The Kroger Co.

THE KROGER CO. 149 The Kroger Co. and Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, Local 540. Cases 16-CA-5898 and 16-RC-6827 February 10, 1977 DECISION AND ORDER On September 30, 1975, Administrative Law Judge James T. Rasbury issued the attached Decision in this proceeding. Thereafter, the General Counsel and the Charging Party filed exceptions and supporting briefs, and Respondent filed cross-exceptions and a supporting brief. The Board has considered the record and the attached Decision in light of the exceptions, cross- exceptions, and briefs and has decided to affirm the rulings, findings, and conclusions of the Administra- tive Law Judge only to the extent consistent herewith. The Administrative Law Judge concluded that Respondent did not violate Section 8(a)(3) by reduc- ing the hours of work of its employees Georgia Faye Morton, Joyce Jillson, and Virginia Holder by transferring these employees from its Denison, Texas, store to its stores in Sherman, Texas,' and by, in effect, forcing Georgia Faye Morton to quit her employment because of her transfer. We find merit in the General Counsel's and the Charging Party's exceptions to these findings. It is undisputed that during the early part of September 1974 Morton obtained union authoriza- tion cards from a fellow employee, Bob Overturf, head meatcutter of the meat department. Morton distributed these cards to Respondent's delicatessen employees,2 informing them that if they signed the cards the union representative could come to meet with them and that the cards would authorize the Union to be their representative. As a result of Morton's efforts, all six of Respondent's delicatessen department employees had signed authorization cards by September 19, 1974.3 During the following months, this organizational activity continued. On October 17, 1974, Fred H. Tilson, a union agent, met with the delicatessen department employees and on October 25, 1974, Tilson demanded recognition on their behalf.4 This demand for recognition was renewed on November 17, 1974, by the Union's president and business manager. Respondent refused both demands. That Respondent was aware of Georgia Faye Morton's union activities is also apparent. Thus, on Jillson and Holder were transferred to Respondent's Sherman , Texas, store. Morton was transferred to the Sher-Den Mall in Sherman , Texas. 2 Overturf testified that one or two of the six delicatessen department employees received their cards directly from him. 3 We affirm the Administrative Law Judge's finding that the seventh individual working in the delicatessen department , Willis Hall, is a supervi- sor within the meaning of Sec. 2(11) of the Act. 228 NLRB No. 19 or about December 16, 1974, Store Manager Ken White, while unlawfully coercing employee Jillson to withdraw her assistance and support from the Union, stated: "We know that Faye's an instigator back there." During the same conversation, White asked Jillson "to talk the union down to all the girls in the back." 5 Respondent, nevertheless, contends that Morton's hours were reduced in mid-December 1974 because of her failure to report for work on a morning when she was scheduled to do the doughnut baking. In support of this contention, White testified that Morton previously was reprimanded for the poor quality of her work, as well as for spending too much time smoking in the restroom and receiving too many personal telephone calls. Morton, however, testified that on the occasion in question she was scheduled for work at 7 a.m. but overslept 1 hour. When she called Hall, the depart- ment manager, at 8 a.m., he told her that he had already gotten Joyce Jillson to come in and work in her place for the day. Morton, nonetheless, went to work to talk to Hall. When she arrived at 9 a.m., Hall turned his back on her and told her "to get the hell out of the store." Morton also noted in her testimony that two former delicatessen department employees, Richard Jones and Debbie Lambert, had been late on occasion but were never disciplined to her knowl- edge. When Morton mentioned these employees to Hall, he responded: "Well, that is them, and this is you." Morton also testified that she was never seriously disciplined or late to work except on this one occasion. Shortly after this incident in mid-December 1974, Morton's hours were cut from between 15 to 25 hours of work to 10 hours of work per week. Stressing White's testimony that Morton had received previous warnings concerning her work performance and that her failure to report for work as scheduled "might have been extremely costly to the Respondent," the Administrative Law Judge did not find Respondent's reduction of Morton's hours to be coercive or discriminatory. We disagree. It is significant that Morton's undesirable conduct on which the Administrative Law Judge relied occurred during the summer of 1974, almost 5 months before Morton's reduction in hours .6 During this period, Respondent's delicatessen department manager, Hall, was aware that Morton was experi- encing personal difficulties and Hall had expressed 4 Tilson testified that this was a verbal request made of Jim Sneyd, The Kroger Co. personnel director. 5 We affirm the Administrative Law Judge's finding that White's conduct constitutes unlawful coercion of employees in violation of Sec. 8(a)(l) of the Act. 6 White testified that his initial discussion with Morton concerning her work performance occurred in August 1974. 150 DECISIONS OF NATIONAL LABOR RELATIONS BOARD his willingness to go along with Morton until she got her problems straightened out.7 When viewed in this light, the relationship of Morton's conduct in the summer of 1974 to the tardiness incident in mid- December appears too attenuated to support the asserted justification for her reduction in hours. We note, moreover, that Betty Potts, assistant manager of the delicatessen, indicated that she was not aware of any occasion in which doughnuts were ruined be- cause of an employee's tardiness. According to her testimony, more doughnuts were ruined when the employee responsible was at work and let the doughnuts overproof so that they became grease- soaked. In light of the foregoing, we find Respon- dent's asserted justification for Morton's consider- able reduction in hours unpersuasive. Rather, we view Respondent's reduction of Morton's hours in mid-December 1974 as part of Respondent's escalat- ing antiunion campaign which