule an Administrative Law Judge's resolutions with respect to credibility unless the clear preponderance of all of the relevant evidence convinces us that the resolutions are incorrect . Standard Dry Wall Products. Inc, 91 NLRB 544, enfd 188 F 2d 362 (C A 3. 1951) We have carefully examined the record and find no basis for reversing his findings 208 NLRB No. 68 432 DECISIONS OF NATIONAL LABOR RELATIONS BOARD negotiations. Moreover, Friebel admittedly prefaced his remarks by saying that all benefits would be negotiable if the Union won the election . In that context, we do not find the statement to have violated Section 8(a)(1) of the Act. An employer is free to indicate to his employees what the possible result of bargaining may be, and to call their attention to the possibility or even probability that certain existing benefits may be traded away for others. Statement 2: Employees Glasheen and Kahnt testified that Friebel spoke to them about shop privileges. Glasheen testified Friebel told him, among other things, that if the Union came to represent the employees all existing benefits would be negotiable , including the privilege the employees then enjoyed of working on their own cars in Respondent's shop. We find nothing unlawful in that comment for the reasons indicated heretofore under "statement 1." The Administrative Law Judge, however, credited Kahnt's testimony that, in a third conversation he had with Friebel about a week before the election, Friebel told Kahnt, among other things, that he would hate to lose certain benefits ; that under the Union all benefits would start from zero ; and that Respondent did not have to extend to the mechanics the privilege of working on their own cars in the shop . Moreover, as noted under statement 1, above, Friebel had indicated to Kahnt in a previous conversation , apparently without elaboration, that profit sharing might be lost . In this context, we agree with the Administrative Law Judge that the state- ment could reasonably be taken by the employee as a threatened loss of benefits to be enacted unilaterally by the Employer as a reprisal for the employees having selected the Union. Statement 3: Friebel admittedly made this state- ment in one form or another to almost all of the employees who testified ; in each instance Friebel's remarks were to the effect that the loss of overtime would occur through negotiations. All but two employees admitted that Friebel gave as the reason that Respondent could not afford to pay time and a half for overtime. As to the two employees (Herrick and Glasheen) who testified, Friebel made the statement without explaining the economic predi- cate, in both instances the employees admitted that Friebel prefaced his remarks by saying that under a union all benefits would be negotiable . Moreover, the nature of the conversation in other respects was not threatening . Under these circumstances , we find that the statement was protected under Section 8(c) of the Act, since in all cases it was explained on the basis of economic considerations or was communi- cated in the context of one of the existing benefits which could be traded away in the course of negotiations, and there was no overtone in the conversation that the action would be taken unilater- ally by the Employer for retaliatory reasons. Statement 4.• Employee Kahnt was the only witness to testify as to this remark. The Administrative Law Judge credited Kahnt's testimony that in a second conversation he had with Friebel , Friebel told him that under a union there would be a 40-hour shop and all benefits would start from zero . As noted under statement 1, above , in the previous conversa- tion Friebel had with Kahnt , Friebel unlawfully implied to Kahnt that profit sharing would be lost with the advent of the Union . In light of this previous conversation , we agree with the Administrative Law Judge that the reasonable impression imparted by Friebel to Kahnt was that benefits would be taken away as a reprisal should the employees select the Union. Accordingly, we find the statement in that context to be violative of Section 8(a)(1) of the Act. Statement 5: Several of the employees testified that Friebel referred to the fact that, under a union, all benefits would be negotiable as a preface to mentioning specific benefits presently enjoyed by employees which could be lost as a result of negotiations . We find nothing threatening in such a statement, especially since in none of the conversa- tions was it made in the context of other threatening remarks. Accordingly, we find it privileged under Section 8(c) of the Act. Statement 6: As the Administrative Law Judge found, Friebel admitted to having talked to about 20 of the employees about the negotiability of existing benefits and that, in the course of these conversa- tions, he stated that if he were in the position of the employees he would hate to lose certain of these benefits as a result of collective bargaining. We find nothing threatening in such a statement , for the reasons stated heretofore , and would therefore find it privileged under Section 8(c). 2. The Administrative Law Judge found that Friebel's conduct in asking employee Glasheen on two separate occasions what he thought of the Union violated Section 8(a)(1) of the Act . We disagree. We note that Glasheen was a self-proclaimed and known union adherent, and the "interrogations" in question appear to have been merely conversation openers, prefacing remarks which we have found elsewhere herein were privileged.3 Accordingly, the Adminis- trative Law Judge's finding of an 8(a)(1) violation based on this conduct is hereby reversed. 3. We agree with the Administrative Law Judge's 3 B F Goodrich Footwear Company , 201 NLRB 353 STUMPF MOTOR COMPANY conclusion that the statement made by Respondent's president to an assembly of employees on August 29, 1972, that in the event of a strike he could lock his doors and retire to the "North Woods," violated Section 8(a)(1) of the Act. Since the statement was not qualified by any reference to economic necessi- ties, it is clear that Respondent was not making "a reasonable prediction based on available facts but a threat of retaliation . . .."'1 4. The Administrative Law Judge based other independent 8(a)(1) findings on conduct involving Respondent's withholding from employees the bene- fit of a warranty rate increase while the election was pending, and then granting that increase immediately after the election but while election objections were pending. We adopt the Administrative Law Judge's conclu- sion that Respondent violated Section 8(a)(1) in withholding from its employees the warranty rate increase benefit while the election was pending. The evidence establishes that Respondent had conceived the plan to provide an increase in the rate for warranty work performed by its employees before the advent of the Union. Thus, at the meeting which Stumpf, Respondent's president, held with the employees on May 11, prior to the commencement of the Union's campaign, Stumpf told the employees that Respondent would be lowering their percentage rate somewhat: but, at the same time, he indicated that he would attempt to get Ford Motor Company's assent to an increase in the price that Respondent could charge Ford for warranty work. (The increased rate would, if passed on to employees, exactly offset the amount the employees would lose from the lower percentage rate on warranty work.) As found by the Administrative Law Judge, Respondent thereby implicitly informed the employ- ees he would pass on the increase, if and when it was approved by Ford. Respondent's intention in this regard is further evidenced by statements in its July 31 letter to union counsel in which Respondent stated it intended "to implement the increases" and would "act accordingly" if it did not hear from the Union within 7 days. In late July, Respondent was notified that Ford had approved its request and, on August 1, commenced charging Ford on the basis of the higher rate. But it did not, in accordance with its stated intention, then pass on the benefit of that increase to the employees. On August 28, it explained to employees it had not done so because: (1) it believed the law forbade it from granting the benefit 4 NLRB v Gtssel Pa: king Co, Inc, 395 U.S 575,618(1969). s The Gates Rubber Company, 182 NLRB 95, McCormuk Longmeadow Stone Co, Inc, 158 NLRE 1237. 6 Cf Dan Howard Mfg Co., 158 IN LRB 805, enfd. in relevant part 390 F 2d 304 (C.A 7, 1968). International Ladies' Garment Workers' Union, AFL-CIO, 142 NLRB 82. enfd. in relevant part 339 F.2d 126 (C A 2, 433 during the pendency of the Union's petition, absent the Union's consent; and (2) the Union would not or did not consent. Respondent's asserted belief that it could not pass on the increase during the pendency of the Union's petition is clearly erroneous. It is well settled that an employer's legal duty during the pendency of a representation petition "is to proceed as he would have done had the union not been on the scene." 