FMC Corp.

12 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Material Handling Equipment Division of FMC Cor- poration and International Union of Electrical, Ra- dio and Machine Workers, AFL-CIO, Petitioner. Case 6-RC-6772 MARCH 20, 1975 DECISION AND CERTIFICATION OF RESULTS OF ELECTION By MEMBERS FANNING, KENNEDY, AND PENELLO Pursuant to a Stipulation of Certification Upon Con- sent Election executed by the parties, and election 'by secret ballot as conducted on May 8, 1974, under the direction and supervision of the Regional Director for Region 6, among employees in the appropriate unit. At the conclusion of the election, the parties were fur- nished with a tally of ballots which showed that of approximately 630 eligible voters 614 ballots were cast, of which 254 were for Petitioner, 50 were for the Inter- venor, 308 were against participating labor organiza- tions, and 2 were challenged. The challenged ballots are not sufficient to affect the results of the election. There- after, the Petitioner filed timely objections to conduct affecting the results of the election. On August 29, 1974, the Regional Director ordered that a hearing be held with respect to Petitioner's objec- tions. The Regional Director further ordered that the Hearing Officer designated for the purpose of conduct- ing the hearing should prepare and cause to be served on the parties a report containing resolutions of the credibility of witnesses, findings of fact, and recom-, mendations to the Board as to the disposition of said issues raised with respect to the Petitioner's objections. Pursuant to the Board's order, a hearing was held on September 11 and 12, 1974, before Hearing Officer Donald J. Burns. All parties to the proceeding ap- peared and were afforded full opportunity to be heard, to examine and cross-examine witnesses, to adduce evi- dence bearing upon the issues, and to file briefs with the Hearing Officer at the close of the hearing. On November 15, 1974, the Hearing Officer issued and served on the parties his Report on Objections to Election in which he recommended that Objection 2 be sustained and that all other objections be overruled. Having found merit in Objection 2, the Hearing Officer recommended that the election be set aside and that a second election be directed. Thereafter, the Employer filed timely exceptions with a supporting brief. The Petitioner filed a brief in support of the Hearing Of- ficer's recommendation on Petitioner's Objection 2 or, in the alternative, filed exceptions with a supporting brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the Na- tional Labor Relations Board has delegated its au- thority in this proceeding to a three-member panel; Upon the entire record in this case, the Board finds: 1. The Employer is engaged in commerce within the meaning of the Act and it will effectuate the purposes of the Act to assert jurisdiction herein. 2. The Petitioner is a labor organization claiming to represent certain employees of the Employer. 3. A.question affecting commerce exists concerning the representation of employees of the Employer within the meaning of Section 9(c)(1) and Section 2(6) and (7) of the Act. 4. The parties stipulated and we find that the follow- ing employees constitute an appropriate unit for the purposes of collective bargaining within the meaning of Section 9(b) of the Act: All production and maintenance employees, in- cluding group leaders, -plant clerical employees, experimental machinists at the Material Handling Equipment Division of FMC Corporation's Blairsville, Pennsylvania, and Homer City, Penn- sylvania, plants; excluding all other employees and guards, professional employees and supervisors as defined in the Act. 5. The Board has considered the record in this case including the Hearing Officer's Report on Objections to Election, the exceptions of the parties, and support- ing briefs, and hereby adopts the Hearing Officer's findings, conclusions, and recommendations except as modified below. , The Hearing Officer found that the granting of a wage increase prior to the election was designed to influence employees to vote against union representa- tion and therefore constituted grounds for setting aside the election. We disagree. It is well settled that the granting of benefits during the critical preelection period is not per se ground for setting aside an election.' The crucial determination is whether the benefits were conferred for the purpose of influencing the employees in their choice of bargaining representatives and were of a type reasonably cal- culated to have that effect.2 When economic circumstances dictate a revision in wage structure and a representation proceeding - is pending, an employer's legal duty is to decide whether or not to grant improvements in wages and benefits in the same manner as it would absent the presence of a I Drug Fair Community Drug Co., Inc., 162 NLRB 843, 854 (1967); Performance Measurements Co., Inc., 148 NLRB 1657, 1658 (1964), The Baltimore Catering Company, 148 NLRB 970 973 (1964), Glosser Bros, Inc., 120 NLRB 965, 966 (1958). 2 See NL.R.B v. Exchange Parts Company, 375 U S 405 (1964); Connor Trading Co., Inc., 188 NLRB 263, 264 (1971); Airpax Electronics, Inc., 172 NLRB 126, 127 (1968), The Baltimore Catering Company, 148 NLRB 970, 973 (1964). 