Buffalo Bituminous, Inc.

BUFFALO BITUMINOUS, INC. 99 Buffalo Bituminous, Inc. and Local Union No. 49, International Union of Operating Engineers, AFL- CIO. Case 18-CA-4694 - December 7, 1976 DECISION AND ORDER BY CHAIRMAN MURPHY AND MEMBERS JENKINS AND WALTHER - On March 31, 1976, Administrative Law Judge Jerry B. Stone issued the attached Decision in this proceeding. Thereafter, Respondent filed exceptions and a supporting brief. Pursuant to- the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the record and the attached Decision in light, of the exceptions and brief and has decided to affirm the rulings, fmdings,1 and conclusions 2 of the Administrative Law Judge, as modified herein, and to adopt his recommended Order, as so modified. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the recommend- ed Order of the Administrative Law Judge as modified below and hereby orders that the Respon- dent, Buffalo Bituminous, Inc., Buffalo, Minnesota, its officers, agents, successors, and assigns, shall take the action set forth in the said recommended Order, as so modified: Substitute the following for paragraph 1(b): - "(b) In any like or related manner interfering with, restraining, or coercing employees in the exercise of their rights guaranteed in Section 7 of the Act except to the extent such rights may- be affected by lawful agreements in accord with Section 8(a)(3) of the Act." MEMBER WALTHER, dissenting: I disagree with my colleagues' finding that Respon- dent agreed to sign the collective-bargaining agree- ment. In my -view this finding is contrary to the evidence. Furthermore, I do not accept my col- leagues' finding that Respondent bargained directly 1 The Respondent has excepted to certain credibility findings made by the Admimstrative Law Judge It is the Board 's established policy not to overrule an Administrative Law Judge's resolutions with respect to credibili- ty 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 (C.A. 3, 1951). We have carefully examined the record and find no basis for modifying or reversing his findings. Contrary to our dissenting colleague , we are not persuaded that the Administrative Law Judge's credibility resolutions are inconsistent with "the 227 NLRB No. 20 with its employees in violation of Section 8(a)(5) of the Act. The record establishes that Respondent is not a member of, nor represented by, the Associated General Contractors of Minnesota (herein AGC), but in recent years Respondent has separately adopted and executed the, Highway, Railroad- and' Heavy Construction agreement effective between Local 49 and AGC. On June 30, 1975, however, Respondent's president, Hicks, notified Local 49 that Respondent would conduct separate negotiations for a new contract. Somewhat later, on July 17, Local 49 and AGC completed negotiations for a new contract to replace their previous contract. Pursuant to Respondent's request, a luncheon negotiation meeting was arranged for August 13, 1975, by Local 49's business - representative, Egan. Hicks testified that at this meeting Respondent insisted that it would have to be afforded a lower wage scale in certain rural areas where Federal or state wage determinations were lacking. Hicks further testified that he insisted that Respondent would accept Local 49's proffered 3-year contract, `viz the Local 49-AGC 1975 agreement, only if such conces- sions were made, since they were essential to Respon- dent's economic survival. Hicks also testified that Egan stated that Local 49 had -no objection to Respondent's discussing contract proposals with its employees in order to keep them abreast of develop- ments in the negotiations. Business Representative Egan on the other hand testified that the Union adamantly refused to grant the requested modification because a "most favored nation" clause in the AGC agreement precluded such a concession. In addition, Egan testified that at the conclusion of the meeting Hicks agreed to sign an agreement binding Respondent to the terms of the Local 49-AGC contract. Further, Egan denied grant- ing permission to Respondent to discuss contract proposals with the employees. The Administrative Law Judge credited Egan's testimony and discredited Hicks' testimony merely on the basis that he perceived Egan to be more truthful. He did not, however, attempt to evaluate or analyze the respective testimony in terms of the rational probabilities. The exchange and interaction between the parties to these negotiations as delin- eated by the Administrative Law Judge's findings are clear preponderance of all the relevant evidence " In these circumstances, no valid basis exists for reversing his findings. - 2 We do not agree with the Administrative Law Judge's conclusion that the character of the unfair labor practices found in this proceeding requires a broad remedial order to fully effectuate the purposes of the Act. According- ly, we have narrowed the scope of the recommended Order to provide that the Respondent cease and desist from in any like or related manner interfering with, restraining, or coercing employees in the exercise of their rights guaranteed by Section 7 of the Act. 100 DECISIONS OF NATIONAL LABOR RELATIONS BOARD extremely unrealistic and atypical of an ongoing collective-bargaining relationship. Contrary to my colleagues, therefore, I find the Administrative Law Judge's findings and credibility resolutions to be implausible. I would dismiss the 8(a)(5) allegation herein on the basis that the Administrative Law Judge failed to consider and adequately analyze all the relevant surrounding circumstances in making his credibility determinations. Specifically, I find that the parties never had a meeting of the minds on a contract. There is no issue that for ' the first time in years Respondent insisted upon separate negotiations in order to obtain contract concessions deemed vital to its continued existence. The Administrative Law Judge and my colleagues, however, find and would have us believe that after only a 2-1/2-hour casual luncheon meeting, during which Local 49 refused to agree to Respondent's requested contract modifica- tions, Respondent immediately abandoned its posi- tion that it must be afforded somewhat lower wage rates in specified rural