included the unlawful interrogation of employees, threats to close down the delicatessen department if the Union was allowed to come in, the solicitation of employees to persuade other employees to refrain from union support, and, as discussed below, the discriminatory transfer of three employees who had signed authorization cards. Particularly probative in this vein is Respondent's indication that Morton was viewed as the union instigator. When we consider this in the context of Respondent's other unlawful antiunion activity, we are impelled to conclude that Respondent's reduction of Morton's hours was discriminatorily motivated in violation of Section 8(a)(3), and we so find. The inquiry into Respondent's motive for the transfer of Jillson and Holder to the Sherman, Texas, store, the subsequent reduction of their work hours, and the transfer of Morton to the Sher-Den Mall in Sherman, Texas, must also start with the fact that Respondent's decision came in the midst of the union organizational campaign, with Respondent's knowl- edge of the pending representation petition. In this vein, particularly suspect is the timing of the transfers in that the three employees were informed of their transfers on January 10, 1975,8 less than 4 weeks before the February 3 election.9 That their transfer was substantially motivated by Respondent's effort to decimate the Union's strength is evidenced by the record testimony. Thus, Bob Overturf testified that in discussing Morton's transfer to the Sher-Den Mall with Store Manager White,10 White stated that Morton "had to go over there as a checker" and that "she'd probably go over there for two or three days ... and then they'd have to let her go because she couldn't check."" Overturf further testified that in subsequently discussing the situation with Delicates- sen Department Manager Hall, Hall noted with respect to the shortage of help in the delicatessen that it did not make any difference because he "wasn't going to get his girls back because of. . .`the Union mess,' and if the union mess continued and if [the delicatessen] did go Union, that [Respondent] would shut it down anyway." Joyce Jillson similarly testified that, on the day she was advised of her transfer, she asked Hall if there was a chance of returning to the Denison store. Hall responded: "Yeah, but it'll be after all this mess is straightened out." Also revealing of Respondent's real motive is the testimony of Betty Potts. Potts indicated that on February 2, 1975, while speaking with Hall about the Union, Hall informed her that Mr. Sneyd 12 would close down the delicates- sen before he would let it go Union. Hall also indicated that Sneyd added: "Now, that's not a threat, that's a promise." Notwithstanding the foregoing, Respondent con- tends that its decision to transfer the three employees stemmed from its new method of operation in the delicatessen department relative to the preparation of doughnuts and pastries. To support its position, Respondent produced evidence indicating that for 1974 the Denison delicatessen operated at a net loss of $10,000. Both Mr. White and Mr. Logan 13 testified that as a result of this loss they discussed the feasibility of reducing labor costs in the delicatessen department by finding a local supplier of the dough- nuts and other pastries which were being prepared on the delicatessen premises. It was further explained that the decision to alter the delicatessen's method of operation was economical14 since it enabled Respon- dent to increase profits and to reduce the total number of employee work hours per week. Thus, White testified that prior to this change in operation about 180 to 200 employee work hours were alloted to the delicatessen, whereas after the change the hours were reduced to about 125.15 ' Morton testified that, in discussin& her work with Hall, she informed him that her mother had been seriously ill and had passed away and that she was having family problems. 8 Around the same time , Geneva Farrington was advised that she was being laid off. Her layoff, however, is not alleged as a violation of Sec. 8(aX3) and (l) 9 The tally was one vote for the petitioning union, one against, and five challenged. Because the objections filed by Petitioner were directly related to the unfair labor practice charges herein, the cases were consolidated for heanng 10 Overturf was also present when White informed Morton of her transfer Overturfs conversation with White took place later in the same day. 11 Morton testified that she had no previous experience as a checker. It is also noteworthy that Morton told White that she could not possibly accept the transfer because she did not have transportation. White indicated that if Morton refused the transfer she was without alob. i2 As mentioned, Jim Sneyd is the Kroger Co. personnel director. 13 George J. Logan is the delicatessen baking merchandiser for Respon- dent's Dallas division. 14 White testified that, while he made the decision to alter the delicates- sen's operation, Mr. Sneyd arranged the transfers 15 Betty Potts testified that the hours were reduced to about 150. THE KROGER CO. 151 The record also indicates, however, that the prepa- ration of doughnuts on the delicatessen premises took only about 15 to 16 hours per week. On a weekly basis, therefore, the hours no longer necessary for the baking of doughnuts do not even begin to approxi- mate the 55-80-hour reduction effected by Respon- dent. Delicatessen employee Betty Potts testified, moreover, that shortly after the Denison delicatessen stopped baking doughnuts on the premises it began baking its own bread. Potts further indicated that it takes about 2 hours a day to bake bread, which, on a weekly basis, would almost equal the number of hours saved through the elimination of doughnut making. Perhaps of even greater significance is that Jillson and Holder, whose transfers were assertedly necessi- tated by the change in the Denison delicatessen's operation, were transferred to a store which appar- ently had no need for them. When Jillson and Holder began work at the Sherman store, their hours of work, which were reduced from approximately 36 to 15 hours per week, were created by deducting hours from the eight employees who were already working regularly in the Sherman delicatessen. The record further indicates that the Sherman store, which also suffered a financial loss in 1974, does only slightly more business than the Denison store. Nevertheless, after the transfers of Jillson and Holder, the Sherman delicatessen employed 10 whereas the Denison deli- catessen employees were reduced to 3. This belies Respondent's expressed concern of financial stress and the need for more efficient operation. Mr. Logan also testified that, while none of Respondent's 22 delicatessens in the Dallas district made a profit in 1974, the Denison delicatessen was one of the "top three," with respect to sales and gross profits. It is also evident that prior to January 1975 only 1 of these 22 delicatessens bought doughnuts from an outside supplier.16 In this context, that Respondent chose to alter the operation of one of its most successful delicatessens in a manner purported- ly requiring the transfer of three of its employees, and at a time when that delicatessen's employees were in the midst of an organizational campaign, is highly suspicious. 