Gaedke Cutlery Manufacturing Co.

GAEDKE CUTLERY MFG. CO. Gaedke Cutlery Manufacturing Co. and Teamsters Union Local No. 844, Over-the-Road and City Car- tage Drivers, Helpers and Dock Workers, and Con- struction Drivers and Helpers, affiliated with Inter- national Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America. Cases 18-CA-4429 and 18-RC-10268 September 29, 1975 DECISION, ORDER, AND CERTIFICATION OF RESULTS OF ELECTION BY CHAIRMAN MURPHY AND MEMBERS FANNING AND PENELLO On June 30, 1975, Administrative Law Judge Alvin Lieberman issued the attached Decision in this pro- ceeding. Thereafter, the Charging Party filed excep- tions accompanied by a supporting brief, and Re- spondent filed an answering 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. The Board has considered the record and the Ad- ministrative Law Judge's Decision in light of the ex- ceptions and briefs and has decided to affirm the Administrative Law Judge's rulings, findings, and conclusions I and to adopt his recommended Order. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Re- lations Board hereby orders that the complaint here- in be, and it hereby is, dismissed in its entirety. CERTIFICATION OF RESULTS OF ELECTION As we find that all the challenges in the election conducted on January 3, 1975, in Case 18-RC-10268 should be sustained, and as the tally of ballots in that election shows that the Petitioner has received less than a majority, it is hereby certified that a majority of the valid ballots have not been cast for Teamsters Union Local No. 844, Over-the-Road and City Car- tage Drivers, Helpers and Dock Workers, and Con- struction Drivers and Helpers, affiliated with Inter- national Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, and that 1 Member Fanning, in accordance with his dissenting view in Swift Tex- tiles, 214 NLRB No. 10 (1974), would find that Respondent's letter to em- ployees on December 14, 1974, constituted an 8(a)( 1) violation and would provide an appropriate remedy therefor. 843 said labor organization is not the exclusive represen- tative of all the employees, in the unit herein in- volved, within the meaning of Section 9(a) of the Na- tional Labor Relations Act, as amended. DECISION STATEMENT OF THE CASE ALVIN LIEBERMAN, Administrative Law Judge: Pursuant to a petition filed in Case 18-RC-10268 by Teamsters Union Local No. 844 (herein the Union) I and a Decision and Direction of Election issued by the Regional Director for Region 18 of the National Labor Relations Board, a representation election was held on January 3, 1975, among certain employees of Gaedke Cutlery Manufactur- ing Co. (herein Gaedke). At the election 9 votes were cast for the Union, 12 against the Union, and 7 ballots, suffi- cient in number to affect the election's result, were chal- lenged by Gaedke. The challenge to one ballot was sustained by the Region- al Director. The ground for challenging the remaining six ballots, those cast by Mariann Nelson, Conroe Miles, Mar- lene Halligan, Mary Frost, Vickie Crew, and Sandra Ack- erson, (herein the Six) was that these voters had been per- manently laid off before the election. On February 10, 1975, a complaint issued in Case 18-CA-4429, alleging that Gaedke had engaged in unfair labor practices within the meaning of Section 8(a)(1) and (3) of the National Labor Relations Act, as amended? The allegations of the complaint dealing with the violations of Section 8(a)(3) are founded, in part, on Gaedke 's discharge of 12 employees, including the Six. In view of the similarity of the basis upon which Gaedke challenged the ballots cast by the Six and the averments of the complaint relating to their discharge, the Regional Di- rector concluded that "the matter of the eligibility [of the Six to vote in the election] must await the dispositon of the pending unfair labor practice proceeding." Accordingly, the Regional Director ordered that "a hearing be held .. . for the purpose of taking evidence relevant to the issues with respect to the challenges to the ballots of [the Six]." The Regional Director further ordered that "Cases Nos. 18-CA-4429 and 18-RC-10268 be . . . consolidated for purposes of hearing, ruling and decision by an Administra- tive Law Judge and that thereafter, Case No. 18-RC-10268 shall be transferred to and continued before the Board f> 3 The hearing in this consolidated proceeding, with all parties represented, was held before me in Waterloo, Iowa, on March 18 and 19, 1975. In general, the issues litigated, as raised by the complaint and answer in Case 18-CA-4429 and by the Regional Director's order in Case 18-RC-10268, were whether Gaedke violated Section 1 The Union's full designation appears in the caption. 2 The complaint was based upon a charge filed by the Union on January 3, 1975. 