areas in order to be able to continue to function at all.3 Such a prompt accep- tance of the Local 49-AGC contract is clearly inconsistent with the aims that Respondent sought to achieve through separate negotiations. In light of its allegedly precarious economic situation, it is highly improbable that Respondent would so quickly forgo its demands for special wage rate consideration in rural areas. Moreover, that Respondent would at an initial meeting accept the very contract terms it was seeking to alter in the first separate negotiations it had procured with Local 49 in several years goes beyond the pale of belief.4 The Administrative Law Judge credited testimony of Egan that Hicks, in a "side conversation," agreed to sign the _ 1975 area contract which the Associated General Contractors had consummated with Local 49. Egan acknowledged that a third individual, Junior Kreps, was also present during the discussion and should have heard the entire conversation. Rather than supporting Egan's version of the discussion, however, Kreps testified that "[w]e were at an impasse getting no, place, and . . . I finally asked Frank [Pendzimas, chief, spokesman for the Charging Party], `Now what happens? We've fooled around all this while and we haven't gotten to first base, so where do we go from here? . . . Is there going to be a strike?' " According to Kreps,5 Pendzimas replied, "Strike is a dirty word. We just don't like to throw out threats like that." Thus, Kreps' undenied testimony seriously undermines Egan's assertion that Respon- dent agreed to contract terms at this meeting. Moreover, even accepting Egan's testimony as truthful, Hicks' invitation, issued to Egan at the luncheon meeting, to "stop by the office and we'll get it done" indicates no more than a hope to reach agreement. There is absolutely no clear testimony that Hicks in fact unqualifiedly accepted all terms of the AGC contract s Thus, I would conclude that the preponderance of the record evidence does not support a finding that Respondent and Local 49 ever reached a meeting of the minds concerning Respondent's acceptance or execution of the Local 49-AGC 1975 area contract. Accordingly, I would not find an 8(a)(5) violation based on Respondent's failure to execute such alleged agreement. Further, I would find that Respondent's so-called direct negotiations with its employees were nothing more than a permissible information-giving session with its employees designed to keep them informed on negotiation progress. That Local 49 representa- tives were present at such sessions undermines any argument that Respondent sought to underhandedly bargain with its employees directly. Therefore, I would not find such conduct to be violative of Section 8(a)(5). Accordingly, I would dismiss the complaint in its entirety. 3 Respondent states that it found itself unable to compete in such areas where no predetermined wage rates had been made applicable to its highway projects by governmental agencies. 4 Egan, business representative of Local 49, arranged this initial meeting at the request of Hicks, Respondent's president. The latter wanted to meet with representatives of the Operating Engineers , Teamsters, and Laborers. This circumstance in my view suggests that Hicks viewed the initial meeting (with all three unions) as exploratory 5 Pendzimas did not testify in this proceeding. 6 While it is the Board's policy, as enunciated in Standard Dry Wall Products, Inc., 91 NLRB 544, to attach great weight to an Adnumstrative Law Judge's credibility findings insofar as such findings are based on demeanor, to the extent that such findings are based on and conflict with evidence and circumstances other than demeanor, as in the present case, a reversal of the Administrative Law Judge 's findings is both legally proper and in my view required. Canteen Corporation, 202 NLRB 767 (1973); Local 18 Bricklayers, Masons and Plasterers 'International Union ofAmerica, AFL- CIO (Union County Building Contractors Association and The Johansen Company) 159 NLRB 303, 306-309 (1966), Que Enterprises, Inc., 140 NLRB 1001 (1963) An additional factor detracting from Egan's credibility, in my view, is that Egan appears to have been unclear on the exact extent of his own authority in dealing with Hicks. Thus, on cross-examination, he stated first that his job was to get an acceptance agreement signed by Hicks whereby the latter would agree to abide by the terms and conditions of the 1975 Local 49-AGC contract. Next, pressed to more carefully delineate his authority he stated that he did have authority to negotiate a contract "different from" the standard area contract. He conceded that he had never exercised such authority other than in a "sickle and dime situation" that might help bookkeeping. Ultimately, pressed as to whether it was not fair to say that he could not negotiate a contract (essentially) different from the standard Local 49-AGC contract without approval of Pendzimas, that Union's financial secretary, Egan replied , "Yes, I think that would be fair to DECISION STATEMENT OF THE CASE JERRY B. STONE, Administrative Law Judge: This pro- ceeding, under Section 10(b) of the National Labor BUFFALO BITUMINOUS, INC. Relations Act, as amended, was heard pursuant to due notice on January 14, 1976, at Minneapolis, Minnesota. The original charge was filed on August 26, 1975. The amended charge was thereafter filed on August 28, 1975. The complaint in this matter, was issued on October 29, 1975. The issues concern whether (1) Respondent has engaged in threats violative of Section 8(a)(1) of the Act and (2) Respondent has engaged in conduct violative of Section 8(a)(5) and (1) of the Act by refusing to sign a collective-bargaining agreement and by bargaining directly and individually with employees. All parties were afforded full opportunity to participate in the proceeding. Briefs have been filed by the General Counsel, Charging Party, and Respondent and have been considered. Upon the entire record in the case and from my observation of witnesses, I hereby make the following: FINDINGS OF FACT 1. THE BUSINESS OF THE EMPLOYER The facts herein are based on the pleadings and admis- sions therein. The Respondent, Buffalo Bituminous, Inc., is, and