16 Respondent's store in Shreveport began its purchase of doughnuts from an outside supplier sometime during the fall of 1974. It is also evident that, shortly before the hearing in this matter on July 8 and 9, 1975, Respondent's Sherman store, to which employees Jillson and Holder were transferred, similarly altered its operation . Jillson testified that she was informed by Margaret Clark, the Sherman delicatessen's manager, that the change in operation would not necessitate any layoffs whatsoever. This is in apparent contrast to Respondent's contention regarding the effects of the similar change at the Denison delicatessen in January. 17 For the reasons stated in his separate opinion in Drug Package Company, Inc. 228 NLRB 108 (1977), Member Walther agrees that Respondent has violated Sec. 8(aX5), and that a bargaining order, effective December 15, 1974, is the appropriate remedy. Indeed, when the foregoing is viewed against the background of Respondent's unlawful antiunion activity, Respondent's contention that its transfer of employees Martin, Jillson, and Holder was solely economically motivated and was unrelated to union organization is not impressive. Rather, we view the transfer of Jillson and Holder, the subsequent reduc- tion in their hours, and the offer of transfer to Morton as designed to undermine the Union's strength in the Denison delicatessen. We therefore conclude, con- trary to the Administrative Law Judge, that Respon- dent's conduct violated Section 8(a)(3) and (1) of the Act, and we shall issue an appropriate remedy. We further find that Respondent's refusal to bargain violated Section 8(a)(5) and (1) of the Act. Under the principles set forth in Trading Port, Inc., 219 NLRB 298 (1975), we find that Respondent had a duty to bargain as of December 15, 1974, the date on which Respondent embarked on a clear course of unlawful conduct which undermined Petitioner's majority status and made the holding of a fair election improbable.17 Notwithstanding that the complaint, as amended, did not specifically allege Respondent's refusal to bargain as an independent violation of the Act, the facts with respect to this violation-the Union's demand for recognition based on a card majority, Respondent's refusal, and Re- spondent's commission of various unfair labor prac- tices-were fully litigated at the hearing and are supported by the evidence. These are the necessary elements for an 8(a)(5) finding. Since these issues have been litigated, it is therefore appropriate for us to find a violation of Section 8(a)(5) in Respondent's refusal to bargain.18 THE REMEDY In order to effectuate the policies of the Act, we find that it is necessary that Respondent be ordered to cease and desist from the unfair labor practices found; to take certain affirmative action, including offering Georgia Faye Morton, Joyce Jillson, and Virginia Holder reinstatement to their former jobs at the Denison delicatessen or, if those jobs no longer exist, to substantially equivalent positions, without prejudice to their seniority or other rights and privileges; to make Jillson and Holder whole for any Members Fanning and Jenkins would find that Respondent refused to bargain in violation of Sec. 8(a)(5) as of the Union's October 25, 1974, demand for recognition. As indicated in his concurring opinion in Trading Port, Inc., Member Fanning would base his finding upon his view that under N.L.RB v. Gissel Packing Co., Inc., 395 U S. 575 (1969), a union may establish its exclusive representative status through the use of authorization cards where, as here, an employer makes the holding of a fair election improbable as a consequence of its unfair labor practices . Member Jenkins concurs in this view. 18 See, e.g., Schwab Foods, Inc., d/b/a Scotts IGA Foodlmer, 223 NLRB 394(1976). 152 DECISIONS OF NATIONAL LABOR RELATIONS BOARD loss of earnings they may have suffered by reason of their discriminatory reduction in hours, with said losses to be computed from January 10, 1975, the date of their transfer, until full reinstatement is offered; to make Morton whole for any loss of earnings she may have suffered by reason of the discriminatory offer of transfer made to her by Respondent on January 10, 1975, with said losses to be computed from January 10, 1975, until full reinstatement is offered;19 and to make Morton whole for any loss of earnings she may have suffered by reason of the discriminatory reduction in her hours in mid-December 1974, with said losses to be computed from mid-December 1974 until January 10, 1975. Backpay shall be computed on a quarterly basis, plus interest at 6 percent per annum, as prescribed in F. W. Woolworth Company, 90 NLRB 289 (1950), and Isis Plumbing & Heating Co., 138 NLRB 716 (1962). We have also concluded that Respondent's transfer of Morton, Jillson, and Holder, as well as the reduction in their hours, was designed to undermine the Union's majority strength. 20 Since we are also of the view that Respondent's unlawful conduct is so serious and substantial in character as to render a fair and free election improbable, we shall order issuance of a remedial bargaining order. In light of this remedy, we shall vacate the Administrative Law Judge's recommended Order that a second election be conducted. