Ladish Co.

354 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Ladish Co. and District No. 10, and Its Local Lodge 1862, International Association of Machinists and Aerospace Workers, AFL-CIO. Case 30-CA-2800 July 22, 1975 DECISION AND ORDER BY MEMBERS JENKINS, KENNEDY, AND PENELLO Upon a charge filed on July 25, 1974,' by District No. 10, and its Local Lodge 1862, International As- sociation of Machinists and Aerospace Workers, AFL-CIO, herein called the Union , which was amended on July 31, the General Counsel of the Na- tional Labor Relations Board, by the Regional Di- rector for Region 30, issued a complaint on Septem- ber 27, alleging that Ladish Co., herein called the Respondent, has unilaterally raised vending machine prices and refused to bargain with the Union with respect thereto. Copies of the charge, complaint, and notice of hearing were duly served on the parties to this proceeding. On October 5, Respondent filed its answer admitting various allegations of the com- plaint but denying that its conduct violated Section 8(a)(5) and (1) of the Act. On November 8, Respondent, the Union, and the General Counsel entered into a stipulation to trans- fer the above-entitled proceeding to the Board, by which the parties waived a hearing before an Admin- istrative Law Judge and the issuance of an Adminis- trative Law Judge's Decision and recommended Or- der and agreed to submit the case to the Board for findings of fact, conclusions of law, and an order, based upon a record consisting of the stipulation of facts and the exhibits attached thereto. On November 15, the Board, by its Associate Ex- ecutive Secretary, approved the stipulation of the parties and ordered the case transferred to the Board, granting permission for the filing of briefs. Thereaf- ter, the Respondent and the General Counsel filed briefs. 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 basis of the stipulation, the briefs, and the entire record in this proceeding, the Board makes the following: FINDINGS OF FACT 1. JURISDICTION The Respondent is a Wisconsin corporation with its principal offices and facilities located in Cudahy, Wisconsin, where it is engaged in the manufacture of forgings and fittings. During the past calendar year, a representative period, Respondent shipped and sold goods valued in excess of $50,000 directly from sup- pliers located outside the State of Wisconsin. The parties stipulated, and we find, that Respon- dent is an employer within the meaning of Section 2(2) of the Act, and is, and at all material times here- in has been, engaged in commerce and in operations affecting commerce within the meaning of Section 2(6) and (7) of the Act. Accordingly, we find that it will effectuate the policies of the Act to assert juris- diction herein. II. THE LABOR ORGANIZATION INVOLVED The parties stipulated, and we find, that the Union is a labor organization within the meaning of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. The Issue The issue presented is whether the Respondent's vending machine prices are a mandatory subject of bargaining, so that Respondent's admitted unilateral raising of food prices in its vending machines and refusal to bargain with respect to the formulation and implementation of vending machine prices vio- lated Section 8(a)(5) and (1) of the Act. B. Background; Contractual Relations Respondent has been in existence since 1905. Since about 1946 to the present time, Respondent has recognized and bargained with the Union as the collective-bargaining representative of about 1,800 of its 4,800 employees at its main plant in Cudahy, Wis- consin, in an appropriate unit, and has entered into a series of collective-bargaining agreements . The most recent agreement is a 3-year contract which became effective on February 17, 1973. Respondent has con- tractual relations with six other unions representing eight other bargaining units. C. Eating Facilities All dates hereinafter are in 1974 unless otherwise stated . The Respondent has since 1972 provided for its 219 NLRB No. 60 LADISH CO. employees 29 "vendette" areas located throughout its plant and office facilities at Cudahy , Wisconsin. A "vendette" is a room in which several types of vend- ing machines are located and which contains tables and chairs. There are other vending machines at vari- ous places throughout the plant . The total number of vending machines is 197 . The machines dispense hot foods, sandwiches, beverages, pastry, candy, and cig- arettes. The Respondent provides no other eating fa- cilities for bargaining unit employees except for the aforementioned "vendette" areas. The vending machines are owned and operated by two companies pursuant to lease agreements with the Respondent. Canteen Company of America owns and maintains about 60 to 65 percent of the ma- chines. The remainder of the machines are owned and operated by Automatique . Under the lease agreements, Respondent provides the space in which these machines are located and maintains the ven- dette areas. Its craftsmen provide access to electricity and water needed to operate the machines . Respon- dent receives a commission on the items sold in the vending machines to cover the use of floor space, overhead, and operational costs. The prices for items sold in the vending machines are determined by the outside contractors . However, Respondent has ultimate control over the prices by its ability under its lease agreements to completely replace a vendor. The majority of Respondent's employees and all of the employees in the Union's bargaining unit receive a 15-minute paid lunch period . About 70 percent of the employees in the Union 's bargaining unit pur- chase their lunches from the vending machines, and 90 percent of the employees in the unit utilize the vending machines for their beverages. Under the following rule in the employees' hand- book put out by the Respondent, employees who re- ceive a 15-minute paid lunch period are not permit- ted to leave the plant for lunch: WHEN DO WE EAT AND WHERE Food service is available at the "servinettes" (automatic vending machines) located through- out the plant and office areas. A variety of hot and cold food is available at reasonable cost. You may, of course, bring your own lunch. Lunch periods vary by departments and unions, so consult your supervisor as to the time and length of your lunch period. Employees who re- ceive a 15-minute paid lunch period are not permit- ted to leave the plant. [Emphasis supplied.] 