Independent Drug Store Owners of Santa Clara County

INDEPENDENT DRUG STORE OWNERS 701 Independent Drug Store Owners of Santa Clara County and Retail Store Employees Union, Local 428, Retail Clerks International Association, AFL-CIO. Case 20-CA-8170 June 18, 1974 DECISION AND ORDER On September 18, 1973, Administrative Law Judge Martin S. Bennett issued the attached Decision in this proceeding. Thereafter, Respondent filed excep- tions and a supporting brief. Counsel for the General Counsel filed a brief in answer to Respondent's exceptions and in support of the Administrative Law Judge's Decision. 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 only to the extent consistent herewith. In finding that the Respondent's refusal to recog- nize and bargain with Retail Store Employees Union, Local 428, on or about March 20, 1973, the Administrative Law Judge relied upon a resolution adopted at two meetings held in February and March 1972.1 The 1972 resolution transferred the operations of Pharmaceutical Clerks Association (herein PCA) to Local 428, urged PCA members to join Local 428, and provided for dissolution of PCA. Notwithstanding the refusal of Respondent to recognize Local 428 in 1972 or thereafter, the Administrative Law Judge found that Local 428 became the exclusive representative of employees represented by PCA, and inherited its contract with the Respondent. Contrary to the Administrative Law Judge, we do not believe that Respondent was required to recog- nize Local 428 as the bargaining representative of the unit represented by PCA or as a party to the contract. The resolution was not designed to insure employees the continuity of their bargaining repre- sentative. Rather, it provided for the complete loss of identity of PCA, and the substitution of a new and different labor organization with its own officers, and thus a complete change in the representative. We do not believe that this case is distinguishable in principle from Gulf Oil Corporation, 135 NLRB 184, where the Board refused to amend the certification from one local to another local of the same international. The membership of the certified local had voted in favor of the merger. The Board held that this requested substitution raised a question concerning representation, which under Board policy should be determined through a petition and secret ballot election.2 We find that on March 20, 1973, Local 428's status was not that of the exclusive bargaining representa- tive with a presumption of continuing majority. We find that the Respondent was not obliged to accept in 1973 the Union-conducted poll of employees of approximately a year earlier as proof of majority. Respondent did not act unlawfully in refusing to recognize or bargain with Local 428 until its majority status was established in a Board-conducted elec- tion.3 Accordingly, we shall order that the complaint be dismissed in its entirety. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that the complaint herein be, and it hereby is, dismissed in its entirety. MEMBERS FANNING and JENKINS, dissenting: The most important fact disclosed by examining the record in this case is that in all respects the employee vote to merge PCA into the Retail Clerks was democratic and comported with the standards required by the Board.4 Because of this and because I The resolution was for the first time presented to and voted upon by members of PCA at a regular meeting of PCA held on February 29, 1972. PCA had approximately 38 members of which 16 were present at the meeting. The second meeting was arranged by Local 428 and held on March 6, 1972 . Notice was given to members of PCA asking them to attend a "Get- acquainted Meeting," as members of PCA had voted in the PCA meeting held on February 29 to dissolve that organization and merge with Local 428. However, the resolution was presented to and voted upon by 16 members of PCA who had accepted Local 428's invitation to the get-acquainted meeting. While it appears that members were not given notice prior to either of these meetings that the dissolution of PCA and merger with Local 428 would be the subject of these meetings and voted upon , we find it unnecessary in view of the disposition of the case to decide whether the procedures followed measured up to the standards required by the Board. 2 Chairman Miller concurs in the applicability of the Gulf Oil precedent, and would also rely on the decision of the circuit court of appeals in American Bridge Division, United States Steel Corporation v. N.L.R.B., 457 F.2d 660 (C.A. 3, 1972), as setting forth a rationale for the result reached here. Member Penello also concurs in the result, and would rely solely on the rationale of the court decision in American Bridge Division, supra, in reaching his decision herein. Contrary to the assertion of the dissenters , we do not apply a different standard in this 8(a)(5) case from that which we would apply in an amendment of certification case . The issues are, to be sure, much the same: (1) Is the new entity the same entity as the old? and (2) did the union seeking either certification or, as here , bargaining rights, succeed to the bargaining rights of its predecessor? We have answered those issues here in the negative, based on the facts before us . Nor do we see any relevance in the Employer's alleged lack of good faith. 