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that the Respondent, The Kroger Co., Denison, Texas, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Interrogating employees employed in the delica- tessen department of its Denison, Texas, store con- cerning their union activities and interests or solicit- ing employees to persuade other employees to refrain from union activities. (b) Threatening or coercing employees of the delicatessen department of the Denison, Texas, store by indicating in any manner that the department might be closed in the event the employees should 19 We note that, unlike Jilison and Holder, Morton did not accept her offer of transfer to the Sher-Den Mall store, in Sherman, Texas, as a cashier Morton testified that while she was able to walk to her employment at the Denison store she was unable to accept the transfer to the Sher -Den Mall store, which is approximately 5 miles from the Demson store, because she did not have an automobile As mentioned, Respondent was unwilling to make an accomodation of Morton's lack of transportation, indicating instead that if Morton did not accept the transfer she was out ofajob While there is also testimony in the record that Morton was frequently able to obtain a ride to the Denison store during periods of inclement weather, we do not view this as sufficient to negate Morton 's explanation as to her inaccessibility to the Sher- select the Union as their collective-bargaining repre- sentative; or that the Respondent would never accept a collective-bargaining representative on behalf of the delicatessen department employees at the Denison, Texas, store. (c) Discouraging membership in or activity on behalf of Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, Local 540, or any other labor organization, by transferring employees to jobs at different stores and by reducing employees' work hours. (d) Refusing to recognize and bargain collectively with Amalgamated Meat Cutters and Butcher Work- men of North America, AFL-CIO, Local 540, as the exclusive bargaining representative of its employees in the appropriate bargaining unit described below. (e) In any other manner interfering with, restrain- ing, or coercing employees in the exercise of their rights guaranteed in Section 7 of the Act. 2. Take the following affirmative action which is necessary to effectuate the policies of the Act: (a) Upon request, bargain collectively in good faith with the Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, Local 540, for the unit described herein with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment. The bargaining unit is: 21 All regular full-time and regular part-time delica- tessen employees employed in the Respondent's store in Denison, Texas, exclusive of all grocery, produce, dairy and meat employees, package boys, office clerks, guards, watchmen, and super- visors as defined in the Act. (b) Offer Georgia Fay Morton, Joyce Jillson, and Virginia Holder immediate and full reinstatement to their former jobs or, if those jobs no longer exist, to substantially equivalent positions without prejudice to any rights and privileges to which they are entitled, and make them whole in the manner and in accord- ance with the method set forth in the section herein entitled "The Remedy." (c) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social security payment records, timecards, personnel records and reports, and all Den Mall store We find therefore that Respondent's offer of transfer to Morton, in effect, constitutes a constructive discharge for reasons proscribed by Sec 8(a)(3) 70 As mentioned, all six of the Denison delicatessen employees had signed authorization cards by September 19, 1974 21 The unit description found appropriate herein is set forth in par 10 of the amended complaint which was admitted by Respondent in its amended answer We note further that on February 3, 1974, pursuant to a Stipulation for Certification Upon Consent Election, an election was conducted in the unit described herein in accordance with the mutual agreement of the parties THE KROGER CO. other records necessary to analyze the amount of backpay due under the terms of this Order. (d) Post at its Denison, Texas, store copies of the attached notice marked "Appendix." 22 Copies of said notice, on forms provided by the Regional Director for Region 16, after being duly signed by an autho- rized representative of Respondent, shall be posted by it, immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including 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 16, in writing, within 20 days from the date of this Order, what steps the Respondent has taken to comply herewith. IT IS FURTHER ORDERED that the election held on February 3, 1975, among Respondent's employees in the appropriate unit, be, and it hereby is, set aside and that the petition in Case 16-RC-6827 be, and it hereby is, dismissed. 22 In the event that this Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board." APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL NOT unlawfully interrogate our em- ployees concerning their union activities or solicit employees to persuade other employees to refrain from union activities. WE WILL NOT threaten to close our store in the event the Union is selected by our employees. WE WILL NOT discourage membership in Amal- gamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, Local 540, or any other labor organization, by transferring employ- ees to jobs at other stores and by reducing employees' work hours. WE WILL NOT refuse to recognize or bargain collectively with Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, Local 540, as the exclusive bargaining representa- tive of our employees in the appropriate bargain- ing unit described below. 