Otis Hospital

402 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Otis Hospital and Massachusetts Hospital Workers Union, Local 880, Service Employees' International Union, AFL-CIO. Case 1-CA-10390 FINDINGS OF FACT I. THE BUSINESS OF RESPONDENT January 19, 1976 DECISION AND ORDER BY CHAIRMAN MURPHY AND MEMBERS FANNING AND JENKINS On June 26, 1975, Administrative Law Judge Phil Saunders issued the attached decision in this pro- ceeding. Thereafter, Respondent filed exceptions and a supporting brief. The General Counsel filed a brief in support of the Administrative Law Judge's Deci- sion. 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 at- tached Decision in light of the exceptions and briefs and has decided to affirm the rulings, findings, and conclusions of the Administrative Law Judge 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 adopts as its Order the recommended Order of the Administrative Law Judge and hereby orders that the Respondent, Otis Hospital, Cam- bridge, Massachusetts, its officers, agents, successors, and assigns, shall take the action set forth in the said recommended Order. DECISION STATEMENT OF THE CASE PHIL SAUNDERS, Administrative Law Judge : Based on an original charge filed on January 16, 1975, by Massachu- setts Hospital Workers Union, Local 880 , Service Employ- ees' International Union, AFL-CIO, herein the Union, a complaint against Otis Hospital, herein called Respondent or the Company, was issued on February 26, 1975 , alleging violations of Section 8(a)(1) and (3) of the National Labor Relations Act, as amended . Respondent filed an answer to the complaint denying it had engaged in the alleged unfair labor practices . Both the General Counsel and Respondent filed briefs in the matter. Upon the entire record in this case , and from my obser- vation of the witnesses and their demeanor,' I make the following: i The testimony of all witnesses had been considered, and the absence of At all times material herein the Respondent has main- tained its principal office and place of business in Cam- bridge, Massachusetts, and has been engaged at this loca- tion in operating a proprietary chronic disease hospital. The Respondent, in the course and conduct of its business operations,, causes large quantities of food, health care products, and related goods and services used by it in the operation of its hospital, to be purchased and transported in interstate commerce from and through various States of the United States other than Massachusetts. Respondent has an annual gross revenue in excess of $250,000, and annually received goods, materials, and services valued in excess of $50,000 from suppliers located within Massachu- setts who receive such goods, materials, and services from points located outside of Massachusetts. The Respondent is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED The Union is a labor organization within the meaning of Section 2(5) of the Act 2 III. THE UNFAIR LABOR PRACTICES The main issue in this case is whether the Respondent violated the Act by refusing to grant an announced cost-of- living increase because of the Union's organizational cam- paign. Respondent is a chronic and terminal hospital, and as of January 1, 1975, had grown to 110 beds with about 225 employees. Respondent's operations are administered by Lawrence Hesenius who had been administrator of the Hospital for about 6 years, and testified that he has com- plete control over the operation of the Hospital including the authority to grant any and all wage increases. On or about October 2, 1974; Respondent posted on em- ployee bulletin boards a memorandum or notice signed by Hospital Administrator Hesenuis stating that there would be a cost-of-living raise given to employees effective Janu- ary 1, 1975, and these notices continued to remain posted for a considerable time thereafter. In the latter part of October 1974, the Union began its organizing campaign, and as a result of this activity RC petitions were filed with the Board on or about November 1, 1974. Decisions and Directions of Elections were there- a statement in the resolution of a conflict in specific testimony, or absence of an analysis of such testimony, does not mean that such resolution or analysis was not made See Bishop and Malco, Inc., d/b/a Walker's, 159 NLRB 1159, 1161 (1966) 2 This record clearly shows that the Union exists for the purpose of deal- ing with Employers concerning wages, hours, and conditions of employ- ment through collective bargaining, and has employees as members of its organization Failure to have adopted a constitution or bylaws is immaterial where, in fact, the Union exists for the purposes defined in Sec 2(5) and has employee participation 222 NLRB No. 47 OTIS HOSPITAL 403 after issued by the Regional Director, and an election was scheduled for January 8, 1975, but the Respondent filed a request for review,'and the Board granted Respondent's request and stayed the election pending their decision. On January 1, 1975, the cost-of-living raise promised on Octo- ber 2, 1974, had not been granted, nor has there been such an increase up to the present time. Nurses Aide Mary Campbell testified as to certain raises she and other employees had received in previous years. She also stated that on or about January 9, 1975, when the wage increase was not granted, she had a conversation with Respondent's Administrator Lawrence