Fremont Manufacturing Co., Inc.

FREMONT MANUFACTURING CO 597 Fremont Manufacturing Company, Inc. and United Steelworkers of America, AFL-CIO, and Progress Team, Party in Interest. Case 17-CA-6688 June 10, 1976 DECISION AND ORDER BY CHAIRMAN MURPHY AND MEMBERS FANNING AND JENKINS On January 26, 1976, Administrative Law Judge Robert E Mullin issued the attached Decision in this proceeding Thereafter, Respondent filed exceptions and counsel for the General Counsel filed an answer- ing 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 at- tached Decision in light of the exceptions and brief and has decided to affirm the rulings, findings,' and conclusions of the Administrative Law Judge and to adopt his recommended Order, as modified herein 1 Respondent excepts to the Administrative Law Judge's finding that Supervisor Jenkins observed and was aware of the employees' union activities on July 7, 1975 We find merit to that exception The record shows that Jenkins did observe certain of the em- ployees leave the parking lot in their cars (and, later, saw one of them drive back past it) But such facts alone do not give rise to an inference that Jenkins knew that they were driving towards a rendezvous for the purpose of discussing the Union, as the Ad- ministrative Law Judge found There is no evidence that he or any other representative of Respondent witnessed the meeting about the Union which these employees held after they had driven away from the ' The Respondent has excepted to certain credibility findings made by the Administrative Law Judge It is the Board's established policy not to over- rule an Administrative Law Judge's resolutions with respect to credibility unless the clear preponderance of all of the relevant evidence convinces us that the resolutions are incorrect Standard Dry Wall Products, Inc 91 NLRB 544 (1950), enfd 188 F 2d 362 (CA 3 1951) We have carefully examined the record and find no basis for reversing his findings We note that at the end of his discussion of "The Facts," the Administra- tive Law Judge inadvertently referred to "Jenkins as Jensen Respondent further contends that the Administrative Law Judge incor- rectly found that Supervisor Anderson corroborated the testimony of em ployee Killion that she had left her machine on July 10 to solicit Anderson s assistance in repairing a malfunction in the machine The record establishes that Anderson in fact corroborated Killion's testimony concerning the mal- functioning of her machine but Anderson was unable to recall whether Killion had sought him out to complain about it Thus while Anderson s testimony does not corroborate Killion's in all respects , neither does it con- tradict it Accordingly, we shall affirm the Administrative Law Judge's find- ings based on Killion's uncontradicted testimony concerning the events of July 10 lot and out of sight Consequently, we do not adopt the finding that Jenkins observed the employees' union activities on that date Nevertheless, the record does establish, as found by the Administrative Law Judge, that Respondent gained knowledge of em- ployees' union activities on July 3, when Jenkins ob- served employee Norma Killion soliciting the signa- tures of fellow employees to union authorization cards 2 Respondent contends that the Administrative Law Judge's finding that it unlawfully dominated the Progress Team is not within the allegations contained in the complaint The complaint alleges that Respon- dent rendered unlawful assistance to the Progress Team, "by urging and soliciting employees to desig- nate two persons in the employ of the Respondent to comprise an entity to be called the `Progress Team,' which would serve to collectively represent the em- ployees regarding their terms and conditions of em- ployment with the Respondent," and concludes that by such conduct Respondent violated Section 8(a)(2) We find that these allegations are sufficient to bring the issue of domination within the scope of the complaint and, further, that the record facts, fully litigated before the Administrative Law Judge, estab- lish that Respondent did unlawfully dominate the Progress Team in violation of Section 8(a)(2) and (1) of the Act See STR, Inc, d/b/a Sound Technology Research, 221 NLRB 1235 (1975) Thus, the record establishes that Respondent conceived, suggested, and abetted the formation of the Progress Team to discuss with Respondent's employees terms and con- ditions of employment and, further, afforded the Progress Team full financial and secretarial assis- tance In addition, Respondent set up the selection procedure for choosing the two Progress Team "members," one of whom was a supervisory employ- ee through whom Respondent could effectively con- trol and dominate the affairs of the Progress Team Accordingly, we adopt the Administrative Law Judge's finding that Respondent unlawfully domi- nated the Progress Team We shall, however, amend the Administrative Law Judge's recommended Order by including a provision permitting the continuation of those benefits instituted by Respondent as a result of its discussions with the Progress Team 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 as modified below and hereby orders that the Respondent, Fre- 224 NLRB No 79 598 DECISIONS OF NATIONAL LABOR RELATIONS BOARD mont Manufacturing Company, Inc, Fremont, Ne- braska, its officers, agents, successors, and assigns, shall take the action set forth in the said recommend- ed Order, as so modified Substitute the following paragraph for paragraph 2(b(b) Withdraw all recognition from the Progress Team as a representative of any of its employees for the purpose of dealing with the Fremont Manufac- turing Company, Inc , concerning grievances, labor disputes, wages, rates of pay, hours of employment, or other conditions of work and completely dises- tablish the Progress Team as such representative, Provided, however, that nothing in this Order shall require the Respondent to vary or abandon any wag- es, hours, or other substantive benefits established as a result of discussions with the Progress Team, or to prejudice the assertion by its employees of any rights they derived as a result of such discussions, and fur- ther provided, that nothing herein shall be construed as prohibiting its employees from forming, joining, or assisting any labor organization " FINDINGS OF FACT I THE BUSINESS OF THE RESPONDENT The Respondent, a corporate subsidiary of The Oilgear Company (herein Oilgear), maintains a plant in Fremont, Nebraska, where it is engaged in the manufacture of hy- draulic components Oilgear, which has its headquarters in Milwaukee, Wisconsin, also maintains another plant in Longview, Texas In the course of its operations in Fre- mont, the Respondent annually purchases goods and mate- rials valued in excess of $50,000 directly from suppliers located outside the State of Nebraska Its annual sales