153 WE WILL NOT in any other manner interfere with, restrain, or coerce our employees in the exercise of rights guaranteed them by the National Labor Relations Act. WE WILL, upon request, recognize and bargain collectively in good faith with Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, Local 540, as the exclusive bargaining representative of all regular full-time and regular part-time delicatessen employees employed in our store in Denison , Texas, exclusive of all grocery, produce, dairy and meat employees, package boys, office clerks , guards, watchmen, and super- visors as defined in the Act. WE WILL offer Georgia Faye Morton, Joyce Jillson, and Virginia Holder immediate and full reinstatement to their former jobs or , if those jobs no longer exist, to substantially equivalent posi- tions without prejudice to any rights and privileg- es to which they are entitled, and WE WILL make them whole for any losses incurred as a result of our discrimination against them. THE KROGER CO. DECISION STATEMENT OF THE CASE JAMES T. RASBURY, Administrative Law Judge: These consolidated cases were heard by me in Sherman, Texas, on July 8 and 9, 1975.1 The original charge in Case 16-CA- 5898 was filed by the Union on January 10 and served on Respondent by registered mail on January 13; the first amended charge was filed by the Union on January 15 and served on Respondent by registered mail on or about January 17. The complaint was issued on March 31. Respondent's answer of April 7, and amended answer of June 23, admitted certain facts, but denied any illegal or improper conduct. Pursuant to a Stipulation for Certification Upon Consent Election, an election by secret ballot was conducted on February 3 in the following agreed-upon appropriate bargaining unit: All regular full-time and regular part-time delicatessen employees employed in the Employer's store in Deni- son, Texas, excluding all grocery, produce, dairy and meat employees, package boys, office clerks, guards, watchmen and supervisors as defined in the Act. There were seven votes cast, with five votes challenged and, of the two remaining, one was cast for the petitioning union and one for no union. On February 7, the Petitioner filed timely objections to conduct affecting the results of the election. The Regional Director found the election objec- tions to be directly related to the alleged discrimination and I All dates hereinafter shall be in 1975 unless otherwise indicated 154 DECISIONS OF NATIONAL LABOR RELATIONS BOARD other alleged acts of interrogation, threats, and coercion of the employees, which had been alleged as violative of Section 8(ax 1) and (3) of the Act in Case 16-CA-5898. On June 13 the Regional Director issued an amended com- plaint and notice of hearing consolidating the unfair labor practice case and the questions raised by the objections to the election and the challenged ballots for hearing before an Administrative Law Judge. Upon the entire record, including my observation of the demeanor of the witnesses, and after due consideration of the briefs filed by the General Counsel, Petitioner, Charg- ing Party, and Respondent, I make the following: FINDINGS OF FACT 1. JURISDICTION Respondent, The Kroger Co., is, and at all times material herein has been, a corporation organized under and existing by virtue of the laws of the State of Ohio. Respondent maintains an office and principal place of business in the city of Dallas, Texas, where it is engaged in the retail grocery business. Respondent maintains retail grocery stores at various locations throughout Texas, including Denison and Sherman. During the 12 months preceding the issuance of complaint, which period is representative of all times material herein, Respondent, in the course and conduct of its business operations at the Denison, Texas, retail grocery store, sold grocery and other related items valued in excess of $500,000. During the same period, Respondent purchased and received goods valued in excess of $50,000 directly from suppliers located outside the State of Texas. Upon the basis of these admitted facts, I find that Respondent is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. II. THE LABOR ORGANIZATION The Respondent admits, and I herewith find, the Amal- gamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, Local 540, to be, and all times material herein to have been, a labor organization within the meaning of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. The Issues 1. Is Willis Hall a supervisor within the meaning of Section 2(11) of the Act? 2. Are the union authorization cards "tainted" because of supervisory solicitation? 3. What were the real motivating forces causing Re- spondent to change the delicatessen operation in its Denison, Texas, store? 4. Was the reduction in hours and the transfer of employees Morton, Jillson, and Holder from the Denison, Texas, store to the Sherman, Texas, stores discriminatory in violation of Section 8(a)(3) of the Act? 2 While this may be a possible violation of Sec . 8(a)(1) of the Act , only the events occurring between the date of the filing of the petition, December 23, 1974, and the date of the election , February 3, may serve as a basis for 5. Did Respondent's supervisors interrogate, threaten, or make promises in violation of Section 8(a)(1) of the Act? 6. How does the resolution of the above issues affect the voting rights of those voters whose ballots were challenged at the February 3 election? Should a new election be ordered? B. The Evidence During the first half of September 1974, one of Respon- dent's delicatessen employees at the Denison, Texas, store, Georgia Faye Morton, obtained union authorization cards from a fellow employee, Bob Overturf, the head meat cutter of the meat department. Morton distributed these cards to the employees of the delicatessen department, although Overturf testified that one or two of the employees obtained their cards directly from him. In any event, by September 19, 1974, six of the seven employees working in the delicatessen department (Willis Hall is the seventh employ- ee and his status as a supervisor is at issue) had signed union authorization cards (see G.C. Exhs. 2, 3, 4, 6, 7, and 8). Fred H. Tilson, a union agent, testified that he had a meeting with the deli department employees on October 17, 1974, and on October 25 he demanded recognition on behalf of the deli department employees. This was a verbal request made of Jim Sneyd, the Kroger Co. personnel director. Tilson further testified that the president and business manager of the Union renewed the demand for recognition on November 17, 1974. The petition in Case 16-RC-6827 was filed on December 23, 1974, requesting that an election be held in an appropriate bargaining unit described as including all regular full-time and regular part-time delicatessen employ- ees employed in the Respondent's store in Denison, Texas, but excluding all grocery, produce, dairy and meat employ- ees, package boys, supervisors, guards, watchmen and office clerks as defined in the Act. On January 23, the Respondent and the Union entered into a Stipulation for Certification Upon Consent Election and the election was held on February 3. As heretofore indicated, the election resulted in five ballots being challenged and one ballot being cast for the Union and one for no union. Employee Betty Potts testified