5 Furthermore, it would appear from the undisputed facts that the Union did acquiesce when Respondent advised it that it planned to grant this benefit and would effectuate, this plan unless it heard from the Union in 7 days, since the Union voiced no objections to Respondent's passing on the increase. Under these circumstances, we conclude that Res- pondent's suspending of the promised increase and blaming that suspension on the Union interfered with the election and violated Section 8(a)(1) of the Act.6 We do not, however, find unlawful Respondent's grant of the increase on the day after the election. The same considerations which would have allowed, and indeed required, Respondent to pass on the increase during the pendency of the Union's repre- sentation petition would similarly apply in the election objections period.? 'We therefore do not adopt the 8(a)(1) finding of the Administrative Law Judge based on Respondent's payment of the increase. 5. Member Penello loins Member Fanning in adopting the Administrative Law Judge's conclusion that Respondent violated Section 8(a)(1) of the Act by Friebel's advising employees Hartzheim and Herrick that their requests for individual merit increases had to be denied because of the Union's petitions In so finding they note that these employ- ees had already received the increases promised them when they were hired (although they were unaware of it), and were not due any other increases at any time here relevant. While Friebel could have given this as the reason for withholding the increases, instead he chose to indicate to the employees that the pendency of the Union's petition was the only reason for his not granting their requests. Viewed in the context of Respondent's attempt to similarly capital- ize on its withholding of warranty increases, the plain implication for the employees was that the Union's presence was the only obstacle to the realization of these benefits.) In so doing, Respondent interfered 1964). 7 See Dan Howard Mfq Co. supra, In. 6 8 In addition to the evidence set out by the Administrative Law Judge, they note that Friebel admitted to having told these employees that "as soon as the election was over, we would give them a raise, as soon as we could." 9 Pacific Southwest Airlines, 201 N LRB 647 434 DECISIONS OF NATIONAL LABOR RELATIONS BOARD with the employees' Section 7 rights in violation of Section 8(a)(1) of the Act.10 6. To the extent that the election objections are supported by the conduct found violative of Section 8(a)(1) herein, it follows, and we find, that the election objections should be sustained and the election set aside. However, we do not find Respon- dent's unfair labor practices to have been of so pervasive a character as to warrant a judgment, under Gissel standards, that use of the Board's traditional remedies could not insure a fair rerun election, and that the Board should, accordingly, accept the prepetition authorization cards as a more reliable index of employee choice. Respondent's conduct in withholding the warranty rate increase was largely dissipated by Respondent's grant of that benefit shortly after the election. Respondent's error with respect to the increase was to a large extent one of timing, and a misunderstanding and perhaps misrepresentation of what was required or permitted under Board law. The remaining unfair labor practices relate to management statements which, we have found, exceeded the bounds of privileged speech. The most damaging of the statements was that made by Stumpf when, during the delivery of otherwise privileged remarks, he referred to his financially secure position, and indicated that he "could retire to the North Woods" in the event of an economic strike. Even as to this statement, although we agree that it interfered with the employees' free choice in the election and violated Section 8(a)(1), we do not believe that its restraining effect on employ- ees' choice would survive our normal injunctive order in the event a new election were to be held. We do not regard Respondent's preelection description of action it might take if faced with a future strike over bargaining demands to be equatable, in terms of lingering impact, to an employer's bald preelection threat to terminate operations once a union is selected. We note further, in connection with Stumpf's remarks, that although General Counsel questioned several witnesses who were present at the meeting as to what was said, only two could remember that Stumpf even made the statement. Accordingly, we find issuance of a bargaining order inappropriate" and shall dismiss the 8(a)(5) and (1) allegations of the complaint. THE REMEDY In light of our findings herein, we shall modify the tO Chairman Miller would not find a violation here In his view, Friebel's response to the employees' request for merit increases went no further than to properly state the law Hildebrand Company, 198 NLRB No 96. Unlike the warranty rate increase situation, he notes that no further merit increases were specifically scheduled or promised at the time of these requests. 11 Olin Conductors, Olin Mathreson Chemical Corporation, 185 NLRB remedy framed by the Administrative Law Judge to conform to the violations found and shall also direct that the Regional Director for Region 30 conduct a second election at such time as he deems, that the circumstances permit a free choice of bargaining representative. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that Respondent, Stumpf Motor Company, Inc., Appleton, Wisconsin, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Warning, or implying to, employees that the advent of the Union would automatically result in the loss of certain existing benefits, or that Respon- dent may take away existing benefits in retaliation for the employees having selected the Union. (b) Threatening to terminate operations if the employees were to engage in a strike. (c) Denying benefits to its employees, which would otherwise have been granted, because of union activity. (d) Announcing the withholding of benefits in the form of individual merit increases in such a manner as to leave with the employees the impression that the obtaining of such benefits is conditioned upon the employees' rejection of the Union. (e) In any like or related manner interfering with, restraining, or coercing its employees in the exercise of their rights guaranteed in Section 7 of the Act. 2. Take the following affirmative action, which is deemed necessary to effectuate the policies of the Act: (a) Post at Respondent's Appleton, Wisconsin, establishment copies of the attached notice marked "Appendix." 12 Copies of said notice, on forms provided by the Regional Director for Region 30, after being duly signed by Respondent's representa- tive, shall be posted by it immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by Respon- dent to insure that said notices are not altered, defaced, or covered by any other material. (b) Notify the Regional Director for Region 30, in writing, within 20 days from the date of this Order, 467 ix In the event that this 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" STUMPF MOTOR COMPANY what steps Respondent has taken to comply here- with. [Direction of Second Election and Excelsior foot- note omitted from publication.] MEMBER FANNING, concurring in part and dissenting in part: I agree with try colleagues to the extent that they affirm the Administrative Law Judge's 8(a)(1) find- ings as to Respondent's many threats of loss of benefits, its threat permanently to close down the plant in the event of a strike, and its withholding of the warranty rate increase during the pendency of the election. I also agree with Member Penello in finding that Respondent violated Section 8(a)(1) with respect to the withholding of merit increases. Contrary to my colleagues, I would, for the reasons so cogently explicated by the Administrative Law Judge, adopt all of his 8(a)(1) and 8(a)(5) findings and issue a Gissel bargaining order in view of the totality of Respondent's flagrantly coercive conduct. In my judgment, such a bargaining order would be amply warranted even on the basis of the majority's findings concerning Respondent's extensive unlawful conduct, particularly the threat to terminate plant operations, which would make it extremely unlikely that traditional remedies will suffice to insure the holding of a fair election. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Act gives all employees these rights: To engage in self-organization To form, join, or help unions To bargain collectively through a repre- sentative of their own choosing To act together for collective bargaining or other aid or protection To ref:ain from any or all these things. WE WILL NOT do anything that interferes with these rights. WE WILL NOT threaten to close our business if you should engage in a strike. WE WILL NO I' warn you or try to lead you to believe that bargaining with a union will necessar- ily result in the loss of any of your present benefits. WE WILL NOT deny you benefits, which we would have otherwise granted, because of union activity. 