Formco, Inc.

FORMCO, INC. Formco, Inc. and International Union, United Auto- mobile, Aerospace & Agricultural Implement Workers of America, UAW, Petitioner. Case 9- RC-1 1825 October 19, 1977 DECISION AND DIRECTION OF SECOND ELECTION BY CHAIRMAN FANNING AND MEMBERS JENKINS AND MURPHY Pursuant to authority granted it by the National Labor Relations Board under Section 3(b) of the National Labor Relations Act, as amended, a three- member panel has considered the objections to an election held on April 29, 1977,' and the Regional Director's report recommending disposition of same. The Board has reviewed the record in light of the Employer's exceptions and hereby adopts the Re- gional Director's findings and recommendations only to the extent consistent herewith. The Regional Director in his report of July 15, 1977, found no merit in the Employer's objections to conduct affecting the results of the election and recommended that they be overruled and that the Petitioner be certified. The Employer filed timely exceptions to the Regional Director's report. Because we find merit in the Employer's Objection 1, we shall set the election aside and order that a new one be conducted. The Employer's Objection I alleges that the "employees were unduly influenced to cause the results of the representation election." In support of this objection, the Employer submitted a letter Petitioner distributed to all employees which was signed by Ivory Howard, one of the Petitioner's business representatives. That letter, dated March II, 1977, stated in part: As you know by now, Management was found guilty of engaging in unfair labor practices and was ordered to post a 60-Day Notice. The Regional Director's investigation disclosed that on March 4, 1977, the Acting Regional Director for Region 9 had issued a complaint and notice of hearing in Case 9-CA-10981 alleging that the ] The election was conducted pursuant to a Stipulation for Certification Upon Consent Election approved by the Regional Director on January 6. 1977 (the Regional Director inadvertently misstated this date in his report). The tally was 53 for, and 25 against, the Petitioner: there were 10 challenged ballots, an insufficient number to affect the results. 2 we are administratively advised that the parties executed the settlement agreement on February 7, 1977. 3 The Regional Director additionally concluded that the objection was merely conclusionary and lacked the specificity required by Board rules. He nonetheless proceeded to investigate the objection and found it substantive- ly lacking in merit. Under these circumstances, and because the Employer 233 NLRB No. 5 Employer violated Section 8(a)(l) of the Act. On March 17, 1977, 6 days after the Petitioner's letter, the Regional Director approved a settlement agree- ment between the parties.2 The settlement agreement contained a nonadmission clause. The Regional Director found that although the Petitioner's letter was inaccurate insofar as it asserted that a finding had been made in the unfair labor practice case and that an order had issued requiring the posting of a notice, it did not rise to the type of deceptive campaign practices involving the Board and its processes which would warrant setting the election aside under the principles set forth in Shopping Kart Food Market, Inc., 228 NLRB 1311 (1977). He therefore concluded that the Employer's Objection I is without merit and recommended that it be overruled. 3 The Regional Director has apparently miscon- strued Shopping Kart Food Market, Inc., as overruling previous cases 4 in which we held that any substantial mischaracterization or misuse of a Board document for partisan election purposes is a serious misrepre- sentation warranting setting an election aside. Shop- ping Kart did not change Board law with regard to improper use of the Board and its processes for election campaign purposes. As enunciated in the Shopping Kart decision: 5 [W]e decide today that we will no longer set elections aside on the basis of misleading cam- paign statements. However, Board intervention will continue to occur in instances where a party has engaged in such deceptive campaign practices as improperly involving the Board and its processes, or the use of forged documents which render the voters unable to recognize the propa- ganda for what it is. While the former standard represents no change in Board law, [Emphasis supplied] by our adoption of the latter we choose to revert to our earlier policy of setting an election aside not on the basis of the substance of the representation, but the deceptive manner in which it was made. It is that unchanged law, rather than Shopping Kart, which is controlling here. The Petitioner herein has stated that the Employer "was found guilty of engaging in unfair labor submitted specific evidence in support of its objection, we do not find the Regional Director's conclusion that the objection should be overruled for failure to comport with Board rules an adequate basis for overruling the objection. 