Hesenius about the matter. Hesenius told Campbell that he did not know what he could do about the raise, told her that at the time when the notice was posted he had never stated the "exact amount," and further informed Campbell that because of the fact "that the union was around" he did not know just what he could give. Campbell then asked Hesenius if he would accept a letter from the Union statmg that no matter what the wage increase was-the Union would not com- plain, and she received the reply from Hesenius that he "just didn't know if it would be a proper thing to do." Campbell also inquired if it would be permissible for her to inform the other employees that the increase or pay raise was not being given due to the Union and because the exact amount of the increase had not been set forth. He- senius replied that it was "perfectly all right" to so inform them. The day after the above conversation Hesenius called Campbell down to his office, and asked her whether she knew he was to receive a letter from the Union which stat- ed that the Union was charging hun with unfair labor prac- tices for not granting the wage increase. Victoria Murphy worked for Respondent until October 31, 1974, as director of nursing service. Murphy stated that when, she was first employed by the Hospital in 1973, there were unequal-pay scales among the employees, and Hesen- ius asked her to see what could be done to equal salary scale for all categories of employees. According to Mur- phy, after this was done, Hesenius then talked to her about a possible cost-of-living raise, and stated that on January 8, 1974, a 4-percent cost-of-living pay raise was given to the nursing department. Administrator Hesenius testified that through the period from 1965 to 1975, it has been the policy of the Hospital to grant wage increases at various times but on a discretion- ary basis, and the only "across the board" raise to the em- ployees was in 1972,: and that was a 5.5-percent raise be- cause of a prior Federal wage freeze, and stated that every other raise given- has -been discretionary with various ranges or percentages, and in many instances the raises were not received by everyone, but were based upon sever- al factorslike length of service, performance of work, and other factors of this nature. - Hesenius admitted that prior to putting up the October 1974, notice of a wage increase, he had determined to grant "some increase," but explained that what he intended was to consider the financial situation of the Hospital around the end of December 1974,, and then ascertain how much of an increase he .could actually give. Hesenius testified that although he knew the income of the Hospital would not vary because charges are based on a per diem rate, and for the past 4 or 5 years the Hospital has been running 97 to 98 occupancy, but he did not know what his expenses or costs would be through the next months because expenses would vary by the number of employees and he was having a large turnover, and it was also the first year of running the Hospital at 110 beds so there would be more equipment and supplies needed. He- senius then stated that he never did work out his wage increase as he was advised by his legal counsel to tempo- rarily freeze all wages on the basis that there was always the possibility of an unfair labor practice charge by making a change in any wage structure or benefits during a union campaign. Hesemus further testified that he chose to label the increase here in question as a cost-of-living increase, but that it was just discretionary use of the term on his part instead of across the board increase, and that his an- nouncement or notice on October, 1974, as aforestated, had absolutely nothing to do with the increase in the cost- of-living even though his notice so stated. The Respondent argues that its determination on this matter -was pursuant to the advice of counsel as special justification for its decision to temporarily withhold the wage increase. Respondent also contends that it was justi- fied in withholding this wage increase because it could not point to any specific amount of increase that it normally granted. Respondent admitted that the Hospital had given some increases on or about January 1 in past years, but maintains these increases had never been across-the-board increases to all employees, whether cost-of-living or other- wise, except in January 1972, when a 5.5-percent increase was granted after the wage freeze. Final Conclusions It is well settled that withholding employees' wage in- creases because of their union activities which otherwise would have been granted, and so advising them, is a viola- tion of the Act. The applicable test with respect to both granting and withholding wage increases under such cir- cumstances is whether or not they would have been grant- ed in the normal course of events absent any union activi- ties. In other words, if a wage increase would have been granted for sound economic reasons in the normal course of events, it should be granted in spite of intervening union activities; and advising employees that it is being withheld because of such activities patently discourages their union activities and interferes with, restrains, and coerces them in the exercise of the rights guaranteed by the Act.' On the other hand, if a wage increase would not have been granted for sound economic reasons in the