that on or about Decem- ber 15, 1974, while she was working in the delicatessen department Irby Smith, assistant manager of the store, approached her and asked, "Betty, who's prounion back here?" The Respondent did not call Irby Smith to testify and this questioning of a rank-and-file employee by the assistant manager stands in the record undenied.2 Employee Joyce Jillson testified that on or about Decem- ber 20 she and Willis Hall were working together in the delicatessen at which time Hall asked her, "Joyce, just what - just what do you stand to gain from joining the Union?" And she said, "Mr. Hall, they have good benefits... . They also give us representation....Also I might even get a pay increase out of it." And he said "Why should I join the Union when every time they get a raise in Sherman, I get it over here, and I don't even have to pay the union objections to the election . Ideal Electric and Manufacturing Company, 134 NLRB 1275( 1961). THE KROGER CO. dues." Jillson said, "Well, Mr. Hall who do you think got you that raise? . . . The Union is the one that fought for it, and got it for you." On another occasion testified to as being on or about December 16, Jillson testified, the store manager, Ken White, spoke to her alone and said, "I hope I can count on a no vote from you" in the election which will be coming up in 3 or 4 weeks. He also asked her "To talk the Union down to all the girls in the back." White did not deny having had such a conversation with Jillson. Employee Betty Potts also testified that on or about December 27 while she was working in the delicatessen department that Willis Hall said to her, "Betty, I'm going to be mighty unhappy if I lose my job over this mess." Hall continued, "I sure would hate standing in the unemploy- ment line." To which Betty Potts replied, "Well, Mr. Hall, if you do, I'm sure you won't be the only one." Hall went on to say, "They're not going to pay this kind of wages to this store when they don't pay that kind of wages to another. That don't make sense." Betty Potts further testified that on or about February 2, while she was baking cookies in front of the oven, Willis Hall came over to her and said that Sneyd was not going to let it go. Moreover, Potts testified that there were various times when Hall commented to her that Kroger was not going to let it go union, "That there wasn't no way it would go union." On one occasion, he said, "Now that's not a threat. That's a promise." This testimony stands in the record unrefuted. On one occasion in mid-December 1974, Georgia Faye Morton was scheduled to report for work at 7 a.m. to do the donut baking and preparation for the day. On this occasion, Morton testified that her alarm did not go off and that she overslept. When she called and spoke to Hall about 8 a.m., he told her that he had already gotten Joyce Jillson to come in and work in her place for the day. Thereafter, Morton's hours were cut from between 15 to 25 hours of work, to 10 hours of work per week. Morton testified that she had never been seriously reprimanded or late to work except on this one occasion. White, however, testified that he was the one that was responsible for the reduction in her hours and that she had previously been reprimanded for the poor quality of her work, as well as spending too much time smoking in the restroom, and she received too many personal telephone calls. Both Respondent's witnesses and General Counsel's witnesses testified that George J. Logan, the delicatessen bakery merchandiser for the Dallas division of Respondent, held a meeting with the delicatessen employees on January 2 at which time he reviewed the financial performance of the Denison delicatessen department for the past year. This financial report, while reflecting favorably on the total dollar volume of business generated by the Denison delicatessen, nevertheless, indicated that the department operated at a net loss of approximately $10,000 for 1974 (see Resp. Exh. 1). Shortly after this financial report was received both White and Logan testified that they discussed the feasibility of reducing labor costs in the delicatessen 3 Sec 2(11) of the Act reads as follows: The term "supervisor" means any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or 155 department by finding a local supplier of the donuts and other pastries which were being baked or fried on the premises of the delicatessen. By January 10 this new method of operating had been accomplished and Geneva Farrington was advised that she was being laid off, and employees Jillson and Virginia Holder were offered trans- fers to the delicatessen department of the Sherman, Texas, store and employee Georgia Faye Morton was offered a transfer to the Sher-Den Mall store in Sherman, Texas, as a cashier. According to the testimony of White, he made the decision to alter the method of operating the deli, but the transfers, or offers of transfers, were arranged by Sneyd. Employees Jillson and Holder accepted the transfer to the Sherman delicatessen although their hours of work were reduced to approximately one-half of what they had been working in the Denison store. Employee Morton testified that she was unable to accept the transfer because she did not have an automobile, and it would be impossible for her to work at the Sher-Den Mall store. It is the General Counsel's contention that the action of reducing the hours of work of Morton, Jillson, and Holder, when viewed in light of the threats to close down the delicatessen, the interrogation of the employees about their union activities and desires, and the solicitation of the employees to abandon the Union, clearly emerges as a violation of Section 8(a)(3) of the Act. Respondent defends its conduct on the basis of economic justification and presented economic data indicating that, for the first half of 1975, the new method of operating resulted in a net operating gain or profit instead of the substantial loss that had occurred for the corresponding period in 1974. (See Resp. Exhs. 2 and 3.) Analysis and Legal Considerations Respondent denies that Willis Hall, delicatessen depart- ment manager, is a supervisor within the meaning of the Act,3 while at the same time contending that the union authorization cards were "tainted" because of "Supervisor Overturf s" limited participation in the distribution of the cards to the employees. While I am quite sure, based on the testimony of the store manager, Ken