Kranco, Inc.

KRANCO, INC. Kranco, Inc. and Carpenters District Council of Houston & Vicinity, affiliated with United Broth- erhood of Carpenters & Joiners of America. Case 23-CA-5975 February 18, 1977 DECISION AND ORDER BY CHAIRMAN MURPHY AND MEMBERS FANNING AND PENELLO On October 8, 1976, Administrative Law Judge Michael O. Miller issued the attached Decision in this proceeding. Thereafter, both the General Counsel and Respondent filed exceptions and supporting briefs and Respondent filed a brief in opposition. 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 briefs and has decided to affirm the rulings, findings, and conclusions of the Administrative Law Judge and to adopt his recommended Order, as modified herein.' 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, Kranco, Inc., Houston, Texas, its officers, agents, successors, and assigns, shall take the action set forth in the said recommended Order, as so modified: 1. Insert the following as paragraph 1(c) and reletter the following paragraphs accordingly: "(c) Threatening employees by indicating that employees have been terminated because of their support for the Union." 2. Substitute the attached notice for that of the Administrative Law Judge. i The Administrative Law Judge found that, at the time of Respondent's March 4 discharge of its night-shift employees, employee Gilmer confronted Supervisor Michulka with the statement that they both knew that employees were being terminated because of the Union Michulka nodded his head in the manner normally signifying agreement Unlike the Administrative Law Judge, we find that this acknowledgement that employees were discharged because of their support for the Union violated Sec 8(a)(1), of the Act Certainly, if a threat to discharge violates Sec 8(a)(l), a fortiori, an acknowledgement (or statement) that union activities precipitated the discharge would constitute a violation of that section of the Act. Indeed, to employees who were not discharged, it was tantamount to a threat of similar treatment for them if they chose to engage, or continued to engage, in union activities APPENDIX 319 NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government After a hearing at which all sides had a chance to give evidence, the National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post this notice: The Act gives all employees these rights: To engage in self-organization To form, join, or help a union To bargain collectively through a repre- sentative of their own choosing To act together for collective bargaining or other mutual aid or protection To refrain from any or all these things. WE WILL NOT do anything that restrains or coerces employees with respect to these rights. WE WILL NOT discharge or otherwise discrimi- nate against employees because they engage in union activities. WE WILL NOT interrogate our employees con- cerning their union membership, activity, or support. WE WILL NOT threaten employees with loss of employment or other reprisals if they engage in union activity or select a union as their collective- bargaining representative. WE WILL NOT indicate to our employees that employees have been terminated because of their support for the Union. WE WILL NOT in any other manner interfere with, restrain, or coerce our employees in the exercise of their rights as set forth above. WE WILL reinstate the following named employ- ees to their former jobs or, if such jobs are no longer available, to substantially equivalent jobs, without prejudice to their seniority and other rights and privileges, and WE WILL make them whole for any loss of earnings with backpay plus 6-percent interest. J. L. Armstrong Clifford Melvin Danny Starnes W. L. Gilmer Steven Norton Steve Hundl Dan Mason William C. Bowen Scott Forbes James Hindman Kenneth Carriere KRANCO, INC. 228 NLRB No. 45 320 DECISIONS OF NATIONAL LABOR RELATIONS BOARD DECISION STATEMENT OF THE CASE MICHAEL O. MILLER, Administrative Law Judge: This matter was heard in Houston , Texas, on May 12, 13, and 14, 1976. The complaint issued on March 31, 1976, pursuant to a charge filed on March 4, 1976, was amended at hearing and alleged violations of Section 8(a)(1) and (3) of the National Labor Relations Act, as amended. Respon- dent's timely filed answer was also amended at hearing. All parties have filed briefs.' Upon the entire record herein, including my observation of the witnesses as they testified, I hereby make the following: FINDINGS OF FACT AND CONCLUSIONS I. THE EMPLOYER'S BUSINESS AND THE UNION'S LABOR ORGANIZATION STATUS Kranco, Inc., herein called Respondent, is a Texas corporation engaged in Houston , Texas, in the manufacture and sale of overhead cranes. Jurisdiction is not