355 D. The Union's Requests to Negotiate Increases in Vending Machine Prices On October 14, 1970, after being informed by the Respondent that vending machine price increases might be required, the Union filed a grievance ob- jecting to any increased prices . In its grievance, the Union requested that Respondent show just cause and proof that price increases were necessary or, in the alternative , that Respondent negotiate with an- other company. This grievance was held in abeyance since prices remained the same. On June 2, 1972, the Union was again told by the Respondent that vending machine prices were going to increase. The Union informed the Respondent that it was reactivating the 1970 grievance and that it was protesting the announced unilateral price in- creases. Nevertheless, prices were increased. In its June 29, 1972, answer to the grievance, Respondent stated that it was not responsible for the increased prices and that the matter was not considered a bar- gainable item. In April and May, vending machine prices on all items except beverages were increased without nego- tiation with the Union. Thereafter, on May 28, the Union reinstituted its 1972 grievance and asked Re- spondent to negotiate over the price increases. On June 20, Respondent replied that it did not believe the increase in vending machine prices was a manda- tory subject of collective bargaining, and therefore refused to negotiate concerning the subject. E. Contentions of the Parties The General Counsel contends that the vending machine prices are a condition of employment so that a change in the prices is a mandatory subject of bargaining and Respondent's conceded failure to bargain with the Union before making such increases violates Section 8(a)(5) and (1) of the Act. Respon- dent asserts that vending machine prices are not con- ditions of employment where the prices are set by independent suppliers and alternative sources of food and beverages are available. F. Conclusion Section 8(d) in defining the duty to bargain, pro- vides, inter alia, that to bargain collectively is the performance of the mutual obligation of the employer and the rep- resentative of the employees to meet at reason- able times and confer in good faith with respect to wages, hours, and other terms and conditions of employment . . . . 356 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Coupled with this duty is the correlative obligation of an employer not to unilaterally change employment conditions without first giving the employees' collec- tive-bargaining representative prior notice and ade- quate opportunity to negotiate, in the absence of cir- cumstances excusing or justifying such action .2 Respondent concededly refused to bargain with the Union concerning the vending machine prices charged its employees for food. The Respondent de- fends this refusal on the ground that vending ma- chine prices do not fall within the scope of "terms and conditions of employment" and hence are not a mandatory subject upon which it is required to nego- tiate. Any determination of what is or is not a subject for mandatory bargaining must start with the prima- ry purpose of the Act: "to promote the peaceful set- tlement of industrial disputes by subjecting labor- management controversies to the mediatory influ- ence of negotiations." 3 While "the Act does not encourage a party to engage in fruitless marathon discussions . . . ," 4 it at least requires him to submit a dispute to the salutary process of negotiations. In the instant case, Respondent's unilateral exclusion of the controversy from the bargaining process has demonstrated the basis for the statutory scheme which Congress created; already there have been three rebuffed requests for negotiations. The only question, therefore, is whether the dispute shall be resolved within the framework of collective bargain- ing established by national policy or left outside the framework, to fester without negotiation and perhaps break out in economic warfare.' Cognizant of the industrial strife brought on by refusals to confer and negotiate, Congress used the phrase "terms and conditions of employment" in a broad sense. Thus, the original Wagner Act did not contain a section like the present Section 8(d) pur- porting to define collective bargaining. It did, howev- er, state in Section 9(a) that a majority union shall be the exclusive representative "for the purposes of col- lective bargaining in respect to rates of pay, wages, hours of employment, or other conditions of employ- ment." 6 When the Taft-Hartley Act was being deli- berated, the House of Representatives added Section 2 N.L.R.B. v C & C Plywood Corporation, 385 U.S. 421, 425 (1967); N.L.R.B. v Benne Katz, d/b/a Williamsburg Steel Products Co., 369 U.S. 736, 743 (1962) 3 Fibreboard Paper Products Corp. v. N.L.R.B, 379 U.S. 203 , 211 (1964), see also Secs. I and 101 of the Act (61 Stat. 136, 29 U.S C. if 141, 151). 4 N.L.R B v. American National Insurance Company, 343 U.S. 395, 404 (1952). 5 See P. Ross, "The Government as a Source of Union Power : The Role of Public Policy in Collective Bargaining," pp. 155- 159, 262-265 (Brown University Press, 1965) 6 1I Leg. Hist. 1669 (1948). 