White, that Willis Hall does not have the authority to hire and/or fire employees, I am convinced that he does have the responsibility to direct the activities of the employees in the delicatessen depart- ment. While Hall performed a substantial amount of manual work in much the same fashion as did the other employees, nevertheless, he directed the other employees and assigned them various tasks as the occasion arose. He also prepared the weekly schedules which were, in turn, approved by White, but in doing so Hall had ample opportunity to reward or discipline the other employees. While Hall was paid on an hourly rate and received overtime payments for hours in excess of 40 per week or 8 responsibly to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment. 156 DECISIONS OF NATIONAL LABOR RELATIONS BOARD per day, his hourly rate was 60 to 70 percent greater than the next highest paid employee in the department .4 The testimony is undisputed that the employees looked to Hall in the day-to-day performance of their duties, and I am convinced that the General Counsel established a prima facie case as to the supervisory status of Hall, which the Respondent did not effectively rebut .5 I fmd Willis Hall to be a supervisor within the meaning of Section 2(11) of the Act and, accordingly, Respondent shall be held account- able for his conduct. There can be no doubt that Bob Overturf, meat depart- ment manager at the Denison store, who had a classifica- tion of head meat cutter, occupied a status similar to that of Willis Hall and, unquestionably, is a supervisor within the meaning of the Act. The evidence, however, indicates that his union activity among the delicatessen employees was confined to responding to the employees' questions, making available union authorization cards, and accepting and delivering to the Union those cards which employees returned to him. There is nothing in the evidence to indicate the slightest degree of coercion, intimidation, or even mild pressure on the part of Overturf to encourage or promote the signing of union authorization cards. In my opinion, he was nothing more than a conduit or servant of the employees' desires. Enforcing the Board's decision in N.LR.B. v. WKRG-TV, Inc., the Fifth Circuit Court of Appeals said:6 It is actual pressure and coercion we are seeking to avoid by our rule disallowing cards tainted by supervi- sory influence. A mechanical rule that requires a finding of supervisory solicitation in situations such as we have here, where there is no hint of intimidation, is too broad. D There must be a more substantial exhibition of pressure than a passing remark or a statement of prounion conviction. So long as nothing in the words, deeds, or atmosphere of the alleged "solicitation" contain the seeds of potential reprisal, punishment, or intimidation, the involvement of the supervisors does not rise to the level of supervisory "solicitation" that we condemmed in American Cable Systems, Inc., supra. Here the supervisors attended a few union meetings and at various times made rather tame statements regarding their approval of the Union. There is not a sufficient showing to throw out any of the cards, and the Board was correct in refusing to allow the minimal supervisory participation in this organization drive to frustrate the union's otherwise valid majority .7 On the basis of the record testimony and the authorities indicated, I conclude and fmd that none of the authoriza- tion cards are invalid as contended by Respondent. White testified that to his best recollection Hall's rate was approximate- ly $5.57 per hour, and the next highest paid employee's was approximately $3.57 per hour. Other employees in the department testified that their rate of pays was $2.90 per hour. Screwmanc, Inc., 218 NLRB 1372 (1975). 6 190 NLRB 174 (1971), 470 F.2d 1302 (1973). r The citation for American Cable in the quoted paragraph is- 414 F.2d 661 (C A. 5,1969). Neither Irby Smith nor Willis Hall, the assistant manager of the Denison store and the department manager of the delicatessen at the Denison store, was called by Respon- dent to testify nor was there any explanation given as to why they were not called to testify. Not only does the testimony of Betty Potts and Joyce Jillson stand in the record undenied, but it is a reasonable inference that had Smith and/or Hall been called to testify their testimony would have been adverse to the interests of Respondent .8 No proof of coercive intent or effect is necessary under Section 8(a)(l), the test being "whether the employer engaged in conduct which, it may reasonably be said, tends to interfere with the free exercise of employee rights." Time- 0-Matic, Inc., 264 F.2d 96 (C.A. 7, 1959). Thus, when a supervisor of a company which has unequivocally ex- pressed its antiunion sentiments asks an employee about his union affiliation there is going to follow a natural coercive effect on the questioned employee .9 This is particularly true where, as here, there was no legitimate purpose for the questioning, and the employee was not given assurances against reprisal.10 I fmd that Respondent by and through the conduct of its supervisors, White, Smith, and Hall, did interrogate employees concerning their union membership and activities and did threaten and coerce employees by commenting that the delicatessen department would be closed before the Union was allowed to come in, all of which is in violation of Section 8(a)(1) of the Act. The General Counsel alleges the disciplinary action of Respondent toward Georgia Faye Morton in mid-Decem- ber when her hours of work were reduced, the transfer of Jillson and Holder to the Sherman, Texas, store and subsequent reduction of their work hours, and the transfer of Georgia Faye Morton to the Sher-Den Mall in Sherman, Texas, all occurred because said employees joined or assisted the Union or engaged in other union activity or concerted activities and thus were discriminatory in viola- tion of Section 8(a)(3) and (1) of the Act. Morton's hours were reduced in mid-December because of her failure to report for work on a morning when she was scheduled to do the donut baking, which could have resulted in a substantial loss of money to the Respondent. This disciplinary measure occurring as it did in the midst of a union organizational campaign arouses some suspicion; however, I credit the testimony of Store Manager Ken White to the effect that Georgia Faye Morton had been warned concerning her lack of attention to duties, excessive smoking, and use of the telephone for personal calls. Her failure to report for work as scheduled reflected a lack of responsibility and might have been extremely costly to the Respondent. I find nothing coercive or discriminatory in Respondent's conduct in reducing Morton's hours in mid- December and shall recommend dismissal of that allegation in the complaint. 