in issue. The complaint alleges, the answer admits, and I find and conclude that Respondent is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. The complaint alleges, Respondent admits, and I find and conclude that Carpenters District Council of Houston & Vicinity, affiliated with United Brotherhood of Carpen- ters & Joiners of America, herein called the Union, is a labor organization within the purview of Section 2(5) of the Act. II. THE ALLEGED UNFAIR LABOR PRACTICES A. Union Activity Overt union activity among Respondent's employees began on February 19, 1976 (all dates hereinafter are 1976 unless otherwise specified), with a distribution of literature and authorization cards in front of the plant . The activity immediately came to the attention of Raymond Vajdak, plant superintendent, and John Pearson, personnel manag- er. Pearson telephonically reported it to Thomas J. Lee, Respondent's executive vice president, who was out of town at the time.2 A distribution on February 24 announced meetings to be held on February 26 with the day - and night- shift employees . The night shift met with union representa- tives at a restaurant following the end of their shift. Authorization cards were distributed and approximately 16 of the 30 night-shift employees signed and returned cards at that time. Several more were returned by W. C. Bowen, the Union's inplant organizer. An additional meeting was held with the night-shift employees on March 1. A representa- 1 Respondent filed a reply brief, to which General Counsel objected and moved to stoke , correctly asserting that the Board's Rules and Regulations do not provide for reply briefs to the Administrative Law Judge . Joseph E Cote, d/b/a J E Cote, 101 NLRB 1486, fn. 4 (1952). Thereafter , General Counsel filed a motion requesting that I take notice of a recent Board decision and urging that it be deemed diapositive of the issue herein General Counsel's motion is, itself, in the nature of a reply brief and I deem its filing a tion petition, bearing the date of March 4, was filed by the Union (Case 23-RC-4359). B. The Employer's ResponseAlleged 8(a)(1) Violations Kranco's official response was a letter from its president to the employees , distributed on -March 2. The letter urged employees not to select union representation and based its arguments on the costs of union dues, fines, and assess- ments, the risk and financial burdens of strikes, the Union's lack of interest in them or investment in the plant, the Union's alleged misuse of money, and the disadvantages of a seniority system, grievance procedure, and checkoff. Specifically, the letter stated, inter alia: These strangers are not out getting customers to buy our cranes so you will have work. They are not putting up their money to make this a safe comfortable place to work. They are not doing anything for you except causing you to risk everything so they can collect tribute from you. s s s s r The threats to your welfare come from the Union - not from the company. s s s s s You would not like a union contract hanging over you. You would not like "job classifications" which pegs you and freezes your pay. You would not like "seniority" which limits your progress. Various employees testified in regard to conversations with Night Supervisor Tommy Michulka (supervisory status admitted) both before and after the March 2 letter issued. Michulka did not testify. General Counsel contend- ed that these conversations violated Section 8(a)(1). Thus, W. L. Gilmer testified that, on the evening of February 27, Michulka came up to him and asked what he thought about the Union. Gilmer gave a noncomittal answer. Steven Norton testified that, while he was reading Respondent's March 2 letter, Michulka asked him, "Are you for the Union?" and what he thought of it. They had a brief discussion of their opposing points of view. Michulka also asked Scott Forbes whether he had a union card and if he knew who was passing them out. In yet another conversa- tion, after Forbes had asked Michulka whether Michulka knew that W. C. Bowen was the union spokesman on the night shift, Michulka asked him who the spokesman was for the day shift. I credit the foregoing testimony and find that the foregoing conversations constitute inherently coercive interrogations in violation of Section 8(a)(1) of the Act. waiver of General Counsel 's objections to my receipt of Respondent's reply brief Additionally, I note that both postbnef submissions facilitated and did not delay my resolution of the issues, herein . Accordingly, I deny General Counsel's motion to strike and have considered both documents. See Cavender Oldsmobile Company, 181 NLRB 148, fn. 2 (1970) 2 The supervisory status