435 WE WILL Nor announce the withholding of merit increases in such a way as to lead you to think that obtaining such benefits can only be accomplished by rejecting the Union. WE WILL Nor in any like or related manner interfere with, restrain, or coerce our employees in the exercise of their rights to self-organization, to form, join, or assist any labor organization, to bargain collectively, through representatives of their own choosing, and to engage in any other concerted activities for the purpose of collective bargaining or other mutual aid or to refrain from all such activities. STUMPF MOTOR COMPANY, 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, Commerce Building, Second Floor, 744 North Fourth Street, Milwaukee, Wisconsin 53203. Telephone 414-224-3861. DECISION SIDNEY SHERMAN, Administrative Law Judge: The instant charge was served on September 8, 1972,1 the complaint issued on November 17, and the case was heard on December 20 and 21. The issues litigated involved alleged violations of Section 8(a)(1) and (5). Briefs were filed by Respondent and the General Counsel.2 Upon the entire record,3 the following findings and recommendations are made: I. RESPONDENT'S OPERATIONS Stumpf Motor Company, Inc., herein called Respondent, is a Wisconsin corporation , engaged in the sale and servicing of new and used automobiles at its establishment in Appleton, Wisconsin. It annually derives gross income in excess of $500,000 and purchases from out-of-state sources goods valued at more than $50.000. Respondent is engaged in commerce under the Act. I All dates are in 1972, unless otherwise indicated. 2 After the filing of formal briefs, the General Counsel, in response to a request for clarification. submitted a statement of his position with regard to one of the allegations of the complaint See the General Counsel's letter of April 6, 1973. l For corrections of the transcript and certain evidentiary rulings, see the orders of March 30 and April 10, 1973. Respondent's motion of April 16, 1973, for reconsideration of part of the latter order is hereby denied. 436 DECISIONS OF NATIONAL LABOR RELATIONS BOARD II. THE UNION General Drivers and Dairy Employees Union Local No. 563 affiliated with the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, hereinafter called the Union, is a labor organiza- tion under the Act. III. THE MERITS The issues litigated, as reflected in the pleadings, the hearing, and the parties' briefs, may be summarized as follows: 1. Whether Respondent engaged in unlawful interroga- tion. 2. Whether Respondent violated Section 8(a)(1) through threats made by Service Manager Fnebel of loss of various benefits if the employees selected the Union as their representative. 3. Whether Respondent on August 29 threatened to terminate its operations because of the employees' union activity. 4. Whether Fnebel unlawfully attributed the withhold- ing of merit raises to the advent of the Union and whether the actual withholding of such raises was unlawful. 5. Whether Respondent unlawfully promised employ- ees raises in return for rejection of the Union. 6. Whether Respondent on September 1 unlawfully granted wage increases as a reward for the employees' rejection of the Union in a Board election. 7. Whether Respondent violated 8(a)(1) by letters to the employees placing the onus on the Union for preventing Respondent from granting raises. 8. Whether Respondent violated 8(a)(5) and (1) by refusing to bargain with the Union. A. Sequence of Events On May 1, Respondent took over the instant operation. The first union meeting was held on May 30 and, by June 2, 18 of the employees had signed union authorization cards and applications for union membership. On June 5, the Union filed with the Board a petition for an election and at the same time sent Respondent a letter demanding recognition. For reasons not here relevant, Respondent refused to accept delivery of that letter. On June 14, two union representatives visited Respondent's president, Stumpf. Although there was conflicting evidence, to be discussed below, as to what occurred at that meeting, it is clear that Respondent did not then, nor at any time thereafter, recognize the Union. On August 3, 1972, the Board's Regional Director issued a Decision and Direction of Election, and an election was held on August 31, which the Union lost by a vote of 24 to 8. Objections to the election were filed on September 1. During the preelection period, Respondent withheld merit raises to individual employees, citing the pendency of the Union's petition, and withheld an increase in the employees' pay rate for certain work until the day after the election. Also, during the preelection period, Respondent's service manager, Friebel, spoke to the bulk of the employees in the unit about the disadvantages of union representation, while at the same time Respondent was sending to the employees a series of 13 letters on that subject. On August 29, Stumpf delivered to the employees a speech urging rejection of the Union in the forthcoming election. B. Discussion 1. Interrogation and threats by Friebel Understanding of some of the matters discussed below may be aided by explaining at this point Respondent's mode of compensating its mechanics and body men, who constituted 12 of the 31 unit employees. The record indicates that such compensation was determined as follows: The pay of a mechanic or body man for a particular job was a given percentage (45 percent) of the price set on the job by Respondent. That price was determined by multiplying two factors-(l) the number of "hours" allowed for completing that job by an industry manual, which did not necessarily coincide with the time actually spent on the job, and (2) the "hourly" rate applicable to such job, which varied depending on whether the work was to be paid for directly by a customer (retail rate) or was done for the account of Respondent (internal rate), or for that of the manufacturer in servicing a warranty (warranty rate). To illustrate, if the time allowed in the foregoing manual for an engine overhaul on a customer 's car was 5 hours and the applicable hourly rate was $10, the price of the job would be $50, and the compensation paid therefor to the mechanic would be 45 percent of $50 or $22.50, regardless of how many hours were actually spent on the job. Although Respondent's shop employees sometimes worked more than 40 hours a week, they received no premium pay for such extra hours , and, as the ensuing discussion will reveal, it was generally assumed that, if the Union came to represent the employees, it would demand that the mechanics and body men be compensated on the basis of hours actually worked and that they, as well as the other employees, receive premium pay for overtime. Glasheen, a mechanic, testified that late in June Service Manager Friebel asked him what he thought about the Union and stated that, if the Union came to represent the employees, all existing employee benefits would be negotiable, including Respondent's profit-sharing plan and the privilege the employees then enjoyed of working on their own cars in Respondent's shop, and that as a result of negotiations overtime work could be eliminated , in which case Respondent would hire new employees to take care of any excess work. Glasheen added that at a later point in the union campaign Friebel asked him if he had given any more thought to the Union. Friebel testified, without contradiction, that Glasheen was wearing a union button during their first conversation but did not dispute any of the foregoing testimony about the subject matter of their conversation. It is accordingly found that he made the remarks ascribed to him by Glasheen. Kahnt, who was no longer in Respondent's employ, testified that in mid-June, while employed by Respondent as a mechanic, he was engaged by Friebel in a conversa- STUMPF MOTOR COMPANY 437 tion, in the course of which he referred to various employee benefits, including profit sharing and group life insurance and declared that he would hate to lose the profit-sharing plan and that Stumpf would fight the Union all the way. Kahnt added that about 2 weeks later Friebel told him that under the Union "this will be a forty hour shop" and "all benefits would start from zero." According to the witness, in a third conversation about a week before the election Friebel observed -hat he would hate to lose the various employee benefits; that under the Union the employees would work only 40 hours a week; that all benefits would "start from zero"; that Respondent did not have to extend to the mechanics the privilege of working on their own cars in the shop; and t.iat, in case of a strike, the strikers could be replaced and they would lose all benefits such as profit sharing. Under cross-examination, the witness conceded that Fnebel might have explained that overtime work would be eliminated under the Union because Respondent could not afford to pay time-and-a-half for overtime. Friebel's version of the first conversation was that he explained the profit-sharing plan to Kahnt, stating that under the Union this would be negotiable. He denied that he warned that Respondent would fight the Union all the way. As to the second conversation, Fnebel's version was that he indicated that, in case of representation by the Union, the existing profit sharing and vacation benefits would be negotiable; that, with regard to overtime, he explained only that, if the mechanics were to go on an hourly rate, it would be difficult for Respondent to pay time-and-a-half for overtime; and that he made no reference to benefits starting from zero. According to Friebel, in the third conversation he merely reviewed the various employee benefits, including profit sharing, paid holidays, and the employees' privilege of working on their cars, and indicated that they were all negotiable items and that, with union