8 M. J. Pirollt & Sons, Inc., 194 NLRB 241 (1972), and Capitol Engineering and Mfg. Co., 191 NLRB 641(1971). 9 Cf. N.L.R.B. v. Louisiana Manufacturing Company, 374 F.2d 696 (C.A. 8, 1967). iU N.LR.B. v. Spotlight Company, Inc, 440 F.2d 928 (C A. 8, 1971). THE KROGER CO. 157 There remains to be considered the layoff of the delica- tessen department employees Morton, Holder, Jillson, and Farrington.11 Ken White, manager of the Denison store, testified that the decision to try a different method of operating in the delicatessen department insofar as the preparation of the donuts and pastries were concerned was his. A consideration of the problem and a possible solution to be tried immediately followed the revelations to White by Logan of the financial contribution, or lack of contribu- tion, from the delicatessen department. He denies that his decision to change the method of operating the delicatessen department was influenced in any way by the appearance of the Union on the scene and points to the general downturn of business and the attendant layoff of employees in other departments of the store that occurred about the same time. Moreover, the wisdom of the managerial decision is graphically displayed in Respondent's Exhibit 2 when compared with a corresponding period in the previ- ous year as reflected by Respondent's Exhibit 3. The question is one of ascertaining motive. Even if Respon- dent's business reasons were not the best, unless the change is illegally motivated, it is not violative of the Act. Here the business reasons were sound, and I am unable to infer an illegal motive. Evidence that points in two directions points in neither. The General Counsel has not satisfied the required burden of proof. I find nothing discriminatory in the layoff by Respondent of part-time employees Holder, Jillson, Morton, and Farrington. Holder and Jillson were offered transfers to the delicatessen department of the Sherman, Texas, store and accepted. The fact that Georgia Faye Morton was unable to accept the transfer to the Sher- Den Mall store in Sherman because of a lack of transporta- tion was certainly not the Respondent's fault.12 I have credited the testimony of Ken White, the store manager, whom I believe to have been an honest, straight- forward, and candid witness. Under all the circumstances in the record herein, I find there is no reasonable expectan- cy on the part of employees Holder, Jillson, Morton, and Farrington of returning to work in the delicatessen depart- ment of the Denison store. It follows from what has heretofore been found that the five challenged ballots would, under ordinary circumstances, be sustained, and the results of the election certified. However, in view of the findings of violation of Section 8(a)(1) of the Act on the part of Respondent, I shall also find that this same conduct interfered with the conduct of the election and is sufficient to warrant setting aside the election, and I shall direct that a second election be held.13 General Counsel has requested a Gissel-type remedy 14 on the theory that Respondent's wrongful conduct has effec- 11 While the layoff of Farrington is not alleged as a violation of Sec 8(a)(3) and (1) of the Act, nevertheless, so far as the record reveals the basic cause of her layoff is the same as that for Holder , Jillson, and Morton and needs to be considered in order to resolve the status of her challenged ballot 12 There was undisputed testimony in the record that the Sher-Den Mall store was not more than 5 miles distance from the Denison store and while Morton was able to walk to her employment at the Denison store , there was also testimony by her that she frequently was able to obtain a ride during periods of inclement weather. tively destroyed the Union's majority, and a fair and free election would be impossible. In view of my findings relating to the layoffs and subsequent transfers, we are left with nothing more than a modicum of 8(a)(1) conduct which hardly rises to the level of "outrageous" and "pervasive" conduct where the effects cannot be eliminated by the application of the traditional remedies. CONCLUSIONS OF LAW 1. The Respondent, The Kroger Co., is an employer engaged in commerce within the meaning of the Act. 2. The Union, Amalgamated Meat Cutters and Butcher Workers of North America, Local 540, AFL-CIO, is a labor organization within the meaning of Section 2(5) of the Act. 3. Willis Hall, delicatessen department manager of the Respondent's Denison, Texas, store, is a supervisor within the meaning of Section 2(11) of the Act. 4. By the acts and conduct of Respondent's supervisors in questioning employees concerning their attitudes and intentions regarding the Union, and by veiled references to the closing of the delicatessen and by indications that the Union would never be accepted, Respondent has engaged in unfair labor practices proscribed by Section 8(a)(1) of the Act.15 5. The result of the election held among the employees of the delicatessen department at The Kroger Co.'s, Denison, Texas, store on February 3, 1975, is tainted and shall be set aside and a new election held. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of Respondent, as set forth in section III, above, occurring in connection with the operations de- scribed in section I, 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 certain unfair labor practices, I shall recommend that it cease and desist therefrom and take certain affirmative action de- signed to effectuate the policies of the Act. [Recommended Order omitted from publication.] 13 See Holmes Foods, Inc., 170 NLRB 376 (1968). Much of the wrongful conduct of Willis Hall occurred between December 23, 1974, and February 3, 1975 14 N L.R.B. v. Gissel Packing Co., Inc., 395 U.S. 575 (1969); also Steel- Fab, Inc., 212 NLRB 363 (1974). 15 See The Karte! Corporation, d/b/a Big Ben Shoe Store, 172 NLRB 1523 (1968); Peerless of America, Inc., 198 NLRB 982 (1972); and Milco, Inc., 159 NLRB 812 (1966), enfd. 388 F.2d 133 (C.A. 2, 1968).