8(d) and sought to specifically enumerate various subjects to which collective bargaining would be lim- ited.7 This version of Section 8(d) was opposed on the ground, inter alia, that what is a proper subject for collective bargaining "should not be strait jacketed by legislative enactment." I This reasoning apparent- ly was persuasive in the Senate since it successfully resisted the House version and won acceptance of the present 8(d) language? The Board and courts have found a wide variety of subjects to fall within the scope of compulsory bar- gaining. Among the "myriad matters arising from the employer-employee relationship" 10 are such "condi- tions of employment" as inplant feeding," involved herein, union security,12 employee seniority," plant locations,14 subcontracting," employee housing," price discount practices," employee loan repayment procedures," methods of paying employees,19 and plant or environmental matters relating to health, sanitation, and safety.20 However, the Board has nev- er taken the position that Section 8(d) requires bar- gaining about everything that might possibly bear on the employment relationship?' In this vein, the Board has recognized that an employer who effec- tively controls the prices charged his employees at 7 1 Leg. Hist. 163-167, 313-314 ( 1948). 6 1 Leg. Hist. 362 (1948). 911 Leg. Hist. 1541, 1668, 1669 (1948) 10 Inland Steel Company v. N.GR.B, 170 F.2d 247 (C.A. 7), cert. denied 336 U.S. 960 (1948). 11 Inland Steel Co., supra at 251. 12 N L R.B v. Andrew Jergens Co., 175 F.2d 130, 133 (C.A. 9, 1949). I3 N.L.R.B. v Century Cement Mfg Co., Inc, 208 F.2d 84, 35 (C.A. 2, 1953). 14 Industrial Fabricating Inc., et al , 119 NLRB 162, 168, 189-190 (1957), enfd. sub nom. N.L R B v. Frank Mackneish, et al, 272 F.2d 184 (C.A. 6, 1959). 13 Fibreboard, supra. 6 N.L.R.B. v Lehigh Portland Cement Company, 205 F.2d 821, 823 (C.A. 4, 1953); American Smelting and Refining Company, 167 NLRB 204 (1967). 17 N L.R.B. v. Central Illinois Public Service Company, 324 F.2d 916 (C.A. 7, 1963). is Porto Rico Container Corporation, 89 NLRB 1570 ( 1950). 19 Weyerhaeuser Timber Company, 87 NLRB 672, 686 (1949). 20 N L R B. v Washington Aluminum Company, 370 U.S. 9 (1962)(plant heat); Preston Products Company, Inc, 158 NLRB 322, 344-345 (1966), re- manded on other grounds 373 F.2d 671 (C.A.D.C., 1967) (sanitary condi- tions and towel supply in toilets); NL.R.B. v. Gulf Power Company, 384 F.2d 822 (C.A. 5, 1967)(safety rules) 21 See, for example, N.L.R B. v. Wooster Division of Borg-Warner Corp., 356 U S. 342, 349-350 (1958xmsistence on clauses requiring prestrike em- ployee vote on company's last offer and substitution of union's uncertified local as bargaining representative); Detroit Resilient Floor Decorators Local Union No. 2265, of the United Brotherhood of Carpenters and Joiners of A mer- ica, AFL-CIO (Mill Floor Covering, Inc.), 136 NLRB 769, 761 (1962), affd. 317 F.2d 269, 270 (C.A. 6, 1963)(contributions to an industry promotion fund); District 50, United Mine Workers, Local 13942 [Allied Chemical Cor- poration] v. N L.R.B., 358 F 2d 234 (C.A. 4, 1966) (decision to subcontract which had no adverse impact on bargaining unit employees ); Metropolitan District Council of Philadelphia and Vicinity of the United Brotherhood of Carpenters and Joiners of America, AFL-CIO (McCloskey & Company), 137 NLRB 1583, 1585 (1962) (provision establishing an industrial advancement program to carry out industrywide activities, e.g., accident prevention and research), Douds v. International Longshoremen 's Association, 147 F.Supp. 103, 111-112 (D.C.N.Y.), affd. 241 F.2d 278, 282-283 (C.A. 2, 1957) (insis- tence on bargaining for employees outside the certified unit). LADISH CO. in-plant eating facilities cannot practicably be re- quired to consult with a union before he changes the price of any item of food . Rather, our view, which we think is a reasonable one, is that the statute imposes on such an employer the narrower obligation to hon- or a specific union request for bargaining about changes made or to be made. Nevertheless, the Board, with court approval, has consistently rejected the argument that bargaining is not required on various employment benefits on the ground that they were offered for employee conve- nience and by their nature accrue only to employees who elect to use them,22 or that alternative benefits from an outside source are available which many and even a majority of the employees prefer.23 Mr. Justice Stewart , concurring in Fibreboard Pa- per Products Corp. v. N. L. R. B., supra, stated that "[i]n common parlance , the conditions of a person's em- ployment are most obviously the various physical di- mensions of his working environment ." 24 Consistent therewith, the Board has long held that an increase in the price of food charged employees by an employer in his plant eating facilities involves a "condition of employment," and hence is a mandatory subject of bargaining.25 These holdings reflect our experience that employ- ees who choose to bargain collectively have far more than increased wages as their goal. Rather , advanta- geous plant conditions , whether or not of an eco- nomic nature , are also a source of substantial exxec- tations and, therefore, potential industrial strife. Food vending machines and other in-plant eating facilities also meet significant management needs. 22 See, for example, Richfield Oil Corporation v. N.L.R.B., 231 F.2d 717 (C.A.D.C.), cert. denied 351 U.S. 909 (1956) (stock purchase plans); N. L. N.L.R.B. v. Black-Clawson Company, 210 F.2d 523, 524 (C.A. 6, 1954) (prof- it-sharing retirement plans); The Kroger Company v. N.L.R.B., 401 F.2d 682, 687-688 (C.A. 6), cert. denied 395 U.S. 904 (1968) (profit-sharing plans) 23 N.L.R.B. v. General Motors Corporation, 179 F.2d 221, 222 (C.A. 2, 1950) (company health and accident insurance); Inland Steel Co. v. N.L.R.B., supra, 250-251 (pension plan). 24 379 U.S. 203, 222 (1964). 25 Weyerhaeuser Timber Co., 87 NLRB 672, 674 ( 1949); Westinghouse Electric Corporation, 156 NLRB 1080 (1966), enfd. 369 F.2d 891 (C.A. 4, 1966), reversed 387 F.2d 542 (1967); McCall Corporation, 172 NLRB 540 (1968), enforcement denied 432 F.2d 187 (C.A. 4, 1970); Package Machinery Company, 191 NLRB 268 (1971), enforcement denied 457 F.2d 936 (C.A. 1, 1972). 