of finished products shipped directly to customers located outside that State also exceeds $50,000 On the foregoing facts, the Respondent concedes, and it is now found, that Fremont Manufacturing Company, Inc, is engaged in commerce within the meaning of the Act II THE CHARGING PARTY INVOLVED United Steelworkers of America, AFL-CIO, herein Union, is a labor organization within the meaning of the Act III THE ALLEGED UNFAIR LABOR PRACTICES DECISION STATEMENT OF THE CASE ROBERT E MULLIN, Administrative Law Judge This case was heard on October 28 and 29, 1975, at Fremont, Ne- braska, pursuant to charges duly filed and served,' and a complaint issued on September 8, 1975 The complaint pre- sents questions as to whether the Respondent violated Sec- tion 8(a)(1), (2), and (3) of the National Labor Relations Act, as amended In its answer, duly filed, the Respondent conceded certain facts with respect to its business opera- tions, but it denied all allegations that it had committed any unfair labor practices At the hearing the General Counsel and the Respondent were represented by counsel 2 All parties were given full opportunity to examine and cross-examine witnesses, and to file briefs The parties waived oral argument and on December 5, 1975, the General Counsel and the Respon- dent submitted briefs 3 Upon the entire record in the case, including the briefs of counsel, and from my observation of the witnesses, I make the following A Background and Sequence of Events The Respondent's plant in Fremont is located in a new building, the construction of which was begun in June 1974 and completed in January 1975 Manufacturing operations did not begin until after the building was finished Howev- er, a cadre of supervisory personnel had been at the plant for some months prior thereto At the time of the events now in question the Respondent had about 30 employees Early in July 1975,4 employee Norma Killion initiated a drive to organize the Responent's production and mainte- nance workers On July 10, Killion was discharged Wheth- er her termination was discriminatory is an issue in this case Early in August, the Respondent distributed a handbook announcing the establishment of various rules and practic- es as to hours, wages, and working conditions This manual also provided for the establishment of a "Progress Team " A day or two after the distribution of the handbook the plant manager supervised the election of two employees to the Progress Team The General Counsel contends that the latter is a labor organization and that it was illegally assist- ed and dominated by the Company The Respondent de- nies this contention in its entirety The employee handbook also set forth several plant rules on solicitation and distri- bution which are now in controversy i The original charge was filed on July 29, 1975 An amended charge was filed on September 3, 1975 2 The Party in Interest, although served with a copy of the complaint did not appear However, Gary Anderson, one of the two elected members of the Progress Team, appeared in response to a subpena and testified for the General Counsel 3 Attached to the General Counsel's brief was a motion to correct certain stenographic errors in the transcript The Respondent having voiced no objection to the proposed corrections and the motion appearing to have merit, it is now granted and the record corrected in accordance therewith B The Supervisory Hierarchy At the time in question, John B Slack was the general manager of the Respondent's facility at Fremont John I Leggett was the plant manager, and Wallace Jensen was the manager of manufacturing 4 All dates hereinafter are for the year 1975 unless otherwise noted FREMONT MANUFACTURING CO 599 The General Counsel contends that Jess Jenkins was also a supervisor within the meaning of the Act This was denied by the Respondent However, when on the stand, and when undergoing cross-examination by the General Counsel, Plant Manager Leggett testified that Jenkins was the quality control manager and, as such, was the supervi- sor of the hourly rated inspection personnel Leggett fur- ther testified that Jenkins had the authority to reprimand employees, allow them to have time off and effectively to recommend discharges and wage increases Jenkins was never called to the stand On the testimony of Plant Man- ager Leggett, it is now found that Jenkins was a supervisor within the meaning of the Act C The Facts Late in June, employee Norma Killion contacted John Elam, a representative of the United Steelworkers of Amer- ica, AFL-CIO, to solicit his help in organizing the work force at the Respondent's plant Soon thereafter, Elam came to Killion's home where he had her sign an authori- zation card in the Union and supplied her with a number of additional cards to distribute among her coworkers at the plant On July 3, a Thursday, Killion induced Diana Smith, a coworker, to sign an authorization card while both of them were in the plant lunchroom during the noonday break During that same break she talked about the Union with employees John Cosseboom, James Peterson, and Wayne Anderson The latter told her that he was uninterested Cosseboom and Peterson, however, manifested a willing- ness to sign cards Both of them did so, Cosseboom later that day, and Peterson on July I 1 After the plant closed at 4 30 p in on July 3, Killion met Cosseboom and employee Lois Kimbrell in the plant park- ing lot where she secured their signatures on authorization cards The execution of their signatures took place beside Killion's automobile and was observed by Supervisor Jen- kins While the two employees were filling out the cards for Killion, Jenkins walked past them on the way to his car, looked at the three of them as he did so, and, after he got in his car, drove past them as he left the parking lot On July 7, the following Monday, the plant having been closed on the July 4 weekend, Killion resumed her organi- zational efforts During the course of the shift she arranged with several of her fellow employees that at the end of the day she would meet with them along a country road a short distance from the Respondent's facility Soon after 4 30 p in that afternoon, and at a time when most of the other employees had already departed, Killion and eight of her coworkers gathered in the plant parking lot Killion and her cohorts then agreed to rendezvous at a point about a half mile east of the plant where they could meet and sign authorization cards Thereafter, as Killion left the parking lot, she was followed by six other cars in which employees Bonnie Peterson, Sharon Bittner, Marilyn Capron, Mardell Synovec, Mary Ann Stodola, Darlene Smith, Marlene Hill, and Harriet Odle were riding or driving This formidable procession proceeded in an easterly direction along a little traveled country road that was known as Old Highway 8 At the time, only Killion and Peterson, who