Ball Corp.

JEFFCO MFG. CO. Jeffco Manufacturing Co., a Division of Ball Corpora- tion and Teamsters, Chauffeurs, Warehousemen, Helpers, Miscellaneous, Brewery and Soft Drink Workers, Local 822, affiliated with International Brotherhood of Teamsters, Chauffeurs, Ware- housemen and Helpers of America. Case 5-CA-6359 June 20, 1974 DECISION AND ORDER BY CHAIRMAN MILLER AND MEMBERS FANNING AND JENKINS On February 25, 1974, Administrative Law Judge Melvin J. Welles issued the attached Decision in this proceeding. Thereafter, Respondent filed exceptions and supporting brief, and the General Counsel filed cross-exceptions and a memorandum in support. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the record and the attached Decision in light of the exceptions and brief and has decided to affirm the rulings, findings, and conclusions of the Administrative Law Judge and to adopt his recommended Order as amended herein.' The Administrative Law Judge, in his recommend- ed Remedy, did not find it necessary to require Respondent to post notice in connection with the unfair labor practices. In this regard the Administra- tive Law Judge noted that Respondent was in "good faith" in its withholding the merit increases, that the Union won the election, that bargaining was in process at the time of the hearing, and that many of the employees will receive backpay, and thus be appraised in a meaningful matter that the Company made a mistake. We disagree. Here, we have found that Respondent has violated the employees Section 7 rights in a manner which seriously affected their wages. Moreover, because of the litigation involved, a lengthy period of time may elapse before these unfair labor practices will be remedied. In these circumstances, we perceive no reason for departing from our customary practice of requiring the posting of notice regarding the unlaw- ful withholding of merit pay increases. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the recommend- 1 Respondent's request for oral argument is hereby denied as the record, exceptions, and brief adequately present the issues and the positions of the parties. 787 ,ed Order of the Administrative Law Judge, as amended, and hereby orders that Respondent, Jeffco Manufacturing Co., a Division of Ball Corporation, Williamsburg, Virginia, its officers, agents, succes- sors, and assigns, shall take the action set forth in the said recommended Order, as amended below: 1. Reletter paragraph 2(c) of the Administrative Law Judge's recommended Order to 2(d) and insert the following as paragraph 2(c): "c. Post at its plant in Williamsburg, Virginia, copies of the notice marked `Appendix."O Copies of said notice, on forms provided by the Regional Director for Region 5, after being duly signed by Respondent's representative, shall be posted by it immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicu- ous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to insure that said notices are not altered, defaced, or covered by any other material. "10 In the event the Board's Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading 'Posted by Order of the National Labor Relations Board' shall read 'Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board."' 2. Substitute the attached notice for that of the Administrative Law Judge. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government After a trial at which all sides had a chance to give evidence, the National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post this notice. The Act gives all employees these rights: To engage in self-organization To form, join, or help unions To bargain collectively through represent- atives of their own choosing To act together for collective bargaining or other mutual aid or protection To refrain from any or all these things. WE WILL NOT withhold benefits from you because a union has filed a representation petition seeking an election. WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exercise of your rights protected by Section 7 of the Act. WE WILL make whole all employees for any losses suffered by virtue of the withholding of the merit increases during the pendency of the Union's petition. 211 NLRB No. 117 788 DECISIONS OF NATIONAL LABOR RELATIONS BOARD JEFFCO MANUFACTURING CO., A DIVISION OF BALL CORPORATION (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, Federal Building, Room 1019, Charles Center, Baltimore, Maryland 21201, Tele- phone 301 -962-2822. DECISION STATEMENT OF THE CASE MELVIN J. WELLES , Administrative Law Judge : This case was heard at Newport News, Virginia, on January 10, 1974, based on charges filed October 9, 1973, and a complaint issued November 23, 1973 , alleging that Res- pondent violated Section 8(a)(1) of the Act. Respondent has filed a brief. Upon the entire record in the case, including my observation of the witnesses, I make the following: FINDINGS OF FACT I. THE BUSINESS OF THE RESPONDENT AND THE LABOR ORGANIZATION INVOLVED Respondent is an Indiana corporation engaged in the manufacture and sale of cans at its plant in Williamsburg, Virginia. It annually sells and ships products valued in excess of $50,000 to points located outside the Common- wealth of Virginia. I find, as Respondent admits, that it is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. The Charging Party is a labor organization within the meaning of Section 2(5) of the Act. II. THE UNFAIR LABOR PRACTICES A. The Issues The basic issue in this case is whether a company, after a union has filed a representation petition, can lawfully withhold discretionary merit increases that would have been granted if the petition had not been filed.' The complaint also alleges that Respondent violated Section I The complaint specifies a company bulletin and various statements by management personnel to the employees of the withholding of the merit increases, rather than the withholding itself , as violative of Section 8(a)(i), but it is clear from the way the case was tried and the arguments of counsel that the issue is more the