26 For example, in Preston Products Company, Inc., 158 NLRB 322 (1966), remanded on other grounds 373 F.2d 671 (C.A.D.C., 1967), a leading indus- trial relations survey was quoted as follows: Probably one of the .most striking differences between employee inter- views and supervisory interviews was that employees were far more concerned with plant conditions than were supervisors . . . [even those supervisors] who shared the same general physical environment.... F. S. Roethlisberger, "Management and the Worker" (Harvard Uni- versity Press, 1964). More recent studies reach the same conclusion. See Theodore V. Purcell, S.J., "The Worker Speaks His Mind on Company and Union" (Harvard University Press, 1953) pp. 274-275; Joel Seidman, "The Worker Views His Union" (University of Chicago Press, 1958), pp 260, 265. 357 Data from various surveys show that food services are provided to further various management inter- ests, for example, to boost employee morale by being presented as an employment benefit, to increase effi- ciency and productivity by keeping employees near their working areas and thereby avoiding excessive lunch and work breaks, and to aid in the recruiting of personnel. Increasingly, these management needs are being met by dispensing food through vending ma- chines?' In the instant case, the record amply demonstrates how the Respondent's vending machines are an im- portant element of the employment conditions in the plant. About 70 percent of the employees in the Union's bargaining unit obtain their food from vend- ing machines during their 15-minute lunch period, and 90 percent of these employees use the vending machines for beverages.28 While some employees bring a lunch with them, there are no other sources of food, except the vending machines, as Respondent's rules do not permit those employees who receive a 15-minute paid lunch period, which includes all of the employees represented by the Union, to leave the plant for lunch. Where, as here, alternative eating facilities are unavailable, the prices charged for food take on an even greater importance. If the employees are unsatisfied with those prices, they cannot simply choose another eating facility. They are compelled to pay whatever prices are charged or bring meals from home, whether or not the latter alternative is burdensome, inconvenient, or otherwise undesirable to them.29 As Respondent points out in its brief to the Board: It is readily apparent that rising prices have been a major item of national concern for a number of years. Frustration in dealing with the prob- 27 In a recent survey, 54 percent of the responding companies provided food services for employees in a lunchroom with vending machines. Em- ployee cafeterias are provided in 43 percent of all companies. Vending ma- chines (but not in a lunchroom) are provided by 25 percent of the compa- nies, and lunchrooms with snack bar service are provided in 15 percent. Because the services vary from one company location to another and re- spondents were asked to check any of the services provided, the percentages add to more than 100. The extended use of vending machines is shown by a survey made by the Field Research Division of the Paper Cup & Container Institute, New York. Of 1,264 plant officials who replied to the survey, better than 8 of 10 are using vending machines , with over I of 5 depending entirely upon automatic vending. 4 Labor Policy and Practice, 245. 201- 203. See also data and conclusions cited in fn. 30 of the Administrative Law Jud¢e's Decision in McCall Corporation, supra The fact that beverage prices are not involved herein is irrelevant, as it is not unreasonable for employees to assume that if the employer increases the prices of all food items as was done here, increases for beverages will follow. 29 We have applied here the principles enunciated in our previous cases cited in In. 25, as well as in other Board precedents, many judicially ap- proved . However, despite the similarities between those cases and this case, there are substantial differences, the more notable being the unavailability of alternative eating facilities because of the Respondent 's rule against leav- ing the premises if employees have a 15-minute lunchbreak, and the high percentage of use by employees of the vending machines. 358 DECISIONS OF NATIONAL LABOR RELATIONS BOARD lems associated with inflation is shared by both employer and employee. In our view, the current economic situation makes even more apparent that the prices charged for food in the vending machines are a significant condition of employment. To argue as does Respondent that employees concerned with rising prices should solve their problems by negotiating for higher wages really begs the question before us. For there can be no comparison between increased wages and lower vending machine prices since the former are subject to multiple and increasing taxes and deductions while the latter are a direct tax-free benefit. More- over, Respondent presents no good reason why the Union should not be permitted to bargain about both "conditions of employment," vending machine prices and wages. In any event, as Judge Craven pointed out in the initial decision in Westinghouse Electric Corporation, supra: In determining whether a matter is a mandatory subject of bargaining, whether much or little is involved financially is not the controlling test .... The underlying philosophy of the Labor Act is that discussion of issues between labor and management serves as a valuable prophy- lactic by removing grievances, real or fancied, and tends to improve and stabilize labor rela- tions. Experience teaches that major work inter- ruptions may spring from seemingly trivial caus- es.30 Respondent contends that vending prices cannot be a mandatory subject of bargaining because it is the caterers who set prices and not Respondent and therefore bargaining with the Respondent would be futile. However, as detailed above, by virtue of its lease agreements with the vending companies, Re- spondent retains ultimate control over which vendors will maintain and stock the machines on its premises and has the ability to completely replace a vendor. Moreover, in Respondent's handbook to employees quoted above, Respondent maintained that prices