3 Linden Lumber Division, Summer & Co., 190 NLRB 718. 4 Although our colleagues intimate otherwise , in view of the small number of employees involved, as well as the fact that the merits of the proposed merger had apparently been discussed among employees for some time prior to the meeting at which the first vote was taken, we believe the notice of the February 29, 1972, meeting was sufficient to alert the employees to the purpose of that meeting . The notice itself stated that the meeting would concern the "new contract" with the Retail Clerks. It is otherwise uncontroverted that the merger votes were democratic . Moreover, (Continued) 211 NLRB No. 85 702 DECISIONS OF NATIONAL LABOR RELATIONS BOARD he otherwise found that the 1969-72 contract had been renewed through its termination date and duly reopened by the Retail Clerks in January 1973, the Administrative Law Judge concluded that Respon- dent had an obligation to bargain thereafter with the Retail Clerks as the representative of these employ- ees. In reversing the Administrative Law Judge's Decision, the majority relies primarily on the supposed disappearance of the old bargaining entity. As the majority acknowledges, however, this is a factor considered chiefly in amendment of certifica- tion cases and even in those cases there is serious question as to how much weight it is actually given .5 In arriving at their decision, our colleagues have also chosen to ignore the record evidence of this Respondent's general bad faith. Thus, contrary to the suggestion of the majority, Respondent was not presented for the first time in January 1973 with a year-old employee poll in support of the Retail Clerks; rather, Respondent was fully informed of the employee vote in favor of the Retail Clerks early in March 1972 and at that time made no claim that it did not accurately reflect employee sentiment or that it had not been fairly conducted. In fact, only after discussing details of contracts which the Union had negotiated with other employers-and apparently finding those details not to its liking-did Respon- dent strive to undo the employee vote by approach- ing former PCA officials and offering to reopen and renegotiate the 1969-72 contract. When this ploy failed, Respondent threatened legal action under California law to compel PCA to administer the 1969-72 contract, which by its terms had renewed itself through 1973. At the hearing, however, Respon- dent again reversed its field and asserted that this contract, which only a few months before it had threatened to sue on, was not binding and in fact had never been agreed to. Indeed, the essence of Respondent's defense to the matters alleged in the complaint was that PCA itself no longer had majority status in 1969 and that Respondent had therefore ceased bargaining with it in 1969. This, of course, is a claim which the Administrative Law Judge properly rejected as contrary to the record evidence. In our judgment, this is an unusual case and a case that should be decided not on the basis of technicali- ties but rather by continued adherence to the longstanding Board policy of honoring the wishes of employees with respect to their right to bargain collectively through representatives of their own choosing. By their decision here, our colleagues in effect have sanctioned Respondent's conduct in attempting to pick and choose its employees' bargaining representative-its employees' wishes omissions in the transcript is hereby granted. notwithstanding. This is a result with which we cannot and do not agree. it does not appear that any employee voted against the merger resolution or subsequently voiced objection to it . Member Jenkins notes that there is no evidence in the record to indicate that any employee in the unit was denied the opportunity to vote at the time the merger votes were taken . See North Electric Company, 165 NLRB 942; The Hamilton Tool Company, 190 NLRB 571 5 See, for example, Chairman Miller's concurring opinion in Hamilton Tool Company, supra. DECISION STATEMENT OF THE CASE MARTIN S. BENNETT, Administrative Law Judge: This matter was heard at San Jose , California, on July 19, 1973. The complaint, issued May 11 and based upon a charge filed March 22, 1973, by Retail Store Employees Union, Local 428, Retail Clerks International Association, AFL-CIO, herein the Union, alleges that Respondent, Independent Drug Store Owners of Santa Clara County, herein IDS, has engaged in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act. Briefs have been submitted by the parties.' On July 20, 1 day after the close of the instant hearing, counsel for Tropicana Drugs, Inc., herein Petitioner, a successor to Clifford's Pharmacy, Inc., the latter a former member of Respondent , moved to intervene in this case, seeking to present evidence