representation, the employees might get more, the same, or less. Friebel acknowledged that he told Kahnt that, if he were in the employees' position, he would hate to lose certain benefits, but that this was said in the context of a statement that they were negotiable items. He admitted warning Kahnt that in case of a strike all benefits would stop. Kahnt's demeanor made a singularly favorable impres- sion. Moreover, unlike Friebel, he no longer had any apparent interest in the outcome of this proceeding. Accordingly, he is credited wherever his testimony con- flicts with Friebel's and it is found that in the course of the foregoing conversations, all of them admittedly initiated by Friebel, Friebel reviewed various benefits currently en- joyed by the employees with particular emphasis on the profit-sharing plan, and stated that he would hate to lose that as well as other benefits; that, if Respondent had to deal with a Union, all benefits would start from zero; that Respondent did not have to give the mechanics the privilege of working on their own cars in the shop; and that overtime work would be eliminated under a union. However, since Kahnt did not take direct issue with Friebel on that score, it is found that, in warning of the elimination of overtime work, Friebel indicated that that would come about, if, as a result of negotiations with the Union, Respondent had to pay time-and-a-half for overtime, which it could ill afford. Paris, a mechanic, testified that during the first 2 weeks in June Friebel advised him that, if the employees went on an hourly rate, Respondent would adopt, or would probably adopt, a 40-hour workweek and any "extra" work would probably be farmed out; and that Respondent would abolish profit sharing, if it had to deal with the Union. Paris added that in a second conversation, in mid- August, Friebel implied that under a union there probably would be no profit sharing. Under cross-examination, Paris acknowledged that Friebel said that with union representa- tion the employees might lose profit sharing, and that, if the employees went on an hourly rate, Respondent probably would not be able to afford premium pay for overtime and for that reason might have to eliminate overtime work and farm out the extra work, and that in the two conversations Friebel might have said that all existing benefits, including the profit-sharing plan, were negotiable. Friebel's version was that he spoke to Paris in July and August; that in July he merely reviewed the employees' benefits, remarking that, if the Union were to represent the employees, profit sharing would be negotiable. Friebel added that in August he told Pans that if, at the instigation of the Union, Respondent adopted an hourly rate, it would be difficult for Respondent to pay time-and-a-half and that under the union vacation benefits and the employees' existing "shop privilege" would be negotiable. It appears from the foregoing that Friebel and Pans were in substantial agreement that in their two conversations during the preelection period Friebel stated that various employee benefits, including profit sharing were negotia- ble, and that, if the Union succeeded in obtaining an hourly rate for the employees, it would be difficult for Respondent to bear the cost of a premium rate for overtime work. In view of Pans' vacillation as to the precise terms of Friebel's warning regarding loss of profit sharing, the record does not warrant a finding that there was such a warning. Herrick, a mechanic, testified, without contradiction, and it is found, that a few weeks before the election Friebel told him that under a union all benefits would be negotiable, including overtime, and that this might result in elimination of overtime work. Schoen, a body repair man, testified that during the election campaign Friebel told him that, if the Union obtained an hourly rate for the shop employees, they probably would work only 40 hours a week, because Respondent could not afford premium pay for overtime; and that all benefits would be negotiable, if the Union won the election, but the employees would probably lose profit sharing. Friebel testified that he told Schoen only that all benefits, including profit sharing, would be negotiable if the Union won the election, and denied saying that the employees would lose profit sharing. He did not dispute Schoen's testimony about overtime. Insofar as there is any conflict, Schoen is credited on the basis of demeanor and it is found that, after alluding to the negotiability of profit sharing, Friebel indicated that any bargaining with the Union would probably result in the loss of that benefit, 438 DECISIONS OF NATIONAL LABOR RELATIONS BOARD and that, if an hourly rate was obtained through negotia- tions, Respondent would probably abolish overtime because of its prohibitive cost. Friebel admitted talking to about 20 employees about the negotiability of existing benefits and that he stated in such discussions that, if he were in their position, he would hate to lose various such benefits as a result of collective bargaining. To sum up, it appears that Friebel's statements, which are under attack here, fall into the following categories: (1) That collective bargaining would probably result in loss of profit sharing. (2) That, if it had to deal with the Union, Respondent did not have to continue to extend "shop privileges" to the employees. (3) That any negotiations between Respondent and the Union might result in the elimination of overtime work.4 (4) That, if Respondent had to deal with the Union, benefits would start from zero. (5) That, if Respondent had to deal with the Union, all benefits would be negotiable. (6) That, if Respondent had to deal with the Union, all benefits would be negotiable and, if Fnebel were in the employees' position, he would hate to lose certain benefits as a result of such negotiations. Statements (1), (2), and (3), above, are clearly threats that, if Respondent had to deal with the Union, it would take bargaining positions that would or might result in loss of certain benefits. Absent any representation by Friebel that such bargaining positions would be dictated by economic considerations, the foregoing statements were tantamount to assertions that Respondent would take those positions merely because of the employees' prefer- ence for collective, rather than individual, action, and would demand the reduction or elimination of existing benefits, which it would have been content to retain, absent a union. In view of the implication therein that Respondent would seek to deal more harshly with the employees through a union than it otherwise would, such statements constituted threats of reprisal or attempted reprisal against the employees, if they forced Respondent to engage in collective bargaining. It follows that Respon- dent thereby violated Section 8(a)(1). As for (4), above, the Board has frequently found to be coercive such a remark, as well as the equivalent warning, that bargaining would start from scratch,5 such warning being regarded as "a threat of reprisal should the employees select the Union,"6 it being pointed out that the effect of such warnings was to contrast "the detriment attached to the advent of a union" with "the converse benefits of the continuation of existing benefits if the plant remained non-union." 7 With regard to (5), above, it would seem that, where an 4 This was said to Herrick and Glasheen As noted above, others were told that Respondent might have to eliminate overtime because it could not afford premium pay In view of this explanation , the latter statement is not deemed a threat but only a prediction of economic consequences 5 Textron, Inc, 199 NLRB 132; Olin Conductors, Olin Mathieson Chemical Corporation, 185 NLRB 467; Kaiser Agricultural Chemicals, Kaiser Aluminum & Chemical Corporation, 187 NLRB 661, enfd 473 F.2d 374 (C A 5, 1973), Raytheon Company, 160 NLRB 1603 ; Astronautics Corporation of America, 164 NLRB 623, Aerovox Corporation of Myrtle Beach, South employer stresses to his employees, in the context of a union campaign, that existing benefit levels are "negotia- ble," it is fair to infer that his purpose is not merely to remind them that such items are a mandatory subject of bargaining but rather to warn them that in any union negotiations he would be free to negotiate for a curtailment of existing benefit levels and that such warning would be calculated to instill in the employees an apprehension that he would, in fact, negotiate in that fashion. Thus, the connotation here is, as in the case of (4), above, that Respondent would bargain for a downward revision of existing benefit levels and it is therefore found that the remark under consideration was unlawful .8 Since statement (6), above, which Friebel admittedly made to the bulk of the employees in the unit, spelled out what was merely implied in (5) (that collective bargaining entailed a risk of loss of existing benefits), it was a fortiori unlawful. There remains to be considered the issue with regard to the interrogation of Glasheen. While the fact that he was displaying a union button tends to detract from the coercive effect of Fnebel's initial query about Glasheen's union sentiments , the recurrence to the same subject in the second conversation manifested an undue preoccupation therewith on the part of Respondent. That circumstance, coupled with the coercive warnings to Glasheen that, if the employees chose to deal with Respondent through the Union they risked loss of overtime work and that all existing benefits would be negotiable, warrants a finding that the interrogation violated Section 8(a)(1). 