3 G.C. Exh. 1(e). 220 NLRB No. 128 844 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 8(a)(1) and (3) of the Act ° and whether the ballots cast by the Six should be opened and counted. More particularly, the questions for decision are as follows: 1. Do Gaedke and Rada Manufacturing Co. constitute a single employer for the purposes of the Act? 2. Did Gaedke violate Section 8(a)(1) of the Act by threatening employees with reprisals for engaging in union activity? 3. Did Gaedke violate Section 8(a)(3) of the Act by dis- charging 12 employees, including the Six? 4. Were the Six, whose ballots were challenged by Gaed- ke, employees of Gaedke on the date of the election and, therefore, entitled to vote? Upon the entire record,' upon my observation of the witnesses and their demeanor while testifying, and having taken into account the arguments made and the able briefs submitted by the General Counsel and Gaedke,6 I make the following: FINDINGS OF FACT 1. JURISDICTION Gaedke, an Iowa corporation, is engaged in Waterloo and Waverly, Iowa, in the manufacture and sale of cut- lery.' During 1974, a representative period, Gaedke shipped goods valued at more than $50,000 to customers located outside the State of Iowa. Accordingly, I find that Gaedke is engaged in commerce within the meaning of the Act and that the assertion of jurisdiction over this matter by the Board is warranted. tive-bargaining representative of employees of Gaedke pursuant to which a representation election was conducted. These included an explosion rendering unusable Gaedke's finishing plant in Waterloo and the establishment of a sim- ilar facility in Waverly by Rada Manufacturing Co.; a let- ter sent by Gaedke to its employees urging them to vote against the Union; Gaedke's discharge of 12 employees shortly before the election; and Gaedke's challenge to the ballots cast at the election by 6 discharged employees. The General Counsel argues that Gaedke's letter to its employees contained a threat to their job security and, hence, violated Section 8(a)(1) of the Act. Contending also that, as alleged in the complaint, the discharges were viola- tive of Section 8(a)(3), the General Counsel suggests that the challenged ballots be opened and counted. Finally, the General Counsel asserts that Gaedke and Rada Manufac- turing Co. are a single employer for the purposes of the Act. Although admitting a relationship between it and Rada Manufacturing Co., Gaedke denies that it and Rada Man- ufacturing Co. are a single employer for the purposes of the Act. Gaedke denies, also, that the discharges were motivat- ed by union considerations. Gaedke argues, in this connec- tion, that the discharges resulted from its inability after the explosion to reopen its finishing plant in Waterloo and oc- curred at a time when it did not know how many jobs would be available at the Waverly facility. Concerning the letter, Gaedke claims that it was privileged by Section 8(c) of the Act.8 IV. PRELIMINARY FINDINGS AND CONCLUSIONS 9 11. THE LABOR ORGANIZATION INVOLVED The Union is a labor organization within the meaning of the Act. III. INTRODUCTION Briefly, this case is concerned with events following the Union's filing of a petition for certification as the collec- 4 In pertinent part these sections provide: Sec. 8(a). It shall be an unfair labor practice for an employer- (1) to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 7 .... (3) by discrimination in regard to hire or tenure or employment or any term or condition of employment to encourage or discourage mem- bership in any labor organization ... Sec. 7, insofar as relevant, states: Sec. 7. Employees shall have the right to self-organization, to form, ,loin, or assist labor organizations , to bargain collectively through repre- sentatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection .... Issued simultaneously in a separate order correcting obvious inadvertent errors in the stenographic transcript of this proceeding. A. The Union's Organization of Gaedke's Employees During the summer of 1974,10 Gaedke's production em- ployees became interested in being represented by a labor organization. Accordingly, in early September, 23 employ- ees out of a total of 28 who worked in Gaedke's casting and finishing departments met with a representative of the Union. All those in attendance at this meeting signed union cards. 