rode in Killion's car, lived east of the plant All the other women lived at various points west of the plant so that they did not normally follow Killion as they left work As a conse- quence, after their meeting along the roadside where the eight employees signed authorization cards for Killion, all those who lived west of the Respondent's location turned around and drove back past the plant as they proceeded to their homes Employees Bittner and Killion credibly testified that, as the entourage of cars led by Killion was leaving the park- ing lot that afternoon, Supervisor Jenkins was standing in a plant doorway at one of the loading docks and observed them as they left Bittner further testified, credibly, that about 20 minutes later when she and the others who lived west of the plant returned from their roadside organiza- tional meeting and proceeded past the plant on the way to their homes, Jenkins was still at the plant doorway only a short distance from the road, and observed them again The General Counsel contended that from this testimony it was evident that Jenkins had knowledge of the union activ- ity of Killion and her coworkers The testimony of both Killion and Bittner was credible in this connection and it was neither denied nor contradicted by any witness for the Respondent Supervisor Jenkins, the logical witness to re- fute any inference that through him the Company secured knowledge of the employees' organizational activities, was never called to the stand and no explanation was offered for the failure to produce him as a witness Under these circumstances, it is now found that, on the basis of Jenkins' observations on July 3 and 7, the Respondent thereupon became aware of the employees' interest in the Steelwork- ers Plant Manager Leggett testified that in July 1974, Gener- al Manager Slack asked that he prepare a draft of plant rules and regulations for the guidance of employees Leg- gett testified that pursuant to this request he prepared the draft of such a manual which he turned over to Slack at some time in August or September 1974 According to Leg- gett, from that time until mid-July 1975 he heard nothing further about such a handbook He testified that on about July 17, 1975, however, Slack handed him a revision of the handbook which had just been received from Oilgear's cor- porate headquarters in Milwaukee According to Leggett, this new version of the rules, which he then saw for the first time, contained several substantially liberalized employee benefits These were clauses providing for three additional paid holidays, a guarantee that an employee reporting for duty would receive at least 2 hours of work, reimbursement for any wage losses incurred while serving on jury duty, be- reavement pay whereby an employee might receive up to 3 days off with pay in the event of a death in the employee's immediate family, and a bid procedure whereby employees could request reassignments and reclassifications The revi- sion also provided for what was to be known as a "Progress Team " Leggett testified that the Company had two to three meetings with the employees during the months of July and August At a meeting held on July 24, during which both Slack and Leggett spoke to the employees, one em- 600 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ployee present, Sidney Ellis, asked whether a union was attempting to organize the employees Ellis testified that although Slack disclaimed any knowledge of such a devel- opment, Leggett stated that he had heard some rumors about organizational activity involving the Fremont plant Early in August, Slack and Leggett held another meeting with the employees On this occasion, copies of the em- ployee handbook were distributed to all the employees for the first time During this meeting, both Slack and Leggett spoke about the Progress Team and the function which the Respondent hoped that it would perform Slack testified that he told the employees that the Progress Team would be especially helpful in a new plant such as the Fremont facility because it would enable them to voice their com- plaints to that organization, rather than having to take their grievances directly to management Leggett indicated that he would be discussing the matter of the Progress Team with each of them very shortly and that an election would be held for the two members of that Team The day after the plantwide meeting, Leggett contacted each of the approximately 30 employees then working for the Respondent at the plant to explain in greater detail the Company's objective with respect to establishing the Prog- ress Team He testified that he told each of the employees that the Progress Team would try to provide a line of com- munication for those who would feel more comfortable in letting the new committee take up their complaints with management rather than requiring each individual to dis- cuss the matter with his supervisor Within a day or two thereafter, at Leggett's behest, ballots were given to each of the employees, who were then asked to designate two rep- resentatives for the Progress Team After the ballots had been marked, they were counted by Leggett and two of the employees Gary Perrey and Gary Anderson received the most votes and, as a result, were designated by Leggett as the Progress Team At the time Anderson was a super- visor 5 Shortly after the election, Leggett met with Anderson and Perrey, the two newly designated members of the Progress Team According to Leggett, during the course of this and subsequent meetings, he and the Team discussed (1) suggested changes in the Company's bid procedure on upgrading jobs, (2) what the Company's policies should be as to attendance, absenteeism, and tardiness, (3) the Team's preference as to a "floating" holidays,6 (4) several complaints that the Team had received from the employees as to the plant timecards and the fact that some employees felt they were not getting paid for all the time they worked, and (5) a proposal by Perrey that the Company establish a payroll deduction system whereby an employee could au- thorize withholding of part of his paycheck for use in pur- chasing tools which the employee had to supply in working 5 When Anderson testified at the hearing on October 28 1975 he stated that he had been a supervisor for about 3 months, so that he had had that status from some time in late July or early August 6 The employee handbook had designated seven specific days in the year as paid holidays and added what it described as two `floating paid holi days, with the provision that the Company would select one of those float- ing days and that the Progress Team would select the other Leggett testified that during their first meeting with the Team the latter selected the day after Christmas as their preference at the plant Leggett testified that this last suggestion was subsequently adopted by