of Lee, Vajdak, and Pearson is admitted. KRANCO, INC. 321 Crown Zellerbach Corporation, 225 NLRB 911 (1976); P B. and S Chemical Company, 224 NLRB 1 (1976). That Michulka may have enjoyed a rapport with his employees, may have been well thought of by them, and even may have been considered a friend by some, does not negate the coercive nature of questions seeking to elicit the union sympathies of a particular employee and others. As the Board noted in Quemetco, Inc., 223 NLRB 470 (1976): An employee is entitled to keep from his employer his views concerning unions, so that the employee may exercise a full and free choice on the point, uninflu- enced by the employer's knowledge or suspicion about those views and the possible reaction toward the employee that his views may stimulate in the employer. That the interrogation may be suave, courteous, and low-keyed instead of boisterous, rude, and profane does not alter the case. It is the effort to ascertain the individual employee's sympathies by the employer, who wields econonuc power over that individual, which necessarily interferes with or inhibits the expression by the individual of the free choice guaranteed him by the Act. Employees Bowen, Gilmer, Melvin, and Mason relate hearing statements by Michulka to the effect that they should not get "messed up" with the Union because it was .,no good," that they did not want the Union, and that it would only cause trouble, the latter two statements phrased crudely and profanely. Such statements, I find, do not contravene the Act's provisions; they are mere statements of permissible opinion. On March 2, Bowen approached Michulka and asked him, "What position would it put me in with the company toward being fired or dismissed if I was to say that I was an organizer and promoter for the Union on the night shift?" Michulka asked him what he was talking about and Bowen stated that he was the promoter of the Union on the night shift. Michulka first told Bowen that he could not answer him but, when pressed, said that it would not affect his employment. Later that evening, according to Bowen, Michulka asked Bowen if he was the Union's organizer on the night shift and Bowen hesitantly answered that he was. In light of Bowen's earlier volunteered admission of his role, I cannot find Michulka's subsequent question to constitute coercive interrogation. About March 1, Mason heard a conversation between Robert Chapman, day electrical foreman (supervisory status admitted), and Walter Schultz, in which Chapman asked Schultz, "Just between me and you . . . how do you feel about this Union? It won't go any further."3 I credit Mason's uncontradicted testimony and conclude, for the reasons set forth supra, that Chapman's questioning of Schultz constituted coercive interrogation in violation of Section 8(a)(1). During the week of February 25 to March 1, employee James Armstrong participated in a conversation with two other employees who were talking about pay raises they had received. David Rattray, who was contended by General Counsel to be the night electrical foreman and a statutory supervisor, joined the conversation. He told the employees that, when a union had previously tried to come in, the Employer had made promises to the employees and was giving these raises now so that the employees would not vote for the Union. Rattray did not testify. Respondent denied that Rattray was a supervisor and contended that he was only the lead electrician on the night shift. The record reflects that Rattray was on the night shift for about 3-1/2 months. He was hourly paid at the rate for a lead electrician on that shift. Admitted supervisors were salaried. Rattray worked with two other employees in the electrical department, a trainee and a helper; he was also observed, from time to time, telling the trainee and the helper what to do, checking their work, reassigning them from job to job, working with them, and sitting in the office reading or taking coffee while the others worked. In all, there were about 30 people on the night shift during February. Michulka was the only admitted supervisor working on that shift. According to Plant Superintendent Valdak, Rattray received his instructions for the night's work on a work schedule from the electrical foreman on the day shift and would follow that schedule in performing or assigning work. Rattray did not appraise the work of the others in the electrical department on the night shift or make recommendations regarding wage increases. That was done by the day foreman by examination of the work performed and the worksheets completed. On one occasion, Rattray was involved in the discharge of an employee: Michulka had reported to Vajdak