6 Although all the arguments of the parties and the authorities cited by them, whether appearing in their briefs or made orally at the hearing, may not be discussed in this Decision , each has been carefully weighed and considered . It is noted, in this connection, that no brief was filed by the Union I The Waverly plant is owned and operated by Rada Manufacturing Co Although Gaedke and Rada are separate corporations , they are, as will be demonstrated below, a single employer for the purposes of the Act. 8 Sec. 8(c) of the Act is as follows. The expressing of any views, argument, or opinion, or the dissemina- tion thereof, whether in written, printed, graphic, or visual form, shall not constitute or be evidence of an unfair labor practice under any of the provisions of this Act, if such expression contains no threat of reprisal or force or promise of benefit. 9 The purpose of these findings is to furnish a frame of reference within which to consider the facts relating to Gaedke's alleged unfair labor practic- es and to the conclusions to which they may give rise . To the extent that the contentions of the parties relate specifically to the findings made here, they will be treated here, although they, as well as the findings , may again be considered in other contests. 10 All dates hereinafter mentioned without stating a year fall within 1974. GAEDKE CUTLERY MFG. CO. 845 B. The Explosion and the Establishment of the Waverly Facility As already noted Gaedke is engaged in the manufacture of cutlery. Aluminum-handled knives, Gaedke's principal products, were sold by Gaedke to women's clubs and re- sold by them for fund-raising purposes. Before October 28, 1974, Gaedke's production work was carried on in two adjoining buildings in Waterloo, Iowa. In one building the knives were cast and made ready for the finishing process which was performed in the other build- ing. On October 28 an explosion occurred in the building in which the knives were finished, injuring six employees, three very seriously. In addition, the explosion severely damaged the finishing department building and rendered inoperative some of the equipment located there , including machines referred to during the hearing as "automatics." It was the consensus of all persons and agencies investi- gating the explosion that it had been caused by the ignition of aluminum dust generated by the automatics. Because of this, Walter Rada, Gaedke's president, who for several months after the explosion was mainly occupied with ex- plosion-related problems, determined that he would not again jeopardize the safety of people working in Gaedke's premises or risk the destruction of Gaedke's property by operating with dust-creating equipment. Accordingly, Walter Rada decided to replace the auto- matics with Clair machines. Although the Clair machines perform the same function as the automatics, they do not create dust. For several reasons, however, the Clair machines could not be accommodated in Gaedke's building in Waterloo which had housed the finishing department. Nor, although a search was made, could an adequate available building be located for this purpose in Waterloo. Widening his search, Walter Rada found a suitable building in the city in which he lived, Waverly, Iowa, some 20 miles distant from Waterloo. To take possession of this building and to perform the knifefinishing operations pre- viously done by Gaedke in Waterloo, Walter Rada activat- ed what he called "a shelf corporation" and had its name changed to Rada Manufacturing Co. (herein Rada). On December 4, Rada leased the Waverly building. Dur- ing the next 3 or 4 weeks the Clair machines, which had been ordered on November 13, and undamaged machinery and equipment formerly used in finishing knives at Gaedke's Waterloo facility were installed there. On Janu- ary 14, 1975, the Waverly plant became operative and turned out its first finished knife. C. The Relationship Between Gaedke and Rada Rada was activated to take possession of, and operate, the Waverly finishing plant because Gaedke was not in a position to obtain financing which would have enabled it to do so. A further reason for having taken Rada off the "shelf" was to limit Gaedke's liability for damages in the event of litigation based upon the explosion. The same individuals are officers, directors, and stock- holders of Gaedke and Rada. Thus, Walter Rada is presi- dent of both corporations. His wife, Sandra Rada, is assis- tant secretary and assistant treasurer of Gaedke and vice president of Rada. Max Guernsey is secretary and treasur- er of Gaedke and secretary of Rada. His wife, Helen Guernsey, is vice president of Gaedke and treasurer of Rada.11 Walter and Sandra Rada each own 25 percent of Gaedke's stock. The ownership of the remaining 50 percent is divided between Max and Helen Guernsey. The former owns 33-1/3 percent and the latter 16-2/3 percent. The Radas and Guernseys each own an equal amount of stock in Rada. As already noted, Rada performs finishing work on knives. It bought the Clair machines from their manufac- turer. Much of the other machinery and equipment used by Rada was purchased from Gaedke at book value, a price which, Walter Rada testified, was "probably three times [higher than] the actual value." The casting of the knives and other preparatory work to make the knives ready for finishing is done by Gaedke in Waterloo. Gaedke sells and delivers the unfinished knives it produces to Rada in whose plant at Waverly they are finished. Since its establishment, Rada has been Gaedke's only customer and Gaedke is Rada's only supplier of un- finished knives. Pursuant to a license issued to it by Gaedke, Rada holds itself out as the "Maker of the Original Gaedke Aluminum Handle Cutlery." 