has been at all times material herein, a corporation duly organized under, and existing by virtue of the laws of the State of Minnesota . At all times material herein, Respon- dent has maintained its principal office and place of business in Buffalo, Minnesota. Respondent is, and has been at all times material herein, engaged in the manufac- ture, sale, and distribution of asphalt blacktop paving and related products. The Respondent's Buffalo, Minnesota, place of business is the only facility involved in this proceeding. During the year ending December 31, 1974, which period is representative of its operations during all times material hereto, Respondent, in the course and conduct of its business operations, purchased and caused to be transport- ed and delivered at its Buffalo, Minnesota, place of business bituminous materials and other goods and materi- als valued in excess of $50,000, of which, goods and materials valued in excess of $50,000 were transported and delivered to its place of business in Buffalo, Minnesota, directly from points located outside the State of Minnesota. As conceded by Respondent and based on the foregoing, it is concluded and found that Respondent is, and has been at all times material herein, an employer engaged in commerce-within the meaning of Section 2(2), (6), and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED Local Union No. 49, International Union of Operating Engineers, AFL-CIO, is, and has been at all times material herein, a labor organization within the meaning of Section 2(5) of the Act. 1 The facts are based on the pleadings and admissions therein unless otherwise noted 2 The facts are based on a composite of the credited aspects of the testimony of Jumor Kreps, Curtis Dmnick, and Willis Duuuck 101 III. THE UNFAIR LABOR PRACTICES A. Preliminary Facts t 1. Agency status At all times material herein Darrell A. Hicks was president of Respondent and has been and is now a supervisor of Respondent within the meaning of Section 2(11) of the Act, and its agent. Duinick Bros. & Gilchrist owns a half interest in Respondent corporation.2 It appears that Curtis, Norm, and Willis Duinick are brothers and have some ownership and, managing interest in Duinick Bros. & Gilchrist. Willis Duinick also serves as treasurer and Norm Duinick serves as vice president of Respondent. The Duinick brothers and Junior Kreps, general superintendent of Duinick Bros. & Gilchrist, aid and assist Respondent, when needed in its management and planning. Duinick Bros. & Gilchrist appears to be engaged in the same type or reasonably related type of work as Respon- dent. Duinick Bros. & Gilchrist has a collective-bargaining relationship with a union called The Christian Labor Association. Such union appears to be a rival to the International Operating Engineers Union. 2. Appropriate bargaining unit All employees employed by Respondent who perform operating engineer work as set forth and defined in the agreement between Associated General Contractors of Minnesota, Highway, Railroad and Heavy Construction with International Union of Operating Engineers Local No. 49 for 1972, 1973, and 1974, excluding all other employees, office clerical employees, professional employees, guards and supervisors as defined in the Act, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 3. Collective-bargaining representative At all times material herein, and continuing to date, Local Union No. 49, International Union of Operating Engineers, AFL-CIO, the Umon, has been and is now the representative of the employees in the unit described above for purposes of collective bargaining and, by virtue of Section 9(a) of the Act, has been and'is now the exclusive representative of all of the employees in said unit for the purposes of collective bargaining with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment. 4. Collective-bargaining history3 Respondent and Local 49 of the Operating Engineers have had a collective-bargaining relationship going back for at least 8 or 9 years preceding January 1976. The practices with respect to collective bargaining and the arrival at collective-bargaining agreements governing em- ployer-union-employee relations may be summarized as 3 The facts are not disputed and are based on the credited aspects of the testimony of Hicks and the exhibits in the record 102 DECISIONS OF NATIONAL LABOR RELATIONS BOARD follows. The Union and the AGC initially negotiated a collective-bargaining agreement. Thereafter, the Respon- dent executed a document entitled "Acceptance of Agree- ment" wherein the Respondent agreed to abide by the terms and conditions of such agreement. The latest acceptance of agreement executed by the Respondent was an agreement executed on February 26, 1973, and was as follows: 4 ACCEPTANCE OF AGREEMENT DATE 2-26-73 The undersigned employer hereby agrees to abide by the terms and conditions of the 1972-1973-1974 High- way, Railroad and Heavy Construction Agreement between the Highway and Heavy Construction Indus- try of Minnesota and the International Union of Operating Engineers, Local No. 49, on all work covered by said agreement. Receipt of a copy of the standard printed agreement is hereby acknowledged. COMPANY Buffalo Bituminous Inc. BY Darrell E. Hicks ADDRESS Box 126 CITY & STATE & ZIP Buffalo Min 55313 PHONE NO. 682-1271 In May 1975, representatives of Respondent and the Union met and discussed the question of contract negotia- tions. Hicks, Respondent's president, expressed dissatisfac- tion with the results of past negotiations by the AGC, and expressed a desire to have negotiations by a "Black Toppers Association" with the Union. Egan, Local 49's representa- tive, indicated that if there were a way to do this the Union would be agreeable. Hicks stated that he would set up a meeting for the "Black Toppers Association." Such a meeting was set up and held in June 1975. At such meeting it was decided that the "Black Toppers" would await the outcome of the AGC and Local 49's negotiations. On June 30, 1975, the Respondent sent a letter to the following effect to the Local 49 of the Union: 6 Buffalo Bituminous Inc. Buffalo, Minnesota June 30, 1975 International Operating Engineermgs 2580 University Ave. St. Paul, Minnesota 