legality of the withholding than the statements concerning the withholding Indeed , Respondent's bnef states the issue in this respect as follows: "Whether the discontinuance by the Respondent of 8(a)(1) by soliciting complaints and grievances by means of questionnanes and individual interviews, between the filing of the Union's petition and the election . Finally, the complaint alleges that Respondent unlawfully interrogated employees about their union activities and sympathies. B. Facts and Discussion Although precisely what was told individual employees by some supervisors is in mild dispute , there is no dispute about the basic facts concerning the merit increase program and the way it was handled following the filing of the Union's petition. The Company's plant in Williams- burg started actual operations in September 1972. In December of that year, the merit review plan was instituted. It provided that each employee, following his 90-day probationary period , was to receive a merit review each 90 days, with the amount of any increase ranging from nothing at all to 20 cents per hour. Guidelines for the various classifications, with rating scales for some dozen or more factors, such as "quality of work," "efficiency," "following of safety procedures and rules," "reliability," and the like, were used by the supervisors to determine if a merit increase was to be given and its amount. A few weeks before the Union filed its petition, it had written to the Company, requesting recognition , stating that it was filing a petition with the Board, and adding "It is suggested that pending the outcome of these proceedings that you make no changes in personnel, wages or working conditions." 2 Shortly after the petition was filed , Plant Manager Mann mailed to each employee a letter stating , in part, "Once a union files an election petition, the company cannot make any promises, pay raises or give you any new benefits that might influence your vote." On August 18, Respondent posted a notice on all bulletin boards at the plant stating: Upon advice of our attorney, no merit increases are to be granted until the outcome of the secret ballot election, the date of which has not been established by the National Labor Relations Board. This decision is based on the National Labor Relations Act which defines merit increases as discretionary. The Company cannot make any discretionary changes in wages or benefits during this period. This decision does not affect promotion or promotion increases or the automatic progression increases during the probationery period (30, 60, 90 days after employ- ment). Thereafter, a number of supervisors told different employees, usually in connection with conducting the merit review, and in response to employees' questions, that they could not receive any increase, referring to the bulletin, and stating, for example, that "the merit increases were being discontinued due to the discretionary nature of granting discretionary merit increases subsequent to the filing of the Union's Election Petition on July 18, 1973, constituted a violation of Section 8(a)(1) . 2 Although this letter was not in evidence, a copy is attached to Respondent's bnef, there is little doubt but that the letter was sent and received, and Respondent does use the letter as a basis, in part, for arguing its position. For purposes of discussion, I will assume the fact of the matter JEFFCO MFG. CO. 789 the increases" (Supervisor Wallen to employee Palmer), or "Because of the involvement with the union and the Labor Relations Board that no merit increases could be given that you could only be review for it but that they could not give any raises" (Supervisor Cummings to employee Crum). Employee Kerley testified that he was told by several company officials or supervisors, Martin Kitt, Clell Lyons, and Ramon DePalm, that if the union was voted out he would get the raise retroactively, but if the union won, he would probably not receive the increase or retroactive pay. Personnel Manager Martin Kitt, one of the company officials, denied Kerley's version, testifying that all he ever told anyone was that the merit system was discontinued until after the Union election. Clell Lyons and Ramon DePalm also denied having responded to Kerley as the latter testified; stating that they said approximately what Kitt said-as DePalm put it, that the "merit reviews were being held in abeyance." There is no really significant difference between Kerley and DePalm in this respect, for by saying the increases would be held "in abeyance," it is apparent that the "abeyance" would be removed if the Union lost the election . I am inclined to believe that Kitt, as personnel manager, would have chosen his words more carefully. But the net of the Company's whole position being that its lawful tack was to continue the reviews but withhold any discretionary fruits thereof while the petition was pending, the explanatory statements of the supervisors do not really affect the basic issue. Stated otherwise, if the withholding was unlawful, so were the statements to the employees about the withholding and the reasons therefor. I return to consideration of this basic issue after discussing the other allegations in the case. As to the alleged interrogation about union sympathies and activities, one employee, Richard Crum, testified that one supervisor, Cummings, asked him how he felt about the Union and why he felt the employees needed a union, with another employee, Dwain Moore,3 present. Although Cummings, no longer with Respondent, did not testify because he was prevented by weather conditions from leaving Boston, it was in effect stipulated that his testimony would be the same as Moore's. Moore testified that Crum brought up the subject of the Union, stating that he felt the Company needed a union, and Cummings responded by asking him why he thought that. In this plant of some 225 employees, with an election campaign during which the Company "was very fair" (testimony of employee Mitchell), made no promises or threats of any kind, I cannot believe that Cummings would have strayed from the prescribed path in a single instance, and therefore credit Moore's testimony that Crum initiated the conversa- tion by stating he thought the Company needed a union. The mild response by Cummings, even though "interro- 3 The complaint originally alleged Moore to be a supervisor, but the General Counsel amended the complaint at the hearing to withdraw that allegation . It appears that Moore is in the bargaining unit, and was assisting Cummings, at the time of the meeting with Crum , in getting certain forms filled out by employees. 