12 Rada's customers, as were Gaedke's, are women's clubs, "the vast percentage" of which, Walter Rada stated, are the same customers who dealt with Gaed- ke before the explosion. In this regard, orders received by Gaedke are turned over to Rada. Walter Rada is the chief executive officer and, as already noted, the president of both Gaedke and Rada. His salary is paid entirely by Rada. Walter Rada spends most of his time at Gaedke's plant in Waterloo. However, he visits Rada's plant in Waverly twice each day. While there he discusses problems requir- ing his attention with Rada's production manager and of- fice manager. Before the explosion Herb Jones, Rada's production manager, was a Gaedke supervisor. All employees in Rada's shipping department and office, including Rada's office manager, formerly worked for Gaedke. Jones oversees Rada's day-to-day affairs including the hiring of employees in accordance with instructions given him by Walter Rada. In the hiring area Walter Rada di- rected Jones to give preference in employment at Rada to persons who were discharged or laid off by Gaedke after the explosion. Jones followed this directive. In this connec- tion, as will be seen, Walter Rada, himself, referred three former employees of Gaedke for employment at Rada and they were hired by Jones. The Board treats separate corporations as one employer where they are commonly owned, have interlocking offi- cers and directors, and engage in an integrated operation to produce a saleable product. Sakrete of Northern Califor- nia, Inc., 137 NLRB 1220, 1222 (1962), enfd. 332 F.2d 902 11 The Guernseys are Mrs Rada's parents ^Z G.C Exh 5. 846 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (C.A. 9, 1964); Royal Oak Tool & Machine Company, et al., 132 NLRB 1361, 1362 (1961), enfd. 320 F.2d 77 (C.A. 6, 1963). There can be no gainsaying the common ownership and interlocking officers and directors of Gaedke and Rada. A more integrated operation between two corpora- tions than that presented by the record in this case is most difficult to conceive. Accordingly, I conclude that Gaedke and Rada consti- tute a single employer for the purposes of the Act. D. The Representation Hearing and the Challenges On November 14, 1974, a hearing was held upon the Union's petition for certification in Case 18-RC-10268. Among those present were Sandra Ackerson, an employee of Gaedke, and Walter Rada, its president. Testifying as a witness at the hearing, Ackerson stated that at a meeting on November 4 attended by all Gaedke employees who worked in the casting and finishing depart- ments they "agree[d] to go along with the union." Appar- ently seeking clarification of this statement , Gaedke's law- yer asked Ackerson whether, in fact, everyone at the meeting was in favor of the Union. Ackerson's reply was "I mean everyone." On December 3, the Regional Director issued his Deci- sion and Direction of Election. The unit he found to be appropriate for purposes of collective bargaining included ..all . . . production and maintenance employees at the Employer's Waterloo, Iowa, facility." 13 Pursuant to this direction an election was held on Janu- ary 3, 1975, at which ballots cast by Mariann Nelson, Con- nie Miles, Marlene Halligan, Mary Frost, Vickie Crew, and Sandra Ackerson (the Six) were challenged by Gaedke on the ground that the Six had been permanently laid off be- fore the election . These challenges were sufficient in num- ber to affect the results of the election.I4 V. THE ALLEGED UNFAIR LABOR PRACTICES A. Facts, Contentions, and Conclusions Concerning Gaedke's Alleged Violations of Section 8(a)(1) of the Act In support of the complaint's allegation that Gaedke vio- lated Section 8(a)(1) of the Act, the General Counsel of- fered in evidence a letter dated December 14, 1974,15 in which Gaedke urged its employees to vote against the Union in the forthcoming election. The last several para- graphs of this letter are as follows: There are a lot of layoffs in the country right now. On paper, out-of-work employees and these compa- nies have a good wage scale and good benefits, howev- er, notwithstanding their hourly rate or anything else, all they are getting in most instances is their unem- ployment check. We hope this will not happen here and, absent the unusual circumstances we are in now, layoffs are not usually a problem . The point is that a '3 G.C. Exh. 10. 