Colt Industries, Inc.

CRUCIBLE, INC. 723 Crucible, Inc., Division of Colt Industries, Inc. and United Steelworkers of America, District 20, AFL- CIO-CLC. Case 6-CA-8879 March 15, 1977 DECISION AND ORDER BY MEMBERS FANNING, PENELLO, AND WALTHER On November 17, 1976, Administrative Law Judge Robert A. Giannasi issued the attached Decision in this proceeding. Thereafter, the Respondent filed exceptions and a supporting brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the record and the attached Decision in light of the exceptions and brief and has decided to affirm the rulings,' fmdings, and conclusions of the Administrative Law Judge and to adopt his recommended Order.2 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 and hereby orders that the Respondent, Crucible, Inc., Division of Colt Industries, Inc., Robinson Town- ship, Pennsylvania, its officers, agents, successors, and assigns, shall take the action set forth in the said recommended Order, except that the attached notice is substituted for that of the Administrative Law Judge. I Although Resp. Exh. 3, which purportedly was prepared by the Respondent's personnel manager in mid-September 1975, and which purportedly indicates that she had recommended then that some of the alleged discriminatees be laid off, may lend some support to Respondent President Dulis' assertion that the decision to terminate the five alleged discnminatees was made prior to the commencement of the organizational drive, the overwhelming weight of the evidence supports the rulings and findings of the Administrative Law Judge. Moreover, we note that the only authentication of the document was through the self-serving testimony of Dulis, who did not impress Administrative Law Judge Giannasi as a credible witness. 2 The Administrative Law Judge inadvertently omitted the broad order language from the notice. We hereby revise his notice accordingly. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government After a hearing in which all sides had an opportunity to present evidence, the National Labor Relations Board has found that we violated the National Labor Relations Act, and has ordered us to post this notice. This 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 discharge, refuse to reinstate, or otherwise discriminate against employees for joining supporting, or engaging in activities on behalf of United Steelworkers of America, Dis- trict 20, or any other labor organization. WE WILL NOT interrogate our employees con- cerning their union activities, or make threats of reprisal or loss of jobs and benefits if United Steelworkers of America, District 20, or any other labor organization, is selected as bargaining representative. WE WILL NOT raise the salary or wages of employees in order to discourage support for United Steelworkers of America, District 20, or any other labor organization. WE WILL NOT in any other manner interfere with, restrain, or coerce employees in the exercise of their rights under Section 7 of the Act. WE WILL offer full reinstatement to Edward Campbell, Barney Seaton, Lou Trombetta, Ber- nard Hurley, and Robert Joll and make them whole for their loss of earnings resulting from our discrimination against them with interest at 6 percent per annum. CRUCIBLE INC., DIVISION OF COLT INDUSTRIES, INC. 228 NLRB No. 84 724 DECISIONS OF NATIONAL LABOR RELATIONS BOARD DECISION STATEMENT OF THE CASE ROBERT A. GIANNAsi, Administrative Law Judge: This case was heard before me from June 15 through 18, 1976, in Pittsburgh, Pennsylvania, upon unfair labor practice charges filed on December 13, 1975, and a complaint issued on February 24, 1976, as amended April 27, 1976.1 The complaint alleges that Respondent violated Section 8(axl) of the Act by various threats, granting of wage increases, and interrogation of employees and violated Section 8(a)(3) and ( 1) by discriminatorily discharging employees Campbell, Joll, Seaton, Trombetta, and Hurley. Respondent filed an answer denying the critical allegations of the complaint. Respondent and the General Counsel have filed briefs. Upon the entire record, including my observation of the witnesses and their demeanor, I make the following: FINDINGS OF FACT I. JURISDICTIONAL FINDINGS Respondent, a Pennsylvania corporation, is engaged in the research, development, and manufacture of specialty steel products at various facilities in Pennsylvania, includ- ing its Materials Research Center (hereafter CMRC) located in Robinson Township, Allegheny County, Penn- sylvania. During the 12-month period immediately preced, ing the issuance of the complaint, Respondent shipped goods and materials from its Pennsylvania facilities valued in excess of $50,000 directly to points outside the Commonwealth of Pennsylvania and received goods and materials valued in excess of $50,000 directly