4 As noted above, Cummings did not testify because he was snow-bound on the day of the hearing. I have assumed that the facts were as testified to by Moore, who was Respondent's witness. Had I been of the view that the violation was made out by that testimony , I would have reopened the record gating" in form, scarcely reaches the status of "coercive interrogation" so as to violate the Act. I shall accordingly dismiss this allegation of the complaint .4 At some time during the pendency of the Union's petition, late in August, Respondent put out a new form, entitled "Speak Up," to enable employees to submit their complaints, comments, and questions to management. At least one supervisor, Cummings, called employees into his office to have them fill out the form if they wished to.5 As noted before, this was a relatively new plant. Management was obviously, as its "Employees Handbook" in evidence demonstrates, endeavouring to use the most modern and enlightened personnel policies. It has an "open door," policy, as does the entire Jeffco operation, not only in Williamsburg, under which "any employee who has any particular problem or complaint which he has been unable to get resolved . . . can go to his boss's immediate superior all the way up to the plant manager ... or the assistant plant manager, or to the personnel department." The "Employees Handbook" itself states "Differences of opinion may develop from misunderstandings regarding promotions, salaries or interpretation of Company policies and practices. Whatever the problem might be, we are anxious that the person concerned be given a fair and thorough opportunity to discuss it openly. If problems occur, bring them to the attention of your Supervisor or the Personnel Manager immediately." The "Speak Up" form, as well as another form entitled "To Know My Employees Better," instituted at about the same time, were both in furtherance of, and implemented, the policies of the Company as set forth in the employees handbook and exemplified by the open door policy. It is true that these forms were put into effect after the Union's petition was filed, and hence constituted a stepped-up procedure, a change which, reviewed simplistically, might be said to be unlawful, to be a method for soliciting and resolving complaints and grievances that would have the effect of keeping its employees from selecting the union, even if not so intended .6 But, in the light of the otherwise clean campaign adverted to earlier, the fact that the Union won the election, the parties' stipulation that the Company and the Union were bargaining pursuant to the Union's certifica- tion, and the fact that Respondent has always had a program, even though less specific, for the airing of employee complaints, even if the "Speak Up" program might be said to have in a very technical sense violated Section 8(a)(1), and I do not think it did, no useful purpose would be served by so finding. I shall accordingly dismiss this allegation of the complaint as well. The key issue in this case is also "technical" in nature-in that I am satisfied that the Company was in good faith in not bestowing such merit increases as would to take Cummings' testimony, as was in effect agreed to at the hearing. 5 Based on the testimony of Crum and Moore, who was questioning employees while Cummings was on vacation . Cummings had been on vacation when the program began, and called the employees on the night shift in separately because there was no other way for him to get access to them. 6 I credit assistant Plant Manager David Wiley's testimony that the filing of the petition had nothing to do with the institution of the "Speak Up" program. 790 DECISIONS OF NATIONAL LABOR RELATIONS BOARD normally have been given during the period in a belief that the giving of them was "discretionary," and would have been unlawful. I am constrained in this instance , however, to find that the Company was legally wrong. Respondent's merit increase program had been in effect since the plant's opening. As noted above, it provided for an automatic review each 3 months following an employee's initial 90- day probationary period. Whether a raise was granted, and its precise amount, varied, and was in that sense'discretion- ary, but the standards were carefully set forth, and supervisors were given lengthy rating sheets for the various classifications . The amount of any particular increase was dependent on these ratings . But it was an established condition of employment both that the review be held and the increases be given if warranted by the supervisor's rating. Indeed, during the preelection period, reviews were given but any increases normally resulting therefrom were withheld, or, as Respondent puts it in its brief "Only the merit increases, i.e., discretionary increases in wages, were discontinued" (emphasis supplied).? Respondent, in its excellent brief, points particularly to two Second Circuit cases, J. J. Newberry Company v. N.L.R.B., 442 F.2d 897 (1971), and N.L.R.B. v. Dorn's Transportation Company, 405 F.2d 706 (1969), as requiring a dismissal here, and argues also that the thrust of the Supreme Court's decision in N.L.R.B. v. Benne Katz, d/b/a Williamsburg Steel Products Co., 369 U.S. 736 (1962), where violations of the Act were found when an employer gave benefits without bargaining with the certified union, mandated its good-faith determination not to give the merit increases