The Boeing Co.

THE BOEING COMPANY The Boeing Company and International Association of Machinists and Aerospace Workers, AFL-CIO. Case 12-CA-5141 November 1, 1974 DECISION AND ORDER On January 21, 1974, Administrative Law Judge Benjamin B. Lipton issued the attached Decision in this proceeding. Thereafter, the General Counsel, the Charging Party, and the Respondent filed exceptions and supporting briefs, the Respondent filed an an- swering brief, and the National Aeronautics and Space Administration filed an amicus curiae brief. The Board has considered the record and the at- tached Decision in light of the exceptions and briefs and has decided to affirm the rulings, findings,' and conclusions of the Administrative Law Judge, as modified herein, and to adopt his recommended Or- der.' The Administrative Law Judge rejected the con- tention of the General Counsel and the Charging Party that Respondent had a "perfectly clear" plan to retain a substantial majority of the TWA incum- bents so as to create an obligation on the part of Respondent, as set forth by the Supreme Court in Burns,3 to consult with the Union before it set its initial terms and conditions of employment. In so concluding, the Administrative Law Judge relied on a number of factors. Although we agree with his conclusion, we rely solely on the reasons set forth in the majority opinion in Spruce Up Corporation, 209 NLRB 194 (1974), as applied hereafter to the facts of this case. Thus it is undisputed, and our dissenting colleagues do not deny, that even if it can be said that Respondent "intended" to hire all or substantially all of the in- cumbents, Respondent's "intentions" were from the outset tied to the lower rates and benefits of the Boeing-IAM contract. In these circumstances, as we said in Spruce Up: When an employer who has not yet commenced 'Certain inadvertent errors in the Decision of the Administrative Law Judge have been noted and corrected The Respondent has excepted to certain credibility findings made by the Administrative Law Judge It is the Board's established policy not to over- rule 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 Drv Wall Products, Inc. 91 NLRB 544, enfd 188 F 2d 362 (C A 3) We have carefully examined the record and find no basis for reversing his findings 2 The Charging Party's request for oral argument is hereby denied as the record, exceptions, and briefs adequately present the positions and argu- ments of the parties } N L R B v Burns International Security Services, Inc, 406 U S 272 (1972) 541 operations announces new terms prior to or si- multaneously with his invitation to the previous work force to accept employment under those terms, we do not think it can fairly be said that the new employer "plans to retain all of the em- ployees in the unit," as that phrase was intended by the Supreme Court. The possibility that the old employees may not enter into an employ- ment relationship with the new employer is a real one . . . .° Accordingly, for these reasons 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 Re- lations Board adopts as its Order the recommended Order of the Administrative Law Judge and orders that the complaint be, and it hereby is, dismissed in its entirety. MEMBERS FANNING AND PENELLO, dissenting: Contrary to our colleagues, for the reasons set forth in our separate dissents in Spruce Up Corpora- tion, supra, and herein, we find that Boeing is a suc- cessor employer to Trans World Airlines (TWA) Spruce Up Corporation, supra, I I par of Board opinion Member Kennedy concurred in this finding of the majority in Spruce Up Corporation He notes that the dissenters in this case have misinterpreted the recent holding of the Supreme Court in Howard Johnson Company v Detroit Local Joint Evecutive Board Hotel and Restaurant Employees and Bartenders International Union, AFL-CIO, 94 S Ct 2236, 2244 (1974) The Court there stated This continuity of identity in the business enterprise necessarily in- cludes. we think, a substantial continuity in the identity of the work force across the change in ownership The Wiley Court seemingly recognized this, as it found the requisite continuity present there in reliance on the "wholesale transfer" of Interscience employees to Wiley Ibid This view is reflected in the emphasis most of the lower courts have placed on whether the successor employer hires a majority of the predecessor's em- ployees in determining the legal obligations of the successor in § 301 suits under Wiley [Footnote omitted I This interpretation of Wiley is consistent also with the Court's concern with affording protection to those employees who are in fact retained in "the transition from one corporate organization to another" from sudden changes in the terms and conditions of their employment, and with its belief that industrial strife would be avoided if these employees' claims were resolved by arbitration rather than by "the relative strength of the contending forces " [Emphasis supplied ] Thus Member Kennedy believes that the dissenters misread the Supreme Court's decision in Howard Johnson when they suggest that successorship does not turn on whether the successor's employees constitute more than half or less than half of the predecessor's employees In his view there can be no substantial continuity in the identity of the work force when fewer than 50 percent of the predecessors employees are hired by the new em- ployer The dissenters' concern that an incoming employer can control his status under the Act ignores the holding of the Supreme Court in both Burns and Howard Johnson that the former employees have no legal right to continued employment with the new employer who has the right not to hire any of the former employees, if it so desires 214 NLRB No. 32 542 DECISIONS OF NATIONAL LABOR RELATIONS BOARD concerning the employment of the Installation Sup- port Services (ISS) employees at Kennedy Space Center (KSC) and was therefore obligated to recog- nize and bargain with International Association of Machinists and Aerospace Workers, AFL-CIO (IAMAW), as the representative of said employees on that basis from the time of its takeover on April 1, 1971. We further find that Boeing had a clear plan to hire all or substantially all of its required work force from ISS incumbent employees, publicly announced same, and implemented that plan to the extent possi- ble. Therefore, under the Burns decision, supra, we conclude that Boeing had an immediate bargaining obligation to recognize IAMAW and to consult and negotiate with IAMAW upon sole selection of Boeing on November 23, 1970, to negotiate with the National Aeronautics and Space Agency (NASA) for a contract award before setting wages and conditions of the involved employees. Concerning whether Boeing succeeded to TWA's bargaining obligation, the Administrative Law Judge properly concluded that NASA awarded Boeing the same ISS operation as administered by the predeces- sor contractor, TWA, with only minor variations in terms of bargaining unit employees. Thus, he found that there was a continuation of the same relations with NASA, the customer, and of essentially the same services, plant machinery, equipment, and job functions. In addition, he found that there were no material differences between Boeing's method of per- forming the ISS contract and TWA's method and that there is no evidence that the duties of Boeing's supervisors are different from those who worked for TWA. However, despite all the foregoing positive factors pointing to the "substantial continuity of identity in the business operation before and after a change" in employer,' the Administrative Law Judge failed to find that Boeing was a successor to TWA because a majority of its ISS unit employees at the takeover on April 1, 1971, did not consist of TWA incumbents, and he found this failure of a majority could not be attributed to unlawful unilateral reduc- tion of wages by Boeing. While as set forth hereafter, we disagree with the latter finding, without regard to how one determines the pretakeover bargaining is- sue, we do not for the reasons articulated in the sepa- rate dissents in Spruce Up, supra, find the lack of majority to be fatally deficient in establishing the successorship of Boeing. In Spruce Up we agreed: Successorship does not depend on the employ- ment of a majority of the predecessor's employ- 5 John Wiley & Sons v Livingston, 376 U S 543, 551 (1964) ees, but on whether a legally significant portion of the successor's employment force consists of employees previously employed in the bargain- ing unit. In making that determination, the ques- tion of whether employees of the predecessor ac- tually predominate over other employees can hardly be the acid test of successorship, al- though it may be an important factor in de- termining whether the successor employer has a basis for doubting the Union's majority status.6 The fallacy of insistence upon majority population is fundamental. Whether or not an employer has the status of a successor cannot turn in any part on its own decision to populate its work force with more than half or less than half of the predecessor's em- ployees. Otherwise an incoming employer can con- trol too readily its own status under our Act. It can so severely undertake the existing employment terms that, should one less than a majority of the predecessor's employees wish employment with it, by that act alone the employer can guarantee denial of the protection which it is the objective of the succes- sorship doctrine to confer.' Applying these principles to the facts herein, it is clear that as of April 1, 1971, when Boeing took over the performance of the ISS work, it had 970 employ- ees on its payroll within this class, divided among 380 TWA incumbents, 138 Boeing employees (transfer- red, recalled from layoff, and former), 450 outside employees, and 2 employees unidentified as to source. In this breakdown, the TWA incumbents comprised more than 39 percent of Boeing's employ- ees. In our view these figures amply support a finding that the TWA employees constituted a "legally sig- nificant portion of the successor's employment force" and a "stable nucleus" of Boeing's work force. Accordingly, we conclude, given all of the other aforementioned positive factors, that Boeing is a suc- cessor to TWA, Boeing succeeded to TWA's bargain- ing obligation on and after April 1, 1971, and Boeing violated Section 8(a)(5) by failing and refusing to rec- ognize and bargain with the Union pursuant to its demand of March 12, 1974. In Burns, supra, the Court held that in general a successor is free to set the initial conditions of em- ployment upon which rehiring is conditioned without 6Spruce Up Corporation, supra p 34 at par 10 of Member Fanning's separate opinion subscribed to by Member Penello at In 48. Polytech. In- corporated, 186 NLRB 984 (1970), enfd 469 F 2d 1226 (C A 8, 1972) Howard Johnson Company, supra, wherein the Court referred to "a sub- stantial continuity in the identity of the work force" (Emphasis supplied ) Members Fanning and Penello disagree with Member Kennedy that succes- sor status depends on whether a majority of the predecessor's employees are retained by the successor See their separate dissents in Spruce Up Corpora- tion, supra, In 21 in United Maintenance & Manufacturing Co, Inc, 214 NLRB No 31. Polytech, Incorporated, vupra THE BOEING COMPANY bargaining with the union, since prior to hiring a sub- stantial proportion of his predecessor's employees it will not be clear that he has a duty to bargain with the union. However, the Court also said that the duty to bargain may precede the formal rehiring of em- ployees where "it is perfectly clear that the new em- ployer plans to retain all of the employees in the unit .. " 8 The Court then went on to say: In other situations, however, it may not be clear until the successor employer has hired his full complement of employees that he had a duty to bargain with a union, since it will not be evident until then that the bargaining representative rep- resents a majority of the employees in the unit 9 Concerning the question of whether Boeing was obligated to bargain with the Union over the fixing of its initial terms and conditions of employment, it seems to us entirely clear that Boeing did plan to retain all or substantially all of the former TWA em- ployees. Thus, the request for proposal issued by NASA required offerors to submit a basic staffing proposal, explaining in depth how the offeror would obtain competent personnel, including a statement of its plans regarding the employment of incumbent workers. In response, Boeing stated that "In order to maintain continuity of support approximately 86 per- cent of the proposed organization will be staffed by qualified incumbents ." This representation that it would retain about 86 percent of the incumbent work force was repeated throughout its response. Boeing explained that its staffing proposal "recognizes the desirability of retaining incumbent contractor per- sonnel to provide continuity of functional support." It further stated that its "analysis indicates that effec- tiveness and economy can be achieved by retaining experienced and qualified incumbent personnel." Boeing's constant theme in its written proposal was the acknowledgement of need for continuity and Boeing's intended use of incumbent contractor per- sonnel. Thus, Boeing proposed a detailed 62-page baseline phase-in plan. One of tie criteria established in writing the plan was "Boeing can and will staff the majority of the total work force from the incumbent contractor." Boeing also averred that, "After incum- bent employees have been reviewed and those select- ed given an opportunity for employment with Boeing, qualified local hires will be hired to fill the remaining vacancies." (Emphasis supplied.) In addi- tion, Boeing's industrial relations chief at the KSC, e Burns, supra at 294-295 /bid 543 John A. Sutherland, admitted that with respect to the ISS work performed by the TWA incumbent em- ployees represented by IAMAW, Boeing expected to hire a work force of about 1,000 employees, of whom it proposed to recruit "All we could get" from the TWA incumbents, no less than 86 percent and "clos- er to 100 percent . . . ." Detailed, selective proce- dures for incumbents were devised and presented which gave prominence to selection of incumbents. As to existing collective-bargaining agreements, Boeing expressed its disbelief that the IAMAW- TWA agreement "can be legally applied" to Boeing. The IAMAW-Boeing agreement, it stated , "could cover the people performing the work." Boeing began an immediate implementation of its plan to use all or substantially all incumbents by ex- tensive public announcements . Boeing told the press; and newspapers in circulation in Brevard County, Florida, wherein the KSC is located, reported that Boeing would hire a "majority" or a "large percent- age" of TWA incumbents. Boeing was quoted as say- ing that "we want to upset the community as little as possible." Indeed, Boeing assured IAMAW, during their first meeting in late November 1970 and then at their second meeting on December 4, 1970, that it would retain most of the TWA incumbents in em- ployment. As admitted by Clifford W. McGee, Jr., Boeing's employment supervisor during the Phase-in of the ISS project, he told IAMAW "that we desired to employ in essence most of our required employees from the ranks of the incumbent contractor." At a meeting on November 30, 1970, Boeing informed TWA that "most of them [TWA employees] would be hired." As TWA Director of Industrial Relations Keil recalled, Boeing stated it "expected to hire be- tween 80 to 90 percent" of the TWA incumbents. Moreover as Harry Orlander, TWA's staff vice presi- dent, operations and services, stated, Boeing indi- cated it "hoped to hire the majority . . . . [it] desired to hire as many TWA