that he had complaints from Rattray that a given employee would not respond to work instructions and would wander away from his work area. Vajdak gave instructions to the day foreman that, if the conduct was repeated, that employee was to be terminated. When Rattray again reported an infraction by this employee, he was terminated. The termination was effected by Rattray. Based upon the foregoing, I conclude that David Rattray did not possess or exercise the statutory authority indicative of supervisory status. He was but a conduit of manage- ment's instructions to himself and other employees within the small department in which he worked. In so concluding, I note that there was a supervisor on duty at all times and that if Rattray were to be found a supervisor the electrical department would have been the only department so directly supervised on the night shift. Accordingly, I shall recommend dismissal of the alleged 8(a)(1) violation attributed to Rattray. Clifford Melvin began working for Respondent about October 10, 1975, as a fitter helper, at $3.30 per hour plus 20 cents night-shift differential. After 3 months of employment he questioned Michulka about a raise he believed due him. Michulka subsequently told him that, under a new compa- ny policy, raises were not due for 6 months. About February 1, a fitter quit and Melvin was promoted into his place. He spoke to Michulka about his raise and was told that he would be put in for a raise, to about $3.80 per hour. He learned that he was receiving a 70-cent raise on the Monday following the first union meeting. He received the 3 Mason was Schultz' helper and worked in close proximity to him Chapman did not testify 322 DECISIONS OF NATIONAL LABOR RELATIONS BOARD raise in the pay he received on March 3, the night he and others were terminated. It was one of the largest raises given by Respondent. It placed Melvin into the second step of the trainee classification. General Counsel contended that Melvin's raise was given to dissuade support for the Union and thus violated Section 8(axl). Melvin had received a bona fide promotion, prior to the union activity, and his raise was consistent with that promotion. The evidence is insufficient to warrant a finding that the raise was intended to interfere with the exercise of free choice by either Melvin or any other employee. On March 4, the day following the termination of 10 night-shift employees (discussed infra), Lee called meetings for the day and night shifts. In his speech to each group he spoke about both the terminations and the union campaign, and he admitted that the latter was what occasioned the meetings. He described how orders had slacked off or been canceled. He described the Company's recent acquisition of Euclid Crane Company in Cleveland, Ohio. James Hind- man, who attended the day-shift meeting, and C. L. Cullever, who attended the night-shift meeting, both attributed to Lee a statement to the effect that Respondent could transfer work from Euclid to Kranco if Kranco's work became slack but that he would not do so if the Union came in. Lee denied making this statement and claimed that he told the employees that they did not want the Union to come in and that some of their customers might object to buying a crane from a shop that was unionized, because of the potential for work stoppages. Cullever recalled Lee making the latter statement; Hindman did not. Pearson confirmed Lee's version of the speeches. Based on the foregoing testimony and my observation of the comparative demeanors of the witnesses, I credit the testimony of the employee witnesses, Hindman and Cullever.4 Accordingly, I find that, in his speeches of March 4, Lee threatened employees with diminished work opportunities in the event they selected the Union to represent them, in violation of Section 8(a)(1). I note also, in reaching this conclusion that, even crediting Lee's version, Lee's statement that customers might not want to do business with them if unionized constituted an impermissible threat of loss of employment opportunities. This was an employer prediction of adverse consequences stemming from unionization unsupported by the requisite objective factual basis. N.LR.B. v. Gissel Packing Co., Inc., 395 U.S. 575, 618-620 (1969); Hertzka and Knowles, 206 NLRB 191, 194-195 (1973). C. The Alleged Discrimination In the early morning hours of Thursday, March 4, at the conclusion of the night shift which had begun on March 3, Respondent discharged 10 employees from its structural department: J. L. Armstrong, Danny Starnes, Steven Norton, Dan Mason, Scott Forbes, Kenneth Carriere, Clifford Melvin, W. L. Gilmer, Steve Hundl, and William C. Bowen. They were informed, by a