55114 Attn: Mr. Frank Pendzimas Dear Sir: INTERNATIONAL UNION OF OPERATING ENGINEERS, LOCAL NO.49. /s/Frank Pendzimas Business Manager /s/Arthur Abbott President /s/Charles E. Swenson Recording-Corresponding-Sec /s/John Schoweller Area Business Representative RETURN TO: Int'l Union of Oper. Engineers, Local No. 49, 2580 University Ave., St . Paul, Minnesota 55114 The referred-to collective-bargaining agreement was to remain in effect until April 30, 1975, and was to be automatically renewed unless proper notice of termination or amendment was given 60 days prior to such expiration date. In February 1975, the Union, Local 49, notified Respon- dent of its desire to open such contract for the negotiation of new terms.5 4 Although the terminology of the agreement does not refer to the Union as a party, places for signatures by representatives of the Union were provided on the document. It is clear that the effect of the agreement was to make the Union and Respondent parties to the AGC-Union contract referred to therein. 5 The General Counsel alleges, Respondent admits in the pleadings, and I conclude and find that commencing on or sometime prior to August 19, 1975, and continuing to date, the Union has requested and is requesting We wish to notify you as of the above date that since our company is not a member of any contractor association bargaining with your organization, that this constitutes formal notice to you that we will be bargaining on our own behalf. We would invite you to respond as to when the first meetings between Buffalo Bituminous Inc. and Local 49 should be held. Sincerely, /s/ Darrell E. Hicks Darrel E. Hicks, President Buffalo Bituminous, Inc. On July 17, 1975, Local 49 and the AGC completed negotiations for a new contract. Later in July 1975, Egan, business representative for Local 49, went to see Respon- dent's president, Hicks. Hicks told Egan that he would like a meeting with the union heads (representatives of the Operating Engineers, Teamsters, and Laborers). Egan agreed to set up such a meeting.? Thereafter, Egan arranged for the requested meeting to be held on August 13, 1975. As indicated later, a critical issue is whether Respondent, by Hicks, agreed with Egan to accept the terms of the previously negotiated AGC-Local 49 contract. Respondent to bargain collectively with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment as the exclusive collective-bargammg representative of all the employees of Re- spondent in the unit described above. 6 Local 49 received such communication on July 3, 1975. 9 It appears that the Respondent desired to negotiate some terms that were different from the current AGC/respective union contracts. BUFFALO BITUMINOUS, INC. 103 B. The Refusal To Bargain The General Counsel alleges and Respondent denies that "Since on or about August 19,1975, and continuing to date, the Respondent has refused and continues to refuse to sign a written agreement with an April30, 1978, expiration date, embodying rates of pay, wages, hours of employment and other conditions of employment agreed upon between the Respondent and the Union." The critical issue as to whether the Respondent has violated Section 8(a)(5) and (1) of the Act, as alleged, by refusal to sign an agreement previously agreed to, depends on the resolution of testimonial conflict between the witnesses' testimony as to whether Respondent's president, Hicks, agreed with Local 49's representative, Egan, on August 13, 1975, to accept the terms of the aforesaid AGC- Local 49 contract and to execute a document of acceptance with respect to such contract. The parties presented much testimonial detail as to what occurred on August 13, 1975, at a luncheon meeting scheduled for contractual discussions between Respondent, Teamsters Union, and Local 49. This meeting was held at a restaurant in Buffalo, Minnesota, known as Highway 55- East. Those 'present for Respondent at such meeting were President Hicks, Junior Kreps, and Curtis Duinick. Present at such meeting for the Teamsters Union were Representa- tives or Agents Van Lith and Esterly. Present for Local 49 of the Operating Engineers were Business Financial Secre- tary Frank Pendzimas and Business Representative Egan.8 It is undisputed that the participants were present at the restaurant for between 2 and 3-1/2 hours, that some of the talk was normal socializing type talk, and that the major and relevant talk concerning contractual discussions oc- curred at the dining table. It is sufficient to say that the dining table was round and of a size to normally accommo- date six persons, and that, the table was located near a wall. On this occasion seven persons were seated around the table. As to the discussion that occurred, it is clear that the principal spokesman for the Respondent was Hicks. Pend- zimas was the principal spokesman for Local 49. The essence of Hicks' remarks and position as expressed to the Unions was that Respondent was willing to go along with the AGC-Local 49 -contract, recently negotiated, except for the wage rates for a rural area, apparently Wright County, where Respondent faced competition from con- tractors who were not unionized. It appears that Hicks also revealed that in such areas his concern for special rates applied to jobs which did not have predetermined wage rates. Local 49's position as reflected by remarks by Pendzimas may be summarized as being to the effect that the Union could not deviate from its AGC-type contract because such contract had a "most favored nation" clause. Pendzimas in 8 Although the facts reveal that Respondent was attempting to secure from the Teamsters and from Local 49 in their respective collective- bargaining contracts differences from AGC-type contracts, and, although union representatives from the Teamsters and from Local 49 were present on August 13 and on later dates when crucial events occurred, the issues as to violative conduct are limited to Respondent's conduct as directed toward Local 49 and employees represented by Local 49. 