people as possible." In addi- tion, on December 1, 1970, TWA informed its em- ployees that "Boeing is interested in hiring the major- ity of TWA/KSC employees." Boeing further implemented its plan to use the in- cumbents by putting into effect initial procedures de- signed to hire the majority of the incumbents. Thus, by December 4, 1970, Boeing and TWA agreed upon a detailed procedure by which TWA incumbents de- sirous of employment with Boeing would apply for a job. Even when hampered by the effective strike ac- tion of Local 773, Boeing did all it could do in seek- ing to obtain the incumbents . Boeing conducted ear- ly interviews of incumbents. Boeing offered jobs ear- ly to incumbents. Boeing substituted job offers to incumbents at the last moment in place of offers al- 544 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ready made up for "others," at least for required skilled leadmen and journeymen incumbents, who were, of course, essential to run the operation effi- ciently. Reviewing fully, as we have just done, what Boeing was required to plan for, what Boeing pro- posed, what Boeing publicly announced, and what Boeing did, we can only conclude that Boeing plan- ned to retain all or substantially all of the incumbent's work force within the meaning of the aforementioned Burns language. Our colleagues in the majority in effect would transform an incoming employer's "plans to retain" his predecessor's employees, which is the Burns test, into "a commitment to hire or an actual advance hir- ing of such employees," as found by the Administra- tive Law Judge. The latter meaning is wholly differ- ent and is destructive of the "plan to retain" stan- dard . A "commitment to hire or an actual advance hiring" is an overt entry into a contract of employ- ment between the employer and employee with noth- ing left to consummate the engagement except re- porting for work at a future fixed time . It is, albeit informal, an offer and acceptance of employment, and hence a completed contract. A "plan to retain," on the contrary, necessarily precedes any "commitment to hire or an actual ad- vance hiring . . . ." A plan to retain simply signifies that the incoming employer proposes to look to the incumbent employees as the primary source of his work force . That plan is the stage preliminary to the employer's approach to the incumbent. It precedes, and is independent of, any ensuing commitment to hire or actual advance hiring . Once the subsequent commitment or actual advance hiring is made, it is no longer a plan ; it is a consummated transaction. It is therefore self-contradictory to equate the plan with the commitment . The former precedes the latter; it is not coterminous with it. Our colleagues agree with us that Burns does not condition the obligation to consult initially with a union before fixing employment terms on a showing of the succeeding employer's intention to retain all unit employees. Instead, an employer has a duty of initial consultation when it becomes evident that he, in fact, will retain a sufficient number of his predecessor's employees so that the incumbent bar- gaining representative will continue as the 9(a) ma- jority representative of the successor's employees. Support for this view is found in the Court's quot- ed Burns language. The Court followed its "plans to take all" language in the very next sentence of its opinion by stating that "in other situations, howev- er," it may not be clear whether a succeeding em- ployer must bargain until he has hired his full work complement. When the two sentences are read to- gether, it appears that the Court has compared the situation where the representative status of the union is clear with the situation where the union 's represen- tative status and the consequent employer bargaining obligation is not evident until after the full comple- ment is hired. The "plans to retain all" sentence is therefore to be viewed as referring to the obvious, rather than to the sole situation in which the employer's bargaining obligation arises. Equally ap- parent, from the Court's language, a successor employer's initial bargaining obligation can be said to arise also in a situation where, as here, he plans to retain sufficient unit employees to continue the union's majority status , and that, consequently, a planned "substantial retention" gives rise to the bar- gaining obligation. Our separate dissents in Spruce Up, supra, dealt with the central fallacy of our colleagues' analysis, i.e., as Boeing's plan to retain the incumbents was "simultaneously and inextricably linked in Boeing's proposals" with the lower terms it proposed to offer them, the existence of the plan did not in the lan- guage of Burns impose upon Boeing the obligation to "initially consult with the employees' bargaining rep- resentative before . . . . [the incoming employer] fix- es terms." In response , it was said then , and we reit- erate now The Court [in Burns] there said nothing about a conditional intent to hire. The majority are at- tempting to revise substantially what the Court said, for their view would, in effect, abrogate the exception, as the only case when a violation would occur under their test would be the un- likely situation where a successor says he will continue the employees under the exact terms and conditions as existed before the takeover. If he says that he "plans" to alter the status quo in any way, while at the same time indicating a desire to retain the old employees, they would find this amounts to a conditional intent to hire. I cannot accept that the Supreme Court would announce a rule of law that is so restrictive as to amount to a nullity.10 The majority's contrary construction of this aspect of the Burns decision leads to the anoma- lous, if not absurd, result that a bargaining obli- gation over the establishment of the successor's initial terms and conditions of employment aris- es when the successor plans to retain the former employees at the terms their union had already established through collective bargaining with 10 Spruce Up, supra at par 4 of Member Penello's separate opinion THE BOEING COMPANY the predecessor employer but not when he plans to retain them at terms different from those pre- viously established. The majority would bring to bear "the mediatory influence of negotiation" where there is no controversy, but deny its ap- propriate use where there is controversy. They thus turn the Act on its head, and to no useful end. II Therefore, we conclude that Boeing's unilateral fixing of ISS wage conditions at a wage rate substan- tially below those rates which prevailed under TWA was in violation of its duty to bargain and was un- lawful under Section 8(a)(5). We also find for the reasons below that TWA employees acted concerted- ly and under the guidance of Local 773, starting in December 1970, in refraining from sending employ- ment applications to Boeing because of the unilater- ally reduced wage rates. These employees became unfair labor practice strikers of Boeing protesting Boeing's unilateral action. Thus, TWA employees acted concertedly and un- der the guidance of Local 773, starting in December 1970, and refrained from sending employment appli- cations to Boeing because of the unilaterally reduced wage rates. Local 773 first determined what TWA proposed to do. It then went to Washington, D.C., to ascertain what was happening; and while there, alert- ed IAMAW of TWA's ISS employees' basic interest in preserving their wage rates. It visited NASA. It learned that Boeing was proposing not to pick up any part of its contract. It formulated demands which included a position of preserving its rates These de- mands became known to Boeing. Local 773 ac- quiesced initially to a few applications being sent to Boeing through Keil's office with cover letter suffi- cient to preserve its position on rates; and sufficient to give Boeing the message that Boeing was going to have to consider the position of Local 773 if Boeing wanted cooperation in the orderly transition of in- cumbents. Thereafter, Local 773 guided employees in withholding applications; brought pressure on Boeing thereby; and consequently restricted inter- views. It publicly demonstrated. Local 773 pursued its position until it got a meeting with Boeing and IAMAW on February 19, 1971, at which time the strikers through the IAMAW unconditionally re- quested reinstatement and offered to begin work for Boeing and to submit whatever forms were required. The Administrative Law Judge relates there was confusion over a number of items and that it is spe- culative as to why incumbent employees reacted and did not submit applications. Such an approach at best mixes varying reasons for support of a local union's position with the fact that a local union ac- 545 tion was taken. It makes no difference that the Inter- national did not authorize the strike action. The issue is whether Local 773 called for said action and in- cumbent employees in responding engaged in pro- tected concerted activity. The withholding of appli- cations was the recommended action. The Local an- nounced it in meetings. Members were so notified by mail in a letter under signature of the local union president. It is enough if the local union told incum- bent employees not to turn in applications; or even as later that the local preferred they not do so. The acts taken were believed by the local at the time as acts taken in the best interest of the membership and the employees by following such directed actions agreed. Accordingly, Boeing was under an immediate obli- gation to reinstate the strikers as of the time Boeing began operations on April 1, 1971, replacing, if nec- essary, employees already hired. Boeing's failure to accept them was itself violative of Section 8(a)(1) and (3) of the Act. Had Boeing not unlawfully refused to reinstate these strikers clearly the majority, if not ful- ly 85.6 percent, of the work force would have been obtained from the eventual 944 who applied. Fur- thermore, employees who were entitled to reinstate- ment but not reinstated should be reinstated and made whole for any loss of pay suffered or status lost In conclusion, for the reasons stated above, we would find Respondent violated Section 8(a)(5), (3), and (1) of the Act, and would order Respondent to take appropriate action to remedy these violations. 11 Ibid at par 14 of Member Fanning's separate opinion DECISION STATEMENT OF THE CASE BENJAMIN B. LIPTON, Administrative Law Judge From July 24 through 27, 1973, this proceeding was heard before me in Tampa, Florida. The charge was filed and served on April 1, 1971, and the complaint thereon was issued by the General Counsel on May 10, 1973 Alleged are certain vio- lations of Section 8(a)(1), (3), and (5) of the Act, more specifically defined below. Comprehensive main and au- thorized reply briefs I were filed by the General Counsel, Respondent, and Charging Party; and by special leave, a brief amicus curiae was submitted by the National Aero- nautics and Space Administration, herein called NASA. Upon the entire record,' and from my observation of the Received October 1. 1973 2 At the instant hearing, the parties stipulated to the authenticity and admission into evidence of various documents and exhibits, including tran- scripts of depositions and appended exhibits taken in another proceeding Continued 546 DECISIONS OF NATIONAL LABOR RELATIONS BOARD witnesses who testified before me, I make the following: FINDINGS OF FACT 1. THE BUSINESS OF RESPONDENT; JURISDICTION The Boeing Company, herein called the Respondent or Boeing, with its principal office and place of business in Seattle, Washington, is generally engaged in the manufac- ture of aircraft and aerospace equipment. In Brevard County, Florida, at the Kennedy Space Center, herein called KSC, Respondent provides test support manage- ment, plant engineering and maintenance, and other serv- ices pursuant to a contract with NASA effective from April 1, 1971. The latter operations are particularly involved in this proceeding. During the year preceding issuance of the complaint, Respondent received goods and materials di- rectly in interstate commerce at its KSC facility valued in excess of $50,000. I find that Respondent is engaged in commerce within the meaning of the Act.' II. THE LABOR ORGANIZATION INVOLVED International Association of Machinists and Aerospace Workers, AFL-CIO, hereinafter called the Union or the IAM, is a labor organization within the meaning of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES A. The Pleadings; the Issues Broadly Defined In essence, the complaint alleges: Par. 5: All employees at KSC performing installation support services, herein called ISS, constitute an appropri- ate bargaining unit. Par. 6: From March 9, 1964, to March 31, 1971, Trans World Airlines, herein called TWA, performed the ISS op- eration pursuant to contract with NASA. Par. 7: Since February 1964, and continuing to date, the IAM has been the exclusive bargaining representative of the employees in the appropriate unit, above. Par. 8(a): Since February 1964, TWA has recognized and had successive contracts with the IAM covering the employees in the above appropriate unit-the last such contract containing an effective term from January 28, 1970, through December 31, 1971 Par. 8(b): By letter dated March 19, 1971, Respondent formally recognized the IAM as the exclusive representa- tive of the employees in the appropriate unit, above. (This allegation is more properly to be noted in chronological context, infra.) Par. 9(a): On June 30, 1970, NASA issued a request for before the U S District Court, Orlando (Florida) District However, each of the parties reserved the right to argue the materiality and relevancy of all these documents The stipulated material provides the major portion of all the evidence The complete record thus made comprises the equivalent of some 7,000 transcript size pages and briefs consist of about 400 pages 3 Certain contentions of Respondent contesting the Board's jurisdiction are considered and rejected infra, following a description of the underlying issues proposal (RFP) from contractors to perform the ISS opera- tion at KSC commencing April 1, 1971. Par. 9(b): On August 19, 1970, Respondent submitted its contract proposal to NASA which stated that 85.6 percent would come from the complement of TWA employees then performing the ISS work at KSC. Par. 9(c): On November 23, 1970, Respondent was des- ignated as the bidder with whom NASA would negotiate a contract for such services; and on March 11, 1971, such a final contract was negotiated and executed between Re- spondent and NASA to commence performance on April 1, 1971. Par. 10(a). In meetings on November 24 and December 4, 1970, Respondent notified the IAM that the employees it would hire to perform the ISS work, including the TWA incumbents, would receive wages and benefits under the terms of Respondent's existing national contract with the IAM, rather than the wages and benefits provided in the current agreement between the IAM and TWA. The IAM requested Respondent to bargain about "this imposed less- er wage scale" (as specified in Respondent's contract pro- posal to NASA). Par. 10(b): On December 5, 1970, the IAM notified Re- spondent that it objected to Respondent's refusal to con- tinue the employment terms set forth in the TWA-IAM agreement. Par. 11: From December 5, 1970, to February 19, 1971, a majority of the TWA incumbents, in protest of Respondent's "announced intent to institute unilateral changes in wages, hours, and working conditions" begin- ning April 1, 1973, concertedly withheld submission of their individual applications for employment with Respon- dent. Par. 12: Such concerted withholding of applications "constituted a strike" against Respondent which was caused and/or prolonged by the unfair labor practices of