letter read to them at that time, that "reversals in the business situation, as it has affected several of our customers, has resulted in cancella- tions of orders and postponements in other cases, thus causing a shortage in our workload. This in turn has caused us to discontinue our night fabrication work." All of these employees had attended union meetings and/or signed union authorization cards. On March 12, James Hindman, a day-shift welder, was also terminated, supposedly for the same reasons. Hindman had signed a union authorization card on February 25 and had attended a union meeting on March 9. At that meeting he was appointed as a witness to accompany the newly appointed inplant committee to see Superintendent Vajdak when they went to inform him that they would be soliciting membership in the plant. The committee, and Hindman, so informed Vajdak on March 10. Those terminations were the first in Kranco's history for such alleged reasons. Indeed, new employees were regularly told that they did not have to worry about layoffs. Respondent asserts that the discharges were unrelated to the union activity and were solely motivated by adverse business conditions. The record reflects the following: Kranco had a record year in 1975. Gross revenues exceeded $9 million and after tax earnings were approxi- mately $750,000. On December 12, 1975, Respondent's employees were sent a letter of season's greetings, inform- ing them of the record established and stating that they were going into 1976 "with the largest backlog [of orders ] in the history of our company." As of October 1975, Respon- dent had prepared a budget for 1976 anticipating another record year, increasing after tax earnings by approximately $80,000. However, according to Respondent's witnesses, business began to slack off in December 1975. An order for one crane was canceled and two orders that had been scheduled for 1976 delivery were postponed until 1977. These cranes had a total value of approximately $1,200,000 and allegedly represented 25,000 to 30,000 shop hours.5 The pace of new incoming orders also slackened, according to this testimony and, even with increased sales effort, including an alleged reduction in profit margin, sales did not keep pace with cranes being shipped. Respondent introduced summaries reflecting its backlog of orders (in dollars) and the estimated number of shop hours required to complete those orders, as of March 1, 1975, February 7, 1976, and February 28, 1976. Those summaries show as follows: 4 Cullever was still employed by Respondent at the time he gave this 5 No documentary evidence identifying or describing these orders was testimony That he would so testify, and incur the potential enmity of his employer, is an additional factor I have considered in deeming him credible Georgia Rug Mill, 131 NLRB 1304, 1305, fn 2 (1961) adduced during the hearing. KRANCO, INC. 3/1/75 dollars/ est. hours 2/7/76 dollars/ est. hours 2/28/76 dollars /est, hours Mar - 616 ,623/13388 840,903/25,710 905,976/20,725 Apr - 897 ,160/28,834 465,945/13,375 629,048/21,631 May - 524,343/13,093 192,360/ 4,440 203,560/ 4,605 June - 760,420/23,465 490,275/10,690 490,383/10,721 July - 365,940/ 8,746 607,529/12,955 627,427/12,946 Aug - 804,241/19,175 34,700/ 793 69,930/ 1,063 Sept - 638,0821 18,378 48 ,250/ 725 48,250/ 725 Oct - 284,204/ 7,734 276, 815/ 6 ,110 267,930/ 6,005 Nov - 455,102/13,000 1,434,392/ 18,615 1,434,392/18,615 Dec - 572,295/17,330 55, 018/ 855 52 ,722 855 These summaries do not, of course, reflect orders which might be received (or lost) after their respective dates. Respondent also introduced summaries showing that in 1973 the plant had worked an average of 1,052 man hours per day. The average was 1,045 hours per day in 1974 and 1,031 in 1975. The plant worked an average of 1,026 hours per day in January 1976, 914 in February, and 723 and 619 respectively in March and April, after the terminations. In 1975, during the months of February, March, April, and May, the average daily hours worked had been 932, 906, 956, and 915, respectively. Vajdak testified that they were able to meet or exceed production requirements with the reduced manpower. Overtime was a regular feature of employment with Respondent and there were 10-hour days and Saturday work throughout 1975 and until the end of January 1976. The plant continued to work 9 hours per day, on both shifts, until the end of March, when the plant finally went on an 8-hour day. Lee and Vajdak testified that they did not reduce overtime earlier, in lieu of the terminations, because they feared an adverse impact on morale. According to Lee and Vajdak, a decision to reduce the work force was made in the last week in February, about