in the instant case . There is a short answer to Respondent's reliance on Newberry and Dorn's, both reversed the Board, and the Second Circuit's position has not been accepted by the Board, which has since those cases continued to reiterate the principle that "during an organizational campaign an employer must decide whether or not to grant improvements in wages and benefits in the same manner as it would absent the presence of the Union." Sinclair & Rush, Inc., 189 NLRB 25; Liberty Telephone & Communications, Inc., 204 NLRB No. 54. As the Board's decisions in Newberry, Sinclair & Rush, and Liberty Telephone all followed the Supreme Court's decision in Katz, manifestly the Board does not view Katz as impinging upon its line of decisions in this respects That this case is controlled by the Board's holdings in Newberry, Dorn's, Sinclair & Rush, etc., is evident from Respondent's own statements in its brief, which, as set forth above, emphasize that the failure to bestow the merit increases was "an established past practice," which was "discontinued" because of the pendency of the Union's petition. Indeed, this case is a fortiori to Newberry, where the timing of the reviews "might vary," and were only "fairly regular." Here, the timing of the merit increase review was fixed at 90-day intervals. Thus, in Newberry, the company could have refrained from giving an increase to any particular employee during the preelection period without departing, on the face of the matter, from its "fairly regular" practice. The question of whether an increase would be given and its amount were "subjective and discretionary" in Newberry and Dorn's, as well as in the instant case, so no distinction exists on that score. In Katz, the Supreme Court found that the company violated Section 8(a)(5) of the Act by instituting a new system of merit increases unilaterally which, the Court pointed out, were not "a mere continuation of the status quo." (Id. at 746.) That case does not, in my opinion, establish that the bestowal of the increases here , pursuant to the preexisting program that Respondent had in effect, could have violated Section 8(a)(l), and hence cannot establish that the withholding of the increase does not violate Section 8(a)(1). With regard to the Union's letter to the Company, to the extent it requested the Company to do or not to do anything, it would have nothing to do with what the Company was legally obligated to do. In fact, the language of the letter quoted only asked the Company not to make changes, and the gravamen of the violation here is that the Company did make changes-it withheld increases that would have been given to employees because of the Union's petition. For all these reasons, I find that Respondent violated Section 8(a)(1) of the Act by withholding the merit increases. CONCLUSIONS OF LAW 1. Respondent, by withholding merit increases from its employees during the pendency of the Union's representa- tion petition, has engaged in unfair labor practices affecting commerce within the meaning of Section 8(a)(1) and Section 2(6) and (7) of the Act. 2. Respondent has not violated the Act in any other respect. THE REMEDY I shall recommend that Respondent cease and desist from its unfair labor practices, and that it make the employees whole for any losses they have sustained as a consequence of withholding merit increases during the preelection period, with interest computed as in Isis Plumbing & Heating Co., 138 NLRB 716. I have found that Respondent was in "good faith" in its withholding of the merit increases. In view of the further fact that the Union won the election, and that bargaining was in process at the time of the hearing, I see no need in this case for the posting of a notice, particularly because the vast bulk of the employees will receive "back pay," and thus be apprised in a meaningful manner that the Company made a mistake. I shall accordingly refrain from requiring Respondent to post any notice. i Upon the foregoing findings of fact, conclusions of law, and the entire record, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: r At other points in its brief, Respondent reiterates "The discontinuation 9 "Manifestly" because, although the Board does not deem itself bound of the merit increase program ," or "Jeffco had an established past practice of by contrary views of the Courts of Appeals, it does, of course , follow the law granting merit reviews and increases prior to the petitioned-for election" as set forth by the Sunreme Court. (emphasis supplied throughout). JEFFCO MFG. CO. ORDERS Respondent, Jeffco Manufacturing Company, a division of Ball Corporation, Williamsburg, Virginia, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Withholding benefits from its employees because a union has filed a representation petition seeking an election among them. (b) In any like or related manner interfering with, restraining, or coercing their employees in the exercise of their rights protected by Section 7 of the Act. 2. Take the following affirmative action necessary to effectuate the policies of the Act: 9 In the event no exceptions are filed as provided by Sec. 102.46 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, and recommended Order herein shall, as provided in Sec. 791 (a) Make its employees whole, in the manner described in the section hereof entitled "The Remedy," for any losses suffered by virtue of the witholding of the merit increases during the pendency of the Union's petition. (b) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social security payment records, timecards, personnel records and reports, and all other records necessary to analyze the amount of backpay due under the terms hereof. (c) Notify the Regional Director for Region 5, in writing, within 20 days from the date of this Order, what steps Respondent has taken to comply herewith. 102.48 of the Rules and Regulations , be adopted by the Board and become its findings, conclusions, and order, and all objections thereto shall be deemed waived for all purposes.