normal course of events, its granting after the commencement of union organiza- tional activities and/or after the filing of a petition for an election, for the purpose of inducing the employees to vote against the union and favor their benefactor, likewise inter- feres with their guaranteed rights. As- the Board 'has ob- served: By withholding salary increases, which it would have granted had there been no organizing campaign and so advising its employees, the Respondent restrained 404 DECISIONS OF NATIONAL LABOR RELATIONS BOARD and coerced its employees and thereby violated Sec- tion 8(a)(1) of the Act. This is so despite the fact that the Respondent may have believed that it could not grant any raises because of a pending election peti- tion. Dorn's Transportation Company, Inc., 168 NLRB 457 (1967). As the Board stated in the case of The Gates Rubber Company, 182 NLRB 95 (1970), where the Employer con- tended that it had withheld wage increases during the pen- dency of an election in order to maintain its neutrality: In these circumstances, neutrality is not maintained by an announced withholding of a wage increase be- cause of a pending Board-conducted election. It is well settled that the employer's legal duty is to proceed as he would have done had the Union not been on the scene. Here the Respondent withheld increases which would normally have been granted but for the pres- ence of the Union and pendency of the election and advised employees that their wages were being with- held for this reason. By such conduct the Respondent violated Section 8(a)(1) and interfered with employee free choice. It appears to me that the above discussion adequately frames the controlling law, but since these overall stan- dards and guidelines, as set forth by the Board and courts, present essentially factual determinations, the decisions and findings in this area are sometimes ambiguous. More- over, as outlined in GAF Corporation, 196 NLRB 538 (1972), the cases and decisions also appear reconcilable with the holdings that absent establishment of good-faith apprehension based on reasonable grounds for concluding that granting of wage increases or other benefits might re- sult in the filing of unfair labor practice charges, withhold- ing of them because of a union campaign or pending of a representation proceeding, is an unfair labor practice. When the Respondent's action in the instant case is eval- uated in view of these principles the conclusion must be that the Respondent's withholding of the wage increase constituted, in these circumstances, a violation of Section 8(a)(1) and (3) of the Act. There is no probative testimony or evidence in this rec- ord to, the effect that Respondent's motivation in withhold- ing the wage increases was fear of unfair labor practice charges or other legal action. No one testified to that effect, and, in fact, Mary Campbell inquired of Hesenius, as aforestated, if he would accept a letter from the Union stating that they would, not complain or file a charge re- gardless of what the increase was. In GAF Corporation, su- pra, the Administrative Law Judge held: "That an Employ- er may be faced with, unfair labor practices because of normal action taken by him during the course of a union campaign or during the pendency of an election is always a possibility. . . . The possibility of being subjected to un- founded litigation is a risk with which all in a democratic society must live. However, that risk is not a ground for exemption from one's statutory obligations or for infringe- ment on,the statutory rights of others." Hesenius also stated that he was advised by his legal counsel to temporarily freeze all wages. But whether pur- suant to advice of counsel or not, the evidence, in my opin- ion, requires the conclusion that the Respondent's motiva- tion was discriminatory, and, of course, the fact that Respondent's decision was undertaken as a result of legal advice does not absolve the Respondent from the responsi- bility for the course of action undertaken, if, in fact, it is unlawful. As frequently documented in numerous cases, employ- ees cannot be left in fear of the loss of employment benefits for having exercised their guaranteed statutory rights mere- ly because an employer concludes that he might be the subject of an unfair labor practice charge if he grants a contemplated increase. If he may do so, the guarantees of the statute assuring employees of their freedom to exercise their self-organizational rights are hollow indeed. GAF Corporation, supra. It will be recalled that Administrator Hesenius admitted in his testimony that prior to posting his October 2, 1974, notice, he had determined to give "some" wage increase to his employees, and in December 1974 he intended to re- view his financial situation and costs and thereby ascertain the amount of the increase. The above sequence of events shows that the original and initial decision for a wage in- crease was made by Hesenius before any union activity started and, of course, the employees were well aware of this. Moreover, there is no credited evidence in this record that Hesenius was in any way prevented from completing his survey or review of his financial costs when December 1974 came around as he originally intended to do-except by this time the Union was now in the picture. Turning again to the overall principal guideline prescrib- ing that an employer