2. The threat by Stumpf On August 29, at a meeting attended by all unit employees, Stumpf delivered a speech in which he urged rejection of the Union. In the course of that speech he admittedly made some reference to the possibility of his retirement. According to Theimer, who was corroborated in this regard by Glasheen, Stumpf said that, if there was an economic strike, his own financial situation was such that he could lock his doors and go into retirement. Stumpf's version was that he said only that he did not have to stay in business, that he was financially secure and could retire to the "North Woods," and he denied that this remark was related to any discussion of economic strikes, insisting that he was attempting only to make the point that his dedication to his Appleton operation was not motivated by any financial considerations, since he could afford to retire if he chose to do so. However, when asked whether he make any reference to an economic strike in his speech, Stumpf became vague and evasive. Also, when, in an effort to resolve an apparent ambiguity in his foregoing testimony, he was asked whether he made it clear to the employees that he, in fact, had no intention of retiring, Carolina, 172 NLRB 1011. " Aerovor Corporation of Myrtle Beach, supra Olin Mathieson Chemical Corporation, supra s It may be noted that a statement that existing benefits would be negotiable is no less coercive , because the employer appends thereto (as Friebel claims he did in his remarks to Kahnt and as Respondent did in some of its letters to the employees) the comment that negotiations might result in a higher, lower, or unchanged level of benefitso Kaiser Aluminum & Chemical Corporation, supra, C R Hills, Division of155 NLRB 1163,1176-77 STUMPF MOTOR COMPANY Stumpf at first avoided a direct answer and only after the question was repeated several times did he asseert that he did so advise the employees. Fnebel testified that in the August 29 speech Stumpf said that he did not have to operate his business and could retire to the "North Woods," but was unable to say whether or not Stumpf was talking about strikes at that time, and, when asked specifically whether Stumpf said that, in the event of a strike, he could close down his business, Friebel pleaded lack of recollection. It is clear from the foregoing that on August 29 Stumpf told the employees that he did not need to stay in business and could afford to retire. Moreover, on the basis of demeanor, and, in view of Stumpf's vagueness and evasiveness and the failure of Friebel, who was Stumpf's alter ego in the antiunion campaign, to corroborate him on critical points, credence is given to the versions of Glasheen and Theimer, and it is found that in his speech Stumpf stated that, in the event of a strike, he could lock his doors and retire from business .9 It is found that by Stumpf's threat to terminate Respondent's operations, if the employees engaged in an economic strike. Respondent violated Section 8(a)(1) of the Act. 3. The wage increases a. The warranty rate increase As already explained, Respondent paid its mechanics and body men a fixed percentage of the "price" assigned by Respondent to a particular job, which price was determined by multiplying the number of hours allowed for that job in an industry manual by a rate, which varied with the identity of the party for whose account the repairs were made . If the repairs were chargeable to a customer, such rate was termed the "retail rate." If the work was done on a vehicle owned by Respondent, as in the case of an auto being held for resale, the rate was called the "internal rate." If the work was done for the account of the Ford Motor Co., in servicing its manufacturer's warranty, the rate charged by Respondent to Ford for such work was called the "warranty rate." Under Respondent's predecessor, the mechanics were paid 50 percent of the job price on all work. On May 11,10 Stumpf met with the employees and announced that the foregoing percentage would be reduced from 50 to 45 and the "internal rate" would be reduced from $9 to $8, but the retail price would be raised from $9 to $10 and he would try to obtain assent by Ford to an increase in the warranty rate from $9 to $10. An application filed on May 25 for approval of such an increase was rejected, but an amended application filed on June 8 was granted late in July. Although on August l it began to charge Ford the higher warranty rate, Respondent did not immediately pass on to the shop employees the benefit of that rate but did engage 9 Wiegand, a mechanic, called by Respondent, expressed doubt that there was any reference to a stoke in the August 29 speech and stated that the impression he received from Stumpf's reference to the "North Woods" was that he would rather be there than have to deal with all the problems he had encountered in the acquisition of his Appleton operation . While due 439 in correspondence with the Union and the employees about the matter. Under date of July 31, Respondent wrote the Union's counsel as follows: As we have previously discussed, the Petition of Stumpf Motor Company, Inc. to Ford Motor Company to increase the rate paid for warranty work has been reviewed and approved by Ford Motor Company in the amount of $9.50. This represents an increase of $.50 per hour and the corresponding increase to all employees of Stumpf Motor Company, Inc., based on 45% of the flat book rate adopted by the Ford Motor Company. Because this increase was requested prior to the commencement of the critical period, it is my opinion that the employer may institute this increase. Nonethe- less, I am aware of the restrictions surrounding the conduct of the parties during this period and feel that it would be to our mutual advantage to advise you of our intention to implement the increases for warranty work within a reasonable length of time after your receipt of this letter. In the event you have an objection to effecting this increase, please advise us as of your earliest opportuni- ty so that we may be made aware of your position. In the event we do not hear from you within 7 days of the date of this letter, we will assume that you have no objections to implementation of the increase and proceed accordingly. On August 7, not having received any reply from the Union, Respondent advised its employees by letter that Ford had agreed to an increase in the warranty rates and that Respondent had "requested permission" from the Union to pass this increase on to the employees but had not received any reply. In a letter dated August 18, Respondent again alleged that it had asked the Union to "permit" Respondent to pass on the increase in the warranty rate but had not as yet received any answer. And, in a letter of August 27, in which it referred to the new warranty rate, Respondent noted: Still no answer from the Teamsters to release this increase to you. In a letter of August 29, Respondent told the employees: ... we just cannot release our new warranty rates or we are guilty of an unfair labor practice. We cannot change our internal rate for the same reason , we are all in a freeze. Finally, on the day after the election, Respondent granted an increase in pay based on the new warranty rate, and, although objections to the election were filed the same day, that increase remained in effect. The General Counsel contends that Respondent violated Section 8(a)(1) of the Act "in first withholding the increase consideration has been given to such testimony. the record as a whole is deemed to preponderate in favor of the findings in the text. io Although it was not until June 13 that Respondent assumed full legal responsibility as owner of the Appleton dealership, Stumpf apparently took over the actual management as early as May 1. 