4 The Regional Director cited Jobbers Warehouse Service, Inc.. 210 NLRB 1038(1974). 5 Member Murphy separately concurred in the view expressed by the majority with regard to this issue. Chairman Fanning and Member Jenkins, while dissenting in the Shopping Karl decision, expressed no disagreement with the majority position that Board intervention would continue to occur in instances where a party improperly involved the Board and its processes. 61 DECISIONS OF NATIONAL LABOR RELATIONS BOARD practices." Only the Board can make such a finding. Here, no such finding had been made. Indeed, the merits of the unfair labor practice allegations were not litigated, as the parties on February 7, 1977, entered into a settlement agreement. That agreement, as stated, contained a nonadmission clause. There- fore, the Petitioner's statement that the Employer was found guilty of unfair labor practices is clearly a misstatement of what actually occurred. This Board has been consistent in jealously guarding against any intrusion or abuse of its processes for partisan election purposes. We have found not only physical alteration of Board docu- ments,6 but also substantial mischaracterization or misuse of such documents,7 to have the potential of placing the Board's neutrality in question during the critical preelection campaign period. A mischaracter- ization of the legal effects of a settlement agreement similar to that present herein existed in Dubie-Clark Co., Inc., supra. In that case a leaflet stating that "the National Labor Relations Board has found that Dubie-Clark has violated your rights under the law" was distributed by the union 3 days prior to an election when, in fact, an informal settlement agreement containing a nonadmission clause had been entered into by the parties. In setting the election aside, we expressed concern both that the mischaracterization might place the Board's neutrali- ty in question, and that allowing the misrepresenta- tion of settlement agreements for partisan election purposes might discourage parties from voluntarily entering into such settlements. We deem that case dispositive as to the objectionable nature of Petition- er's statement. It could perhaps be argued that the Employer had ample time to respond. Petitioner's misstatement here occurred on March 11, 1977, and the election was held some 7 weeks later, on April 29, 1977. However, we find the fact that there may have been time to respond is not a valid consideration with 6 Allied Electric Products, Inc., 109 NLRB 1270(1954); Mallory Capacitor Company, a Division of P. R. Mallory & Co., Inc., 161 NLRB 1510 (1966); Rebmar, Inc., 173 NLRB 1434 (1968); Thiokol Chemical Corporation, Hall- Way Plant, 202 NLRB 434 (1973); J. Ray McDermott & Co., Inc., 215 NLRB 570 (1974). respect to the conduct here involved. The Petitioner's misstatements were reasonably calculated to mislead employees into believing that the Board had judged the Employer to have committed unfair labor practices whereas, in truth, such practices were never proven. The impact of the Petitioner's message upon the freedom of choice of the voter is not amenable to credible or effective response by the Employer. Employees may well view any response by the Employer as an attempt to extricate itself from the damaging effects of an adverse finding by the Board by seeking to mislead them. As we stated in Thiokol Chemical Corporation, supra, a case in which an employer had reprinted an outdated Board docu- ment, "A Layman's Guide to Basic Law Under the National Labor Relations Act" (1962 edition), to misstate the presently existing law as to the rights of economic strikers: We think the [dissenter's I reliance on the Union's "opportunity to correct" the misrepresentation is misplaced. It is questionable whether any partisan in a campaign can credibly and effectively correct a misstatement, buttressed by official documents, about the legal principles applied by the public agency administering the statute. In any event, we deem it more salutary not to attempt any such evaluation. Our concern is with the protection of the integrity of our own processes, lest any voter be left with the impression that this Board is biased in favor of any party in an election. We are unwilling to condone any campaign statement which even implies such bias. Accordingly, Objection I is hereby sustained, and we shall set the election aside and direct that a new one be conducted. [Direction of Second Election and Excelsior foot- note omitted from publication.] 7 Dubie-Clark Co., Incorporated, 209 NLRB 217 (1974); Natter Manufac- turing Corporation, 210 NLRB 118 (1974); Jobbers Warehouse Service, Inc., supra. 62