from points outside the Commonwealth. Accordingly, I find, as Respondent admits, that Respondent is an employer as defined in Section 2(2) of the Act and is engaged in commerce within the meaning of Section 2(6) and (7) of the Act. United united Steelworkers of America, District 20, AFL-CIO-CLC (herein the Union), is a labor organization within the meaning of Section 2(5) of the Act. II. THE ALLEGED UNFAIR LABOR PRACTICES A. Background On November 24, 1975, the Union filed a petition in Case 6-RC-7312 with Region 6 of the National Labor Relations Board requesting certification as the collective- bargaining representative of certain of Respondent's employees. After a hearing on the petition, a Decision and Direction of Election was issued by the Regional Director on May 25, 1976. On or about June 7, 1976, Respondent filed with the Board a request for review of the Regional Director's decision, contending, inter alit , that certain of the employees at the Materials Research Center were managerial and/or confidential employees and thus not employees within the meaning of the Act. On June 29, by I At the hearing the complaint was amended to allege an additional violation of Sec. 8(a)(l) of the Act 2 This is based on the credited testimony of Hurley. Subsaro's testimony telegraphic order, the Board denied Respondent's request for review of the Regional Director's decision as it raised no substantial issues warranting review . The election was held on June 30. The employees rejected the Union and, on July 9, 1976, the Regional Director issued a Certification of Results of Election. This proceeding involves issues arising from an organiza- tional attempt by Respondent's CMRC employees. The employees are primarily technicians who assist engineers and supervisors in the performance of experiments and tests aimed at reducing costs by eliminating jobs and improving production techniques or processes. CMRC is not a profitmaking operation but performs research for other divisions of Respondent. It operates under an annual budget financed in part by Respondent and its operating divisions and in part by other sources such as Government grants and contracts. The Center is divided generally into five groups of engineers and technicians each headed by a technical director who reports to President Edward Dulis. B. The Organizational Campaign On or about September 24, 1975, after meeting with President Dulis, the technical directors called meetings of their groups to inform employees that CMRC was having financial difficulties and that there would be a tightening of procedures. Employees were told that there would be a ban on cashing checks, talking, and leaving the building on working time-amenities which had been permitted there- tofore. Employees were also told that there probably would be no layoffs but there would be no wage increases in the immediate future. Thereafter some employees brought up the possibility of forming a union. Employee Paul Rossome approached employee Robert Joll after the meeting and said something to the effect that "if they were going to treat us like union people, we may as well have a union ." Joll agreed. He and employees Barney Seaton and Lou Trombetta spoke with employee Edward Campbell about Campbell contacting a union. Campbell contacted the Union and obtained authorization cards and literature. He placed the material in his unlocked desk at the plant. Campbell told employees the material was in his desk and several came to the desk to pick up the material. By October 7, 1975, four employees had signed cards: Joll, Campbell, Seaton, and Trombetta. In late September, employees Bernard Hurley, Jimmy Connors, and Angelo Marchionna were talking, in their work area, about the Union and employees who were passing out union cards. They were discussing what each had heard about these matters. Admitted Supervisor John Subsaro came into the area and asked each what they knew about the Union and whether they had seen cards. They replied they "didn't know anything." 2 On October 15, employees Joll, Seaton, Trombetta, Campbell, and Hurley were discharged. They were told they were being terminated as of that date because of economic reasons . President Dulis testified that he made the decision to terminate the five technicians on September 15. He had told Personnel Director Susan Ray about a on this point was vague and evasive and he did not impress me as a reliable witness. CRUCIBLE, INC. 725 week before to come up with the names of people recommended to be laid off. Ray, who had no technical experience, did not consult the technical directors in charge of the particular employees but came up with the names listed above. No one else was terminated at this time although there were two or three other employees- including one technician-who left voluntarily