on the issues involved, the right to cross-examine adverse witnesses, and the right to reopen the record after a decision issued in the instant matter to introduce evidence supporting its position . It alleged that the Union did not inherit any bargaining status from an independent labor organization, namely Pharmaceutical Clerks Association, herein PCA. This is one of the issues litigated before me. Also complained of was the fact that on July 20 the Regional Director of Region 20 refused to issue a complaint based upon a charge of Petitioner alleging a violation of Section 8(b)(7)(C) of the Act by the Union and complaining that its RM petition had been blocked by the charge in the instant case. The General Counsel opposes the motion, inter alia, on the basis that the issue Petitioner seeks to litigate was fully and fairly litigated before me on July 19, 1973. Upon consideration of said motion in its entirety, the motion to intervene is hereby denied. Upon the entire record in the case, and my observation of the witnesses, I hereby make the following: FINDINGS OF FACT 1. JURISDICTIONAL FINDINGS Independent Drug Store Owners of Santa Clara County is a volunteer association of employers engaged in the retail pharmaceutical business at various locations in Santa Clara County, California, which represents most of its members in labor relations matters. The employer-mem- bers of Respondent annually enjoy gross revenues in excess of $500,000 and also receive goods and supplies valued in 1 An unopposed motion by the General Counsel to correct certain INDEPENDENT DRUG STORE OWNERS excess of $50,000 shipped to them directly from points outside the State of California. I find that the operations of Respondent affect commerce within the meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATIONS INVOLVED Retail Store Employees Union, Local 428, Retail Clerks International Association, AFL-CIO, and Pharmaceutical Clerks Association are and were at all times material herein labor organizations within the meaning of Section 2(6) and (7) of the Act.2 III. THE UNFAIR LABOR PRACTICES A. Introduction; the Issues PCA and IDS were signatories to a collective-bargaining agreement from June 1967 to March 31, 1969. A new agreement was executed late in March or early in April 1969, and PCA allegedly merged into the Union in 1972. At issue herein is whether the merger was democratically and effectively consummated and whether Respondent thereafter refused to bargain with the Union within the meaning of Section 8(a)(5) and (1) of the Act. B. Sequence of Events As treated below more fully, a collective-bargaining contract was executed between IDS and PCA, effective April 1, 1969, and was due to expire on March 31, 1972. This agreement provided that it was renewable from year to year thereafter, absent 60 days' notice prior to its expiration date. Such timely notice was not given. PCA was a small independent labor organization with a membership of approximately 38. Early in February 1972, dissatisfied with its inability to achieve meaningful results from IDS in problems affecting its membership, two officials of PCA instituted a meeting with representatives of the Union to discuss a merger into the latter. Representatives of the Union were invited to attend a regular meeting of PCA on February 29. Approximately 1 week prior to that date, the general membership of PCA was sent a postcard reading as follows: PHARMACEUTICAL CLERKS ASSOCIATION OF S. C. CO. IMPORTANT MEETING concerning our new con- tract with the Union: DATE: Tuesday-February 29 TIME: 8:30-10:00 p.m. PLACE: Hyatt House-Room 502 San Jose Dues accepted 8:30-9:00 p.m. 2 Respondent has adduced evidence bearing upon the relative ineffectu- ality of PCA. This, to some extent, is agreed to by the PCA as a motivating factor for its merger into the Union. PCA had a previous contract with IDS from 1967 through 1969 . It operated pursuant to its constitution and bylaws which set up the structure and operational procedures for the organization, including monthly meetings. At these, there was an order of business including the reading of minutes from past meetings, presentation of a trea'surer's report, treatment of new business , and the discussion of current Marcellite Wall, Secretary A copy of this was also sent to the Union. This direct mailing of the notice of meeting was consistent with the type of procedure and notice given concerning meetings in past years. Some 16 members attended and, according to the uncontroverted testimony of Vice President Wanda Evans, this attendance was slightly higher than usual. This meeting commenced as a normal business meeting chaired by President Jane Noll of PCA. Representatives Patricia Brady and William Reiser of the Union then explained its workings and answered questions. A pro- posed resolution previously prepared by the Union was then read aloud to those present by a PCA official. This resolution stated in essence that long experience had taught PCA that, as an independent unaffiliated labor organization, it lacked sufficient