Respondent in unlawfully announcing and scheduling uni- lateral changes in employment conditions affecting the ISS employees. Par. 13: On January 15, 1971, the IAM again protested to Respondent the unilateral action of establishing differ- ent wages and conditions and requested that Respondent "hire all TWA incumbents under the terms" of the TWA- IAM contract. Par. 14: On February 19, 1971, the IAM notified Re- spondent that "all" TWA incumbents unconditionally re- quested continuation of their employment with Respon- dent beginning April 1, 1971, and would now submit appli- cations for employment to Respondent. Par. 15. Despite the foregoing "unconditional offer on behalf of all" TWA incumbents, Respondent since Febru- ary 19, 1971, has failed and refused to offer employment "to a majority of the TWA installation support employees, the exact identity and number of which employees are not now known." Par. 16: Respondent's unlawful announcement and uni- lateral establishment of lower wages and different condi- tions of employment for the employees "it would employ at KSC, caused many TWA installation support employees (the exact identity and number of whom are not now known) to fail to submit a timely application for employ- THE BOEING COMPANY ment with Respondent, thereby causing less than a majori- ty of the TWA employees to be employed by Respondent and causing the majority to suffer loss of their employ- ment." Par. 17: Since November 23, 1970, Respondent has been "the designated successor employer to TWA with regard to" the ISS operation at KSC, and since April 1, 1971, has performed the same services for the same customer, NASA, as did the predecessor contractor, TWA. Par. 18: Consistent with its prior unilateral announce- ment, since April 1, 1971, Respondent has "unilaterally im- posed the terms, wages, hours and working conditions" of its national agreement with the IAM upon the employees in the appropriate unit, "and has thereby caused employees to forfeit employment and/or to suffer loss of wages" by reason of the lower wage rate schedule of such national agreement. In his brief, General Counsel requests the remedies that Boeing be ordered (a) to reinstate with backpay the TWA employees it did not hire (about 600), and (b) to recognize and bargain with the IAM "for the employees performing the work." Respondent denied essentially all the foregoing allega- tions, except those in paragraphs 6, 8(a), 9(a), and 9(c). Respondent's formal answer to the complaint contains 55 separate defenses, including a lengthy statement of facts; and at the hearing it filed 6 additional separate defenses. As already noted, the evidence taken at the hearing con- sists mainly of voluminous stipulated material, as supple- mented by further testimony and exhibits 4 In this context, questions were not raised, nor rulings made, as to the pro- priety of Respondent's 61 separate defenses. Many of these defenses merely present extended argument and are not truly affirmative defenses properly asserted in a pleading; and many, in my opinion, are frivolous and unduly burden the record.5 Therefore, the general ruling is made that only those separate defenses which were specifically brought out at the hearing or in Respondent's briefs are appropriately presented for consideration. Particularly in view of the manner in which this record was made by the parties and the wide range of arguments and counterarguments in the briefs, it is important to maintain a close focus on the actual issues for decision in this proceeding. The principal issues presented within the framework of the complaint fall into two broad segments: (1) Whether Respondent is a successor-employer and whether, as such, it breached its obligation to bargain with the IAM by unilaterally changing the terms and conditions of employment which existed under the predecessor em- Respondent's motions to strike, and various objections to testimony cited in the briefs of the General Counsel and IAM are denied Authenticity of the evidence has been stipulated, the materiality of its use, particularly in briefs, involve questions of weight to be assigned Exh 14(H) to Joint Exh 1 was stipulated subject to the parties ' agreement as to its completeness Joint Exh 3 was reserved for such agreement after the hearing Having been advised posthearing that agreement was not reached, I have placed Exh 14^H) with the rejected exhibits Concerning the filing of an answer , see Sec 102 21 of the Board's Rules and Regulations , and Rules 8(e)(1) and I i of U S District Court Rules of Civil Procedure 547 ployer, TWA. On these issues pertaining to the successor- ship doctrine under the Act, the more recent opinion of the Supreme Court in the Burns case 6 and the Board's subse- quent applications of this case are of controlling signifi- cance. The complaint does not allege that Respondent gen- erally refused to recognize and bargain with the IAM or that Respondent violated Section 8(a)(5) in respects other than the alleged unilateral actions. Indeed, paragraph 8(b) of the complaint specifically asserts that on March 19, 1971, Respondent formally recognized the IAM as the ex- clusive representative in the contended appropriate unit of the ISS employees (an allegation validly disputed by Re- spondent). Respondent advances various arguments that it, Boeing, is not legally a successor to TWA in the perfor- mance of the ISS operation at KSC, and that, even assum- ing such successorship and a duty to bargain, Respondent fulfilled its bargaining obligation under the Act. Further, it should be indicated that Respondent adopted a major posi- tion when it submitted its competing bid to NASA to as- sume the contractorship for the services-a position to which it has consistently adhered. Thus, Respondent main- tains that the incumbent IAM-represented ISS employees properly constituted an accretion to a unit of employees performing other services for Respondent at KSC who were embraced in a preexisting national agreement be- tween Boeing and the IAM. (2) Whether certain of the TWA incumbents, from about December 5, 1970, through February 19, 1971, engaged in a concerted activity, cognizable and protected under the Act either as unfair labor practice or economic "strikers," by withholding their employment applications to Respon- dent prior to Respondent's takeover of the NASA contract on April 1, 1971. Assuming an affirmative finding to the latter question, a further issue is whether such TWA in- cumbents abandoned their concerted activity on February 19, 1971, so notifying Respondent, and "unconditionally requested reinstatement" 8 by Respondent to their status and rights which existed prior to the "strike"; and whether any of such TWA incumbents after February 19, 1971, were deprived by Respondent of employment or other rights because of their protected concerted activity. As rea- sonably construed, the complaint does not allege violation of Section 8(a)(3) on the basis of deliberate and motivated discrimination by Respondent in failing to employ any of the TWA incumbents. Nor, apart from the formalized complaint, has such a contention been clearly advanced to my notice and properly attempted to be substantiated in the litigation. The complaint itself, which is not further clarified in the arguments, describes the alleged violations of Section 8(a)(1) and (3) as stemming directly from the alleged denial of protected rights related to the withholding of employment applications, and as a consequence of the alleged unilateral actions. 6 N L R B v Burns International Detective Agency. Inc 406 U S. 272 (1972) r Although such an allegation is expressly set forth in the charge filed by the IAM on April I. 1971 9 The theory presented is that these TWA incumbents occupied the same legal status under the Act as unfair labor practice or economic strikers who submit unconditional applications to the employer for reinstatement to their jobs Respondent's motion to dismiss the complaint on the basis of Section Continued 548 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Despite the voluminous evidence introduced and argued on all sides at great length, the facts immediately essential to this decision are virtually undisputed. However, the nar- rative which follows is not intended as findings that all such facts are considered to be material but to provide a sufficiently rounded context within which the issues and arguments of the parties may be comprehended and evalu- ated. B. The JAM and Its Subordinate Units (1) The IAM, as an International, was the recognized and contracting party in the two collective-bargaining agreements, with TWA and with Respondent Boeing, which existed during the material time of the bidding and award of the ISS contract at KSC. (2) District Lodge 142 confines its membership to em- ployees of TWA and Ozark Airlines at KSC and other locations. (3) Local Lodge 773, with membership consisting of TWA employees at KSC, was a subordinate unit of Dis- trict Lodge 142 until April 1, 1971 (the takeover date of Boeing), and assisted in administering the IAM contract with TWA. In April 1971, Local Lodge 773 also became affiliated with District Lodge 166, and has since assisted in dealing with Boeing with respect to the ISS employees. (4) District Lodge 166 assists in the negotiation and ad- ministration of contracts with employers operating at KSC and elsewhere. (5) Local Lodge 2061 is a subordinate unit of District Lodge 166 and assists in the negotiation and administra- tion of the contract with Respondent as it applies to KSC. C. History of TWA and Boeing at KSC, Contracts with the JAM From March 9, 1964, through March 31, 1971, TWA operated the ISS project for NASA pursuant to a cost-plus- award-fee contract and successive extentions thereof. This operation, sometimes referred to as "housekeeping" serv- ices, included test support management , plant engineering and maintenance, and logistical functions relating to NASA's utilization of KSC as a principal launch site for space vehicles. Under subcontracts from TWA, certain other firms performed guard , fire, janitorial, training, and documentation services . As of March 7, 1971, there were 1,054 ISS employees embraced under contract between the IAM and TWA for an effective term from January 28, 1970, through December 31, 1971 For the most part, these 10(b) is denied Those violations alleged which preceded the limitation peri- od, beginning October I, 1970, were continuing in nature The contention that prosecution is barred by lathes is rejected N L R B v J H Rutter-Rex Manufacturing Co, 396 U S 258 (1969), is applicable The jurisdictional defense that Boeing is exempt from the Act as a joint employer with NASA has no merit It is clear that Boeing exercises effective control over the employment conditions of its employees at KSC and is competent to bar- gain collectively within the requirements of the Act See, e g . Atlantic Tech- nical Services Corp, 202 NLRB 169 (1973), Herbert Harvey, inc, 171 NLRB 238, 239, (1968), enfd 424 F 2d 770, 778 (C A D C 1969) Indeed Boeing has been subject to the Board's jurisdiction to an election proceeding in 1955 (infra) involving its employees working on the Bomarc project at KSC covered employees performed various mechanical and craft functions. The agreement described a single unit en- compassing all airline and other operations of TWA in the nation, and was expressly to be governed by the Railway Labor Act. The parties had successive contracts of similar content dating from February 17, 1964. On such date, the ISS employees were brought within the coverage of the company-wide contract between TWA and IAM, which specifically identified the "KSC Operation" at Merritt Is- land, Florida. Since 1952 Respondent Boeing has had various "hard- ware" contracts with NASA at KSC involving particular missile projects, e.g., Bomarc, Minuteman and Saturn-A- pollo 5. In these contracts the areas of research and testing, including structural work.10 There were periods of overlap in each missile program, while earlier projects were re- duced or phased out, and employees were transferred be- tween different projects. Boeing's total payroll at KSC peaked at 809 employees in 1968 and sharply declined thereafter In November 1955, following a consent election," the IAM was certified for an appropriate unit (as described in the stipulation) of "all maintenance and production em- ployees in Brevard County, in the State of Florida, em- ployed by the employer ...." About 280 employees were affected by the certification who were then engaged under the Bomarc contract with NASA. Thereafter, the IAM and Boeing consummated successive bargaining contracts which specify, as part of their national agreement, a sepa- rate unit in the language of the Board certification, above As of the RFP and ISS award by NASA, the existing Boeing-IAM contract had a term from October 2, 1968, through October 1, 1971. On April 1, 1971, when it took over the ISS operation, Boeing had 287 IAM-represented employees working on its pending missile or hardware pro- jects at KSC D. NASA's RFP and Boeing's Proposal on the ISS Contract On June 30, 1970,12 NASA issued Request for Proposal (RFP) for the ISS operation at KSC under a cost-plus- award-bid contract for 1 year commencing April 1, 1971, with options by NASA to extend the contract for succes- sive 1-year terms. An overlapping period, from February 1 through March 31, was specifically contemplated to phase out the incumbent and phase in the new contractor. In extensive detail, the RFP described the services to be per- formed, as well as types and qualifications of personnel The ISS work involved was essentially the same as that performed by the incumbent, TWA, with relatively minor differences.13 The propsective offerors were required to ex- 'o On certain of the missiles, Boeing performed production, maintenance, testing, and research development at many locations other than KSC 11 Pursuant to a Stipulation for Certification upon Consent Election 12 Hereinafter, all dates are sequentially in 1970 and 1971 unless otherwise specified 13 Mail and distribution services affecting 51 unit employees were deleted Other miscellaneous functions involving 70 unit employees were added. e g, a staffing increase in "Logistics", elevator maintenance, pad lighting, and some heavy equipment operations previously performed by Bendix Corpo- ration Also newly included were "Documentation Support Services and THE BOEING COMPANY plain their recruiting plans, including the "type and esti- mate" of local and nonlocal personnel, the "approximate number" by type of incumbent employees to be hired, their understanding of existing union agreements, and which employees were to be represented by "bargaining labor." In addition, NASA stated: 1. The NLRB has held that when an employer as- sumes the operations of another employer without change in employees, jobs or methods, the succes- sor-employer is obligated to bargain with the Union before changing wages and other conditions of em- ployment. Under a recent series of cases, the NLRB has held that the successor-employer must assume the predecessor's collective bargaining agreement. It is NASA's position that the offerors make them- selves familiar with the NLRB cases covenng this issue, namely, The William J. Burns International Detective Agency, Inc., 74 LRRM 1098; Chemrock Corp., 58 LRRM 1582; John Wiley & Sons v. Liv- ingston, U.S. Sup. Ct., 66 LRRM 2769. 