a week before the discharges actually took place.6 Vajdak testified that his instructions from Lee were to reduce the force by 30 to 35 percent. The details of how and who were supposedly left to Vajdak and Pearson.? Lee made the decision to effectuate the reduction on the morning of March 3. The record reflects no evidence of any specific precipitating event on or about that date. Vajdak chose to eliminate 10 employees from the structural department on the night shift, on the basis that approximately 50 percent of production work is performed in the structural depart- ment and that is the department where production on new cranes begins. The terminations followed seniority among those in that department on that shift. No employees were transferred to the day shift or offered the opportunity to go into other departments.s In all, there was a reduction of the work force by about 40 employees by the end of April; about one-half during March and the remainder in April. Approximately half of the reduction occurred through natural attrition. The night shift was shut down at the end of April and employees on that shift who were not terminated were transferred to days. 6 Pearson allegedly took part in this decision However, his testimony as to when the decision was made was vague, shifting, and conjectural 7 Neither Lee nor Pearson testified as to any communication , at that time, to effect a reduction by a specific percentage of the work force 6 Respondent's production is a continuous process, the night shift does 323 General Counsel contends that the evidence establishes that the discharges were motivated by the employees' union activities, rather than the business conditions, and were thus violative of Section 8(a)(3). Upon the evidence in its entirety I am constrained to agree with General Counsel. All of the elements for finding the discharges to have been substantially motivated by the union activities are present herein. See Publishers' Offset, Inc., 225 NLRB 1045 (1976). Respondent had knowledge that its employees were engaging in union activity and,, from the conversations occurring on the night shift between Michulka and the employees, had reason to conclude that the activity was strong, if not centered, among the night-shift employees in the structural department. All of the discharged employees were, in fact, card signers. Respondent also demonstrated union animus by its March 2 letter,9 the interrogations by Michulka and Chapman, and Lee's March 4 speeches which contained threats of job loss in the event of successful union organization . Such "antiunion bias and demonstrated unlawful hostility are proper and significant factors for Board evaluation in determining motive." N.LR.B. v. Dan River Mills, Incorporated, Alabama Division 274 F.2d 381 (C.A. 5, 1960); Publishers' Offset, Inc., supra. The timing of the discharges in the instant case and their precipitous nature further evidence the unlawful motive. Even crediting Respondent's witnesses in regard to the decision to reduce the work force, that decision was made almost immediately upon the inception of the union activity and Respondent's acquisition of knowledge there- of. The discharges took place in that same timespan and on the day between Respondent's antiunion letter and Lee's antiunion speeches. They also occurred in midweek, with no advance warning to the employees, and in the absence of any event which might have occasioned such precipitous action. Finally, for a number of reasons , I find Respondent's economic defense unpersuasive . Central to its contention was the alleged loss of one order and the postponement of two others. Details of these transactions, including the size, scope, and timing, and documentary evidence thereof (which must necessarily have existed in contracts of such magnitude) were not offered . Other evidence of its business condition consisted, in part, of self-serving and vague testimony and documents, some prepared after the fact. More significant, however, are the inconsistencies in not work on separate projects. Rather, it continues from where the day shift leaves off. 9 The complaint did not allege the letter to be independently violative of Sec 8(axl) However, I deem its statement, that the Union was causing employees to "risk everything," a thinly veiled threat evidencing animus 324 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Respondent's actions. In December, it boasted of a record year with another to follow. Even allowing for some reduction in business, the evidence did not establish that sales would be significantly below those of 1973, 1974, and 1975, when the plant operated, without reductions-in-force, at an average of over 