440 DECISIONS OF NATIONAL LABOR RELATIONS BOARD and then granting it during the objections period." Respondent defends on the ground that it had made no express commitment before the advent of the Union as to when it would pass the increase on, if at all. In this connection, Respondent contends that in his May II speech Stumpf did not in so many words promise to pass on to the employees the benefit of any increase he might obtain in the warranty rate, and that there was no uniform past practice of passing such a benefit on to the employees immediately. However, Stumpf admittedly intended at all times to pass that benefit on to the employees and that was the clear implication of his speech, since there was no apparent point to his discussing with the employees a possible increase in the warranty rate, unless it would affect their earnings. Moreover, if one is to credit the statement of Respondent's counsel in the July 31 letter, quoted above, Respondent was disposed to pass that increase on early in August. It is true that on May II Stumpf did not promise the employees in so many words that the increase in the warranty rate would be passed on to them as soon as it took effect, and the evidence as to Respondent's past practice in that regard is inconclusive. ii It is presumably Respon- dent's position that under those circumstances the employ- ees had no reason to expect a raise in August on the basis of the new warranty rate and so could not have been aware that one was being withheld. Thus, to put it in the vernacular, Respondent's position is that what the employ- ees did not know could not hurt them. Moreover, there is the additional consideration that, not having made a specific commitment before the Union's advent as to the timing of the employees' "warranty raise" and there being at least arguably no uniform past practice in that regard, Respondent would have been hard put to justify granting the raise during the election campaign and was entitled to withhold what it could not lawfully grant. These considera- tions might well have warranted Respondent's withholding the raise had it kept quiet about the matter. Instead, Respondent chose to publicize such withholding and make it an issue in the election campaign. In the recent case of Pacific Southwest Airlines, 201 NLRB 647, the Board found a violation of Section 8(a)(1), where an employer during a union organizational cam- paign canceled a previously announced raise, believing that it would be unlawful to grant it, and notified the employees of the reason for its action. In its decision in that case, the Board recognized that during a union campaign an employer is entitled to withhold a raise which he may not lawfully grant, citing The Great Atlantic & Pacific Tea Company, Inc., 192 NLRB 645, where, during a union campaign, the employer withheld a pay raise, because it could not be fully justified on the basis of past practice. The Board added: i i Stumpf admitted that all increases in warranty rates since 1956, when he took over the operation of Respondent, were passed on "eventually," but he pleaded ignorance as to any further details As to the practice of Respondent's predecessor at Appleton, some of whose employees were acquired by Respondent, one of them , Wiegand, testified that over an 18- year period there was only one warranty increase that was not passed on immediately i2 See McCormick Longmeadow Stone Co, Inc, 158 NLRB 1237 In its brief, Respondent attributed its failure to grant the raise during August, However, in the latter cases, full explanation of the reasons for the withholding along with the assurance of future consideration of the withheld benefits, notwith- standing the outcome of the union's election campaign, serve to dissipate any assumption that the employees may or may not have that the union's presence is the sole obstacle to the ultimate realization of the promised benefits. The Board then pointed out that in the case at bar the "cancellation announcement was unaccompanied by any assurances of future consideration [n ]or predicated on any economic considerations" In Ring Metals Company, 198 NLRB No. 143, after assuring the employees that serious consideration was being given to an increase, the Respondent announced that its hands "were tied" because of the filing of a union election petition and unfair labor practice charges and there would be no increases until those matters were settled. On these facts, the Board found that the Respon- dent's "entire course of conduct, with respect to the union, was calculated to lead employees to believe that wage increases would be forthcoming upon rejection of the Union" and that the presence of the Union was the only obstacle to a raise. In The Great Atlantic & Pacific case, supra, in finding lawful the employer's decision not to grant an increase during a union campaign , the Board said: In reaching this conclusion we specifically note that there is no evidence to indicate that Respondent in any way sought to capitalize on the absence of a wage increase by connecting the absence with the Union or the employees' support of the Union. It is clear from the foregoing that, in determining the propriety of an employer's announced withholding of a wage increase during a union campaign , the Board considers whether the employer's entire course of conduct reflects an intent to foment antiunion sentiment or merely a desire to avoid the appearance of "buying" votes, and that an important consideration in that regard is whether the employer gave the employees affirmative assurance that their designation of the union would not affect the employer's willingness to grant the increase. Here, not only is there no evidence of any such assurance but it is clear, in addition, that Respondent made an intensive effort to convince the employees that the Union, contrary to the fact, was deliberately preventing Respon- dent from granting the increase . Such a studied effort to shift to the Union the onus for the postponement of the raise could have had no purpose other than to subvert the employees' allegiance to the Union.12 It follows that, by manipulating the issue of the raise on despite the absence of any objection from the Union, to the advice of Herrling, who was then Respondent 's labor relations counsel, that it would be unwise to do so because of the proximity of the election Although Herrling testified that he so advised Respondent , no explanation was offered for the fact that the employees were told only that the raise was being withheld because of the Union's alleged refusal to authorize it nor was there any plausible reason given for making that charge against the Union Moreover, Herrling had considerable difficulty in explaining why he advised against granting the raise, even though in the July 31 letter another STUMPF MOTOR COMPANY 441 warranty work 5t) as to discredit the Union and influence the employees to reject it, Respondent violated Section 8(a)(1). b. The postelection raise As already related, on September 1, the day after the Union's defeat n the election, Respondent granted the employees a raise based on the increase in the warranty rate. The Union filed objections to the election on the same day. At the hearing, Herding explained that he thought it proper to pass on the increase at that time because, the election being over, there was no longer any danger of influencing it. However, Herrling conceded that he was aware of the possibility that objections to the election would be filed and of the Board's rule restricting the granting of raises during the pendency of objections to an election. That rule is that during such a period an employer may not take any action for the purpose of interfering with the employees' freedom of choice in the event of a new election.13 The General Counsel contends that Respondent's motive was to reward the employees for rejecting the Union in the election, thereby predisposing them to continue to reject the Union in any future election. There appears to be merit in that contention. Respondent's handling of the warranty raise issue before the election, as described above, reflects a disposition to exploit that issue for the purpose of portraying the Union as the only obstacle to the granting of a raise. The same purpose was served by granting the raise as soon as the Union lost the election. Accordingly, the inference is amply warranted that it was this disposi- tion to manipulate the warranty rate issue so as to drive a wedge between the employees and the Union that motivated the granting on September 1 of the pay increases based on the higher warranty rate. Such action was calculated to insure that the employees would continue to withhold their support from the Union in any future election. It follows that, by granting that raise, Respondent violated Section 8(a)(1). c. The merit increases The General Counsel contended that during the union campaign Respondent unlawfully withheld merit raises from two employees-Herrick and Hartzheim. Hartzheim testified that he was hired on June 1 as a washboy at $1.75 per hour: that Fnebel promised that he would soon be transferred to undercoating and that he would be given a raise if his work was satisfactory; that after about 10 days he was assigned to undercoating; that 2 or 3 weeks later Respondent's bookkeeper told him that he was being given a raise of 25 cents per hour; that he had the raise for a week; that Friebel then told him that it was necessary to rescind the raise because of the union campaign; and that the raise was never restored, although he made frequent requests therefor through the preelection period. Fnebel's version was that, although Hartzheim was, as he testified, hired on June 1 at $1.75 an hour, he was in fact paid $2 an hour from that date. Friebel explained that the transfer to undercoating was made a few days after June 1, and he instructed the bookkeeper to raise Hartzheim's rate to $2 per hour as of June 1. However, Friebel acknowl- edged that several weeks later Hartzheim asked for another raise of 25 cents per hour and that Friebel was disposed to grant it, but Stumpf overruled him, saying Respondent could not grant the raise "at this time." Stumpf testified that he opposed the raise because of the "freeze period." Since Respondent's personnel records show that Hart- zheim's rate from his date of hire to his termination date was $2 per hour, Fnebel's testimony as to the initial increase is credited. While it appears. therefore, that Hartzheim was mistaken in his belief that he received a raise which was rescinded after a week, there was no dispute