2. The offeror will have to apply the NLRB's reason- ing in the previously mentioned cases to the scope of the RFP in relation to method in which the work has been performed and to its own intended mode of operation. On August 19, 1970, in response to the RFP, eight pro- posals were submitted to NASA by seven companies, in- cluding TWA and Boeing,-the latter having two bids. All the proposals were treated as confidential documents by NASA, not revealed to the competing bidders, the employ- ees, unions, or general public. As to Boeing's principal pro- posal, it needs emphasis that the labor costs submitted were based specifically upon the wage rates and fringe ben- efits contained in its existing national agreement with the IAM, applicable to its KSC hardware contracts.14 In staff- ing the total contract (including guards, firemen, superviso- ry, professional, and clerical personnel), Boeing proposed: Boeing Local 67 3.5% Boeing other locations 5 Incumbent contractors 1779 85.6% Local hires 227 9% 10.9% 2078 100 % It was deposed by a Boeing official that the 85 6 percent resulted after calculating the number of its present employ- ees that would transfer to the ISS operation, the number that would be recalled from layoff from Boeing employ- ment in the area, and the number of known talents in the area available for employment. In the proposal itself there is no clear breakdown of the number of IAM-represented TWA incumbents Boeing proposed to hire,15 Boeing's pro- Training" having little effect on the represented employees That the ISS operations were basically the same for both of these contractors was de- posed by officials of TWA, Boeing, and NASA 14 These costs were substantially below the labor costs submitted by TWA based on the wage rates and benefits in its existing agreement with the IAM for the ISS unit 549 posal included an "alternate staffing" plan in which it was stated: "While the staffing plan is based on retaining ap- proximately 86 percent of the incumbent personnel, FSES data indicated that the local labor market is sufficient in both skills and number to provide the staffing require- ments of this contract." 16 Elsewhere in its proposal, the statement was made that "After incumbent employees have been reviewed and those selected given an opportuni- ty for employment with Boeing, qualified local hires will be hired to fill the remaining vacancies." In response to NASA's queries regarding union contracts, Boeing stated in its bid, as follows: Boeing does not believe that the collective bargaining agreement between District 142 of the IAM, and TWA, covering the operations and maintenance em- ployees of TWA can be legally applied to The Boeing Company. However, Boeing has in effect a collective bargaining agreement with Local Lodge 2061 of Dis- trict Lodge 166 of the IAM&AW which covers our production and maintenance employees in Brevard County, Florida. . . . Since the Local and District lodges involved are all part of the same International Union, Boeing sees no reason for them to generate any labor dispute accruing from these issues. Boeing's other, alternative, proposal was eliminated ear- ly in the bidding procedures. The wage rates or other con- tent of this bid are not revealed The record and the deci- sion herein are confined to Boeing's main and successful proposal On November 23, 1970, NASA announced that it had selected Boeing "for negotiations leading to an award of a contract to provide installation and technical support serv- ices" at KSC.17 The contract, estimated at $20 million for the first year, would extend from April 1, 1971, through March 31, 1972, with provision for four 1-year extensions. On April 1, 1971, Boeing undertook performance of the ISS contract, without the phase-in period contemplated in NASA's RFP and Boeing's proposal, and proceeded to ap- ply the terms of its "hardware" contract with the IAM, notwithstanding the latter's opposition Relating to the prospective and actual award of the NASA contract to Boeing, the events developed along sev- eral concurrent courses formal and other protests of NASA's action, meetings and communications within the IAM; meetings and communications between Boeing and 15In a deposition taken on November 17, 1971, an industrial relations official of Boeing indicated that the Company expected to hire "the majori- ty." meaning "all we could get," of the TWA incumbents to staff a force of about 1,000 production and maintenance employees The approximate date or time period of such expectation was not shown in the course of the hiring process, infra 16 In July 1970, Boeing consulted the Florida State Employment Service, and it was advised, in August, that there would be no difficulty in obtaining qualified personnel in the desired classifications from available manpower in the county On July 26 and August 1, as a means of surveying the local market, Boeing advertised in a newspaper of general circulation seeking applicants for employment on the ISS work and received numerous affirma- tive responses 17 On November 25, 1970, the Orlando Sentinel reported that "Boeing officials said that the firm would hire about ninety percent of the TWA employees and subcontractor employees" 550 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the IAM apprising each other of their opposing positions; and the recruitment of ISS personnel by Boeing. E. The Protests and Challenges On November 23, formal protests with the U.S. Comp- troller General were immediately lodged by TWA 18 and Pan Am (Airlines). The IAM supported this challenge. On March 1, 1971, when TWA's protest was rejected, the IAM itself formally filed with the Comptroller General a chal- lenge to the Boeing award disputing the claimed applicabil- ity of the Boeing-IAM agreement to the ISS operation. (This was ultimately denied in June 1971.) TWA sought an injunction against NASA in the Federal District Court (D. C.D.C.), which was denied on March 10. Then, on March 11, NASA announced that Boeing was given the final award of the ISS contract. Various other suits were filed in the Federal courts seeking to set aside Boeing's selection, and for other relief. 19 In January 1971, at roadway entrances to KSC, placards in the name of Local 773 were exhibited stating protests, e.g., "Is NASA Involved in Wage Busting?" Boeing was not named. On February 27, 1971, U.S. Senator Lawton Chiles held a public meeting in a theater at Merritt Island, Florida, attended by officials of IAM, Boeing, and NASA, and a large audience at which the controversy was aired concerning the ISS contract at KSC. And generally, fol- lowing Boeing's selection in November 1970, various forms of protest against NASA's actions were communicated to U.S. Senators, Representatives, and Congressional com- mittees. Directly related to NASA's award of the ISS contract at KSC,20 the Service Contract Act was amended on October 18 On the basis, in part, that the purchasing power of the Government was being used as an instrument to deprive employees of the wages and benefits gained through collective bargaining with an incumbent contractor 19 E g In April 1971, the IAM filed a grievance with Boeing that, in violation of the IAM-TWA agreement, Boeing failed to retain at least 602 incumbent employees on and after the takeover on April I, that it treated the incumbents that it retained as new hires, and that it failed to observe the terms of the IAM-TWA agreement The IAM then requested arbitration In May 1971 Boeing brought action in a Federal District Court seeking a declaratory judgment that it "is not a successor to [TWA] and is not bound" by the TWA agreement , and the IAM counterclaimed seeking enforcement of its arbitration demand After April I Boeing placed in escrow and refused to remit to the IAM the dues it deducted from the employees' wages pur- suant to their individual authorizations As part of its counterclaim, the IAM requested turnover of the dues In October 1972, the court found that "Boeing is not a successor and is not bound by the collective-bargaining agreement between TWA and IAM" and denied enforcement of the arbitra- tion demand , basing its decision on Boeing's failure to employ a majority of the TWA incumbents The court also ordered Boeing to remit the dues to the IAM Boeing v. IAM, 351 F Supp 813 (D C Fla.) Appeals by the IAM and Boeing are pending before the Fifth Circuit Court of Appeals In 1971 the IAM filed suit against the Secretary of Labor, NASA, and Boeing con- testing the award to Boeing on the ground that it was made without compli- ance with the Service Contract Act of 1965, it sought vacation of the award to Boeing, resolicitation of the NASA contract, and indemnification of the employees for the loss they sustained in receiving less than the minimum wages and fringe benefits prevailing in the locality in November 1973, the suit was dismissed IAM v Hodgson, et at, 21 WH Cases 344 (D C D C ) 20 S Rep No 92, and Hearings before Subcommittee on Labor Senate Labor Committee, on S 3827, H R 15376, 92d Cong, 2d Sess (1972), Hearings before Special Subcommittee on Labor, House Labor Committee, on H R 6244, 6245, and Report of Special Subcommittee on Labor, House Labor Committee, "The Plight of Service Workers Under Government Con- 9, 1972, by the addition of a new section 4(c), in substance providing that a succeeding contractor subject to that stat- ute shall pay its service employees no less than the wages and fringe benefits specified in the collective-bargaining agreement with the predecessor employer.21 F. Staffing the ISS Following its selection by NASA on November 23, 1970, Boeing proceeded with arrangements for staffing the ISS operation on the contingency that it would later be award- ed a firm contract. In contemplation of the phase-in provi- sions of the RFP, Boeing's proposal specified certain re- cruitment procedures to be implemented in consultation with NASA and with the concurrence of the existing con- tractor, TWA. These included the establishment of an on- site employment office; review of personnel folders fur- nished by TWA and preparation of a list of incumbents recommended for hire; and use of selected TWA supervi- sors reporting to nearby offices in work areas to interview incumbent candidates. An employment schedule, prepared in November 1970, projected that 1,500 offers in all catego- ries would be extended by February 1, and 2,500 offers by March 1. And it was expected that staffing would be com- pleted by March 3, although all employees would not be on Boeing's payroll until March 31. However, the proposed procedures were sharply altered On November 30, 1970, an initial meeting took place between high officials of TWA and Boeing. TWA objected to onsite recruitment by Boeing because it would interfere with TWA's operations in the remaining period of its contract with NASA. In- stead, Boeing accepted TWA's proposal that TWA under- take to distribute the employment applications, collect the completed forms, and return them to Boeing. TWA refused to make available the incumbent personnel folders. There- after discussions continued between officials of TWA and Boeing. On December 1, in general meetings and by letter, TWA informed its employees of procedures concerning their em- ployment after the Boeing takeover. A "Declaration of In- terest" form was distributed which the employees were asked to complete and return to their supervisor. On this form, the employee was requested to indicate certain choices: (1) employment by the successor contractor, if of- fered, (2) consideration for a TWA position at a specific location, (3) consideration for a job at any TWA location, (4) exercising union-security rights under the TWA-IAM contract to displace another TWA employee, and (5) seek- tracts," 92d Cong, 1st Sess (1971) 21 "No contractor or subcontractor under a contract, which succeeds a contract subject to this Act and under which substantially the same services are furnished , shall pay any service employee under such contract less than the wages and fringe benefits provided for in a collective-bargaining agreement to which such service employees would have been entitled if they were employed under the predecessor contract Provided, That such obligations shall not apply if the Secretary finds after a hearing that such wages and fringe benefits are substantially at variance with those which prevail for services of a character similar in the locality " Public Law 92-473 Of course, the Service Contract Act and the National Labor Rela- tions Act are separate statutes with entirely different purposes The conten- tion of the iAM that, as to the issues herein, the N L R A "must be inter- preted compatibly with the public policy enunciated by Congress" in the foregoing amendment of the Service Contract Act has no validity THE BOEING COMPANY Ing employment elsewhere. Only those employees who in- dicated such an interest received from TWA forms of em- ployment application with Boeing. However, it also ap- pears that some of the incumbents were able to obtain ap- plications from other sources and by direct request from TWA; and some personally made application at Boeing's offsite employment office. TWA also conveyed the infor- mation to the employees that Boeing had indicated a desire to employ a large percentage of the incumbents. As of December 18, TWA advised Boeing that about 500 incumbents had indicated on their declaration of interest forms that they desired to work for Boeing. TWA specifi- cally advised the employees of its formal protest with the Comptroller General against NASA's selection of Boeing and that, failing in its protest, it would do everything that it could to assist employees in finding other employment. On January 8 it stated in a bulletin to employees that it was strongly convinced of the validity of its claims and it in- tended to pursue the protest to an ultimate conclusion. On January 7, 8, and 9 newspaper ads were placed by Boeing seeking applicants for the ISS work. Boeing's reason was that, until then, it had received an insufficient number of applications from incumbents to satisfy its schedule for staffing. It also hoped that, when the incumbents saw the ad, they would get their applications in expeditiously. In response to the ads, Boeing received numerous applica- tions from nonincumbent sources in all position categories. As of January 11 Boeing had received applications from 263 TWA hourly employees. These were more than half of the IAM-represented employees who had earlier indicated to TWA an interest in such employment, and they com- prised 26 percent of Boeing's ultimate requirement of hour- ly employees. In other categories-general office, profes- sional-technical, and management-most of the TWA in- cumbents had already applied by this date. On January 11, Boeing's daily status report shows that 59 TWA hourly employees had been interviewed, of whom 20 received of- fers, and that 112 former Boeing employees had been inter- viewed for hourly jobs, of whom 11 received offers. In mid- January, NASA requested that Boeing halt further offers of employment until the completion of an Apollo space launch scheduled for January 31. During the interim peri- od, Boeing continued all aspects of its recruitment proce- dures, except the placing of prepared offers in the mail- which in fact were mailed after the launch on January 31. In this process, "quite a few" offer letters already prepared for nonincumbents were withdrawn and sent instead to in- cumbents. As of February 2, a cumulative total of 851 of- fers had been extended for hourly jobs, of which 227 went to TWA employees, 78 to former Boeing employees, 39 to current Boeing employees, and 507 to "other" applicants.22 As of February 19, a critical date in the complaint,23 Boeing's status report shows the following figures in the recruitment of hourly employees- Applications Received Interviews Offers Extended Accepts Re acts Former Boeing 168 171 128 116 12 Boeing 0 0 46 25 0 TWA 435 354 273 205 4 WACs 359 1 52 0 0 Other 1771 614 547 464 67 551 Slot-ups 51 0 81 0 264 *Wackenhut Corp .. apparently reflecting the employment of guards , outside the IM bargaining unit. As of March 20, applications had been received from 626 TWA employees, of whom 467 had been interviewed, with 403 offers extended. The