strength to achieve its demands for fair wages and decent working conditions; that PCA had learned of the activities of the Union; that PCA had been advised that the Union represented not only employees of pharmacies in the area, but also thousands of retail store employees in other establishments; that the Union was affiliated with an international labor organiza- tion and therefore had the strength of that organization behind it; and that the interests of its members would be better served by a merger into the Union. It was then resolved, in the proposed resolution, that all of the operations of PCA be transferred to the Union, that the members of PCA be urged to qualify as members of the Union without delay and that PCA be dissolved effective 30 days after the adoption of the resolution. Reiser then explained that the 1967-69 contract had not been timely reopened and that this would therefore require honoring that contract with the Union as bargaining representative. He further announced that the Union was not interested in the small PCA treasury of approximately $1,500 and also would not collect dues until it, in turn, negotiated a new contract for the membership. At this point, and prior to the voting on the resolution, the representatives of the Union were asked to leave the room and did so. Ballots were then distributed among the membership offering a "yes" or "no" vote on the resolution. The ballots are in evidence, as supported by oral testimony, and all 16 present voted unanimously in favor of the resolution and merger into the Union. The representatives of the Union were recalled and informed of the results. All three of the PCA officials, the president, the vice president, and the treasurer, then signed a document identical with the proposed resolution except that it was entitled "Resolution." It is undisputed that the procedures leading up to the February 29 meeting and the conduct of the meeting including a majority vote of those problems. The treasurer collected dues from the members in attendance and these were entered on individual membership file cards . The treasurer also filed LM-3 reports with the U.S. Department of Labor reporting its financial status as required. There is evidence of the existence of a grievance committee for some years with slight action on its part which met with resistance from the respective employers. I find nothing here to warrant a finding, on a preponderance of the evidence, that PCA was not a labor organization within the meaning of the Act. 703 Please be there! 704 DECISIONS OF NATIONAL LABOR RELATIONS BOARD present were entirely consistent with the constitution and bylaws of PCA. On March 3, the Union sent a letter to each of the employers represented by IDS allegedly bound to the 1%9-72 contract, some 40 in all, inviting them to attend a "get-acquainted meeting" on the evening of March 9. It stated, inter alia: At the request of the now dissolved Pharmaceutical Clerks Association, we are the Collective Bargaining Representative for its members under the existing contract with you. Earlier, on March 9, Reiser, Brady, and Secretary- Treasurer James McLoughlin of the Union met with John Bucholz,3 a pharmacy owner who had been active as one of a committee of three in the 1%9 negotiations . According to Brady, Bucholz, who did not testify, announced that President Aldo Fontana of IDS had asked him to meet with them. Brady pointed out, in response to a query as to the role of the Union, that it had been approached by PCA rather than the opposite. Brady also stated that the Union intended only to enforce the contract as it stood and then make a timely reopening for the following contract year, as indeed was done later. Reiser corroborated Brady and also recalled that Bucholz inquired concerning the contracts enjoyed by the Union elsewhere, welfare and pension plan costs, short hour employees and the interchange of employees within a store. At the "get-acquainted meeting" set up for that evening, only Bucholz appeared for IDS. The three representatives of the Union as well as three PCA officials attended. Bucholz' attitude had changed from the ostensible cordiali- ty of the afternoon, according to Brady and Reiser, and I so find. He directed his remarks to the erstwhile PCA officials, Wanda Evans, Helen Sargol, and Jane Noll, urging them to reconsider their merger move and to get together with IDS . He opined that they could negotiate new benefits and a pension plan. Bucholz added that the employers were undecided what to do about the presence of the Union on the scene. As Reiser put it, Bucholz in effect offered to waive any time ban as to the reopening of the 1969-72 contract .4 A second meeting of the PCA membership, similar to that held on February 29, was arranged by a letter sent by the Union to PCA members on March 6. It asked them to attend a "get-acquainted meeting" on March 14 and further stated: We wish to welcome you into the membership of Local 428. At the annual meeting of the Pharmaceutical Clerks Association held February 29, the members voted by unanimous secret ballot to dissolve that organization by merging into Local 428 in recognition of our strength and ability to serve our members. 