in the vending machines would be "reasonable." If dis- cussions between Respondent and the Union per- suade the former that the vendors' pricing policies are out of line and detrimental to employee interests, its right to terminate a vendor gives the Respondent persuasive economic leverage to bring about a change in those policies. This, of course, would affect prices to be charged by a third person. So may a demand for a wage increase when ability to grant it 30 Westinghouse, supra, 369 F.2d at 895. Accord: Fibreboard, supra, 261; Cap Santa Vue, Inc. v. N.L R. B., 424 F 2d 883 (C.A D.C., 1970). turns on the employer's willingness to try to obtain lower prices from his or alternative suppliers; or, per- haps more in point, so may a demand for more con- fortable heat in the plant when providing it turns on the employer's willingness to try to obtain more eco- nomical heat from his or alternative heating compa- nies. The request to negotiate unit working conditions may not be rejected as futile merely because the bar- gaining demand may require the employer to exer- cise his power to change business relationships with other employers. Hence, the Union and Respondent may engage in meaningful bargaining concerning re- duction of prices of meals in the plant vending ma- chines, even if it is assumed that any agreement reached would require the Respondent to exercise its clear ability to modify or terminate the arrangement with the current caterers. Our order requires no more than that the Union be given the chance to persuade the Respondent that a given increase is unwarranted. The contractual relationship between the vendors and the Respondent is such that giving the Union this opportunity may well result in a satisfactory res- olution of the problem. In our view, the "chances are good enough to warrant subjecting [this issue] to the process of collective negotiations." 31 Finally, we see no problem in the fact that the Union represents only about 37 percent of Respondent's employees and is only one of seven unions representing Respondent's employees, when all of Respondent's employees are served by the vending machines located on the Respondent's premises. For the definition of a mandatory subject of bargaining does not turn upon whether the subject under negotiation has an impact beyond the confines of the bargaining unit.32 While it is not unusual for an employer whose employees are represented by several unions to negotiate separately with each union, the Respondent is of course not precluded from joint discussion with some or all of the unions. In any event, "it is inconsistent with public policy to hold that public duties [e.g., the duty to bargain in good faith] may be set to naught because of alleged private inconvenience." 33 For all of the reasons stated, we find and conclude that the vending machine food prices constitute "conditions of employment" and bargainable mat- ters. We further find that Respondent's refusal to comply with the Union's specific request to bargain about the vending machine food price increases, af- ter placing into effect such increases, constitutes a 31 Fibreboard, supra. 33 N.L R B v. Charles M Smythe d/b/a E W Saybolt & Co, 212 F.2d 664, 667 (C A. 5, 1954). 33 N.L R.B v. F McKenzie Davison, et al d/b/a Arlington Asphalt Compa- ny, 318 F 2d 550, 558 (C A. 4, 1963). LADISH CO. 359 violation of Section 8(a)(5) and (1) of the Act. CONCLUSIONS OF LAW 1. Respondent is an employer engaged in com- merce within the meaning of Section 2(6) and (7) of the Act. 2. The Union is a labor organization within the meaning of Section 2(5) of the Act. 3. At all times material herein, the Union has been and is the exclusive representative of all employees in the following appropriate unit 34 within the meaning of Section 9(a) of the Act: All Cudahy, Wisconsin, employees of the Company, as such group may exist from time to time after giving effect to all of the provisions of this contract and actions taken hereunder, in- cluding Pattern Makers, Janitors, Sweepers, and Charwomen, Production Machine Shop, Tool Room, Welding, Maintenance and Repair De- partment Employees, Grinders, Straightening Press, Processing Department, Inspection De- partment, Shipping and Receiving, crane opera- tors, truck drivers, Stock and Parts Room, oilers, Garage employees, first aid attendants, fire in- spectors, machine operators in the Draw Bench Department who perform machine operations after the end sawing operation immediately after ells are formed, and all other production and maintenance employees, in all other classifica- tions herein not mentioned but excluding the following: All executives, office and clerical em- ployees, all guards, all supervisors with authority to hire, promote, discipline, discharge or other- wise effect changes in the status of employees or effectively recommend such action, all employ- ees of the Metallurgical Laboratory Depart- ment, all employees engaged in the Die Room who work on dies or parts of dies used in the manufacture and completion of forgings and who are covered by the collective bargaining contract between the Company and the Milwau- kee Die Sinkers' Lodge No. 140 of the Interna- tional Die Sinkers' Conference, all employees of the Company of the Steel Stores, Forge Shop, Draw Bench, Heat Treat and Metallurgical De- partments coming under the jurisdiction of the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers & Helpers, Subordinate Lodge #1509, AFL-CIO, all em- ployees in the Electrical Department under the jurisdiction of the Associated Unions of Ameri- 74 As described in the collective agreement between the Union and Re- spondent and as stipulated at the hearing. ca, Local No. 85, and all employees in the Power Plant coming under the jurisdiction of the Inter- national Brotherhood of Firemen and Oilers, Local No. 125, A.F. of L., and all employees under the jurisdiction of the International Brotherhood of Firemen and Oilers, Local No. 125, A.F. of L., and all employees under the ju- risdiction of the American Federation of Tech- nical Engineers and Local 92, AFL-CIO. Cu- dahy, Wisconsin as used in this section is defined to include Milwaukee County and pro- tions of Ozaukee County, Wisconsin. 