9 Although counsel made statements at the hearing that Pendzimas was effect told Hicks that concessions to Respondent would not really benefit Respondent because similar concessions would have to be made to other AGC contractors and thus Respondent would receive no competitive edge. Others, including Kreps, made remarks from time to time. Kreps indicated to Pendzimas - that the -"most favored nation" clause was Local 49's problem. Pendzimas replied in effect that such problem was now Respondent's problem. Pendzi- mas also indicated that the problem of the nonunion contractors' competition would be attacked by attempts to organize such contractors. Pendzimas also indicated that Respondent and the Union should work together through the state legislature to get predetermined wages established in the area. Teamsters Representatives Van Lith and Esterly made some remarks to the effect that-they were familiar with or had some contracts that provided for special consideration. The end result of Pendzimas' remarks, however, was to the effect that Local 49 would not deviate from the AGC-Local 49 contract which had recently been negotiated. Egan testified to the effect that at the end of the luncheon meeting Hicks agreed to abide by the terms of the recently negotiated AGC-Local 49 contract and told him (Egan) to bring the acceptance document to him later for signing. Hicks testified in denial that such separate conversation occurred. Van Lith and Esterly testified to the effect that they observed Egan and Hicks engaged in separate conversation but did not hear what was said. Kreps testified that "separate conversations" did not take place and that he did not hear Egan and Hicks engage in a conversation wherein Hicks agreed to sign the AGC-Local 49 contract.,-Kreps' testimony as a whole.reveals in effect that,there were some "separate" conversations which took place during the luncheon. Curtis Duinick testified tp the effect that there were no separate conversations that took place and that he did not hear Hicks tell Egan that he would sign the AGC- Local 49 agreement. Pendzimas did not appear as a witness.9 Much of the testimony of the witnesses was directed to whether or not witnesses heard the conversation which Egan testified occurred between him and Hicks at the end of the luncheon meeting; whether there were separate conversations; whether the individuals could break up_into separate groups,,-the size of the dining table; whether Hicks or Egan made later consistent or inconsistent statements as to whether an agreement had been made; whether Hick's drawing of a diagram for evidentiary use unconsciously revealed that there were "separate" groupings; and whether the meeting broke up on a happy or unhappy note. Hicks and Egan also testified in some detail as to other meetings that occurred between them on August 19 and through August 22 and thereafter. engaged in activities elsewhere, such statements are not evidence and do not negate the consideration of Pendzimas' absence as a witness. It is clear that he is affiliated with a party of interest and in any event could have been subpenaed. I have considered the failure of the General Counsel or the Charging Party to present Pendzimas as a witness, but am persuaded from the overall facts and testimonial demeanor of witnesses as of the crediting of witnesses as indicated in this Decision. 104 DECISIONS OF NATIONAL LABOR RELATIONS BOARD I have considered all of the evidence and all of the testimony and demeanor appearances of the witnesses. I find no value in and attribute no weight to the evidence relating to a diagram by Hicks of the dining table and seating order of participants as revealing a psychological type of admission to the effect that the individuals were seated or withdrew into smaller groups. The credited testimony of Kreps convinces,me that there were, however,- separate conversations that occurred between the various individuals. I find no value and attribute no weight to the testimony of Egan or other witnesses relating to statements made by Egan after the luncheon meeting of August .13, 1975, to the effect that Hicks had agreed to accept the terms of the AGC-Local 49 contract. I also find no value and attribute no weight to the testimony of Hicks and other witnesses relating to statements made by Hicks after the luncheon meeting of August 13, 1975, to the effect that Hicks and Egan had not agreed to a contract. Such evidence is of a hearsay nature, is self-serving, and is unreliable as proof of whether Hicks agreed or did not agree to accept the terms of the AGC-Local 49 contract on August 13, 1975. Such evidence, however, is properly considered with respect to, and rebuts the evidentiary contention that the initial unfair labor practice charge reveals an inconsistency.10 Considering all of the foregoing, I find persuasive as to the credibility of Hicks and Egan only a consideration of the totality of Hicks' and _ Egan's testimony and their demeanor while testifying. I am persuaded from such consideration that Egan clearly appeared a more 'frank, forthright, and truthful witness than Hicks in the testimony relating to whether Egan, on August 19, 1975, agreed or did not agree to allow Hicks to present his proposals to the employees. I credit Egan's denial of such agreement. Hicks' testimony also as to whether he negotiated directly with employees on August 20 and 22 was particularly unimpres- sive. I discredit Hicks' testimony to the effect that Egan agreed that Hicks could talk to or negotiate with the employees directly. I also discredit Hicks' testimony to the effect that he did not negotiate directly with employees on August 20 and 22, 1975. Curtis Duinick also testified to the effect that Egan, on August 20, 1975, before Respondent' s meeting with em- ployees, told him that he was free to talk to "these men," to go ahead and say anything he- wished. Egan testified in denial that he had made such remarks to Duinick. Consid- ering the demeanor of the witnesses and all the testimony, I am persuaded that Egan appeared the more objective, frank, and forthright witness on such point and credit his testimony over that of Curtis Duinick. 