3 Also appearing as Bucholtz. 4 I view this as an assertion of the binding effect of that contract upon Respondent, in contrast with its contrary claim stated below. S Although the sign in sheet for the meeting reflects 18 names. 6 Not counsel who appeared herein. At this meeting, the procedure followed as to explanation of the Union and its aim was identical with that of the previous meeting. The union representatives left the room as the vote was taken. It is undisputed that upon their return they were advised, as was the fact, that 16 votes had been cast in favor of the merger with one abstention.5 The membership was advised of what had taken place at the two meetings on March 9 with Bucholz. A total of some 21 members of PCA signed in favor of the merger at the two meetings. On the following day, March 15, a letter on the letterhead of PCA was sent to the employer-members of IDS covered by the 1969 contract. The four officers of PCA signed the letter in their capacity as officers "of the now disbanded" PCA. Its content was as follows: This is to officially notify you that on Tuesday, February 29, 1972 the members of the Pharmaceutical Clerks Association of Santa Clara County by unani- mous secret ballot voted concurrently to disband and merge into the Retail Store Employees Union, Local 428-AFL-CIO for the expressed purpose of Local 428 becoming our official representative for all matters affecting our jobs and future welfare. On Tuesday, March 14, 1972 by secret ballot vote the members again reaffirmed their previous action of disbanding the Association and selecting Local 428 to represent us in all matters of Collective Bargaining. On April 5, 1972, the Union wrote to President Fontana of IDS. Reference was made to the March 15 letter set forth above and to the March 3 letter urging a meeting between the parties which had not evoked a response. The Union asked that an employer committee be selected so that the parties could meet in the near future. Thereafter, Brady, Reiser, and McLoughlin met for coffee with Fontana who asked as to the intentions of the Union. Reiser responded that the Union intended to enforce the existing contract as it could not then be timely reopened. According to Brady, Fontana, who did not testify herein, doubted that the Union could do so. Fontana claimed that many of the employer-members could not afford the requirements of the contract. An offer by the Union to inspect the books of the respective employers and make an appropriate adjustment was declined. I deem it a fair statement that the meeting was inconclusive. At this point, Respondent IDS turned to counsel,6 who sent a letter dated May 16, 1972, to President Jane Noll of PCA. Reference was made to the March 15 letter cited above and the view was expressed that the vote to "disband and merge" into the Union violated the law of California and was contrary to the contract.? Counsel therein also contended that the contract had duly renewed itself that year and was "in full force and effect" on March 15, 1972. Violation of any part of the r This was a reference to art. XI of the 1969-72 contract which provided that the contract could not be "assigned, transferred or in any manner conveyed to any other labor organization." The merits of this claim are treated below. INDEPENDENT DRUG STORE OWNERS contract was asserted to constitute grounds for civil litigation. Attention was directed to the California Labor Code providing fof enforcement of collective-bargaining contracts. On May 30, the same counsel wrote again, complained that there had been no response to the former letter, and stated that this would be the last communication prior to advising IDS to take appropriate action. On June 13, the Union met again with the PCA members and officials. The events of the preceding 4 months were reviewed, including the two letters set forth immediately above from counsel. The group, in essence, concluded that the best recourse, in view of the slowness of events, would be to wait until January 1973 when the contract could be duly reopened. Nineteen former PCA members were present on this occasion and signed attendance cards in behalf of the Union. Matters remained somewhat quiescent for some months until January 29, 1973. On that date, on the letterhead of the Union, President Jane Noll, in behalf of PCA, and President James McLoughlin, in behalf of the Union, wrote to President Fontana of IDS. He was notified therein of an election to amend the contract effective April 1, 1973, to conform with an enclosed copy of the Union's standard drugstore agreement. IDS was asked to execute and return a copy of same. This met with no response and a meeting was arranged on March 16, 1973 between representatives of the Union and newly elected President Lombardi of IDS and its new counsel, Herbert Matthews. The latter pleaded his lack of familiarity with the case and the meeting was reset for March 