that he later sought a 25-cent raise and that this was denied him, the only reason given being the pendency of the union campaign. The issue is thus posed, again, whether Respondent might lawfully notify an employee that he was being denied a raise because of the pendency of the Union's petition. It is clear from the authorities already cited that it may not do so, unless it assures the employee that it will make the raise available after the election, regardless of the result thereof. This Respondent did not do.14 When Herrick was hired on June 12 at $2.25 an hour, Friebel told him he would be on trial for 30 days and that, if his work was satisfactory, he would receive a raise. Although Fnebel admittedly was satisfied with Herrick after the end of his trial period, his requests for a raise were rejected by Friebel on the ground that there was a "freeze" due to the Union. As in the case of Hartzheim, Friebel insisted that he in effect gave Herrick a raise during his first week of employment, explaining that, although he was hired at $2.25 an hour, Friebel was so favorably impressed with him even before his first payday that he instructed the bookkeeper to pay him from the date of hire at $2.50 an member of his law firm had expressed the view that it would be proper to grant it, particularly if the Union withheld any objection thereto Construed most favorably to Respondent, Herrhng's position appears to he that the Regional Director's action of August 3. in scheduling the election for August 31, created a special "critical period," during which any raise would have been unlawful. whether or not the Union acquiesced therein but that the situation would have been different, if, as was previously expected on July 31 , the election had been set for a date several months away insofar as this attributes to the pioximity of the election any special legal sigmficance in the present context, there is no support for that view in Board precedent At any rate, it is Ilea- that this explanation for Respondent's change of heart about granting the raise was never communicated to the employees, an intensive effort being made instead to convince them that the Union's putative opposition thereto was the sole reason for the withholding of the raise is E.g, Ralph Printing & Lithographing Co, 158 NLRB 1353. General Electric Company, Batters- Products, Capacitor Department, 163 NLRB 198 14 Respondent contends that, in refusing to grant Hartzheim a second raise, it was relying on the advice of counsel that such a raise would be unlawful, unless before the union campaign Respondent had promised to pay a specific amount by a specific date. However, here, as in the case of the warranty raise issue, there would be no quarrel with Respondent's failure to grant the raise, had it remained silent about the matter , but once an employer places the onus for withholding a raise on a union campaign, it becomes incumbent upon him to offer reassurance that the outcome of the campaign will not affect his willingness to grant the raise. Pacific Southwest Airlines, supra 442 DECISIONS OF NATIONAL LABOR RELATIONS BOARD hour. Respondent's personnel records confirm this. How- ever, Friebel acknowledged that Herrick persisted in requests for another raise after his trial period and he was put off with the plea that wages were frozen because of the Union's petition. Thus, Herrick's case is essentially identical to Hartzheim's and no reason appears for a different result here. It is therefore found that, by advising both Herrick and Hartzheim that their requests for a raise could not be granted because of the pendency of the union campaign, without any assurance of future consideration of such requests regardless of the outcome of the election, Respondent violated Section 8(a)(1) of the Act.15 4. The objections to the election On September 1, the Union filed timely objections to the election alleging that Respondent threatened loss of the profit-sharing plan, a reduction in the workweek, and loss of the employees' privilege of working on their own cars in Respondent's shop, and that Respondent threatened to close down its establishment and refused to grant "auto- matic" wage increases and increases promised before the filing of the Union's petition. It has already been found that Respondent violated Section 8(a)(1) by the threats enumerated above and by the withholding of a raise on the basis of the higher warranty rate. It follows that by such conduct Respondent interfered with the election and it will be recommended that it be set aside. 5. The 8(a)(5) issue a. The appropriate unit There is no dispute, and it is found, that the following unit is appropriate for bargaining: All auto, truck and used car, mechanics, greasers, body shop employees, parts department employees, and shop maintenance men at Respondent's Appleton, Wiscon- sin, facility, excluding office clerical employees, service billing employees, service writers, wash rack employees and supervisors as defined in the Act.16 b. The Union's majority status It was stipulated that throughout the month of June there were 31 employees in the unit. Prior to June 5, when the Union addressed to Respondent a letter requesting recognition, 18 unit employees had signed (a) cards which authorized the Union to act as the bargaining representa- tive of the employees, and (b) an application for member- ship in the Union, which contained an authorization for dues checkoff. Respondent attacks the validity of two of the cards- those of Nelson and Hermes. However, there is no need to 15 Contrary to the contention in General Counsel's brief, no violation is found in the actual withholding of the raises to Herrick and Hartzheim, there being insufficient evidence in the record for finding that any raise was promised to either of them before the advent of the Union other than that which he received in his first paycheck Absent such evidence, it is found that Respondent was entitled to reject their requests for another raise, albeit not to put the blame on the Union in the manner described above. pass on that matter, since even without their cards the Union would have a majority of 16 out of 31.17 It is found that at the time of its bargaining requests in June the Union was designated by a majority of the employees in the appropriate unit. c. The request and refusal By letter of June 5, the Union transmitted to Respondent copies of the cards signed by the 18 employees and advised that a union representative would call upon Respondent on June 14 to begin contract negotiations for a unit which included shop employees, but excluded, inter a/ia, parts department employees. Also, on June 5, the Union filed a petition for an election in the same unit. Although, for reasons not here relevant, Respondent did not accept delivery of the June 5 letter, two union representatives called on Stumpf on June 14. One of them, Curtin, testified that, when they referred to the June 5 letter, Stumpf denied receipt thereof; that the witness showed Stumpf a copy of that letter and announced that the union agents were there as representatives of the employees for purposes of collective bargaining; that the employees' cards were tendered to Stumpf but he refused to examine them; and that he declared that any further discussion of the matter would have to be conducted with his attorney, Myse. The other union agent, Krasniewski, testified that Stumpf was informed on that occasion that his visitors were there on behalf of the Union pursuant to their letter; that they offered to show him the cards; that he denied receiving the letter; that the witness showed Stumpf a copy of the letter; and that, after gazing at the letter, Stumpf again denied receiving it and referred the union agents to his attorney. Stumpf's initial version was that there was no discussion of cards and no request for recognition and that he had no recollection of the conversation on that occasion other than a reference by Curtin to the fact that he had bought some cars from Respondent. Stumpf even professed to have no recollection of referring the union agents to his attorney. However, when recalled to the stand, he admitted that the union agents showed him a letter, denying only that he read it, and he apparently retracted his previous categorical denial that they asked for recognition, profess- ing inability to recall whether they did or not. On the basis of demeanor and in view of Stumpf's vacillation and equivocation, I credit the testimony of the union agents that they explained the purpose of their visit, offered to show Stumpf the cards, and did show him a copy of the demand letter, and that he referred them to his attorney. Six days later, at the hearing on the Union's petition, Respondent, inter alia, questioned the appropriateness of the unit sought by the Union, contending that parts department employees should be included, which conten- tion was sustained by the Regional Director. 