1. The agreement Considering all the above, I conclude and find that Egan appeared as a more frank, forthright, and truthful witness than did Hicks. Accordingly, I credit Egan's testimony to 10 Cf. Moran Oil Producing & Drilling Corp., 204 NLRB 773 (1973), a case cited by the Charging Party in support of a contention that "consistent" after-the-event statements constitute relevant and substantive evidence Although the language in such case seems to indicate that the Administrative Law Judge in said case considered such "consistent" statements relevant and part of a chain of events on which he based his findings, I am not persuaded the effect that Hicks, at the end of the August 13, 1975, luncheon meeting, agreed to accept the terms of the recently negotiated AGC-Local 49 contract containing an expiration date of April 30, 1978. 2. The refusal to bargain The facts are clear and undisputed that Egan on August 19, 1975, for Local 49, requested Hicks, for the Respondent, to sign a document whereby the Respondent in effect would be bound to honor and abide by the terms of an agreement which had been negotiated by the Associated General Contractors of Minnesota Highway, Railroad and Heavy Construction and International Union of Operating Engineers, Local No. 49 with terms thereof effective from Monday July 14, 1975, through April 30, 1978.11 The facts are also clear and undisputed that Hicks, for Respondent, on August 19,1975, and at all, times thereafter, has refused to sign such an agreement or a document of acceptance of terms thereof. Considering the foregoing, it is clear and I conclude and find that Respondent, by Hicks, on August 19, 1975, and thereafter, has refused to signa written document as to a collective-bargaining agreement previously agreed to, and thereby has violated Section 8(a)(5) and (1) of the Act. General Counsel alleges and Respondent denies that "On or about August 20, 1975, and August 22, the Respondent, by its President Darrell A. Hicks, at its Buffalo, Minnesota place of business, bargained directly and individually with employees in the unit described above in paragraph' 6, concerning rates of pay, wages, hours of employment, and other terms and conditions of employment." Hicks and Egan testified with respect to a discussion on August 19, 1975, wherein Egan had attempted to get Hicks to sign an acceptance agreement for the AGC-Local 49 agreement. In such discussion, both Hicks and Egan testified with respect to remarks made by Hicks as to his desire to talk with or present proposals to the employees. It suffices to say that Egan appeared to be the more credible witness as to such conversation. I credit his testimony over Hicks' where in conflict, and conclude and find that Egan did not agree that Hicks could negotiate directly with the employees, and Egan in fact told Hicks that it was improper for him to negotiate with the employees. Hicks' testimony in overall effect was ambiguous and appeared to be an attempt to convey that he merely wanted to talk and to report the bargaining and problems to employees, and to convey that at the meetings on August 20 and 22, 1975, he did not negotiate but merely reported the result of bargain- ing positions and problems to employees. Hicks' testimony, and the testimony of the other witnesses, clearly reveals that on August 20 and 22, 1975, Hicks presented bargaining that the issue of relevancy was presented, considered, or really passed on by the Board. Such "consistent" statements as presented in this case are self- serving and hearsay in nature and are admissible only when evidentiary contentions of inconsistent statements or events have been raised 11 The same agreement previously agreed to by Hicks and in' the record of this proceeding is referred to as G.C. Exh. 5 BUFFALO BITUMINOUS, INC. 405 proposals to the employees and in fact was engaged in negotiations with the employees directly and individually.12 As previously indicated, Curtis Duinick testified to the effect that Egan told him just prior to Respondent's August 20, 1975, meeting with employees that he could now go ahead and say anything he wished to the employees. As previously indicated, I credit Egan's denial that he made such remarks to Duinick. In sum, I credit Egan's testimony to the effect that he did not agree with Respondent (with either Hicks or Duinick) that Respondent could negotiate directly with the employ- ees. I also credit Egan's testimony to the effect that he told Hicks that it was improper -for Respondent to negotiate with the employees. Although some of-Hicks' testimony was to, the effect that he did not negotiate with employees on August 20 and 22, 1975, Hicks' testimony otherwise and the testimony of other witnesses make it clear and I conclude and find that Respondent, by Hicks, on August 20, and 22, 1975, engaged in negotiations directly and individually with employees.13 3. Conclusion It is clear from the foregoing and I conclude and find that Respondent, by Hicks, on August 20 and 22, 1975, engaged in negotiations directly and individually with employees, such negotiations were an attempt to bypass Respondent's obligations to recognize and bargain with Local - 49 as the exclusive collective-bargaining agent of such employees, and such conduct was and is violative of Section 8(a)(5) and (1) of the Act. It is so concluded and found. August 22, 1975, made separate threats of cessation of operations which are violative of Section 8(a)(1) of the Act. It is sufficient to summarize the relevant facts to this issue as follows. The facts are clear that Respondent was concerned over its financial conditions, its profits had not been as high during the preceding year as in the past, and President Hicks adverted to Respondent's financial condi- tions on August 22,. 