4. By refusing, on and since June 20, 1974, to bar- gain collectively with the Union as the exclusive rep- resentative of its employees in the aforesaid bargain- ing unit, concerning plant vending machine food price changes, Respondent has engaged in and is en- gaging in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act. 5. The aforesaid unfair labor practices affect com- merce within the meaning of Section 2(6) and (7) of the Act. THE REMEDY Having found that Respondent has unlawfully re- fused to meet and bargain with the Union concern- ing food price increases, we shall order that it cease and desist therefrom and take certain affirmative ac- tion to effectuate the policies of the Act. As we held in Westinghouse Electric Corporation, supra, "It is suf- ficient compliance with the statutory mandate . . . if management honors a specific union request for bar- gaining about changes made or to be made." 156 NLRB at 1081. Accordingly, our order will not re- quire Respondent "to bargain about every proposed price change in food prices before putting such change in effect." Ibid. We will require Respondent to bargain on such price changes only after they are effectuated unilaterally and upon a request of the Union. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Re- lations Board hereby orders that the Respondent, Ladish Co., Cudahy, Wisconsin, its officers , agents, successors, and assigns, shall: 1. Cease and desist from: (a) Refusing, upon request, to bargain collectively with District No. 10, and its Local Lodge 1862, Inter- national Association of Machinists and Aerospace Workers, AFL-CIO, as the exclusive bargaining rep- resentative of all the employees in the unit set forth 360 DECISIONS OF NATIONAL LABOR RELATIONS BOARD in paragraph 3 of the Conclusions of Law herein with respect to changes in food prices in the vending ma- chines. (b) In any like or related manner interfering with the efforts of the above-named labor organization to bargain collectively on behalf of the employees in the above-described unit. 2. Take the following affirmative action which will effectuate the policies of the Act: (a) Upon request, bargain collectively with the above-named labor organization, as the exclusive representative of all its employees in the aforesaid appropriate unit with respect to any changes, now in effect or hereafter made or proposed, in food prices charged employees in the vending machines. (b) Post at its plant in Cudahy, Wisconsin, copies of the attached notice marked "Appendix." 31 Copies of said notice, on forms provided by the Regional Director for Region 30, after being duly signed by an authorized representative of Respondent, shall be posted by it immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereaf- ter, in conspicuous places, including all places where notices to employees are customarily posted. Rea- sonable steps shall be taken by Respondent to insure that said notices are not altered, defaced, or covered by any other material. (c) Notify the Regional Director for Region 30, in writing, within 20 days from the date of this Order, what steps the Respondent has taken to comply here- with. MEMBER JENKINS, concurring: It is axiomatic that not every matter bearing upon the employment relationship is so material or signifi- cant as to constitute a mandatory subject over which an employer is obligated to bargain with the union. However, many employee benefits which in typical circumstances have only a peripheral effect on the terms and conditions of employment may in another context have a direct impact on the employment rela- tionship and thereby become mandatory subjects of bargaining. Food services provided by an employer for the benefit of its employees fall into just such a category. The service may be offered merely as a convenience to employees which they as individuals may utilize or not utilize as they see fit, or it may be that due to work schedules or job requirements there is no other food service available. In the latter situa- tion, the employee may evidence his protest over the cost or the service at the employer's facility only by 35 In the event that this Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board." bringing his own lunch or not eating at all and nei- ther of those options qualifies, in my judgment, as a reasonable alternative to food services provided by the employer.36 As I stated in my dissent in Westinghouse,37 price increases in the cost of food items at an employer's facilities are best left to the voluntary action of the market place. But that contemplates that a market place exists in the sense that employees have the op- portunity to use other commercial vendors. This is not to say that alternative food services exist only when there are a sufficient number of restaurant fa- cilities in locations proximate enough to the plant to permit their utilization by employees during their meal period. It is enough if one can say that commer- cial food services similar to those offered by the em- ployer are available or can be made available to the employees. In my judgment, the situation presented here is more akin to the one in Weyerhaeuser 38 than the one in Westinghouse.39 Here the employees are true cap- tives to the food services being offered at the Respondent's plant because they receive only a 15- minute lunch period and they are not permitted to leave the plant for lunch. There are no other food services available to the employees and their depen- dence on the facilities provided by the Respondent is demonstrated by the fact that, among the employees in the bargaining unit represented by the Union, 70 percent obtain their food from these facilities and 90 percent purchase beverages from this source. In these circumstances, I find in agreement with Member Penello that food prices at the Respondent's facilities are conditions of employment over which the Respondent is