the Company Other suggestions made by the Progress Team were also accepted by manage- ment These related to proposals on the bid procedure in reclassifying jobs, and the plant attendance policy As a result of the discussions which Leggett had with the Prog- ress Team in August, the Company subsequently issued two amendments to the Employee Handbook, one on a substantially revised bid procedure that was effective Au- gust 27, and the other on a new attendance policy that was effective on September 2 The Respondent's officials disclaimed having had any knowledge of the Union's organizational campaign until late in July Leggett initially testified that he first learned of the Union's attempt to organize the employees on or about August 1 when he secured a handbill which the Union was distributing Later, however, he conceded that at the meet- ing with the employees on July 24, he might have acknowl- edged having heard something about the Union As has been found earlier, employee Ellis testified that on July 24, Leggett stated, in response to a question from Ellis, that he had heard "rumors" about some organizational activity at the plant Slack denied any knowledge of the Union until about July 31, when handbills were distributed at the plant entrance According to Slack, upon seeing a copy of this handbill, he questioned some of the employees as to what they knew about it He further testified that he asked sever- al of them " who in the hell is passing these out9" and that one of the male employees told him that it was Norma Killion Neither Slack nor Leggett was a persuasive or convinc- ing witness in his categorical denials of knowledge about the employee union activities which occurred prior to July 31 The credible and uncontradicted testimony , related ear- lier herein, as to the activity of Supervisor Jensen during the early part of that month establish that by the late af- ternoon of July 7, Jensen, and, therefore, the Respondent, had reason to believe that a number of the employees were involved in a union campaign D The Alleged Violations of Section 8(a)(2), Findings and Conclusions in Connection Therewith In its brief, the Respondent concedes that it assisted in the formation of the Progress Team, but it denies that in so doing it attempted to dominate or control its employees The General Counsel alleges that the Progress Team is a labor organization within the meaning of the Act and that the Respondent established, supported, and dominated it in violation of Section 8(a)(2) and (1) The contention of the General Counsel that the Progress Team is a labor organization within the meaning of the Act is plainly well founded Section 2(5) of the Act defines a "labor organization" as "any organization of any kind, or any employee representation committee or plan, in which employees participate and which exists for the pur- pose, in whole or in part, of dealing with employers con- cerning grievances wages, rates of pay, hours of em- ployment, or conditions of work " This definition is so extremely broad that it has been found to encompass al- most any kind of employee group, committee, or plan that FREMONT MANUFACTURING CO 601 is established to represent plant personnel Here, the defin- ition clearly embraces the Progress Team The recitation of subjects covered in the meetings which the Team had with Leggett, set forth above, discloses that, in practice, these discussions were solely concerned with employee griev- ances and proposed modifications of the terms and condi- tions of employment of the Respondent's employees The activities of the Progress Team and the Respondent's man- agement, set out above, clearly establish that the Progress Team was "dealing with" the Company as to matters with- in the scope of Section 2(5) of the Act N L R B v Cabot Carbon Company, 360 U S 203, 210-218 (1959), N L R B v The Chardon Telephone Company, 323 F 2d 563, 564 (C A 6, 1963), Pacemaker Corporation, an Indiana Corpora- tion v NLRB , 260 F 2d 880, 883 (C A 7, 1958) In so doing, the Progress Team was acting as, and must be held to constitute, a labor organization within the meaning of the Act As noted above, the Respondent concedes responsibility for the establishment of the Progress Team Its creation was plainly a unilateral act of management After an- nouncing to the employees that the Respondent proposed to institute a program to improve communications between the Company and the employees, Plant Manager Leggett conducted the election for members of the Team, helped count the ballots, and announced the results of the election in which one of the two members elected was Gary Ander- son, a plant supervisor Throughout its existence, the Com- pany has controlled the operations of the Progress Team It is evident that insofar as the latter needed any financial, secretarial, or clerical assistance, it received this from the Respondent Nor is there any dispute that the usual indicia of an independent labor organization, such as a constitu- tion, bylaws, membership requirements, and dues, or other means of independent financing, are completely lacking On the basis of the foregoing facts, it is now found that the Progress Team was established, supported, and dominated by the Respondent, that it is inherently incapable of ever fairly representing the employees, and that, by the course of conduct found above, the Respondent has violated Sec- tion 8(a)(2) and (1) of the Act STR, Inc, d/b/a Sound Technology Research, 221 NLRB 496 (1975) See also N L R B v Newport News Shipbuilding & Drydock Co, 308 U S 241, 250-251 (1939), Indiana Metal Products Corp v NLRB, 202 F 2d 613, 621 (C A 7, 1953), Harrison Sheet Steel Co v N L R B, 194 F 2d 407, 409-410 (C A 7, 1952), N L R B v Western Reserve Telephone Co, 323 F 2d 564, 566 (C A 6, 1963) E The Discharge of Norma Killion, Findings and Conclusions With Respect Thereto Killion was discharged on July 10, according to the Gen- eral Counsel, for discriminatory reasons This allegation is denied by the Respondent, according to whom Killion was discharged for cause Plant Manager Leggett testified that Killion was termi- nated for "inattentiveness, failure to remain at [her] work station, [and] leaving [her] machine while it was in opera- tion " In support of this position, Leggett testified that late on the afternoon of July 9, General Manager Slack asked that he make a note of where Killion was at the time Ac- cording to Leggett, when he did so he saw that she was some distance away from her machine and talking to the shipping clerk, one Darrell Hendricks Leggett testified that the next morning he spent about a half hour observing Killion and that during that period she again spent some time away from her machine According to Leggett, shortly after noon that day he discussed Killion with Wallace Jen- sen, manager of manufacturing Leggett testified that he told Jensen to observe