14 Although the findings in this paragraph appear earlier in this Decision, the' have been repeated here for ready reference. ' G.C. Exh 14. union card alone can 't keep your job. One of our main concerns about this union and the reason we feel that it is a real threat to your job securi- ty is the idea which has been expressed by many em- ployees that individuals can rely on the union to take care of them so that they can slow down and get more pay. This is an erroneous assumption. Our whole merchandising practice and what success we have had is based upon low per unit costs. If our per unit costs go up two or three times, which well could be the result of this type of thinking, there would be no market for our product-and as a result no jobs for anyone. This is not an easy or simple thing to understand but I do feel that I particularly owe a truthful explana- tion to those persons who have been with us for some period of time . I foresee very real problems if this union is successful-and quite frankly none of us need any more problems than we have right now. Pointing to the mention of layoffs in the first paragraph of the letter set forth above and especially to the letter's last sentence, the General Counsel argues on brief that the letter "constitutes a thinly veiled threat that [Gaedke] would react to the Union by reducing the scope of [its] business and that layoffs would result if the employees se- lect a union to represent them." Gaedke, on the other hand, contends that Section 8(c) of the Act privileges the letter. In my opinion, Gaedke has the better of the argu- ment. In N.L. R.B. v. Gissel Packing Co., Inc., 395 U.S. 575, 617-618 (1969), the Court observed that "Section 8(c) [of the Act] merely implements the First Amendment ." It then had this to say concerning the privileges and limitations of employer conduct under Section 8(c): [A]n employer is free to communicate to his employ- ees any of his general views about unionism or any of his specific views about a particular union, so long as the communications do not contain a "threat of repri- sal or force or promise of benefit." He may even make a prediction as to the precise effects he believes union- ization will have on his company . In such a case, how- ever, the prediction must be carefully phrased on the basis of objective fact to convey an employer 's belief as to demonstrably probable consequences beyond his control . . . . If there is any implication that an em- ployer may or may not take action solely on his own initiative for reasons unrelated to economic necessities and known only to him, the statement is no longer a reasonable prediction based on available facts but a threat of retaliation based on misrepresentation and coercion, and as such without the protection of the First Amendement. In Swift Textiles, Inc., 214 NLRB No. 10 (1974), the Board had for determination the question of whether Sec- tion 8(a)(1) of the Act was violated by words spoken by an employer "in the context of, and in response to, a union's GAEDKE CUTLERY MFG. CO. promise to obtain" higher wages for its employees. Within this framework the employer stated , as noted by the Board, that "'if . . . the Union were able to force [it] to pay this type of wage, . . . its cost would have to go up to sustain that type of increase,' which would `impair the plant's com- petitive position and cause the mill to close.' " Relying upon the teaching of Gissel, the Board held that this state- ment did not entrench upon Section 8(a)(1). The Board said, in this regard, "These remarks, in our view, were sus- ceptible of recognition by the employees as economic ar- guments rather than threats of plant closure in reprisal for the employees' union activities . Consequently, we conclude that such remarks were privileged as free speech." As in Swift, the letter here under consideration speaks in a context of higher costs to Gaedke , which were predicta- ble in the event of the unionization of its plant . Also like the employer's remarks in Swift which posed the foreseea- ble event of higher wages impairing its competitive posi- tion, thus causing the mill to close, the letter here refers to the equally foreseeable effect of higher costs destroying "the market for [Gaedke's] product-and as a result no jobs for anyone." These, it seems to me, were the "prob- lems" spoken of in the letter's last sentence. Accordingly, as was the Board's view in Swift, it is my view here that the statements in the letter dealing with higher costs resulting in the loss of jobs "were susceptible of