217 NLRB No. 16 MATERIAL HANDLING EQUIPMENT DIV. OF FMC CORP. union? If the employer would have granted the bene- fits because of economic circumstances unrelated to union organization, the grant of those benefits will not violate the Act. On the other hand, if the employer's course is altered by virtue of the union's presence, then the employer has violated the Act, and this is true whether he confers benefits because of the union or withholds them because of the union.' In the instant case, the employer excepted to the Hearing Officer's conclusion that the April 15, 1974, wage increase was unlawful, contending that it was granted in accordance with a decision made prior to its knowledge of union organizational activity. In November 1973, consistent with past company policy of granting general wage increases in October or November of each year, the Employer granted a 5.5- percent wage increase to both its hourly and salaried employees. This increase was restricted to a 5.5-percent maximum in conformance with the Cost of Living Council guidelines then in effect.' On February 15, the Employer announced' that the Company would review its wages and salaries to keep abreast of chang- ing economic conditions if Congress should accept the President's recommendation that wage controls be dis- continued after April 30, 1974.' On March 6, 1974, it wrote to the Cost of Living Council expressing its desire to adjust wages and salaries due to the current economic situation. On approximately March 26 or 27, the Employer received a notification that the industry was decontrolled! The Employer thereupon, on April 1, posted a notice on employee bulletin boards indicat- ing.that effective April 15 all hourly employees would receive a 10-cent-per-hour adjustment in their base hourly rate.' The Hearing Officer found that the wage increase was granted to influence employees to vote against union representation. Noting that the Employer never 3 Diamond Motors, 212 NLRB 820 (1974). 4 McCormick Longmeadow Stone Co, Inc., 158 NLRB 1237, 1242 (1966) 5 On November 1973, Phases III and IV of the Economic Controls Pro- gram (Economic Stabilization Act of 1970, 12 U S C Sec 1904 (1970) was in effect. Executive Order 11695, 38 Fed. Reg. 1473 (February 12, 1973) Under Phase III and IV, wage controls administered by the Cost of Living Council was shifted from "mandatory" to "voluntary" for all industries other than food processing and retailing, construction, and health industries. The guidelines limited increases to those not inconsistent with the 5.5- percent wage increase (plus 0 6 percent for fringe benefits) standard of Phase II It was no longer necessary to obtain Cost of Living Council approval when an increase in excess of the guidelines was justified 6 The Employer placed a notice in all pay envelopes The Hearing Officer erroneously determined that the notice was posted on the bulletin board 7 In early February 1974, President Nixon announced he would recom- mend to Congress that wage and price controls be discontinued after April 30, 1974 8 By letter dated March 14, 1974, the Cost of Living Council responded to the Employer's March 6 inquiry by requesting that the Company com- plete certain forms before its submission would be officially processed. Before the Employer completed the forms sent by the Cost of Living Coun- cil, however, the industry was decontrolled on March 21. 9 This adjustment was first reflected in the employees' April 22 paycheck 13 before granted such an inflationary wage adjustment, he found it implausible that the Employer's March 6 request was unrelated to the union organizational drive. Accordingly, _ he made the inference that by March 6 the Employer had learned of the organiza- tional activity. We disagree with this conclusion. No evidence was submitted indicating that there was organizational ac- tivity as of February 15. Although the record indicates that there was organizational activity as of March 6, there is no evidence that the Employer was aware of such activity. In fact, the instant petition was not filed until March 12. Absent evidence establishing the relationship be- tween Respondent's knowledge of organizational activ- ity and its February 15 announcement,10 we view the April wage increase as the logical culmination of a pattern of events which began February 15 and which was followed through on March 6. The record does not indicate that such pattern was altered by the presence of organizational activity." In such circumstances we conclude that the wage increase was not designed to interfere with the election. Therefore, we shall overrule Petitioner's Objection 2. Accordingly, as we have overruled the objection and as the tally of ballots shows that Petitioner has not received a majority of the valid votes cast, we shall certify the results of the election. CERTIFICATION OF RESULTS OF ELECTION It is hereby certified that a majority of the valid ballots have not been cast for International Union of Electrical, Radio and Machine Workers, AFL-CIO, and that said labor organization is not the exclusive representative of the employees in the unit found ap- propriate within the meaning of Section 9(a) of the National Labor Relations Act, as amended. 10 Cf. Revco Drug Centers, 188 NLRB 73, 76 ( 1971), Preston Products Company, Inc, 158 NLRB 322, 345 (1966), enfd 392 F 2d 801 (C.A D C., 1967) 11 The Respondent introduced persuasive evidence that the wage increase was granted because of the extraordinary rise in the inflationary rate during late 1973 and early 1974. Employer's manager, Dr George Sommer, testi- fied that, never having experienced such tension , interest, and concern regarding inflation , the Employer had been monitoring the CPI , the Cost of Living Index, since prior to the November 1973 wage increase Continued concern over the economic situation , as well as the Company's uncertainty concerning the ultimate fate of economic controls, prompted the March 6 request to the Cost of Living Council He testified further that in deciding upon the April 15, 1974, wage increase , the Company took into considera- tion area wage patterns and concluded that an inflationary wage adjustment was appropriate Sommers testified that it was in this context-in an effort to remain competitive while confronted with the extraordinary inflationary rate-that the decision to grant a 10-cent-per -hour wage increase was made