20. Representatives of the Union demanded recognition, pointing to the two secret ballots as demon- strating their status. After the employer representatives caucused, they returned and announced that, in their view, the Union had no representation rights. The union representatives then pointed to the May 16 letter from prior counsel claiming that the 1969 contract was in effect in 1972. The employers were adamant that the Union had no status at that time as the representative of the employees of members of IDS.8 To sum up, in February 1972 the elected officers of PCA which for some time had enjoyed a collective-bargaining history with Respondent decided to contact the Union in order to obtain more effective representation for their members and did so. PCA held two separate meetings at which the Union presented a full picture of its organiza- tion. This resulted in unanimous votes by secret ballot of those present to merge into the Union as the new representative and also to dissolve PCA. The Union notified Respondent of its representative status and endeavored to establish a working relationship prior to the expiration of the current contract. Respondent, through various personnel, assumed various postures, including an attempt to retain PCA within the old bargaining relation- ship, and thereafter, in March 1973, refused the demand of the Union to bargain. C. Analysis and Conclusions 705 (1) I find, on a strong preponderance of the evidence, as noted above, that PCA was a viable and functioning labor organization until, of its own volition , and by a majority and unanimous vote of its members , with one abstention, it merged into the Union. While Respondent has attempted to adduce evidence to the effect that this small, independ- ent labor organization of 38 ladies lacked much muscle, this rather supports the logistics of the merger . PCA had a history of collective bargaining with Respondent. There was a grievance committee which , on occasion, albeit unsuccessfully, sought to redress complaints and there is also evidence that, because of the smallness and weakness of the organization, members were reluctant to pursue grievances. As set forth, minutes of previous meetings were read and dues were collected at regularly scheduled business meetings. It also filed regular LM-3 reports to the United States Department of Labor, reflecting the disposition of its funds. Stated otherwise, the duly elected officers abided by the constitution and bylaws of this labor organization in the performance of their duties. (2) I find that PCA, of its own initiative, appropriately and democratically chose to cease its own functions and merge into the Union. It sent notices to its members setting up the meetings of February 29 and March 14 , 1972, which were slightly better attended than normal meetings. There was a discussion of the issue of the merger on these occasions and votes by secret ballot were taken in the absence of representatives of the Union . The votes were taken pursuant to the constitution and bylaws of PCA which required only a majority of those present to vote in favor of the proposition. I view this to be a fully democratic procedure; indeed, all of this was initiated by PCA and not by the Union. (3) Respondent has cast some aspersions on whether the 1969 contract was duly executed with it in behalf of all its members signatory to the previous contract. Three repre- sentatives of PCA met with a committee from IDS, including Charles Longinotti, then its president . According to Wanda Evans of PCA, and I so find, Longinotti and Negotiator Bucholz stated that the three men were a committee representing the employers whose names appeared on a list supplied by the employers and this list was ultimately attached to the 1969 contract as Appendix A. Longinotti admitted that a copy of the 1967-69 contract was present at the negotiations . While he, in effect, contended that no official document was signed, he conceded that the three employer representatives were present as a negotiating committee for IDS . He also conceded that the 1967 contract had a list of the employers bound thereto, and the supplement to the 1969 contract lists six changes sought by PCA, all agreed to. Longinotti also conceded that a final agreement was reached and nothing else was to be ironed out, although contending that this was to be signed by each employer. This, of course, is not inconsistent with multiemployer 8 The findings as to this meeting are based upon the uncontroverted testimony of Brady and Reiser; the Employer representatives did not testify. 