recognition by the employees as economic arguments rather than threats [of job loss] in reprisal for the employ- ees' union activities." Consequently, I find that the letter was privileged by Section 8(c) of the Act. I conclude, therefore, that Gaedke did not violate Sec- tion 8(a)(1) of the Act by writing, and distributing to em- ployees, the letter here under consideration. B. Facts Concerning Gaedke's Alleged Violations of Section 8(a)(3) of the Act Before the explosion 17 employees, including those named in paragraph 6(a) of the complaint (herein the Twelve), worked in Gaedke's finishing department and 11 in its casting department. In view of Sandra Ackerson's testimony at the hearing on the Union's petition for certifi- cation, Gaedke was aware that all supported the Union. Immediately following the explosion, Gaedke suspended all manufacturing operations and placed all its employees on layoff status . Anticipating that Rada would soon be in a position to begin finishing knives at Waverly, Gaedke, on December 12, 1974, recalled all casting department em- ployees. Work there resumed on December 16. Before Rada started to finish knives, exactly how many produc- tion employees would be needed there was not known. This was due, in part, to representations made by the man- ufacturer of the Clair machines that they could be operated by fewer employees than were required to operate the auto- matics.16 i6 As it developed, these representations were exaggerated . The fact is, however, that as of February 11, 1975, by which time Rada had been finish- ing knives for about a month , it employed only II production workers, whereas Gaedke needed 17 employees to do the same work before the ex- plosion. 847 Accordingly, on December 20 Gaedke sent letters to each of the Twelve, who had been the most junior employ- ees in Gaedke's finishing department, informing them "that instead of being on layoff status . . . you should con- sider that your employment with Gaedke has been perma- nently terminated." 1 The letter also invited its recipients to apply for work at Rada. The employment of the five senior Gaedke finishing de- partment employees was not terminated. They were re- tained on layoff status. Two of those who received the foregoing letter, Masumi Huberg and Mariann Nelson, applied for work at Rada and were hired. Sheryl Powell, one of the senior employees in Gaedke's finishing department who had been retained on layoff status, also applied for work at Rada and she, too, was hired. Huberg, Nelson, and Powell were referred to Rada by Walter Rada, the president of Gaedke and Rada. Re- specting Huberg and Powell, they were told by Walter Rada, Powell testified, that "he didn't want any of the troubles from Waterloo taken up [to Waverly]." 1 Huberg's version of Walter Rada's statement differs somewhat from Powell's. She testified that Walter Rada said that "he doesn't want any problem brought up from Waterloo." Huberg further testified that Walter Rada did not "tell [her] what kind of problems he was talking about." Upon being queried about the foregoing testimony of Huberg and Powell, Walter Rada stated that when he men- tioned not taking Gaedke's problems to Waverly he was "referring to ... litigation, insurance, production and pri- marily safety problems that [he would] go to great lengths [to] make sure [would] never reoccur." 1 In order to assess the General Counsel's contention that the discharge of the Twelve was violative of Section 8(a)(3) of the Act, findings are necessary concerning the subse- quent employment with either Gaedke or Rada of the Twelve and those retained on layoff status when the Twelve were discharged. Starting with the five most senior employees, who were retained on layoff status, I have al- 17 G.C. Exh. 12. 18 Powell also testified that during this conversation Walter Rada also said that when he purchased Gaedke from its former owner he "knew that Waterloo was more or less a unionized city and that he had to take that into consideration when he bought it." Whether Walter Rada actually said this is problematical. He denied doing so. In connection with his denial, Walter Rada testified that he would not have made such a statement "because [he] had been counseled by [Gaedke's lawyer] and [he] had also counseled Mrs. McMullin [then Gaedke's bookkeeper] and everybody else . . . on the man- agement end of [Gaedke] about such things and [he was] sure that [he] did not make that statement." Beverly McMullin, now Rada's office manager, who was present during Walter Rada's entire conversation with Powell cor- roborated Walter Rada's denial. She testified that she did not remember either Walter Rada or Powell mentioning a union or union cities. McMullin further testified that she would have remembered those subjects, if they were discussed, because she had been warned not to talk about unions to anyone. In view of Walter Rada's denial and its corroboration by Mc- Mullin, I am extremely reluctant to credit Powell concerning her testimony here under discussion. i9 The General Counsel would have me infer that when Walter Rada mentioned "troubles" and "problems" to Huberg and Powell he was talking about union "troubles" and "problems." However, there does not appear to be any cogent reason for me to accept Walter Rada's testimony at less than face value. 