1 16 This was the unit found appropriate by the Regional Director 17 Respondent contends that thel tactics allegedly used by employee solicitors in the cases of Nelson and Hermes created an "atmosphere of misrepresentation and intimidation", that invalidated the other cards However, absent any evidence that any other cards signers were affected by, or even aware of, such alleged tactics, that contention is rejected STUMPF MOTOR COMPANY 443 Respondent now urges that there was never (1) any valid request for recognition nor (2) any effective refusal of recognition. As to (1), Respondent contends, first, that no demand for recognition was ever communicated to Respondent. However, it has been found that on June 14 the union agents explained the purpose of their visit and Stumpf admitted that they showed him a copy of the demand letter, denying orly that he read it. Even if that were so, an employer cannot avoid communication of a request for bargaining merely by refusing to read a letter, which he has reason to believe contains such a request. Surely, Stumpf could not have thought, although his testimony so suggests, that the union agents were merely paying him a social visit and that the letter they were showing him was somehow related to such a visit. Accordingly, it is found that, even if, contrary to the finding above, there had been no oral communication by the union agents of the purpose of their visit, and assuming that Stumpf did not actually peruse the letter, he would still be chargeable with knowledge of its contents.is It follows that a demand for recognition of the Union was effectively communicated to Respondent on June 14. Respondent argues, further, that in any case any demand made by the Union on June 14 was invalid because of a substantial variance between the unit sought and that found appropriate by the Regional Director. Respondent, here, relies on the exclusion of parts department employees from the unit sought by the Union, as described in its June 5 letter and its petition. The record shows that in June Respondent had 8 or 9 such employees 19 out of a total of 31 in the appropriate unit. It has been held that the difference between a requested three-man unit and the two-man unit found appropriate was "insubstantial," since the union had a majority in both units.20 Here, too, the Union had a majority in both units and it is clear that Stumpf either made no effort at the June 14 meeting to ascertain what unit was sought, or, if he did, failed to raise any issue at that time with regard to the exclusion of parts department employees. Accordingly, it is concluded that on June 14 the Union made a valid request for bargaining. Respondent con tends, finally, that there was never any refusal to bargain, alleging that at the June 14 meeting the Union volunteered to pursue the matter of recognition further with Respondent's counsel and that the Union failed to do so. However, there was no evidence that the Union volunteered to take up the matter with counsel. Although the record shows that at the June 14 meeting the first reference to Respondent's counsel, Myse, was made by one of the union agents, he merely asked whether Myse represented Respondent, and it was Stumpf who then suggested that the Union deal with Myse.21 While there is no evidence that the Union thereafter requested recogni- tion from Myse, in haec verba, the maintenance of the petition was, in itself, a continuing request for recognition, and Respondent made it clear at the June 20 hearing on the petition that Respondent was not disposed to recognize the Union voluntarily. Moreover, under Board precedent, the Union had no obligation to follow the matter up with Respondent's counsel. The Union having made a proper request for bargaining, it was incumbent on Respondent to take the next step and either grant or deny that request. It could not require the Union to reiterate its request to a legal or other representative of management.22 Finally, it may be noted that Respondent concedes in its answer that it has not recognized the Union. It is concluded therefore that on June 14 the Union had signed authorization cards from a majority of the employ- ees and made a proper request for bargaining on that date, which was rejected by Respondent.23 The question remains whether by such rejection Respondent violated Section 8(a)(5) under the rule of Gissel.24 In view of the threats by Friebel of loss of existing benefits, in the event Respondent had to deal with the Union, which threats were addressed to a majority of the employees in the unit, Stumpf's threat to terminate Respondent's operations in case of a strike, and Respon- dent's exploitation of the issue of the merit raises and the increase in the rate for warranty work so as to drive a wedge between the employees and the Union, and its granting of the warranty raise the day after the election, there is little likelihood that traditional remedies will suffice to insure the holding of a fair election. Under the circumstances, it is found that the signed authorization cards are the most reliable available evidence of the employees' sentiments, and that, by refusing on and after June 14 to recognize the Union on the basis of such cards, Respondent violated Section 8(a)(5) and (1) of the Act.25 TV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondent set forth in section III, above, occurring in connection with Respondent's opera- tions described in section I, above, have a close, intimate, and substantial relationship to trade, traffic, and com- merce among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. 18 Gerhard Landgraf and Peter Landgraf, d/b/a Bay Standard Products Mfg Co, 167 NLRB 340,345.-347 is It was agreed a' the hearing that there were eight or nine such employees during the eligibility period for the election in late July. Absent any evidence to the contrary, it is presumed that the same was true in June 20 N L R B v. Richman Brothers Co & Richmond Brothers Madison, Inc, 387 F 2d 809 (C A. 7, 1967), enfg. 157 NLRB 1666, and cases there cited. (In Sabine Vending Co. In;, Division of United Servomation Corporation, 147 NLRB 1010, cited in that case, the Board found insubstantial a variance between a 10-man anc an 8-man unit ) Accord. Galloway Manufacturing Corporation, 136 NLRB 405,409 21 The foregoing findings are based on the testimony of Curtin, as corroborated by Krasniewski As noted above, Stumpf professed not to recall any mention of his attorney on June 14 22 S E Nichols Comipani, 156 \LRB 1201. 1212 2.1 Even if it were found that there was not a proper request or refusal, it would be appropriate, in view of the nature and pervasive character of the 8(a)(1) violations found herein, to issue a bargaining order as a remedy for such violations See J C Penney Co, Inc, 160 NLRB 279, 287, enfd. 384 F 2d 479 (C A 10. 1967), Western Aluminum of Oregon, incorporated 144 NLRB 1191, Grevstone Knitwear Corp. 136 NLRB 573, and cases cited in In 4 thereof . i N L R. B. v Gissel Packing Co, Inc, 295 U S. 575(1969) Mr Wtcke, Lid Co, 182 NLRB 38, Merritt Motor Company, 181 NLRB 1099. Kaiser Agricultural Chemicals, a Division of Kaiser Aluminum & Chemical Corporation, 187 NLRB 661, enfd 473 F.2d 374 (C A 5, 1973). Lawrence Rigging, Inc, 202 NLRB 1094, Meehan Truck Sales, Inc, 201 \LRB 780 DECISIONS OF NATIONAL LABOR RELATIONS BOARD V. THE REMEDY It having been found that Respondent engaged in certain unfair labor practices within the meaning of Section 8(a)(1) and (5) of the Act, it will be recommended that it be directed to cease and desist therefrom and, upon request, bargain collectively with the Union as the exclusive representative of all employees in the unit set forth above and, if an understanding is reached, embody it in a signed agreement. CONCLUSIONS OF LAW 1. Respondent is an employer engaged in commerce and in operations affecting 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. The following employees constitute a unit appropri- ate for the purpose of collective bargaining within the meaning of Section 9(a) of the Act: All auto, truck and used car mechanics , greasers, body shop employees , parts department employees and shop maintenance men at Respondent's Appleton, Wiscon- sin, establishment, excluding office clerical employees, service billing employees , service writers, wash rack employees and supervisors as defined in the Act. 4. At all times since June 2, the Union has been the exclusive representative of the employees in the aforesaid unit for the purpose of collective bargaining with respect to rates of pay, wages, hours of employment , and other terms and conditions of employment. 5. By refusing on and after June 14 to bargain with the Union as the exclusive representative of the employees in the said appropriate unit , Respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8(a)(5) and ( 1) of the Act. 6. By threatening to terminate its operations. if the employees engaged in a strike , Respondent violated Section 8(a)(1) of the Act. 7. By threatening employees with loss of existing benefits if they chose the Union as their bargaining agent, by apprising its employees that wage increases were being held in abeyance because of the pendency of the Union's petition for an election, without any assurance that such increases would be offered regardless of the outcome of the election, by granting wage increases the day after the Union's defeat in the election and maintaining them in effect even after the Union had filed objections to the election, and by coercively interrogating an employee about his union sentiments, Respondent further violated Section 8(a)(1) of the Act. 8. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. [Recommended Order omitted from publication.]