1975. The facts are also clear that Respondent, by Hicks, argued that it had a right to negotiate a contract as an independent employer and that Hicks argued the competitive disadvantage Respondent faced in rural areas where many of the competing employ- ers were not under contract with the Union and where "pre- determined" wages were not in effect. The facts are clear that the employees were aware and knowledgeable of the foreseeable problems concerning competitive bidding in such rural areas and the possible effect on loss of job opportunity in such areas. During the discussions -Esterly, a representative of the Teamsters Union, argued in effect to Hicks that Respondent's problem might not be with, labor but with the way Respondent managed its affairs.14 Hicks responded by saying that this could be true, that he was going to have some cost-accounting surveys made, that if he found that part of the organization was not making money, he might have to shut down a plant or shut down a paving crew if it were not profitable. When Hicks told the employees that unprofitable parts of the operation might be eliminated, Hicks stated that this goes for "you and you and you, too," and pointed to an employee named Phil Ritze, a member of Local 49.15 - The facts are also clear that Respondent has not had "performance" surveys in the past. C. The Alleged Threat of Cessation of Operations The General Counsel alleges and Respondent denies that "Since on or about August 22, 1975, and continuing to date," Respondent has interfered with, restrained, and coerced, and is interfering with, restraining, and coercing its employees in exercise of rights guaranteed-in Section 7 of the Act, in that its president, Darrell A. Hicks, at its Buffalo,- Minnesota, place of business, threatened employ- ees that it would cease some of its operations if the employees did not accept a I-year collective-bargaining agreement. On August 20 and 22, 1975, Respondent's officials met with employees at a meeting in Respondent's shop at which certain union representatives for the Teamsters Union and Local 49 were present. It has already been concluded and found that Respondent violated Section 8(a)(5) and (1) of the Act by, at such time, bargaining directly and individual- ly with employees and attempting to bypass said employ- ees' exclusive collective-bargaining agent, Local 49. The issue now presented is whether Respondent, by Hicks, on 12 The facts are clear that Hicks presented his proposals to a group of employees and he engaged in some discussions thereto with specific individual employees as to terms of the agreement, the length of the duration of the agreement, and certain specific wages thereto. Although Egan, for Local 49, was present at the August 20 and 22, 1975, meetings, Hicks had only invited Egan to be present at a meeting on August 22, 1975. An employee had called Egan and advised him of the setting of an employer- employee meeting on August 20, 1975. 13 I discredit the testimony of any witness inconsistent with the facts found. Contentions and Conclusions General Counsel contends that President Hicks' remarks relating to a possible cutback or cessation of operations accompanied by the singling out of employees in relation thereto, in the context of Respondent's unlawful direct negotiations with employees, constitute a separate threat of reprisal in violation of Section $(a)(1) of the Act. Respon- dent contends in effect that such remarks were not violative of Section 8(a)(1) of the Act, and that such remarks were simply expressions of economic belief and argument. Considering all of the foregoing, I conclude and find that the General Counsel has not established that Respondent made threats of economic reprisals. violative of Section 8(a)(l) of the Act. It is clear that. Respondent's direct negotiation with employees in this case is violative of Section 8(a)(5) and (1) of the Act. The presentation of economic arguments directed to the employees as part of such refusal-to-bargain conduct is clearly improper. Such economic arguments, however, do - not rise above the unlawful conduct of a refusal to bargain and constitute a 14 Considering the logical consistency of all of the evidence and the testimony and demeanor of Hicks while testifying on this issue , I credit Hicks' testunony to the effect that Esterly argued,the point as indicated. I discredit any testimony inconsistent with the findings herein. 15 The facts are based on a composite of the credited aspects of the testimony of Egan, Hicks, Scheubal, and Brown. I discredit the testimony of any witness inconsistent with the facts found. 106 DECISIONS OF NATIONAL LABOR RELATIONS BOARD separate threat of reprisal. It is clear that employees were aware that the arguments made were economic arguments. Especially is this so when the references to cost-accounting surveys, possible cessation of operations, and possible effect-on individuals were raised in response to a counter- argument by a union representative. Accordingly, I conclude and find that such conduct does not constitute more than a derivative violation of Section S(a)(1) following the basic 8(a)(5) violation already found, and does not constitute a separate violation of Section 8(a)(1) of the Act on its own accord. - IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of Respondent set forth in section III, above, occurring in connection with Respondent's opera- tions described in section 1, above, have a close, intimate, and substantial relationship to trade, traffic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that Respondent has engaged in unfair labor practices, it will be recommended that Respondent cease and desist therefrom and take certain affirmative action to effectuate the policies of the Act. Having found that Respondent has violated Section 8(a)(5) and (1) of the Act by refusing to bargain collectively with the Union, the exclusive collective-bargaining agent, by (1) bargaining directly with individual employees and (2) refusing to sign an agreed-to contract, it will be recom- mended that Respondent be required to bargain collective- ly with the Union, and be required to sign and execute a written contract embodying the terms and conditions of the agreed-to contract, and to make all employees covered by such contract whole for any loss of wages or other benefits resulting from Respondent's refusal to sign such contract on August 19, 1975, with interest added in accord with Isis Pltanbing & Heating Co., 138 NLRB 716 (1962). Because of the character of the unfair labor practices herein found, the recommended Order will provide that Respondent cease and desist from in any other manner interfering with, restraining, and coercing employees in the exercise of their rights guaranteed by Section 7 of the Act. Upon the basis of the above findings of fact and upon the entire record in the case, I make the following: CONCLUSIONS OF LAW 1. Respondent Buffalo