848 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ready found that one of these, Powell, was hired by Rada. The remaining four were given jobs in the casting depart- ment at Gaedke. Concerning the Twelve, two of their number, Huberg and Nelson, as set forth above, were hired by Rada and have been working there since January 8 and 15, 1975, respectively. Seven 20 never sought employment at Gaedke or Rada after receiving notice of their discharge. Of the remaining three, one, Mary Frost, who lives in Gilbertville, Iowa, about 30 miles from Waverly, asked to be reemployed at Gaedke. Walter Rada, who had earlier instructed Herb Jones, Rada's production manager, to give preference in hiring to all former Gaedke employees, sug- gested that she apply for a job at Rada. Frost replied, as she testified, "Waverly . . . was a long way to drive." On or about February 15, 1975, Frost again applied for a job at Gaedke. Lou Rausch, Gaedke's production manag- er, to whom she spoke on this occasion, told her there were no openings there. Their discussion then turned to Rada. As she had previously said to Walter Rada, Frost told Rausch, as she further testified, "Waverly is quite a way for me to drive." Like Frost, in about mid-January 1975, Marlene Halli- gan, the second of the remaining three, also applied for a job at Gaedke. She stated at the time that she preferred working in Waterloo to working in Waverly. Halligan did not seek a position with Rada until a few days before the hearing in this proceeding. Walter Rada stated, concerning this, that she would be considered for employment there "at the first opening." After being advised of her discharge, Connie Miles, the last of the remaining three, informed Walter Rada that she was interested in working at Rada. Walter Rada told her, as he testified, that "we would be glad to take [her] on." Several days later, Miles called Walter Rada and told him, as he further testified, that "she had changed her mind [and because] she did not have a driver's license she would not be interested in working at Waverly." On January 8, 1975, Miles filed a written application for a job at Rada. In response, Rada sent Miles a letter, dated January 15, 1975,21 informing her that she would "be called for work as soon as [there was] an opening, which should be in the not too distant future." Upon receiving this letter, Miles told Walter Rada, as she testified, that she "would prefer to work . . . in Waterloo since [she] didn't drive." C. Contentions and Concluding Finding Concerning Gaedke's Alleged Violations of Section 8(a)(3) of the Act Although guiding principles are not in doubt, "Section 8(aX3) cases are difficult cases," 22 and the instant one is no exception to this rule. Almost always present in such cases, and present here also, are vexatious questions of mo- tive. 2e These are Sandra Ackerson, Minnie Ayers, Vickie Crew, Susan Chris- tensen, Jacquelyn Eastman, Mary Sandoval, and Delphma Van Kamen. Shortly after the explosion , Van Kamen and Sandoval told Walter Rada that they would never again work for Gaedke or any company like it. 21 G.C. Exh. 5. 22 N L.R.B. v Atlanta Coca-Cola Bottling Company, Inc, 293 F 2d 300, 308 (C.A 5, 1961). If the discharge of the Twelve was motivated by their support of the Union, as Gaedke was well aware, obviously the termination of their employment was violative of Sec- tion 8(a)(3) of the Act. But the facts seem to indicate that this is not the case, After Gaedke learned that it would be impossible to re- sume finishing knives in Waterloo and after it had, for this reason, decided to have that work done in Waverly through the medium of Rada, discharge notices were sent to the Twelve. In the expectation that the finishing opera- tion in Waverly could be carried on with fewer employees than the number who had done that work in Waterloo, five senior finishing department employees, who were as staunch supporters of the Union as were the Twelve, were not discharged, but retained on layoff status, probably for the purpose of employing them at Waverly. In fact, one was so employed and the other four were given jobs in Gaedke's casting department after its reopening on De- cember 16. Two of the Twelve, who, like