earlier targeted dates for completion of the hiring process for hourly employees and the originally planned phase-in period prior to April 1 had been abandoned 24 As of Boeing's takeover on April 1, the final data as to hourly employees indicate:25 Applications Received Interviews Offers Extended Accepts Re jects Sixg-vos Former Boeing 242 175 143 124 19 124 Boeing 0 0 46 41 5 41 TWA 944 472 454 403 48 402 WAC 401 1 318 309 9 309 Other 2,279 629 586 467 119 467 G. The Duncan Question Respondent contends that it relied on a verbal agree- ment from the IAM in preparing its bid to NASA predicat- ed on the Boeing-IAM hardware contract and the lower 22 The offers were made contingent upon final award by NASA, with the work scheduled to start on April I In offers made to laid-off employees elsewhere in the Boeing system, they were advised that failure to accept the offer would result in change from layoff status to termination 23 I.e., the allegation that on February 19 an unconditional request for reinstatement was made upon termination of a "strike" which commenced about December 5 24 After January 31, Boeing had an "accept target line" of about 12 day%, estimated as the average time lag from the offer to an acceptance 25 Reference has been made to the daily status reports (Comp Exh 2-I to Exh 14-B of Joint Exh I) which include numbers of applications received Another exhibit (Exh 13 to Joint Exh I) reflects comparable but not mate- rially different figures, e g., that 380 TWA employees were hired as of April I 552 DECISIONS OF NATIONAL LABOR RELATIONS BOARD wage rates and benefits contained therein. In the entire record it is evident that, in seeking to obtain the award from NASA, and in its dealings with the IAM thereafter, Boeing maintained a fixed position that its hardware con- tract with the IAM was applicable to the ISS project. Con- cededly, it had advice of counsel from the outset. In pre- paring its bid, it did not attempt to communicate directly with the International, nor seek to obtain from the IAM anything in writing on this subject, because it felt that the Boeing-IAM contract was "very plain" on its face. The verbal assurances which it sought from the IAM were deemed to be "insurance." Thus it appears that, in July 1970, and thereafter, Respondent's industrial relations manager, John Sutherland, had discussions with Robert Duncan, business representative of District Lodge 166.26 Sutherland told Duncan that, in submitting its ISS propos- al to NASA, Boeing was planning to use the rates in the existing IAM (hardware) contract. Duncan was asked to get an opinion from IAM Vice President George Watkins and from IAM General Counsel Plato Papps. On several occasions, Duncan communicated with these and other sources in the International. I credit Duncan's firm denial that he advised Sutherland of any agreement to apply the Boeing-IAM contract, on the part of Duncan personally, or from the offices of Watkins or Papps. Duncan related to Sutherland the substance of his talks with the International sources,27 that no decision had been made on how the IAM would go, particularly in view of the numerous bidders on the ISS contract, but that the IAM "did feel that whoever got the contract was going to have to pay the wages, at least, that TWA was paying." There was no mention of such purported verbal agreement with the IAM in Boeing's ISS proposal to NASA, or in its later exchanges directly with the IAM top officials on the question of which of the existing contracts, TWA or Boeing, was applicable. In sum, I reject this contention of Respondent as completely spe- cious 28 However, what is significant from all this evidence is the early and clear indication to the IAM that Respon- dent was proceeding, in its bid for the ISS work and in implementing the NASA award, on the basis of the Boeing hardware contract, with the provisions for substantially lower wages and benefits.29 26 Duncan's term of office expired on December 31, 1970, following a union election 27 In his deposition taken on November 18, 1971, Duncan clearly stated that, among others , he spoke with Watkins 28 In addition, Respondent appears to rely on a December 30, 1970 , letter from Duncan, wherein he agreed to apply to ISS employees certain classifi- cations under the Boeing-IAM contract This letter can scarcely be found to constitute an agreement by the IAM that the Boeing contract would apply if Boeing obtained (as it later did) the final ISS award from NASA 29 At the instant hearing , Duncan testified there was a continuing desire by Boeing to determine the IAM's position, and that he thinks he talked to Watkins personally In his deposition on January 21, 1972, Watkins did not recall a discussion on this subject with Duncan ("it could well have been"), but he "could not say" he was aware prior to December 1970 that Boeing was going to bid the wage rates of the Boeing-IAM contract In any event, I find it inconceivable on this evidence that the IAM leadership was not put on notice as a result of Sutherland 's early overtures H. Internal IAM Activity About December 3,30 and again in January 1971, there were trips to Washington by a delegation of officials from Local 773 (whose membership consisted of TWA incum- bents) to discuss with the IAM International, NASA, and various sources in Congress NASA's selection of Boeing to negotiate the ISS contract. The delegations were led by the local president, Darryl D'Andrea. He testified that in the beginning there was a lack of policy coordination between Local 773 and the International, apprehension of possible collusion between the IAM and Boeing, and general confu- sion. IAM Vice President Winpisinger deposed as to the dis- cussions with the D'Andrea delegations. He assured them that the IAM would do everything legally in its power to defend their jobs and the negotiated wages and conditions regardless of who their employer would be. He assigned a coordinator, Frank Waldner, to guide Local 773 in resolv- ing its problems and to see that the policies of the Interna- tional were carried out. Waldner would have the assistance of James Fowler or William Dinkelmeyer from District Lodge 142 present at KSC. Particularly in view of ques- tions raised by Local 773, Winpisinger, with the concur- rence of other high officials, had formulated the policy concerning the Boeing employment applications: The members were to be told to fill out the applications and give them to Fowler, who would then transmit them with a cover letter reserving the rights of the applicants under the TWA-IAM contract. Instructions from the International were firmly and repeatedly conveyed to Local 773 officers to carry out this policy 31 According to Fowler, there was some resistance, not so much from the membership but from three men on the grievance committee who did not wish any applications to be turned in. Fowler deposed that at KSC he told the officers of the Local "they were not to stop people from turning in applications." On December 22, Fowler sent John Keil, TWA's manager of industrial relations, the following letter: Enclosed herewith are printed forms regarding em- ployee data as requested by the Boeing Company. Please be advised this information is being provided under protest and is in no way to be construed as an acceptance of any lesser rate of pay, hours of employ- ment, working conditions, or other employee benefits as are now, or will be in effect under the terms of the present collective bargaining agreement between the International Association of Machinists and Trans World Airlines. cc: V.P. Winpisinger 30 Deposition of IAM Vice Presidents Winpisinger and West 31 John Peterpaul an international officer, deposed that Waldner kept him informed of the developments at KSC respecting the activities of Local 773. particularly in the matter of filing Boeing applications He indicated that the Local had 6 or 10 officers with different opinions as to courses of action in protecting the TWA jobs and wages He stated that the Local officers were given instructions from the international which they were un- questionably obligated to fulfill THE BOEING COMPANY Thereafter, from time to time in December and January, completed forms were hand carried by Fowler to TWA for delivery to Boeing. It is noted that, as of January 11, Boeing had received from TWA hourly employees some 263 applications for employment .32 However, also on De- cember 22, D'Andrea of Local 773 mailed a letter to the membership, in part as follows: Dear sisters and brothers: I am writing with regard to the applications for em- ployment. It appears that a great deal of confusion has arisen as to what the union wants done. We have been advised by the International Headquar- ters that we should not turn these applications in. It is their feeling that the Company is attempting to divide the ranks and thereby undermine our position that our wages, hours and working conditions will remain in effect. For those people who feel they must fill out an appli- cation, we have requested that they leave the wages part blank and turn them in to their local union stew- ards or committeeman We, in turn , will forward these applications with a cover letter stating that these ap- plications are only for information purposes and the wages and working conditions will be as set forth in the present IAM/TWA Contract.. . D'Andrea conceded that he was in error as to the second paragraph , above, and this was made clear to him and other Local officers by the spokesmen for the Internation- al. In evidence are certain documents of various Local 773 union meetings , notices to members, and communications, which reflect in part the following. On December 28, minutes of Local 773 executive board meeting: We discussed what position to take on the Boeing ap- plications at this time. We agreed to stand by Brother D'Andrea's letter. We would prefer the membership not to fill them out but if you do so, we will turn them in to the Company. On December 30, a letter from Local 773 to Vice Presi- dent Winpisinger: This letter will confirm a request made to Asst. Airline Coordinator Frank Walden on December 30, 1970, that a Grand Lodge Representative preferably Brother George Brown, be assigned to the Kennedy Space Center to assist and advise the Local Officers and 32 Undoubtedly, many of these applications were turned in by the em- ployees to TWA or filed directly with Boeing Fowler indicated the total number he sent over to TWA was less than 50 553 Grievance Committee in the problems of the TWA contract with NASA, that is presently in dispute. This request is made in order to protect the interests of our members, by assuring them that the decisions made here by the local officers are consistent with the thinking of our International Headquarters. Early in January, a Local 773 notice to members: BOEING applications are to be returned to the Local Lodge Grievance Committee through your steward or to your officers. DO NOT, WE REPEAT, DO NOT fill in the wage- rate Instead use the words I.A.M. or T.W.A. ALL APPLICATIONS THAT ARE FILLED OUT MUST BE RETURNED TO THE GRIEVANCE COMMITTEE OR TO YOUR OFFICERS. In mid-January, a "Special Fact Notice" from Local 773: FACT # 1: As of this date , no company has been awarded the contract now held by T W.A. FACT # 2: We have been advised by NASA that no award would be made prior to final decision on pro- tests lodged by T. W A. and PAN AMERICAN FACT # 3 Our International President, Floyd E. Smith, has notified the White House, The Secretary of Labor, NASA, The Comptroller General and other ap- propriate Government Agencies that the IAM 's position is that the KSC-TWA union members should be af- forded continuation of employment with wages, bene- fits and working conditions as provided under the terms of the present IAM-TWA Agreement. FACT # 7. Some TWA employees have been advised by letter of ultimatum from prospective employer that reply on desire for employment must be returned by X date-or else! In response to this latest threat to your job security , and with the assistance of ... District 142 representatives on Friday, we were in constant contact with top government officials in Washington and we have now been advised that the Boeing Com- pany rescinds the deadline expressed in their letter and will again contact these TWA employees, some- time in the future, who may have submitted applica- tions' Attached to this "Special Fact Notice" is a telegram on January 15 sent to Boeing by J J. Schwind, president-gen- eral chairman of District 142, in part: . .. in accordance with applicable law, the entire work force must be offered employment opportunities subsequent to the final awarding of the bid to any successor company. Therefore , the applications for 554 DECISIONS OF NATIONAL LABOR RELATIONS BOARD employment that Boeing is soliciting from our union members are unnecessary , and we will take all appro- priate steps to support this position for the complete protection of our membership. On January 26, a "Fact Sheet" from Local 773• FACT # 1. At the time of this writing, the Contract has still not been awarded. FACT # 2. The protest of T.W.A. and PAN AM is still before the Comptroller General's office. FACT # 3. The position in regards to the applications remains the same. On February 12, "`Fact Sheet" from Local 773: FACT # 1. Until a decision from the Comptroller General's office is made, Boeing does not have a con- tract. FACT # 2. Status quo on applications On February 17, minutes of Local 773 membership meet- ing at 8 a.m., in the presence of District 142 General Chair- man Schwind: Good and Welfare: President D'Andrea spoke on the contract. A question was asked about the employees who had not turned their applications in to Boeing. President D'Andrea stated that we held out on turning in the applications as we felt this was the best interest of the members. He also stated that there was no guar- antee that these employees who held out would be guaranteed a position with Boeing. February 17, minutes of Local 773 membership meeting at 5 p.m.: We have contacted Mr. C. R. McGehee , Division Manager with Boeing, stating wages, hours and work- ing conditions remain the same . It is the District's po- sition that we preserve this, regardless of who the con- tractor is. Brother Schwind again stated that members should submit an application to Boeing and get your job. On the other hand , it can hurt you and your fam- ily. The foregoing relates particularly to the alleged "strike" from December 5 to February 19. After the Boeing-IAM meeting on February 19, infra, there is no contention of concerted withholding of Boeing applications. 1. 