must determine whether to grant or withhold benefits precisely as if a union were not in the picture, in the instant case the credited testimony of Gener- al Counsel's witness, Mary Campbell, discloses Respondent's motive for not granting the increase. In their conversation Administrator Hesenius told Campbell, "due to the fact that the Union was around," he didn't know what he could give. As pointed out, it is thus clear that but for the Union and organizational activities, Respondent's employees would have received their promised pay in- crease as originally announced. It is alleged in the complaint as an independent 8(a)(1) allegation that on or about January 8, 1975, Administrator Hesenius told an employee that he could not give the raise here in question because of the Union. As set forth and discussed above, to withhold wage increases during the pendency of an election or union campaign when this is the motivating factor is clearly violative of the Act. Moreover, as noted in The Gates Rubber Company, supra, "neutrality is not maintained by an announced withholding of wage in- crease because of a pending Board-conducted election." In the instant case Hesenius told employee Campbell that the reason for the increase not being given was because "the Union was around." I agree that this statement clearly falls within the purview of The Gates Rubber Company case, su- pra, and thus constitutes a violation of Section 8(a)(1) of the Act. Moreover, as also pointed out, this could hardly be considered an isolated statement given Hesenius' fur- ther assurances to Campbell that she could inform other employees about this decision, and especially so in view of OTIS HOSPITAL the increase being actually withheld. It is also alleged in the complaint, as an independent 8(a)(1) allegation, that on or about January 9, 1975, Hesen- ius asked an employee if she was aware that he was to receive a letter from the Union. As aforestated, employee Campbell testified that Hesenius called her into his office and, referring to a letter he had received from the Union which indicated the Respondent would be charged with unfair labor practices for not granting the increase,3 asked Campbell if she knew he was to receive the letter. As point- ed out, Hesemus initiated the foregoing conversation with- out any apparent legitimate purpose and gave no reason to Campbell as to why he was questioning her about the Union; neither did he give any indication or assurance that she would not suffer economic reprisals. I agree that ques- tioning an employee in this manner tends to inhibit them in the exercise of their right to organize, and that such inter- rogation could hardly be considered random or innocent as it followed a conversation with the same employee wherein Hesenius had previously indicated that a wage in- crease was not being granted because of the Union "being around." Respondent violated Section 8(a)(1) of the Act. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICE UPON COMMERCE The activities of the Respondent set forth in section III, above, occurring in connection with the operation of Re- spondent Company described in section I, above, have a close, intimate, and substantial relationship to trade, traf- fic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing com- merce and the free flow of commerce. V. THE REMEDY Having found that Respondent has engaged in certain unfair labor practices, I shall recommend that it cease and desist therefrom and take certain affirmative action de- signed to effectuate the policies of the Act. A broad cease and desist order is warranted in view of Respondent's dis- criminatory conduct and other violations. It is also recommended that Respondent promptly pay to its employees the wage increase that, on October 2, 1974, it promised would become effective on January 1, 1975, with interest at 6 percent on the wage increases for the period from January 1, 1975, to the date when the increases are made currently operative as part of the employees' reg- ular pay. Since Respondent had not promised a specific amount of a wage increase, the increase will be in the amount that Respondent would have paid but for its illegal withdrawal of the promised increase. The Board's remedies are designed to restore the status quo which would have prevailed if the unlawful acts had not been committed. The Board has, in other cases like the present one, ordered an employer to reimburse employees for wage increases they would have received except for the employer's unlawful conduct in canceling them. Hendel Manufacturing Company, Incorporated, , 197 NLRB 1093 3 See G C. Exh. 3. 