1,000 man-hours per day. Moreover, Respondent's exhibits establish that as of both February 7 and 28, 1976, the backlog of orders for March was higher than it had been for the same month 1 year earlier. Further, these same exhibits reveal that between February 7 and 28 the backlog of orders for April delivery increased by more than a third over $160,000, and increased the necessary shop hours by approximately 8,000. I further note in this regard that, as Respondent admitted, the early months of each year was its usual slow period. Additionally, Respondent had met slow periods before without layoffs and, indeed, this and the regularity of overtime were selling points in the hiring of new employees. Respondent continued its overtime, 2 hours per day per employee plus Saturday work through January, and 1 hour per day even after the discharges in question, even though it claimed to be looking for solutions to the slackening off of business as early as December 1975. With approximately 130 employees, 2 hours of daily overtime equals 390 paid man-hours per day; eliminating even the I hour of daily overtime worked after February saves 195 paid man-hours per day without any terminations. I fmd unpersuasive Respondent's argument that reduction in overtime threat- ened to create a morale problem. It seems clear that discharges, after a history that did not even include layoffs, would be at least equally threatening to morale. Further, faced with an alleged economic situation warranting a reduction in profit margins, it is unlikely that Respondent would have rejected the savings potential of premium pay. I note, too, that, while there was no evidence of any permanent change in the pattern of Respondent's business, Respondent did not lay off the employees in question, they discharged them. Casting further doubt on Respondent's claimed motiva- tion and indicating the precipitous and inconsistent nature of the discharges are various personnel actions by Respon- dent. Notwithstanding the alleged decline in business, James Hindman was hired on February 16 as a welder. Several of the employees terminated on March 4 were welders with greater seniority than Hindman. As previously noted, Clifford Melvin received a substantial wage increase effective in the week before his discharge. He actually saw this increase, for the first time, in the pay he received after discharge. Additionally, Respondent continued to advertise for employees all during the period of its alleged crisis. A trailer, advertising job openings, remained outside the Kranco premises until the end of March. Respondent's explanation, that it was paid for on a monthly basis and was retained through March because it was paid for, is implausible and, even if believed, does not explain why it would have been rented for the months of January, February, and March in the face of the alleged loss of business. Moreover, Respondent ran newspaper advertise- ments for crane service personnel and crane service trainees (bargaining unit positions) after the March 4 discharges, gave no consideration to any of the discharged employees for such positions, and, when one of the discharged employees applied for such a job, informed him that the minimum qualifications for the job had just been increased. Considering all of the above, I conclude that "Respondent's unconvincing reasons for the [discharges] actually support the General Counsel'sprima facie case of unlawful discrimi- nation." Paramount Metal & Finishing Co., Inc., 225 NLRB 464 (1976). Finally, while I do not give it great weight, I note that when Gilmer confronted Michulka with the statement that they both knew that the employees were being terminated because of the Union, Michulka did not deny it. Instead, he nodded his head in the manner normally recognized as signifying agreement.lo Accordingly, I fmd that, by discharging the 10 previously named employees from the night shift on March 4, and by discharging James Hindman on March 12, Respondent has discriminated against those employees because of their union activity and has thereby violated Section 8(a)(3) of the Act. CONCLUSIONS OF LAW 1. By threatening employees with loss of employment opportunities or other reprisals and by interrogating employees concerning their union activity, membership, and support, Respondent has interfered with, restrained, and coerced its employees in the exercise of rights guaran- teed them under Section 7 of the Act, thereby violating Section 8(a)(1) of the Act. 2. By discharging the employees named below in order to discourage union activity, membership, and support, Respondent has discriminated in regard to the hire and tenure of their employment, in violation of Section 8(a)(3) and (1) of the Act: J. L. Armstrong Clifford Melvin Danny Starnes W. L. Gilmer Steven Norton Steve Hundl Dan Mason William C. Bowen Scott Forbes James Hindman Kenneth Carriere 3. The unfair labor practices enumerated above are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. 