Bituminous, Inc., is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. Local Union No. 49, International Union of Operat- ing Engineers, AFL-CIO, is, and has been at all times material herein, a labor organization within the meaning of Section 2(5) of the Act. 3. The employees described in section III, A, 2, of this Decision constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 4. Local Union No. 49, International Union of Operat- ing Engineers, AFL-CIO, has been at all times material herein and is now the exclusive bargaining representative of all the employees in the above-referred-to appropriate collective-bargaining unit. 5. By refusing to bargain collectively with the Union, described above, bargaining directly with individual em- ployees, and refusing to sign an agreed-upon written contract on August 19, 1975, and since, Respondent has violated Section 8(a)(5) and (1) of the Act. 6. The aforesaid unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. Upon the foregoing findings of fact, conclusions of law, and the entire record, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: ORDER 16 The Respondent, Buffalo Bituminous, Inc., Buffalo, Minnesota, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Refusing to bargain collectively with Local Union No. 49, International Union of Operating Engineers, AFL- CIO, by bargaining directly with individual employees and by refusing to sign agreed-upon written contracts, or by in any other manner refusing to bargain with said Union. (b) In any other like or related manner interfering with, restraining, or coercing employees in the exercise of their rights guaranteed in Section 7 of the Act except to the extent that such rights may be affected by lawful agree- ments in accord with Section 8(a)(3) of the Act. 2. Take the following affirmative action which it is found will effectuate the policies of the Act: (a) Upon request, meet with and bargain collectively with Local Union No. 49, International Union of Operating Engineers, AFL-CIO, as the exclusive collective-bargain- ing representative of all the employees in the appropriate bargaining unit, below, and, if an understanding is reached, embody such understanding in a signed agreement. The appropriate collective-bargaining unit is: All employees employed by Respondent who per- form operating engineer work as set forth and defined in the agreement between Associated General Contrac- tors of Minnesota, Highway, Railroad and Heavy Construction with International Union of Operating Engineers Local No. 49 for 1972, 1973, 1974, excluding all other employees, office clerical employees, profes- sional employees, guards and supervisors as defined in the Act. (b) If the said Union so requests, sign the collective- bargaining agreement, or document of acceptance thereof, previously agreed to by the parties on August 13, 1975. 16 In the event no exceptions are filed as provided by Sec. 102.46 of the of the Rules and Regulations, be adopted by the Board and become its Rules and Reg ulations of the National Labor Relations Board, the findings, findings, conclusions, and Order, and all objections thereto shall be deemed conclusions, and recommended Order herein shall, as provided in Sec 102.48 waived for all purposes. BUFFALO BITUMINOUS, INC. 107 (c) Make whole all employees for any loss of wages or other benefits, with interest added thereto, resulting from its refusal to sign said collective-bargaining agreement on August 19, 1975. (d) Post at Respondent's plant at Buffalo, Minnesota, copies of the attached notice marked "Appendix." 17 Copies of said notice, on forms provided by the Regional Director for Region 18, after being duly signed by Respondent's representatives, shall be posted by Respondent immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, includ- ing all places where notices to employees are customarily posted. Reasonable steps shall be taken by Respondent to insure that said notices are not altered, defaced, or covered by any other material. (e) Notify the Regional Director for Region 18, in writing, within 20 days from the date of this Decision, what steps Respondent has taken to comply herewith. IT Is FURTHER ORDERED that the allegations of unlawful conduct not specifically found to be violative herein be dismissed. 17 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, upon request, meet with and bargain collectively with Local Union No. 49, International Union of Operating- Engineers, AFL-CIO, as the exclusive collective-bargaining representative of all the employees in the appropriate bargaining unit, below, and if an understanding is reached, embody such understanding in a signed agreement. The appropriate collective-bargaining unit is: All employees employed by the Respondent who perform operating engineer work as set forth and defined in the agreement between Associated General Contractors of Minnesota, Highway, Railroad and Heavy Construction with Interna- tional Union of-Operating Engineers Local No. 49 for 1972, 1973, 1974, excluding all other employ- ees, office clerical employees, professional em- ployees, guards, and supervisors as defined in the Act. If Local Union No. 49, International Union of Operating Engineers, AFL-CIO, so requests, WE WILL sign the collective-bargaining agreement, or a document of acceptance thereof, previously agreed to on August 13, 1975. WE wiLL make whole all employees for any loss of wages or other benefits, with interest at the rate of 6 percent per annum added thereto, resulting from our refusal to sign said collective-bargaining agreement on August 19, 1975. WE WILL NOT refuse to bargain collectively with Local Union No. 49, International Union of Operating Engineers, AFL-CIO, by bargaining directly with individual employees and by refusing to sign agreed- upon written contracts, or by in any other manner refusing to bargain with said union concerning employ- ees in the appropriate collective-bargaining unit. WE WILL NOT in any like or related manner interfere with, restrain, or coerce employees in the exercise of their rights guaranteed- in Section 7 of the Act except to the extent that such rights may be affected by lawful agreements in accord with Section 8(a)(3) of the Act. BUFFALO BITUMINOUS, INC.