1AM Meetings and Communications with Boeing and NASA-to April 1 On November 13, 1970, IAM President Floyd E. Smith sent a wire to NASA, stating in substance: now has pending a determination with respect to the continuation of Trans World Airlines Inc., as a sub- contractor for certain so-called Trans World Airlines Inc., as a subcontractor for certain so-called house- keeping functions at the Kennedy Space Center... . The employees of TWA in this case are represented by the [IAM].... The employment in question is gov- erned by the provisions of the Railway Labor Act as amended and the [IAM] is the duly authorized and certified employee representative. As such, we have a collective-bargaining agreement . . . which ordains that the work in question will be performed by appro- priately classified employees under the coverage of that agreement. The "scope rule" contained therein effectively and lawfully asserts that the IAM members . .. in effect "own" the work currently contracted for TWA. That same agreement embodies a "successor and assigns" clause which preserves all rights accruing thereunder whether or not any change in the employ- ees occurs. . . . We regard the rights enumerated herein as inalienable and this wire may be construed as notice by the IAM that we will do all in our power to preserve them intact including recourse to the ap- propriate Federal Courts should that become neces- sary. IAM General Vice President William P. Winpisinger de- posed on August 23, 1971, that "Beginning with this tele- gram and in every subsequent letter or document from our union, we were insisting upon, A, title to the work, and B, wage rates and working conditions commensurate with those enjoyed by the employees manning the jobs, our TWA agreement, in effect." On December 1, at a NASA-requested meeting with the IAM, NASA indicated that it was going to try to release the ISS contract to Boeing.33 On December 4, at Boeing's request, there was a meeting with the IAM of top officials. Principal spokesmen were Vice Presidents Winpisinger and West for the IAM, and Charles R McGehee, general manager of field operations, for Boeing. Boeing stressed that its tentatively accepted proposal to NASA was based on the current hardware con- tract at KSC, and that this contract bound the IAM as to wage rates and terms in covering the ISS work. Boeing presented the IAM with a worksheet showing the specific wage rates in various craft and other classifications con- tained in the TWA and the Boeing contracts, as well as a fringe benefit comparison of these contracts. In 11 of 18 categories, a decrease in excess of 10 percent from the TWA rates is reflected; for example in five instances, the decrease is 20 percent. The IAM asked if there was any area in which Boeing could move Boeing indicated that "there might be if they were allowed by NASA." An inter- nal union meeting was scheduled for the next day, Decem- ber 5, to consider the position the IAM would take, and Boeing was asked to stand by. Subsequently, at a luncheon meeting, NASA told the IAM in point blank "that if Boeing even attempted to 33 This was of course already a matter of presumptive knowledge in light Information reaching my office indicates that NASA of the selection of Boeing on November 23 THE BOEING COMPANY change wage rates upward that they would reopen the bid- ding on the contract." NASA emphasized that it had a right to get the lowest possible prices for the contract and effect a cost savings to the Government. Winpisinger and West deposed that, other than the conversation concerning NASA on December 4, they were not aware that the 1AM made any subsequent demand for negotiation concerning the wage differential in the contract positions of the par- ties. On December 5, the IAM officials met among them- selves. Winpisinger gave the version: "After a very careful assessment of Boeing's responses and their flatfooted pos- ture that they had to implement their wage rates, we then had our own discussion and we had to equally flatfootedly say that there is no way that we as a union can go out and advocate a reduction of wage rates to anybody." Boeing's use of employment applications, of which the IAM was then aware, was not considered, nor the possibility of call- ing a strike or the use of any other economic pressure against Boeing or TWA. They did "certainly" discuss "how to try and put NASA on the spot for being a wage-cutting agency." Following this meeting, West telephoned McGe- hee and stated that under no circumstances would the IAM buy the wage scale of the Boeing contract, and that the union position was to pick up under the same condi- tions provided in the TWA contract. On December 16, IAM President Smith sent a wire to NASA, with a copy to Boeing, in part as follows: Concern- ing the negotiations between Boeing and NASA on the ISS contract, "it is the position of LAM as representative of TWA employees . . . that any successor employer must assume wages, hours, and working conditions as currently embodied in Collective Bargaining Agreement between IAM and TWA. No other labor agreement has applicabili- ty . . . Boeing has been advised of this position... . On December 23, Pete Pitard, an industrial relations em- ployee of Boeing, addressed a memorandum to ISS Project Manager Morehead and Labor Relations Manager Suther- land, stating: Some more info on Local 773 at TWA: To date, they have 50 Boeing applications submitted by their membership. They plan to give them to us with a list of demands. (1) that we accept the group as a unit, without inter- views or qualification checks (2) that we accept 773 as a bargaining unit (3) that we pay 773's scale wages.34 J. IAM-Boeing Meeting on February 19; Subsequent Staffing On February 19, at the IAM's request, a high level meet- 3° The source of this information was not shown Pitard did not testify and no corroboration was offered Relied on by the General Counsel, this item can only be regarded as pure speculation and hearsay 555 ing took place with Boeing at Cocoa Beach, Florida. Wald- ner for the IAM and McGehee for Boeing were the main spokesmen. D'Andrea for Local 773 also attended. IAM's purpose was stated that it was not concerned with who got the ISS contract, but it was prepared to assist in whatever agreement was necessary to effect an orderly transfer of the incumbents. Boeing emphasized that it will hold the IAM to the existing Boeing-IAM contract. At the onset, it made every effort to favor the TWA incumbents, but at this late date it could not extend any preference. Waldner stated generally that the TWA employees he represented did seek employment with Boeing, and offered a member- ship roster of names. McGehee said this was not good enough; Boeing had to have individual applications. IAM's response was that if it takes some individual piece of paper, although the matter of the award was "still very much up in the air," it will cooperate fully. Waldner deposed that it came as a complete "shock" to the IAM officials when they heard for the first time at this meeting that the filing of an application would not mean a job for the incum- bents, and that they had to pass security, medical clear- ance, and the standard Boeing hiring process. McGehee indicated that "maybe it was too late anyway." Schwind of the IAM suggested the possibility of a 30-day postpone- ment of the takeover on April 1 to allow for a smooth transfer of employees. McGehee did not see any benefit to it but said he would "let him know something." The IAM wanted to send application forms to all TWA incumbents (numbering about 1,100), notwithstanding previous distri- bution of these forms and those already filed with Boeing. Such an understanding was reached at the meeting. On February 25, Boeing sent a telegram to the IAM concerning Schwind's request for an extension of the April 1 changeover date: Consistent with your request, we have examined the desirability of requesting an extension of the April Ist take off date for the [ISS] Contract. We cannot at this time see any benefit to the interest- ed parties. We remain ready to meet with you to dis- cuss the orderly transition of responsibility from TWA to the Boeing Company. Also on February 25, Schwind sent a letter to McGehee, in pertinent part: Confirming a telephone conversation on February 24, to assure Boeing that "all employees are in- terested in maintaining employment with Boeing," . .. we assure you that all IAM-TWA members would be contacted and provided with an individual Boeing employment application form with proper in- structions. The Union, however, advise[s] you that our position re- mains unchanged regarding lowering the wages, benefits, etc, which the IAM-TWA employees are presently en- joying. [Emphasis supplied] Boeing furnished on March 1, 1971, the IAM with 650- 750 application forms, all that it had available at KSC, and 556 DECISIONS OF NATIONAL LABOR RELATIONS BOARD arranged to fly in from other locations additional applica- tions; some were also obtained by IAM from TWA. The IAM waited until it had a "sufficient number" to send to every TWA employee, so that "nobody could claim that they got preferential treatment." In early March, the IAM mailed out the forms to the employees with a covering let- ter dated February 26. The letter stated in part: A meeting was conducted with the Boeing Company, a prospective bidder, on February 19. . . . The union very emphatically and clearly informed the Boeing Company that the IAM International President's posi- tion remains unchanged with respect to our willing- ness to pursue into the courts, if necessary, our claim for full and proper application of the existing IAM/ TWA Contract.. . . Accordingly, I have received instructions as follows from District Lodge 142 President . . . Schwind, which are fully endorsed by your Local Lodge Execu- tive Board. You will find enclosed a Boeing applica- tion form for employment. You must fill it out com- pletely, except for that portion concerning wages. Please leave that portion blank, and return the form to the local lodge office in the enclosed envelope by re- turn mail, or by other means, promptly... . On March 9, the IAM transmitted 504 completed appli- cations to Boeing with a covering letter, in part as follows: Enclosed herein please find completed applications of TWA/IAM employees that are interested in maintain- ing employment in the event that the Boeing Corpora- tion is awarded [the ISS contract], as was discussed at our February 19th conference.. . . However, be advised that by the Union's supplying the above said applications does not suggest nor imply that our position has changed with regard to the low- ering of wages, benefits, etc., which TWA/IAM em- ployees now enjoy. In letters from March I I through 16 to Boeing, completed applications from 80 employees were submitted, and from March 18 through 29, 6 additional applications. Thus, from the IAM's testimony, a total of 590 completed applications were sent to Boeing through the IAM after the February 19 meeting. However, Boeing's daily status reports show that, after February 19, it received from TWA hourly employees 778 completed applications, of which 269 were duplicates of previous filings. In these reports it is recorded, for exam- ple, that 20 such applications were received on February 23, and that the last group of applications was received on March 22.35 During the same period from February 19 to April 1, there were additional applications filed for hourly jobs by 74 former Boeing employees, to whom 15 were extended offers, and 508 applications from "other" sources, to whom 33 were extended offers. About March 35 The variations from the IAM evidence, though not at all significant, is not explained 20, Boeing rescinded the acceptances of 17 nonincumbents and 3 incumbents "because of a reduction in require- ments." NASA had removed a portion of the ISS contract involving the "Bendix" operation. Boeing explained that it was unable to find other jobs for this group of 20 offerees, among those who were affected by NASA's curtailment. Boeing's stated position was that, apart from this NASA change, it was committed to hire all applicants who had accepted offers and were "signed up." Further, it is noted that the great bulk (507) of the offers to "other" applicants was made about January 31, from 1,522 applications re- ceived in this category. By April 1, of 2,279 applications filed in the same category, 586 offers were extended, and 467 were hired. Two observations should be made: (1) The IAM had 650-750 application forms immediately available on Feb- ruary 19 which it could have, without delay, sent to TWA hourly employees. Having been apprised and being aware that it might already have been "too late," it assumed a risk of jeopardizing job opportunities for some of the interested employees by waiting until early March in order to send out the forms to all 1,100 employees at once. (2) The IAM and the applicants themselves also took such a risk by de- laying submission of the completed forms until March 9 and thereafter, while being aware that the takeover date was definitely set for April 1. Furthermore, the employees and Boeing were specifically told in relation to these later applications that the IAM maintained its strong position in rejection of any lowering of wages and benefits from the TWA/IAM contract. In light of these and other factors, it cannot be accepted on its face that all of these late-filing applicants were seriously interested in taking employment with Boeing, while reserving their legal rights, at the lower rates which they knew Boeing was generally offering.36 The ultimate fact established is that on April 1 Boeing had 970 employees on its installation support services pay- roll, divided among 380 TWA incumbents, 138 Boeing em- ployees (transferred, recalled from layoff, former), 450 out- siders, and 2 employees unidentified as to source. K. Maintenance Utility Man This classification was not specified in Boeing's bid to NASA.37 As of April 1, 202 such employees had been hired by Boeing, of 281 indicated as "required" by Boeing Gen- erally they were assigned as assistants or helpers to the journeymen in particular crafts, and designated by Boeing to perform lower skill functions than those of the journey- men; they received substantially less than journeymen pay TWA, as the ISS predecessor, had only two levels of hourly 76 It is noted, for example, that TWA had about 1,100 hourly employees, that about 140 of these were retained or transferred within the TWA system, and that 944 filed applications with Boeing as of April I These figures leave no room for employees who chose not to file or who had already made other dispositions, e g , seeking employment elsewhere than at TWA or Boeing It is ajob description or classification which was included by reference in the Boeing-IAM nationwide contract In Duncan's letter to Boeing of December 30, supra, he concurred that this classification might be installed at KSC, and that the "Helper" classification could be "reactivated" under the Boeing-IAM contract Since Boeing had unilaterally undertaken to ap- ply this contract on April 1, it may reasonably be inferred that it did not act solely in reliance on Duncan's letter in utilizing the maintenance utility classification for the ISS project THE BOEING COMPANY employees-leadman and journeyman. It is apparent that Boeing undertook to hire a greater percentage of TWA incumbents in higher skill categories, and to hire a greater percentage of "other" applicants in the maintenance utility man and "Helper Learner" categories.38 It is clear that all labor costs were to be paid by NASA, at least in the first year of the ISS contract, and it must be assumed that NASA was aware and approved the extensive hiring of employees as maintenance utility men. Certain employees hired by Boeing in this classification testified they per- formed the same journeymen work for Boeing as they pre- viously did for TWA. Mainly as a result of grievances filed by the IAM and U.S. Department of Labor procedures invoked to obtain prevailing wage determinations, 130 such classifications were eventually changed by Boeing principally to reflect journeymen wage rates. As of June 27, 1973, only four maintenance utility men were left on Boeing's ISS payroll. The inference to be drawn from this evidence is that Boeing consciously used this classification to reduce the cost in its contract proposal to NASA. It is not alleged, nor can it be found, that violative discrimina- tion against the TWA incumbents was thereby involved.39 L. Request for Recognition On March 12, following NASA's award of the ISS con- tract to Boeing, IAM President Smith wrote to Boeing, re- questing (1) that Boeing recognize IAM in a unit of the ISS employees, (2) that Boeing refrain from unilateral changes in wages and conditions of employment in such unit, and (3) that Boeing adopt and observe the terms of the IAM- TWA contract. "If Boeing believes that particular terms of that agreement are inappropriate in their application to [the ISS unit], the IAMAW