the employee closely and to note that she was wasting time by visiting other employees and being away from her machine when it was running Soon thereafter, Leggett instructed Jensen that he was to inform Killion that she was being discharged Jensen complied with this order and the employee was terminated that af- ternoon Both Leggett and Slack denied having any knowl- edge at that time that any employee had an interest in the Union During the period in question Killion was operating what was known as a Norton flat lap This was a large machine used in grinding parts to specified degrees of smoothness She had had considerable experience in the shop with this machine, as well as with turret lathes She credibly testified that she had never been criticized for any of her work for the Company from the time she was hired the preceding March She further testified, credibly, that on two different occasions Jensen had praised her work According to Killion, in the latter instance, only a week to 10 days before her discharge, Jensen had told her that, when skilled machining and tolerances were critical, she was one of only four or five employees in the shop that he could trust to do such a job properly Leggett himself con- ceded that prior to his conversation with Slack on the af- ternoon of July 9 he had never noticed any problems with Killion's work, and that until then he had considered her work performance satisfactory Killion testified at length with respect to those occasions on July 9 and 10 when she was away from her machine and allegedly derelict in her duties According to the employee, on the afternoon of July 9, when Slack and Leggett ob- served her talking with employee Hendricks, she had gone to the latter, who was engaged in painting some equipment, to request that he turn on one of the plant exhaust fans because the paint fumes were giving her a headache and causing nausea She further testified that both that af- ternoon and the next day she was having trouble with the flat lap machine, that it was not working properly and that, as a result, she had to secure help from Gary Anderson, who was then responsible for its maintenance, and secure his assistance in making adjustments on the stone Accord- ing to Killion, during the last 2 days of her employment, Anderson told her that the malfunctioning of the flat lap was due to inability to "hold its dressing " She testified that Anderson told her that this difficulty arose because the stone had once been frozen and that he had asked the Company to purchase a new diamond to dress the stone, but that the Company had not yet secured the diamond Anderson corroborated much of Killion's testimony about the difficulties the employee was having with the flat lap According to Anderson, due largely to the poor quality of the stone which it had, the machine was not working 602 DECISIONS OF NATIONAL LABOR RELATIONS BOARD properly Anderson acknowledged that during the course of both July 9 and 10, Killion sought him out on several occasions to complain about the machine and to solicit his assistance He further testified that Manager Jensen was aware of the difficulties they were having with the flap lap machine and he thought that he discussed them with Jen- sen at some point prior to July 10 Killion testified that when Jensen informed her that she was being discharged she asked for the reason and that his only response was "Well, you haven't done anything all day but walk around " According to Killion, she protested "Wally, the machine has broken down and I was after Gary to fix it," and then added, "You've never had any complaints about my work before " Killion testified that Jensen did not make any effort to respond to these com- ments on her part Instead, he abruptly concluded the con- versation with the declaration "We're going to let you go anyway " Jensen was called as a witness for the Respon- dent, but was asked no questions about this conversation Killion's testimony, therefore, stands undenied Since she was a credible witness, the foregoing testimony is now found to be a substantially accurate account of the ex- change between Jensen and the employee at the time of her termination Leggett conceded that, prior to Killion's discharge, nei- ther he, nor any member of management, told her that her work was unsatisfactory or reprimanded her in any way for alleged misconduct Killion had been hired in March and had completed a 60-day probation period satisfactorily 7 Thereafter she had worked without any complaints from her supervisors or reprimands of any kind from the man- agement Only a few days before he complied with Leggett's order that she be terminated, Manager Jensen had commended her highly Late in June, Killion had taken the initiative to contact a union representative and to launch an organizational cam- paign During the luncheon break on July 3, she talked with several coworkers about the Union and secured a signed authorization card from one At the end of that shift, and while in the plant parking lot, she induced two other colleagues to sign cards at a time when Supervisor Jenkins was in the vicinity and could observe her solicita- tion On July 7, the following Monday, Killion continued the campaign among her colleagues during the noon lunch period At the close of work that afternoon she led a party of eight female employees out of the plant parking lot to a rendezvous a short distance away where she secured signed authorizations from all of them Again, Supervisor Jenkins observed the women as they followed Killion off the prem- ises and a few minutes later he watched them as they drove back past the plant at the conclusion of their roadside meeting with her By July 8, Killion had secured 10 signed cards from her coworkers Since the plant had only about 30 employees at the time, this constituted a third of the 7 General Manager Slack testified that customarily the work of a new employee is reviewed at the end of her first 30 days and if it has been satisfactory, she is given a nominal increase At the end of another 30 day period, if her work has continued to meet all requirements the individual is given the status of a full-time regular employee and thereafter gets insurance and all other benefits that come with that status work force Leggett and Slack, who testified that they spent a considerable part of each day on the plant floor, never- theless denied any knowledge of union activity or interest among the employees prior to Killion's discharge Signifi- cantly, however, Jenkins, who had closely observed the ac- tivities of Killion and her colleagues on July 3 and 7, was never called by the Respondent to refute the inference that through him the Company had learned of Killion's man- agement of the union drive Neither Leggett nor Slack was credible in his denial of knowledge as to Killion's union activities prior to her termination