the remainder, were also union adherents, were hired at Rada upon their applying for work there. One did not desire to work at Rada because it was too far from her home. Another refused an offer of employment at Rada for a somewhat similar reason. Still another applied for work at Gaedke at a time when there were no vacancies and stated that she preferred to work in Waterloo rather than in Waverly. Some 2 months later this employee sought a position at Rada and was in- formed, only a few days before the hearing, that she would be hired there "at the first opening." The remaining seven did not, following their discharge, seek employment at Gaedke or Rada. Had they done the latter at a time when jobs were available, it is likely, as was the case respecting Huberg, Nelson, and Powell, that they would have been successful in view of the instruction given by Walter Rada, the president of Gaedke and Rada, to Herb Jones, Rada's production manager, to give prefer- ence in employment to former Gaedke employees. It thus appears that those of the Twelve who applied for work at Rada and who indicated a desire to accept em- ployment there were hired or offered a job. It further ap- pears that five employees in the Gaedke's finishing depart- ment who, as in the case of the Twelve, also favored the Union were not discharged at all. Such a course of conduct by Gaedke does not, in my opinion, bespeak an employer bent on destroying its em- ployees' interest in a union by discharging its supporters. It seems to me that if this had been Gaedke's object it would have discharged not only the Twelve but also the five se- nior employees who were retained on layoff status. Nor would Rada's production manager have been instructed to give rreference in employment to former Gaedke employ- ees? Notwithstanding the foregoing, I am disturbed by the fact that the discharges occurred some 2 weeks before the election. This is a suspicious circumstance. However, as has been said many times, "suspicion is not a substitute for proof." Rafael Igartua, Proprietor of Aguadilla Children's 23 It will be remembered in this regard that I have found Gaedke and Rada to be a single employer for the purposes of the Act GAEDKE CUTLERY MFG. CO. Wear Plant, 174 NLRB 615, 619 (1969). Furthermore, "an unlawful purpose is not lightly to be inferred. In the choice between lawful and unlawful mo- tives, the record taken as a whole must present a substan- tial basis of believable evidence pointing toward the unlaw- ful one." 24 Upon careful consideration of the record, I do not find such a "substantial basis" to be present here. Accordingly, I am constrained to conclude, upon consid- eration of the entire record, that the General Counsel has not proven by a preponderance of the evidence that Gaed- ke violated Section 8(a)(3) of the Act by discharging the Twelve on December 20, 1974. VI. THE CHALLENGES The six employees whose ballots were challenged at the election held on January 3, 1975, were, as I have found, lawfully discharged before that date . They were, there- fore, ineligible to vote . Jefferson Mills, Division of Kahn and Feldman, Inc., 120 NLRB 385, 388 (1958). Having found that Gaedke did not engage in any of the unfair labor practices alleged in the complaint and that the persons whose ballots were challenged by Gaedke were in- eligible to vote, my recommended Order will provide that the complaint be dismissed and that the challenges to the ballots be sustained. Upon the basis of the foregoing findings of fact, and u N.L.R.B. v. T.A. McGahey, Sr., et al., d/b/a Columbus Marble Works, 233 F.2d 406, 413 (C.A. 5, 1956). 849 upon the entire record in this case, I make the following: CONCLUSIONS OF LAW 1. Gaedke and Rada constitute a single employer for the purposes of the Act. 2. The Union is a labor organization within the meaning of the Act. 3. Gaedke has not engaged in unfair labor practices within the meaning of Section 8(a)(1) or (3) of the Act. Upon the foregoing findings of fact, conclusions of law, and the entire record in this case, I hereby issue the follow- ing recommended: ORDER 25 It is ordered that the complaint in Case 18-CA-4429 be, and the same hereby is, dismissed. IT IS FURTHER ORDERED that the challenges to the ballots cast at the election in Case 18-RC-10268 by Mariann Nel- son, Connie Miles, Marlene Halligan, Mary L. Frost, Vick- ie Crew, and Sandra Ackerson be, and the same hereby are, sustained. 25 In the event no exceptions are filed as provided by Sec 102.46 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, and Order herein shall, as provided in Sec. 102.48 of the Rules and Regulations, be adopted by the Board and become its findings, conclu- sions, and Order, and all objections thereto shall be deemed waived for all purposes.