requests that Boeing identify those particular terms. . . . The IAMAW will negotiate with Boeing concerning those identified terms to the end that mutual agreement upon the deletion, modification, or continuance of those terms shall be sought." On March 19, Boeing replied in substance that (1) it recognized the IAM as representative of the ISS employ- ees, but as an accretion to the unit covered by the Boeing- IAM contract and not as a separate unit, (2) it would apply the Boeing-IAM contract to the ISS work at KSC, and (3) it would make no unilateral changes in the employment terms fixed by the Boeing-IAM contract In addition, Boeing stated that employment had not been offered TWA employees who "failed to timely complete and file employ- ment applications"; that on the basis of its current recruit- ment, at least 625 of about 1,000 ISS employees will be nonincumbent, i.e., that IAM will lack majority representa- tion of the ISS employees; and that Boeing does not regard itself as a "successor" to the bargaining relationship or to 38 In the initial phase of recruitment, Boeing made efforts to interview incumbents before other applicants It offered lead jobs carrying maximum pay to TWA applicants on the basis that those who applied early would get the higher paid positions By such means, it hoped to accelerate the filing of applications by other TWA employees 9 General Counsel's query whether a greater number of TWA employees would have been hired if initially Boeing had properly classified the work performed by maintenance utility men is entirely speculative and without sufficient substance to affect the issues 557 the contract which existed between TWA and the IAM. M. Posttakeover Relations On April 1, Boeing assumed the performance of the ISS operation at KSC, and applied to these employees all the terms of the existing Boeing-IAM (hardware) contract. Each of the ISS hourly employees reporting for work on and after April 1 received from Boeing a copy of the Boeing-IAM contract in the form prescribed by that agree- ment, viz: Employees in the bargaining unit to which you have been hired or transferred have chosen [the IAM] to be their bargaining agent in accordance with this law and that union now represents all employees in that group on matters dealing with your wages, hours, and work- ing conditions. [The IAM] is the Union that negotiat- ed with the Company the agreement that states these conditions in detail. You are now being given a copy of that agreement. You are urged to study the agree- ment carefully and thoroughly as soon as you can do so. If you do not understand any part of it, a union representative or a Company representative will be glad to be of help in this regard. Thereafter, while the IAM maintained its legal position on the applicability of the TWA-IAM contract and opposed the Boeing-IAM contract, the union security and checkoff provisions of the latter contract were implemented, dues were deducted from the employee's wages (and held in es- crow by Boeing subject to the pending law suit, supra), numerous grievances were filed by the IAM and settled pursuant to the Boeing-IAM contract, and all other terms of the contract were applied.40 The existing Boeing-IAM agreement was due to expire on October 1. Contract negotiations commenced between the IAM and Boeing in Seattle about August 3, 1971. I do not regard these negotiations or the results as controlling in any manner on the issues raised herein with respect to the appropriate unit or the applicability of any union contract during the times material. Nevertheless, the substance of this evidence is described to indicate the prevailing rela- tions between the parties. During the negotiations, Boeing repeatedly raised the question whether the IAM was bargaining for the ISS em- ployees. In each instance, the IAM's position was stated that the matter was in litigation where it was going to stay until resolved, that it could not be settled at the bargaining table, and that the negotiations should not be brought to an impasse on something they could not handle there. In a letter from Boeing to the IAM on October 22, inter aka the statement was made. 40 By letter to Boeing on April 8, the lAM set forth its position "incident to the day to day business of representing" the ISS employees affected by the Boeing-IAM contract, including matters relating to dues deductions, stewards zones, and seniority standing and listing of employees The letter was to officially notify Boeing that the actions are taken "without implying any recognition of the applicability of the Boeing Agreement to employees in the ISS operation and are without prejudice to any action taken or which may be taken relative to the extent of applicability (if any) of the IAM Boeing Agreement to this unit 558 DECISIONS OF NATIONAL LABOR RELATIONS BOARD We are under the impression that [the ISS employ- ees] are now represented in these negotiations but if it is your position that they are not, we stand ready to negotiate with any expanded union group that you consider necessary to accomplish such representation. The IAM made no reply to this assertion. On November 12, the parties entered into a nationwide agreement effec- tive from December 13, 1971, through October 1, 1974, with provision for yearly automatic renewal. The basic terms of the previous Boeing-IAM contract were contin- ued, including the identical descriptions of the units cov- ered. Certain changes were negotiated in wages and other terms which specifically affected the ISS employees. On a question raised by Boeing, the IAM indicated that the ISS employees would be permitted to vote on ratification of the completed contract, their ballots would be impounded, and, if these ballots affected the outcome, the matter would then be taken up with the IAM headquarters for a determi- nation as to disposition. Subsequently, the nationwide con- tract was ratified without the necessity of counting the im- pounded ballots of the ISS employees. N. Conclusions 1. The successorship question The Supreme Court's comprehensive decision on the successor doctrine in Burns 41 was handed down on May 15, 1972, long after the material events herein. In a reversal of the Board on one issue,42 the Court held that successor employers are "not bound by the substantive provisions of a collective bargaining contract negotiated by their prede- cessors but not agreed to or assumed by them." Other as- pects of the Court's opinion are discussed below It is thoroughly evident in the present record that, during the relevant period from the RFP through Boeing's take- over on April 1, 1971, the parties, in their meetings and communications with each other, assumed and maintained fixed positions, leaving no area of substance for bargain- ing. Boeing insisted that the Boeing-IAM (hardware) con- tract with the wages and benefits therein, legally applied to the ISS operation. Indeed, Boeing's proposal to NASA in- corporated such a position and committed Boeing to the labor costs predicated on the Boeing-IAM contract. For its part, the IAM was equally insistent upon the applicability of its contract with the incumbent, TWA, and it adamantly rejected consideration of any reduction in the existing wag- es and benefits therein. To a substantial degree, such a reduction was reflected in the Boeing contract with which the IAM was confronted. Thus, virtually from the outset, Boeing and the IAM were in stalemated contract positions, each depending on the correctness of its legal judgment at the time. Undoubtedly the IAM then relied on the succes- sorship doctrine extant in the Board's decision in Burns- since overruled in part. There is no allegation in the com- plaint (issued in May 1973) and, of course, it cannot now be held in any circumstances, that Boeing was required to adopt the TWA-IAM contract to which it did not agree. 41 N L R B v. Burns International Detective Agency, 406 U S 272 As pertinent here, the Supreme Court in Burns also de- scribed certain bargaining obligations under the Act where all the elements of successorship are present: Although a successor employer is ordinarily free to set initial terms on which it will hire the employees of a predecessor, there will be instances in which it is per- fectly clear that the new employer plans to retain all of the employees in the unit and in which it will be appropri- ate to have him initially consult with the employees' bar- gaining representative before he fixes terms In other sit- uations, however, it may not be clear until the succes- sor employer has hired his full complement of employees that he had a duty to bargain with a union, since it will not be evident until then that the bargain- ing representative represents a majority of the employ- ees in the unit as required by Section 9(a) of the Act. [Emphasis supplied.] 43 In the complaint and the briefs, there are basic issues raised (a) whether all the required elements are present to establish Boeing as a successor employer in an ISS bargain- ing unit ; (b) if so, whether it manifested a "plan to retain" within the meaning of the Burns case, by including in its contract proposal to NASA a plan to hire 85.6 percent of the incumbent ISS employees, or by other revelations of intent; and (c) whether it violated the Act by failing initial- ly to consult or bargain with the IAM before fixing the employment terms for the ISS employees. Upon careful consideration of the evidence and the case precedents, my conclusions are negative as to each of these questions. a. Accretion contention, appropriate unit If Respondent was legally justified in its overall position based on the theory of accretion, the appropriate unit would consist of all hourly employees employed by Boeing at KSC, combining the new ISS employees with those al- ready employed pursuant to Boeing's hardware contracts with NASA. The wage rates and employment conditions for the ISS employees would be fixed by the existing Boeing-IAM agreement, thereby negating the allegations herein of unilateral action by Boeing. For several reasons, I find the accretion principle does not apply in the circum- stances of this case. Respondent places heavy reliance on the literal description of the stipulated unit for which the IAM was certified in 1955 to represent the hardware (Bo- marc) employees then employed at KSC, i.e., "all mainte- nance and production employees in Brevard County." This is an insufficient basis to warrant an unlimited expansion of such a unit within the geographical area. It cannot be construed that the parties had any intention to cover such a group as the ISS employees in the existing Boeing-IAM contract; and it can scarcely be found here that the ISS employees desired their interests to be merged with those of the "hardware" employees. Nor is it material that each of the groups sought to be combined was historically repre- sented (albeit with the different employers) by the same 41 182 NLRB 348 (1970), enfd in part 441 F 2d 914 (C A 2, 1971) 47 406 U S at 294-295 THE BOEING COMPANY International union, the IAM-more especially in face of the IAM's opposition to such accretion. However, the fact that employment conditions of each group was governed by different collective-bargaining agreements militates against the accretion. The evidence indicates that the work of the hardware group in missile launch support services is separate and substantially different from the work of the ISS group engaged essentially in housekeeping functions; and there is no showing of product or employee inter- change. Further, it should be realistically contemplated that, as in the past, NASA may issue RFP's and subse- quently award the ISS as well as the hardware or missile projects separately to employers other than Boeing-thus maintaining a consistency in the distinctive identity of the two groups in question at KSC. Finally, it is a recognized consideration in Board and court cases that, absent com- pelling counterbalancing factors in the entire picture, "the accreted unit should not numerically overshadow the pre- existing unit," 44 and thereby deprive the larger group of employees of their free choice in selecting a bargaining rep- resentative. Here, Respondent had, at its risk, unilaterally proceeded on an erroneous assumption that, as of takeover on April 1, some 1,034 ISS employees could legally be ac- creted to the hardware unit of 287 employees. As it devel- oped, of the 1,034 employees hired, 632 were nonincum- bents, as to whom there is no showing or basis for pre- sumption in the evidence that they desired to be represented by the IAM or by any union 45 b. Continuity of the employing industry 46 Primarily it is plain that NASA awarded Boeing the same ISS operation as administered by the predecessor contractor, TWA, with only minor variations in terms of bargaining unit employees47 Inter aha, there was a contin- uation of the same relations with NASA, the customer, and of essentially the same services, plant, machinery , equip- ment, and job functions. No material difference exists in Boeing's method of performing the ISS contract . An indet- erminate number of supervisory incumbents was hired by Boeing ; there is no evidence that the duties of Boeing's supervisors are different from those who worked for TWA. Further arguments of Respondent are unsupported-that guards and nonguards were included in the TWA-IAM unit, and that the unit contained supervisors, essentially in 44 Spartans Industries, Inc v N L R B, 406 F 2d 1002 1005 (C A 5. 1969), enfg 169 NLRB 309 (1968) See also, e g, N L R B v Horn & Hardart Company, 439 F 2d 674, 682 (CA 2, 1971), NLRB v Food Employers Council, 399 F 2d 501 (C.A 9, 1968), International Paper Company, 171 NLRB 526, 527 (1968), Pullman Industries, Inc, 159 NLRB 580, 582 (1966), Worcester Stamped Metal Company, 146 NLRB 1683, 1686 (1964) 45 Unquestionably, the Boeing-IAM contract was imposed on the [AM against its will Any implications in Respondent's arguments that the Boeing contract unit is appropriate by virtue of a tacit or de facto acceptance by the IAM of such contract on and after April I. for the purposes herein, are rejected Relating to the period subsequent to April 1, there are no com- plaint allegations stemming from the application of the Boeing contract to the ISS employees, and nothing herein is intended to pass on any such questions. 46 A fundamental test to invoke the successor doctrine for purposes of the Act E g, N L R B v Zayre Corp, 424 F 2d 1159 (C A 5. 