Moreover, in view of the circumstances set forth above, particularly the credible and uncontradicted testimony that Supervisor Jenkins was in a position to observe, and did observe, Killion while she was engaged in union activities, and the unexplained failure of the Respondent to call Jenkins as a witness, it is now found that prior to her termination the Respondent was well aware of Killion's prominence in the organizational cam- paign NLRB v Link-Belt Co, 311 U S 584, 603 (1941), Amalgamated Clothing Workers of America, AFL-CIO [T I L Sportswear Corporation] v N L R B, 302 F 2d 186, 190 (C A D C, 1962), N L R B v Lawson Printers, Inc, 408 F 2d 1004, 1005 (CA 6, 1969), NLRB v Am- pex Corporation, 442 F 2d 82, 86 (C A 7, 1971), cert denied 404 U S 939 (1971), Angwell Curtain Co v N L R B, 192 F 2d 899, 903 (CA 7, 1951) The evidence adduced by the General Counsel estab- lished that Killion had a good work record, and, as recent- ly as a week to 10 days prior to her discharge she had been praised by Manager Jensen, she had never been repri- manded or admonished at any earlier time, she was dis- missed without any warning after Slack and Leggett alleg- edly observed her wasting time and being absent from her machine, Killion's credible testimony, corroborated by that of Supervisor Anderson, established that she was not guilty of this alleged dereliction, at the time of her peremp- tory dismissal Killion was spearheading an organizational campaign in the plant, at the time approximately one-third of the work force had signed union cards for Killion and when it dismissed her, the Respondent had knowledge of her union activities On these findings, I conclude that the explanation for her abrupt dismissal 8 offered by the Re- spondent was a pretext and that the motivating cause for Killion's termination was her activities on behalf of the Union By this conduct, the Respondent violated Section 8(a)(3) and (1) of the Act F The Alleged Violations of Section 8(a)(1), Findings and Conclusions With Respect Thereto 1 The conferral of employee benefits after the onset of the organizational campaign In August or September 1974, Plant Manager Leggett submitted to the Oilgear headquarters, the Respondent's parent corporation, a proposed draft of an employee hand- 8 The abruptness of a discharge and its timing are persuasive evidence as to motivation N L R B v Montgomery Ward & Co 242 F 2d 497 502 (C A 2 1957) cert denied 355 U S 829 (1957) see also N L R B v Dorn s Transportation Company, inc 405 F 2d 706 713 (C A 2 1969) N L R B v Symons Manufacturing Co 328 F 2d 835 837 (C A 7 1964) FREMONT MANUFACTURING CO 603 book Nothing further was heard about the matter until over 10 months later Then, on about July 17, 1975, Leggett and Slack received from Oilgear a revision of the original draft which was made effective very promptly thereafter Significantly, the revision provided for additional holiday pay, bereavement pay, jury duty pay, report-to-work pay, maternity leave, and a bid procedure for employee promo- tions, none of which had appeared in Leggett's original draft The General Counsel contends that these additional benefits were offered by the Respondent at that time for the unlawful purpose of thwarting the union drive This is denied by the Respondent In its brief, the Respondent asserts that the decision to include the foregoing benefits was based upon a corporate decision to provide the same benefits at Fremont that the parent corporation had already given to the employees of another plant which the latter had in Longview, Texas At the hearing, however, no documentation was offered to substantiate this thesis, and the Respondent produced no evidence of any legitimate business concern which caused this implementation of its fringe benefit program during the employee organizational campaign Moreover, the grant of these benefits was made only shortly after the Respondent's discriminatory discharge of employee Kil- lion on July 10 and when the Company was in the process of unlawfully establishing an employer-dominated labor organization Plant Manager Leggett, the only manage- ment official to testify on this matter, gave no testimony which would establish that the increased benefits were long planned and unrelated to the Respondent's knowledge that an organizational drive was underway Under these cir- cumstances, and in the light of the background of unfair labor practices in which the Respondent announced the fringe benefit package which appeared in the new employ- ee handbook, it is now found that this action by the Re- spondent was designed to thwart the employee attempt at unionization and was, therefore, a violation of Section 8(a)(1) of the Act Newport Division of Wintex Knitting Mills, Inc, 216 NLRB 1058 (1975) 2 The rules on solicitation and distribution The employee handbook, which was distributed on or about August 1, contained a large number of new plant rules, three of which have been alleged by the General Counsel to be overly broad and unlawful restrictions on the Section 7 rights of the employees These rules, although unnumbered in the handbook, will be designated 1, 2, and 3, for purposes of this discussion They read as follows 1 Distributing literature or printed matter of any kind in any work area or during work time anywhere on the company premises or posting notices, signs or writing in any form anywhere on the company prem- ises, unless specifically authorized to do so by the company 2 Soliciting contributions of any kind, unless au- thorization in writing is given by the personnel depart- ment 3 Communicating in any way to any unauthorized person information confidential to the company and/ or designated by the U S Government or its agencies as classified material Making any statement or disclo- sure regarding company affairs, whether expressed or implied as being official, without proper authorization from the company Violation of any of the foregoing rules could subject the offender to disciplinary action, including discharge It is well established that an employer may not prohibit employees from soliciting on behalf of a union, or discuss- ing organizational matters during nonworking periods at the employer's premises Nor may an employer preclude an employee from distributing literature as to union or con- certed activity during nonworking time in nonworking ar- eas, in the absence of a compelling business consideration (such as safety) The Respondent made no effort to estab- lish any business reasons for its promulgation of the afore- said rules Rule 1, in prohibiting the distribution of literature "of any kind in any work area anywhere on the company premises unless specifically authorized to do so by the company" and rule 2, prohibiting "Soliciting contributions of any kind," unless authorized by the personnel depart- ment, are clearly susceptible of the interpretation