obligated to bargain, upon re- quest. In reaching this conclusion, I recognize full well that the independent caterers who supply the food and drink items set the prices, not the Respon- dent. But, Respondent clearly has a financial stake in the caterers' operations, since it receives a commis- sion on all items sold. More importantly, ultimate control over pricing policies resides in the Respon- dent by virtue of its ability under the lease agree- ments to replace any vendor whose prices the Re- spondent considers to be unreasonable. Thus, since real and effective control is in the hands of the Re- spondent, it is of little or no significance whether the control is exercised directly or indirectly 40 Accord- ingly, on the basis of the undisputed evidence that 36 The brown bag may be an American institution , but it is not an ade- quate substitute for commercial food services. For an interesting discussion as to why, see Arbitrator Gerald Cohen's Decision in United Telephone Sys- tem, 64 LA 525 (March 19, 1975). 37 Westinghouse Electric Corporation, 156 NLRB 1080 (1966). 3e Weyerhaeuser Timber Company, 87 NLRB 672 (1949). 39 Supra 40 Cf. McCall Corporation v. N.L.R B, 432 F.2d. 187 (C.A. 4, 1970). LADISH CO. the Respondent refused to honor the Union's request for bargaining about vending machine food prices which had been placed into effect, I find that such conduct constitutes a violation of Section 8(a)(5) and (1) of the Act. MEMBER KENNEDY, dissenting: In my opinion, the Employer is not obligated to bargain with the Union over the prices charged by an independent caterer for food dispensed by the cater- er in vending machines located at the Employer's plant. As noted in the majority opinion, there are approx- imately 197 vending machines located in Respondent's plant. These machines are utilized by 4,800 employees represented for collective-bargain- ing purposes by seven labor organizations in nine dif- ferent units. The machines are owned and operated by two independent catering companies pursuant to lease arrangements with Respondent. The leases pro- vide that prices for items sold in the vending ma- chines shall be established by the caterer. During April and May 1974, prices on all vending machine items were increased by the caterers. By let- ter dated May 28, 1974, the Charging Party 41 (here- after IAM) filed a grievance with Respondent in which it objected strenuously "to your increasing these prices without negotiations ...." On June 20, 1974, Respondent replied that the vending machine prices did not constitute a mandatory subject of bar- gaining given, inter alia, "our lack of control over the prices charged...." 42 My colleagues find that Respondent's refusal to bargain with regard to a sub- ject over which it retained no control violated Sec- tion 8(a)(5) of the Act. I cannot agree. This case is the fourth time that a majority of this Board has found an employer in violation of Section 8(a)(5) for refusing to bargain over changes in vend- ing machine prices.43 In each of the three prior cases, the Board's Order was denied enforcement by the courts.44 Of the four cases, the instant case provides the weakest record for finding an 8(a)(5) violation be- 41 The Charging Party is one of seven separate labor organizations recog- nized by Respondent in nine bargaining units at its Cudahy, Wisconsin, facility. The Charging Party represents approximately 1,800 of the 4,800 em4ployees. The 1974 grievance is actually a reinstatement of an identical grievance filed after a 1972 price increase. According to the stipulation herein, Respondent's answer to the grievance then, as now, was that it "was not responsible for the increased prices...." The Charging Party elected not toSursue the 1972 grievance any further. See fn. 44, infra 44 Westinghouse Electric Corporation, 156 NLRB 1080 (1966), enfd. 369 F.2d 891 (C.A. 4, 1966), reversed 387 F.2d 542 (C.A. 4, 1967); McCall Corporation, 172 540 (1968), enforcement denied 432 F.2d 187 (C.A 4, 1970); Package Machinery Company, 191 NLRB 268 (1971), enforcement denied 457 F.2d 936 (C.A. I, 1972). 361 cause here-unlike the earlier cases-the Employer has virtually no control over the caterers' estab- lishment of prices. In Westinghouse, for example, the employer retained indirect control over vending ma- chine prices through a clause in the contracts with the caterers which provided that the "quality and prices of the meals served . . . shall at all times be reasonable." In Package Machinery, the employer was able to influence vending machine prices by ad- justing the amount of the subsidy paid to the caterers as an incentive to service its employees. And in Mc- Call, the employer itself actually determined the prices to be charged. In contrast, the authority to establish vending machine prices here resides exclu- sively with the caterers. My colleagues nevertheless find that Respondent has an obligation to bargain with the IAM over the establishment of vending machine prices. Their theo- ry, I gather, is that Respondent does possess the abil- ity to dictate prices by virtue of its authority to can- cel the leases and procure catering services elsewhere. The Fourth Circuit in Westinghouse did not find this argument persuasive 45 and neither do I. In my judgment, authority to take the extreme step of contract cancellation cannot reasonably be equat- ed with authority to effectively establish prices on individual items. Just as the prospect of divorce is seldom an effective mechanism for controlling daily marital discord, so too the prospect of lease termina- tion is unlikely to provide Respondent with the le- verage necessary to dictate a 15-cent reduction in the price of peanut butter sandwiches or prevent a nickel increase in the cost of a root beer. The plain and simple fact is that under Respondent's lease arrangements it is the caterers- not Respondent-who effectively establish prices. This being the case, my colleagues' Order that Re- spondent bargain "with respect to any changes, now in effect or hereafter made or proposed, in food prices charged employees in the vending machines" is, in effect, an order to perform a futile act. For if Respondent cannot set prices, any agreement reached by the negotiators would be unenforceable. In the words of the Fourth Circuit, my colleagues are ordering Respondent to engage in "fictional bargain- ing." 46 There is also a second-and in my judgment equally persuasive-reason for dismissing the 8(a)(5) complaint. As noted above'41 the IAM is only one of seven labor organizations currently recognized by Respondent at its Cudahy facility. Moreover, the IAM represents only 1,800 of the 4,800 employees. 