405 (1972), enfd. 483 F.2d 350 (C.A. 2, 1973); GAF Corporation, 196 NLRB 538 (1972), enfd. 488 F.2d 306 (C.A. 2, 1973). Also see Keller Columbus, Inc., 215 NLRB No. 124 (1974). The October 2, 1974, notice posted by Respondent in the instant case refers to a cost-of-living increase, as aforestat- ed, but I will accept the testimony by Hesenius that this was a "frivolous" use of the term or an inadvertent mistake on his part, and that the notice he posted should have read, "across-the-board" increase. The testimony given by He- senius as to income, grants, additional beds, equipment, and supply expenses, and his evaluations in other cost fac- tors of a similar nature, all tend to substantiate his testimo- ny that "across the board" was the contemplated increase and the standard to be applied. Hesenius further stated that he would have determined in December 1974 the amount of the increase to be given on January 1, 1975. All the income figures, grants, and cost factors and all records from other outside agencies are as easily available at the present time as they would have been in December 1974, or even more so, and as a result Hesenius can now readily ascertain the exact and precise across-the-board increase he would have given on January 1, 1975, had not the em- ployees engaged in union activities. This increase must also be considered with increases of a like nature given in the past (5.5 percent in 1972) and which would be sufficiently definite to remove it from the category of speculative. The exact amount of the increase can be determined in a back- pay proceeding if the parties are unable voluntarily to agree on a precise figure. See Keller Columbus, Inc., supra. CONCLUSIONS OF LAW 1. Respondent is engaged in commerce within the mean- ing 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. By withholding or withdrawing a wage increase for the employees the Respondent engaged in unfair labor practices within the meaning of Section 8(a)(1) and (3) of the Act. 4. By interfering with, restraining, and coercing employ- ees in the exercise of the rights guaranteed in Section 7 of the Act, as enumerated herein, the Respondent has en- gaged in and is engaging in unfair labor practices within the meaning of Section 8(a)(1) of the Act. 5. The aforesaid unfair labor practices are unfair labor practices within the meaning of Section 2(6) and (7) of the Act. Upon the basis of the foregoing findings of fact, conclu- sions of law, and the entire record, and pursuant to Section 10(c) of the Act, I hereby issue the following recommend- ed: ORDER4 Respondent Otis Hospital, Cambridge, Massachusetts, its officers, agents, successors, and assigns, shall: 4 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, 406 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 1. Cease and desist from: (a) Interrogating employees about union activities or union letters. (b) Telling or warning employees that a promised wage increase could not be given because of the Union. (c) Withholding and refusing to pay to its employees the pay increase that it promised its employees would be effec- tive January 1, 1975. (d) In any other manner interfering with the exercise by employees of the rights guaranteed to them under Section 7 of the National Labor Relations Act. 2. Take the following affirmative action to effectuate the policies of the Act: (a) Pay to its employees the wage increases that were promised to be effective on January 1, 1975, including the wage increases that were withheld from January 1, 1975, to the effective current institution of the pay increases, with interest at 6 percent on the previously withheld increases, and all in the manner set forth in the section of this Deci- sion entitled "The Remedy." (b) Preserve and, upon request, make available to the Board or its agents, for examination and copying all pay- roll records, social security payment records, timecards, personnel records, reports, and all other records necessary to analyze the amount of backpay due under the terms of this recommended Order. (c) Post at its place of business and Hospital, copies of the attached notice marked "Appendix." 5 Copies of said notice, on forms provided by the Regional Director for Region 1, after being duly signed by Respondent's repre- sentative, shall be posted by Respondent immediately conclusions, and recommended Order herein shall, as provided in Sec 102.48 of the Rules and Regulations, be adopted by the Board and become its findings, conclusions, and Order and all objections thereto shall be deemed waived for all purposes 5In the event that the Board's Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall be changed to read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board." upon receipt thereof, and be maintained by it for 60 con- secutive days thereafter, in conspicuous places, including all places, where notices to employees are customarily post- ed. Reasonable steps shall be taken by Respondent to in- sure that said notices are not altered, defaced, or covered by any other material. (d) Notify the Regional Director for Region 1, in writ- ing, within 20 days from the receipt of this Decision, what steps have been taken to comply herewith. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government After a hearing in which all parties were represented by their attorneys and presented evidence in support of their respective positions, it has been found that we have violated the National Labor Relations Act in cer- tain respects and we have been ordered to post this notice and to carry out its terms. WE WILL pay to our employees the wage increases that we had promised to them beginning January 1, 1975, with interest at 6 percent on the wage increases that we have withheld since January 1, 1975. WE WILL NOT interrogate our employees concerning their union activities, nor inquire as to letters sent to us by the Union. WE WILL NOT inform or give warning,to our employ- ees that promised wage increases cannot be given be- cause of the Union. WE WILL NOT in any other manner interfere with our employees' exercise of rights guaranteed to them by Section 7 of the National Labor Relations Act. OTIS HOSPITAL