that, un- less permission is secured from the Respondent, all distri- bution of union literature and all solicitations on behalf of a union are prohibited during all business hours Conse- quently, these rules must be, and are, found to be overly broad Accordingly, their promulgation and maintenance violated Section 8(a)(1) of the Act Essex International, Inc, 211 NLRB 749 (1974), Pepsi-Cola Bottling Co of Los Angeles, 211 NLRB 870 (1974), Alberts, Inc, 213 NLRB 686 (1975), Republic Aviation Corporation v N L R B, 324 U S 793, 803, fn 10 (1945) The General Counsel contends that rule 3 is similarly invalid The Respondent's management conceded that at the present time it has no defense orders in process, so that there does not appear to have been any connection with the promulgation of rule 3 and a contract to supply materi- als for the military or defense establishment The language in the rule which is subject to varying interpretations is the last sentence, viz, "Making any statement or disclosure re- garding company affairs, whether express or implied as being official, without proper authorization from the com- pany " It is conceivable that many of the charges and countercharges that frequently arise during an organiza- tional campaign could be construed as disclosures "regard- ing company affairs" and, if made without "proper author- ization from the company," thereby subject an employee to reprimand for violation of this rule It may be urged that this is an unlikely construction of the rule On the other hand, the Respondent supplied no background or rationale for its promulgation simultaneously with the distribution and solicitation rules discussed above In Lexington Chair Company, 150 NLRB 1328 (1965), the Board found viola- tive of Section 8(a)(1) a plant rule, announced during an organizational campaign, that prohibited employees from "criticizing Company rules and policies so as to cause con- fusion or resentment between employees and manage- ment " The Court of Appeals for the Fourth Circuit held that the Board was justified in holding that the rule consti- 604 DECISIONS OF NATIONAL LABOR RELATIONS BOARD tuted an infringement of rights guaranteed employees un- der Section 8(a)(1) of the Act In so concluding, the court stated (N L R B v Lexington Chair Company, 361 F 2d 283, 287 (CA 4, 1966) ) management was not entitled to promulgate a rule so general in its terminology and so broad in its apparent coverage as to inhibit legitimate organization activity by pro-union employees To the average em- ployee the rule might well have meant that any criti- cism of management, resulting in aid to the Union campaign, would bring swift and severe reprisal "The true meaning of the rule might be the subject of gram- matical controversy However, the employees are not grammarians The rule is at best ambiguous and the risk of ambiguity must be held against the promul- gator of the rule rather than against the employees who are supposed to abide by it " (Citing N L R B v Miller, 341 F 2d 870, 874 (C A 2, 1965) ) In the same fashion as the rule cited in Lexington Chair, the Respondent's rule in this case is subject to various con- structions, one of which is that it would restrict or stultify employee debate during the union campaign then in prog- ress at the plant insofar as such a debate might involve statements or disclosures as to company affairs "without proper authorization from the company " Since "the risk of ambiguity must be held against the promulgator of the rule" (Lexington Chair, supra), it is now held that rule 3 is also an invalid restriction on the rights of the Respondent's employees and a violation of Section 8(a)(1) 3 Interrogation As found earlier herein, on about July 31, when the Union circularized employees at the plant entrance, Gener- al Manager Slack thereafter observed some of the employ- ees with handbills in their possession According to Slack, he then asked several of the employees "Who in the hell is passing these out9" and that one of them told him that it was Norma Killion The General Counsel alleged that Slack's inquiries of the employees as to the identity of the individual who was passing out the Union's handbills constituted unlawful in- terrogation of the employees and created the impression that the Respondent was engaged in unlawful surveillance of protected concerted activity on the part of the employ- ees There is merit to this contention and it is now found, on the basis of General Manger Slack's testimony, set forth above, that by this conduct the Respondent engaged in unlawful interrogation and created the impression of un- lawful surveillance in violation of Section 8(a)(1) of the Act Polyurethane Products Company, Inc, 168 NLRB 98, 99-100 (1967) 9 9 See N L R B v Laister Kauffmann Aircraft Corporation 144 F 2d 9, 13 (C A 8, 1944), where the court stated "This was a fairly new plant and one in which there was, as yet, no crystallization of employee labor affiliation Under such circumstances, it is reasonable to assume that the employer knew the employees would be sensitive to overt or subtle communications of respondent's hostility toward the Union " CONCLUSIONS OF LAW 1 The Respondent is engaged in commerce and the Union is a labor organization, all within the meaning of the Act 2 By discriminating in regard to the hire and tenure of Norma Killion, thereby discouraging membership in the Union, the Respondent has engaged in, and is engaging in, unfair labor practices within the meaning of Section 8(a)(3) of the Act 3 By dominating and interfering with the administra- tion of the Progress Team, and contributing support there- to, the Respondent has engaged in, and is engaging in, unfair labor practices within the meaning of Section 8(a)(2) of the Act 4 By interfering with, restraining, and coercing its em- ployees in the exercise of the rights guaranteed in Section 7 of the Act, the Respondent has engaged 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 affecting commerce within the meaning of Sec- tion 2(6) and (7) of the Act THE REMEDY Having found that the Respondent has engaged in cer- tain unfair labor practices, it will be recommended that the Respondent be ordered to cease and desist therefrom and to take certain affirmative action designed to effectuate the policies of the Act Having found that the Respondent discriminatorily ter- minated Norma Killion on July 10, 1975, it will be recom- mended that the Respondent be ordered to offer Killion immediate and full reinstatement without prejudice to her seniority or other rights and privileges, and make her whole for any loss of earnings she may have suffered from the time of her discharge to the date of the Respondent 's offer of reinstatement The backpay shall be computed in accor- dance with the formula approved in F W Woolworth Company, 90 NLRB 289 (1950), with interest computed in the