706 DECISIONS OF NATIONAL LABOR RELATIONS BOARD bargaining. Moreover, the signature page of the 1969 contract provides for signature only by its president. I credit Evans herein and reject Longinotti 's testimony that the respective members of IDS could approve or not as they chose. I further find that the contract was not contingent upon approval of individual members. (4) Longinotti denied signing any official 1969 contract. Evans, on the other hand, testified that the 1967 document, as amended in the 1969 meeting, was signed on this occasion. She uncontrovertedly testified, and I find, that Bucholz, who did not testify, typed up the amended contract and that it was picked up in his office. And Longinotti conceded that he obtained a copy of the 1969 contract from Bucholz and put its terms , including a 15- cent wage increase, into effect. Here as well, I credit Evans. (5) As set forth, Respondent's former counsel in May 1972 contended that the 1969 contract with PCA was in full force and effect, this on an associationwide basis, and in fact threatened litigation if it was not lived up to. Indeed, Bucholz, in a prior meeting in April 1972, recognized this by offering to waive the untimely failure to reopen the contract and to grant concessions to PCA. (6) The record is entirely devoid of evidence that any of the affected employers communicated to PCA or the Union any notice of withdrawal from IDS or that they sought to obtain consent from PCA or the Union to so withdraw. It follows that the respective employer-members of Respondent were bound to the 1969 contract. N.L.R.B. v. for. T. Strong, d/b/a Strong Roofing and Insulating Co., 393 U.S. 357 ( 1969). (7) Thus, the 1969-72 contract renewed itself through the termination date of April 1, 1973. Having been duly reopened in January of 1973, Respondent had an obliga- tion to bargain thereafter with the Union as the representa- tive of the employees in the unit. (8) Respondent has asserted that article XI of the contract, forbidding in essence the transfer or assignment of the contract to another labor organization, nullifies all of the foregoing. But the record amply demonstrates that this was not a transfer of the contract to another labor organization, but rather a merger of PCA into the Union which therefore inherited the contract . This is so because there were two democratic votes on the issue and the employees thereafter attended meetings of the Union. And there is also . precedent that freedom of choice of a bargaining representative may not be circumscribed by a nontransferability clause . See, e.g., New England Foundry Corporation, 192 NLRB 785. (9) The complaint has alleged that all pharmaceutical clerks, excluding fountain personnel, licensed pharmacists, office clerical employees, guards, and supervisors of employer members of Respondent , as set forth in Appen- dix A of the 1969-73 contract, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. This is a unit long recognized by the parties. No evidence of its lack of appropriateness has been proffered and I find that this unit is appropriate as alleged . I further find, for the reasons stated above, that PCA, at all times material herein up to March 14, 1972, was the exclusive representative of the above-described employees, and that the Union at all times from on or about March 14, 1972, was and now is the exclusive representative of the aforesaid employees within the meaning of Section 9(a) of the Act. (10) I find that on January 29, 1973, the Union duly reopened the contract for bargaining and that on March 20, 1973, Respondent refused to bargain with it on the basis that it had no representation rights . As there is a presumption of continuing majority status in the appropri- ate unit and there is no contention or proof that this was not the case, I find that Respondent has thereby engaged in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act. Upon the basis of the foregoing findings of fact, and upon the entire record in the case , I make the following: CONCLUSIONS OF LAW 1. Independent Drug Store Owners of Santa Clara County and its employer-members constitute an employer within the meaning of Section 2(2) of the Act. 2. Pharmaceutical Clerks Association and Retail Store Employees Union, Local 428, Retail Clerks International Association, AFL-CIO, are and were at all times material herein labor organizations within the meaning of Section 2(5) of the Act. 3. All pharmaceutical clerks, excluding fountain per- sonnel, licensed pharmacists, office clerical employees, guards, and supervisors, employed by employer members of IDS covered by the 1969-73 contract with Pharmaceuti- cal Clerks Association constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 4. Pharmaceutical Clerks Association has been at all times material herein, and the Union now is , the exclusive representative of the employees in the above -described appropriate unit within the meaning of Section 9(a) of the Act. 5. By refusing to recognize and bargain with the Union on and after March 20, 1973, Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act. 6. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. THE REMEDY Having found that Respondent has engaged in 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. As Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act, I shall recommend that it recognize and bargain with the Union concerning wages, hours, and other terms and conditions of employment and, if an agreement is reached, sign same. [Recommended Order omitted from publication.]