45 387 F.2d at 549-550. 46 Westinghouse Electric Corp., supra, 387 F.2d at 550; cl: N.L.R.B v. Highland Park Mfg. Co., 110 F.2d 632, 637 (C.A 4, 1940). See In. 41, supra 362 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Accordingly, since the vending machines are avail- able to everyone in the plant, any price agreement reached by Respondent and IAM will directly affect employees represented by other labor organizations. And what if the agreement reached is not acceptable to those other employees? The Board cannot logical- ly direct Respondent to bargain with the IAM over vending machine prices without providing the same privilege to the six other labor organizations. It is entirely possible, therefore, that each time the cater- ers increase their prices Respondent will be com- pelled to engage in seven separate sets of negotia- tions.48 If a uniform price schedule acceptable to all of the labor organizations cannot be attained, would the cost of a "ham and cheese on rye" then depend upon which labor organization represents the pur- chases of the sandwich? This is not the meaningful collective bargaining envisioned by our Act. The order of my colleagues carries with it the potential for meaningless and re- petitive negotiations which would be both disruptive of stable employee relations and economically waste- ful. In refusing to enforce a similar Board order in Westinghouse, the Fourth Circuit stated, "[c]onceiv- ably, enforcement of the order could lead to dis- agreement, dissatisfaction, strife and turmoil." 49 I think this observation is equally valid here. In my judgment, the order of my colleagues re- quires Respondent to bargain with respect to a sub- ject over which it has no control and in a manner which is inimical to the purposes and policies of our Act. Accordingly, I dissent and would dismiss the complaint in its entirety. 48 There is nothing in the record to indicate that the labor organizations recognized by Respondent have ever engaged in joint bargaining 49 387 F.2d at 550. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government Pursuant to a Decision of the National Labor Rela- tions Board, and in order to effectuate the policies of the National Labor Relations Act, as amended, we hereby notify our employees that: WE WILL NOT refuse, upon request, to bargain collectively with District No. 10, and its Local Lodge 1862, International Association of Ma- chinists and Aerospace Workers, AFL-CIO, as the exclusive representative of all employees in the bargaining unit described below with respect to any change in food prices charged in the food vending machines. The bargaining unit is: All Cudahy, Wisconsin, employees of the Company, as such group may exist from time to time after giving effect to all of the provi- sions of this contract and actions taken here- under, including Pattern Makers, Janitors, Sweepers, and Charwomen, Production Ma- chine Shop, Tool Room, Welding, Mainte- nance and Repair Department Employees, Grinders, Straightening Press, Processing De- partment, Inspection Department, Shipping and Receiving, crane operators, truck drivers, Stock and Parts Room, oilers, Garage em- ployees, first aid attendants, fire inspectors, machine operators in the Draw Bench De- partment who perform machine operations af- ter the end sawing operation immediately af- ter ells are formed, and all other production and maintenance employees, in all other clas- sifications herein not mentioned but exclud- ing the following: All executives, office and clerical employees, all guards, all supervisors with authority to hire, promote, discipline, discharge or otherwise effect changes in the status of employees or effectively recommend such action, all employees of the Metallurgi- cal Laboratory Department, all employees en- gaged in the Die Room who work on dies or parts of dies used in the manufacture and completion of forgings and who are covered by the collective bargaining contract between the Company and the Milwaukee Die Sinkers' Lodge No. 140 of the International Die Sink- ers' Conference, all employees of the Compa- ny of the Steel Stores, Forge Shop, Draw Bench, Heat Treat and Metallurgical Depart- ments coming under the jurisdiction of the In- ternational Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers & Helpers, Subordinate Lodge #1509, AFL- CIO, all employees in the Electrical Depart- ment under the jurisdiction of the Associated Unions of America, Local No. 85, and all em- ployees in the Power Plant coming under the jurisdiction of the International Brotherhood of Firemen and Oilers, Local No. 125, A.F. of L., and all employees under the jurisdiction of the International Brotherhood of Firemen and Oilers, Local No. 125, A.F. of L., and all employees under the jurisdiction of the Amer- ican Federation of Technical Engineers and Local 92, AFL-CIO. Cudahy, Wisconsin as used in this section is defined to include Mil- waukee County and portions of Ozaukee County, Wisconsin. LADISH CO. 363 WE WILL NOT in any like or related manner representative of all of our employees in the interfere with the efforts of the above-named aforesaid appropriate unit with respect to any Union to bargain collectively on behalf of the changes, now in effect or hereafter made or pro- employees in the above-described unit. posed, in food prices charged employees in the WE WILL, upon request, bargain collectively vending machines. with the above-named Union, as the exclusive LADISH CO.