manner and amount prescribed in Isis Plumbing & Heating Co , 138 NLRB 716, 717-721 (1962) It will also be recommended that the Respondent be required to preserve and make available to the Board, or its agents, on request, payroll and other records to facilitate the computation of backpay due Because the Respondent has established , dominated, and interfered with the administration of the Progress Team, and has contributed support thereto, it will be rec- ommended that the Respondent be ordered to cease and desist from such conduct and that it withdraw recognition from and completely disestablish the Progress Team as the representative of any of the Respondent's employees for the purpose of dealing with the Respondent concerning grievances, labor disputes , wages, rates of pay, hours of employment, or other conditions of work As the unfair labor practices committed by the Respon- dent are of a character striking at the root of employee rights safeguarded by the Act, it will be recommended that the said Respondent be ordered to cease and desist from FREMONT MANUFACTURING CO 605 infringing in any manner on the rights guaranteed in Sec- tion 7 of the Act N L R B v Entwistle Mfg Co, 120 F 2d 532, 536 (CA 4, 1941), Centeno Super Markets, Inc, 220 NLRB 1151, fn 5 (1975) Upon the foregoing findings and conclusions and the entire record, and pursuant to Section 10(c) of the Act, there is issued the following recommended ORDERIo Fremont Manufacturing Company, Inc, its officers, agents, successors, and assigns, shall 1 Cease and desist from (a) Discharging or otherwise discriminating against any employee because of activity on behalf of United Steel- workers of America, AFL-CIO, or any other labor organi- zation (b) Dominating or interfering with the administration of the Progress Team, or with the formation or administration of any other labor organization of its employees, and con- tributing support to the Progress Team or to any other organization of its employees (c) Recognizing, or in any matter dealing with the Prog- ress Team, or any reorganization or successor thereof, as a representative of any of its employees for the purpose of dealing with Fremont Manufacturing Company, Inc, con- cerning grievances, labor disputes, wages, rates of pay, hours of employment, or other conditions of work (d) Maintaining, giving effect to, or enforcing any rules that prohibit employees from distributing literature to, or soliciting, other employees in nonworking areas of the Respondent's plant and premises on nonworking time for self-organizational or other purposes under Section 7 of the Act, or that require employees to obtain permission to en- gage in such distribution or solicitation (e) In any other manner interfering with, restraining, or coercing its employees in the exercise of their right to self- organization, to form, join, or assist any labor organiza- tion, to bargain collectively through representatives of their own choosing, or engage in concerted activities for the pur- pose of collective bargaining or other mutual aid or to re- frain from any or all such activities 2 Take the following affirmative action which is neces- sary to effectuate the policies of the Act (a) Offer to Norma Killion immediate and full reinstate- ment to her formerjob, or, if thatjob no longer exists, to a substantially equivalent position, without prejudice to her seniority or other rights and privileges and make her whole in the manner set forth in the section of this Decision enti- tled "The Remedy " (b) Withdraw all recognition from the Progress Team as a representative of any of its employees for the purpose of dealing with the Fremont Manufacturing Company, Inc, concerning grievances, labor disputes, wages, rates of pay, hours of employment, or other conditions of work and 10 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 recommended Order herein shall as provided in Sec 10248 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 completely disestablish the Progress Team as such repre- sentative (c) 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 and reports, and all other records neces- sary, or appropriate, to analyze the amount of backpay due (d) Post at its plant in Fremont, Nebraska, copies of the attached notice marked "Appendix" I I Copies of the no- tice, on forms provided by the Regional Director for Re- gion 17, after being duly signed by the Respondent's au- thorized representatives, shall be posted by it for a period of 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are cus- tomarily posted Reasonable steps shall be taken by the Respondent to insure that said notices are not altered, de- faced, or covered by any other material (e) Notify the Regional Director for Region 17, in writ- ing, within 20 days from the date of this Order, what steps the Respondent has taken to comply herewith 11 In the event the Board's Order is enforced by a Judgment of the 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 APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL NOT discourage membership in United Steelworkers of America, AFL-CIO, or any other union, by discharging or otherwise discriminating against our employees because of their union or con- certed activities WE WILL NOT engage in surveillance of our employ- ees, or give the impression of engaging in surveillance, with respect to their union or concerted activities WE HAVE notified the members of the Progress Team that they may no longer act as your representatives on grievances, labor disputes, wages, rates of pay, hours of employment or other conditions of work, and WE have completely disestablished the Progress Team as such representative WE WILL NOT maintain, give effect to, or enforce any rules that prohibit you from distributing literature to or soliciting other employees in nonworking areas of the plant or premises on nonworking time for self- organizational or other purposes under Section 7 of the National Labor Relations Act, and WE WILL NOT require you to obtain permission to engage in such distribution or solicitation WE WILL NOT in any other manner interfere with, restrain, or coerce our employees in the exercise of their right to self-organization, to form, join, or assist any labor organization, to bargain collectively through representatives of their own choosing, and to engage 606 DECISIONS OF NATIONAL LABOR RELATIONS BOARD in concerted activities for the purpose of collective ger exists, to a substantially equivalent position, with- bargaining or other mutual aid or protection , or to out prejudice to her seniority, or other rights and privi- refrain from any or all such activities leges, and make her whole for any loss of pay suffered WE WILL offer Norma Killion immediate and full as a result of the discrimination against her reinstatement to her formerjob , or, if thatjob no lon- FREMONT MANUFACTURING COMPANY, INC