4. Respondent has not engaged in any unfair labor practices not specifically found herein. THE REMEDY It having been found that Respondent has engaged in unfair labor practices in violation of Section 8(a)(1) and (3) of the Act, it will be recommended that Respondent cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act. It having been found that Respondent discriminatorily discharged the employees named in Conclusion of Law 2 10 1 do not deem Michulka's implied admission sufficient to constitute an independent violation of Sec 8(a)(1) as alleged in the complaint. KRANCO, INC. above, Respondent shall offer them immediate and full reinstatement to their former or substantially equivalent positions, without prejudice to their seniority or other rights and privileges, and shall make them whole for any loss they may have suffered by reason of the discrimmation against them. Any backpay found to be due shall be computed in accordance with the formula in F. W. Woolworth Company, 90 NLRB 289 (1960), and Isis Plumbing & Heating Co., 138 NLRB 716 (1962). "A violation of Section 8(a)(3) goes to the very heart of the Act." It therefore warrants that Respondent be further required to cease and desist from infringing in any other manner upon the rights guaranteed employees by Section 7 of the Act. Pan American Exterminating Co., Inc., 206 NLRB 298, fn. 1 (1973); Entwistle -Mfg. Co., 23 NLRB 1058, enfd. as modified 120 F.2d 532 (C.A. 4, 1941). Upon the basis of the entire record, the findings of fact, and the conclusions of law, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: ORDER i i The Respondent, Kranco, Inc., Houston, Texas, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Threatening employees with loss of employment opportunities or other reprisals in order to discourage umon activity, membership, and support. (b) Interrogating employees concerning their union activity, membership, and support. (c) Discouraging membership in or activities on behalf of any labor organization, by discharging or otherwise dis- criminating against employees in any manner with regard to their rates of pay, wages, hours of employment, hire, tenure of employment, or any term or condition of their employment. (d) In any other manner interfering with, restraining, or coercing its employees in the exercise of their rights to self- organization, to form, join, or assist any labor organization, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the 11 In the event no exceptions are filed as provided by Sec. 102.46 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, and recommended Order herein shall, as provided in Sec 102 48 of the Rules and Regulations, be adopted by the Board and become its findings, conclusions, and Order, and all objections thereto shall be deemed waived for all purposes 325 purposes of collective bargaining or other mutual aid or protection, or to refrain from any and all such activities. 2. Take the following affirmative action which is deemed necessary to effectuate the policies of the Act: (a) Offer the following-named employees immediate and full reinstatement to their former jobs or, if those jobs no longer exist, to substantially equivalent positions, without prejudice to their seniority or other rights and privileges, and make them whole for any loss of earnings they may have suffered by reason of the discrimination against them in the manner set forth in the section of this Decision entitled "The Remedy": J. L. Armstrong Clifford Melvin Danny Starnes W. L. Gilmer Steven Norton Steve Hundl Dan Mason William C. Bowen Scott Forbes James Hindman Kenneth Carriere (b) 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 other documents necessary and relevant to analyze and compute the amount of backpay due under this recommended Order. (c) Post at its Houston, Texas, facility copies of the attached notice marked "Appendix." 12 Copies of said notice, on forms provided by the Regional Director for Region 23, after being duly signed by the Respondent's authorized representative, shall be posted by it 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. (d) Notify said Regional Director, in writing, within 20 days from the date of this Order, what steps Respondent has taken to comply herewith. IT IS FURTHER RECOMMENDED that the complaint be dismissed in all other respects. 12 In the event the Board's Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board "