1970), Hecker Machine, Inc, 198 NLRB 1114 (1972) 47 Supra, fn 13 559 the ISS "lead" categories. The guard functions at KSC were performed by Wackenhut Corporation, as a subcon- tractor for TWA; and the guards were represented by a union other than the TAM. The evidence, as litigated, does not establish that there were supervisors in the TWA unit. The TWA-IAM contract embraces a nationwide unit of all transportation and other operations of TWA, apparently as required under the Railway Labor Act. After TWA re- ceived the award from NASA in 1964, the ISS project at KSC was brought within the coverage of the TWA-IAM contract. Significantly, the ISS project has been separately recognized and identified in the successive agreements, 8 and the ISS employees thereunder have had local union representation. I find it is no barrier to an appropriate unit of the ISS employees that it would constitute a diminution of the contract unit in effect under TWA 49 That the sys- temwide TWA-IAM contract was governed by the Rail- way Labor Act would not vitally impede the holding of Boeing's successorship-in view of the factors already not- ed, and since the Board's jurisdiction and application of the Act's provisions are clear. Respondent's attempted at- tack upon the legality of TWA's initial recognition of the TAM, in 1964, is not properly litigable herein, particularly by reason of Section 10(b).50 That the TAM had no Board certification for the ISS unit at TWA does not preclude the existence of a bona fide collective-bargaining relation- ship. 51 As alleged in the complaint, I find that the ISS hourly employees at KSC constitute an appropriate unit for the purposes of collective bargaining under the Act. Notwithstanding the foregoing positive factors, on the essential question of Boeing's successor status, it is a most important consideration whether or not a majority of its ISS unit employees at the takeover consisted of TWA in- cumbents represented by the IAM.52 Conceding that such a majority was not employed, the complaint attributes the failure of a majority to unlawful unilateral reduction of wages by Boeing. These allegations are considered infra. c. The "plan to retain " test of the Supreme Court A new employer is not obligated by the Act to hire any of the predecessor's employees unless it effectively assumes 48 E g, Solomon Johnsky d/b/a Avenue Meat Center, 184 NLRB 826 (1970), Ranch-Way, Inc, 183 NLRB 1168 (1970), 203 NLRB 911 (1973) (on remand) 49Eg, Solomon Johnsky, supra, Howard Johnson Company, 198 NLRB 763 (1972), Bachrodt Chevrolet Co, 186 NLRB 1035 (1970), and 205 NLRB 784 (1973) (on remand), Dorrance J Benzchawel and Terrence D Swingen. Copartners d/b/a Parkwood iGA, 201 NLRB 905 (1973), Eklund's Sweden House Inn, Inc, 203 NLRB 413 (1973) 50 Howard Johnson Company, 198 NLRB 763, fn 3, Barrington Plaza and Tra1niew. Inc, 185 NLRB 962 (1970) 5 E g, Howard Johnson Company, id, Eklund's Sweden House inn, Inc, supra 52 Burns, supra. at fn 4, N L R B v Interstate 65 Corp d/b/a Continental Inn, 453 F 2d 269, 273 (C A 6 1971), Spruce Up Corporation, 194 NLRB 841, 847 (1972), Dorrance J Benzchawel and Terrence D Swingen. Copart- ners d/b/a Parkwood IGA, 201 NLRB 905 (1973), Bachrodt Chevrolet Co. 205 NLRB 784 (1973). Where successorship was denied in the absence of such a majority, see, e g, Tallakson Ford, Inc, 171 NLRB 503 (1968), Thom- as Cadillac. Inc, 170 NLRB 884, 885 (1968), affd 414 F 2d 1135 (C A D C. 1969), cert denied 396 U S 889 (1969) But cf, Lincoln Private Police, Inc, etc 189 NLRB 717, 720 (1971) 560 DECISIONS OF NATIONAL LABOR RELATIONS BOARD such an obligation or is discriminatorily motivated in its refusal to employ such employees.53 And a successor em- ployer is ordinarily free to set initial terms under which it will hire the predecessor's employees. However, the Gener- al Counsel particularly relies on the caveat in Burns that . , . there will be instances in which it is perfectly clear that the new employer plans to retain all of the employees in the unit and in which it will be appropri- ate to have him initially consult with the employees' bargaining representative before he fixes terms... . Although the derivation of this statement in Burns is not clear, such a dictum of the Supreme Court, in the context, must be accorded full respect. Nevertheless, it cannot be understood that the Supreme Court in this manner is de- parting from the central collective-bargaining concept in the Act based on the majority principle.54 The "plan to retain" language in Burns must contemplate that the union involved represents a majority of the unit employees of the successor employer before a refusal to bargain violation may be found on this ground. Thus, to be "perfectly clear," a successor employer's "plan to retain" all or a substantial majority 55 of the employees of the predecessor must rea- sonably mean a commitment to hire or an actual advance hiring of such employees to be effective at the takeover of operations.56 For purposes of the Act, such a majority is thereby shown at the time of the commitment. However, as the Court further stated, in other situations it may not be clear whether the bargaining representative represents a majority of the employees until the successor employer has actually hired its complement of employees, and only at such time does the bargaining obligation mature if a major- ity is established.57 Where the predecessor's employees constitute a majority of the unit "both before and after the transfer of ownership," 58 the earlier revealed "plan to re- tain" is reinforced and made manifestly clear. In my opin- ion, it is some indication of the lack of perfect clarity in the 53 Golden State Bottling Co v NLRB , 414 U S 168 (1973) at In 6, citing Burns, 406 U S at 280, In 5 54 See International Ladies' Garment Workers' Union, AFL-CIO [Bern- hard-Altman Texas Corp ] v N L R B, 366 U S 731, 737 (1961) 55 E g , Alliance Industries, Inc, 198 NLRB 646 S-H Food Service Inc , 199 NLRB 95 (1972), i e, less than literally all 56 E g., Howard Johnson Company, 198 NLRB 763 (1972), Bachrodt Chev- rolet Co, 205 NLRB 784 (1973), No H Denham and Gerladine A Denham, d/b/a The Denham Company, 206 NLRB 659 (1973) No 75 And Cf Ranch-Way, Inc, 203 NLRB 911 (1973), in which, during a hiatus before takeover, the new employer interviewed incumbent employees, and others, for the jobs to be filled before it decided whom it would hire, only those who accepted the offered wage rates were hired In the latter case, the alleged violation based on the contention of a "plan to retain" before fixing terms was rejected, in the former cases, the violation was found 57 The Supreme Court distinguished the facts in the Burns case from ap- plication of the "plan to retain" standard After Burns, as a successor, took over operations on July 1, the unit employees received a lower rate than was paid by the predecessor During June, it had completed its hiring in the unit with a majority of the predecessor's employees The Court held there was no "evidence that Burns ever unilaterally changed the terms and conditions of employment it had offered to potential employees in June after its obliga- tion to bargain with the union became apparent" 406 U S at 295 58 E g, Good Foods Manufacturing & Processing Corporation, etc, 200 NLRB 623 (1973), Bachrodt Chevrolet Co, 205 NLRB 784 (1973) And see Ranch-Way, Inc, supra, In 56, where the obligation to bargain attached only after the successor began operations initial "plan to retain" where, absent discriminatory cause, there is in fact no majority after the takeover or when hir- ing is effectively completed. Various other considerations operate to defeat the Gen- eral Counsel's major contention that Boeing invoked such a "perfectly clear" plan to retain a substantial majority of the TWA incumbents, and that it violated the Act by fixing the wages and terms of employment in the ISS unit without initially consulting with the IAM. In its competitive pro- posal to NASA on August 19, 1970, Boeing incorporated a primary staffing plan to hire 85.6 percent of the ISS incum- bents at specified wage rates and labor costs substantially lower than the existing terms for the employees under TWA.59 It is a realistic fact that the plan to hire and the lower terms were simultaneously and inextricably linked in Boeing's proposal. Boeing was free to hire or not hire the incumbents and to require applications 60 Even assuming a basis for accurate projection in Boeing's staffing plan, it could not be regarded that the mere submission of its pro- posal to NASA constituted proscribed conduct of unilater- ally changing terms of employment. Despite Boeing's de- tailed reasons in the proposal to support this staffing plan, such an attempted prediction of ability to hire union-repre- sented skilled employees at sharply reduced earnings was inherently dubious. An alternative plan relying on re- searched nonincumbent sources was included in the pro- posal as an assurance that full staffing could be accom- plished within the scheduled time. In the awareness of the IAM and the employees, Boeing's intentions to hire the incumbents were tied to the lower rates and benefits of the Boeing-IAM contract. And they knew that employment applications were required. I do not find that, in the pro- posal to NASA or in any other form, was an employment commitment made by Boeing to the incumbent employees. While there is an indicated disposition of Boeing to have initially preferred TWA incumbents on a selective basis in the light of available classification vacancies, applications from others, and time targets, it cannot be held that Boeing was thereby obligated to hire any incumbents individually or as a class And there was certainly not, in my view, a "perfectly clear" plan to retain a majority of the incum- bents within the intendment of Burns. Accordingly, Gener- al Counsel has not sustained the allegation that Boeing had unilaterally changed employment terms in violation of Sec- tion 8(a)(5).6t 59 As earlier noted, the 85 6 figure pertained to all categories in the ISS pr%ect, and was not related specifically to the unit employees E g, Tn State Maintenance Corp v N L R B, 408 F 2d 171, 173 (C A D C 1968) 61 Respondent argues the "impracticality" of requiring bidders on com- petitively bid contracts to bargain concerning unilateral changes submitted in the bid As to Federal Government contracts, perhaps the problem has been largely alleviated in the 1972 amendment to the Service Contract Act, supra. so far as wage reductions are concerned Assuming the Board's power to do so, there appears no valid reason to exempt such employers from the full bargaining requirements of the Act The facts in each case would be determinative as to when the bargaining obligation matures See Emerald Maintenance, Inc, 188 NLRB 876 (1971), cited and quoted in Burns, 406 U S at In 13 And cf, Atlantic Technical Services Corporation, 202 NLRB 169 (1973) THE BOEING COMPANY 2. The alleged "strike" The complaint alleges that, from December 5, 1970, to February 19, 1971, a "majority" of the TWA employees engaged in a "strike" against Boeing by concertedly with- holding their employment applications. On the theory that they were unfair labor practices strikers or, alternatively, economic strikers, the General Counsel seeks reinstatement and backpay for all incumbents who were not hired by Boeing, presumably omitting only those who were retained by TWA. As found, the alleged prior unfair labor practice by Boeing of engaging in unilateral action has not been sustained. There is no testimony from employees themselves that any of them withheld their applications, concertedly or otherwise, as a means of putting economic pressure on Boeing. During or following the supposed period of the strike, there was no express or implied communication to Boeing of the existence of such a strike from any employee group acting in concert, or from Local 773, or the Interna- tional IAM. There is no identification of any individual employees, or recognizable group, to constitute the alleged "majority" of incumbents who were purportedly on strike. And there is no evidence to support the General Counsel's allegation that an unconditional request was made to Boeing on February 19 for reinstatement of TWA employ- ees who had not theretofore filed applications. The basis of General Counsel's position is far from clear. It is apparently rested on the letters, communications, and notices from Lcoal 773 to its membership and from the evidence that a large number of applications were submit- ted later in March. The detailed facts need not be reiterat- ed. From the outset, it was the mandatory policy of the International, with its agents on the scene at KSC, to have the applications filed; and it cannot be inferred that the officers of Local 773 deliberately sought to flout this poli- cy. One item largely relied on by the General Counsel is the letter of December 22 to employees from D'Andrea, Local 773's president. The statement therein that the Inter- national had "advised" Local 773 that applications should not be turned in was an admitted error, which the Interna- tional quickly undertook to rectify It is noted that, in the same letter, instructions are given to "those people who feel they must fill out an application." This, in my opmon, is hardly a call for concerted action against Boeing. There was no opposition from Local 773 to the "Declaration of Interest" questionnaire distributed to all TWA hourly em- ployees on December 1. Only about 500 of the responders indicated by December 18 that they desired employment with Boeing. Notwithstanding the alleged call for "strike" action by Local 773, it appears that 435 incumbents filed applications by February 19, the date of the asserted "re- quest for reinstatement." The IAM itself forwarded appli- cations of incumbents on December 22 and thereafter, with a reservation based on claimed rights under the TWA- IAM contract . Some references are made in minutes of meetings and notices to members of only a "preference" by 561 Local 773 that applications not be filled out. Indeed, in early January, the members were advised in a positive vein to turn in their applications to officers of the Local. Re- peated emphasis was placed in communications to the members in January that "no company" had been awarded the ISS contract "now held by TWA," and that no award could be made before final decision on the protests before the Comptroller General. Additionally, during the same period of the alleged "strike," the TWA employees were often reminded by TWA, engaged in the recruitment for Boeing, that its protests were being pursued and that it strongly believed its claims to be valid. The employees were also aware of the lawsuits pending and the efforts to seek Congressional assistance. In this whole context of evi- dence, the particular reasons of any employees for not fil- ing applications for employment with Boeing can only be speculated. The outstanding circumstances were that Boeing was offering substantially lower wage rates and benefits,62 and that the TWA employees were aware of the IAM's vigorous stand in support of the binding effect of TWA-IAM contract on Boeing-an erroneous assumption as it later turned out in Burns. It is difficult to conceive in terms of the law the attainment of superior rights by poten- tial applicants for concertedly refusing to seek employment with an employer who is offering unacceptable wages and conditions. In certain limited circumstances, applicants for employ- ment are deemed employees under the Act, for example as protection against discrimination in hiring by the employ- er.63 In the present context, such a concept would be ex- ceedingly strained. Even if it be assumed that certain of the incumbents engaged in an economically motivated con- certed activity by withholding their applications, upon the cessation of such action, they would not be entitled to dis- place employees hired during the period of the concerted activity. Nor, in my opinion, would they be entitled to pref- erence in hiring as against other existing applicants. It is not alleged or found that Boeing deliberately refrained from hiring a majority of the ISS incumbents to avoid suc- cessorship or for discriminatory reasons. In sum, I conclude there is no merit to the allegations that TWA employees engaged in a strike or protected con- certed activity against Boeing, or that they were unlawfully refused "reinstatement" on or after February 19. While, as already shown, there is no complaint allegation of a gener- al refusal to bargain, it may finally be noted that the IAM was not properly the majority representative in the ISS unit on, before, or after March 12, when it presented Boeing with a formal request for recognition in such unit. I per- ceive nothing else under the complaint to warrant remedial action. Accordingly, it is hereby recommended that the com- plaint be dismissed in its entirety. 62 In his deposition, D'Andrea indicated that, by withholding their appli- cations, the "people" were showing "that they didn't want to work for the wages Boeing was offering," and felt that the TWA-IAM "contract that the 6 1 had should be upheld " Phelps Dodge Corp v N L R B, 313 U S 177