about this time. Early in the day on October 15, Dulis called a meeting of technical directors and told them there would be staff reductions during the day and that they could inform the affected employees. After the layoffs, the technical direc- tors held staff meetings and told their employees about the layoffs and that there would be a wage freeze starting immediately and lasting until July 1976. At Technical Director Bressanelli's meeting there was a question about the Union. Bressanelli told employees that Dulis had stated that "if a union came in to the laboratory that would be the end of the lab" and that he agreed. Bressanelli held another meeting of his employees several days later. At this meeting, Bressanelli mentioned the current union activities, which he stated would "be detrimental and be the finish of the lab, as we know it today." On the same day, in the hallway, Engineer John Eckenrod, an admitted supervisor, told employee Paul Rossome that, if the Union came in, the lab would be closed. C. The Wage Increases There is testimony that a wage freeze was discussed at meetings on September 24 and October 15, 1975, between the technical directors and President Dulis and at meetings between the technical directors and the employees. Em- ployees Joll and Campbell credibly testified that at their group meetings on September 24 they were told by their technical directors that there would be no raises in the immediate future. On October 15, when the technical directors told employees about the layoffs, they again told employees that the wage freeze was effective immediately and would last through July 1976. This is supported by the testimony of employees Berg and Rossome whom I credit. Technical Director Bressanelli's testimony confirms this. Dulis' testimony was that he announced the wage freeze on October 15 and that the wage freeze was to begin in early 1976 and to last through 1976. The weight of the evidence shows, however, that the wage freeze was first announced on September 24, which is plausible since Joll and Seaton were still employed on that date and testified about the announcement made to them. It is unclear whether Dulis specifically told his technical directors that the freeze would begin immediately or in early 1976. For example, Technical Director Bressanelli testified that Dulis told him that there would be a wage freeze effective immediately and that it would last through July 1976. Technical Director Martin Welles testified that Dulis said that the freeze would last through the first 6 months of 1976 and there would be "very few" raises in the remainder of 1975. However, as I have indicated, it is clear that employees were told that the freeze would begin immedi- ately- Based on the above testimony, I find that a wage freeze was announced by Dulis to the technical directors and by them to the employees both in late September and mid- October. The wage freeze was to last through June 1976. Employees were told it was to start immediately and Dulis gave the impression to his technical directors that it would start immediately. In late October 1975, 2 or 3 weeks after the wage freeze was first announced, the wage freeze was lifted by Dulis. There is no evidence that Dulis told either the technical directors or the employees the reason for lifting the wage freeze. Thereafter, and continuing through June 1976, Respondent granted wage increases to supervisory and nonsupervisory employees. For nonsupervisory employees, i.e., the technicians, utilitymen, and office clerical employ- ees, and the employees the Union was seeking to organize, the increases ranged from 8 percent to over 14 percent. About 60 employees received increases during this period. Dulis, who decided to institute the wage freeze on his own, approved each of the pay raises. Respondent's "final" proposed budget for calendar year 1976 was prepared as a revision of an earlier document on September 22, 1975, shortly before the initial announce- ment of a wage freeze on September 24. The amount of money allocated for salaries in the "final" proposed budget was not increased from that amount of money allocated for salaries in the initial proposed budget. The "final" proposed budget was approved as the budget for 1976. This proposed 1976 budget projected a deficit of $366,000 if no changes were made. That budget figure also did not include subsequent salary increases which would have resulted in an additional deficit of another $100,000. Early in November, Personnel Manager Susan Ray requested Technical Director Bressanelli to make recom- mendations for merit raises for his employees. These raises were approved and some became effective on or about November 15. Ray also approached Technical Director Welles stating that there would be a wage increase after the first of 1976, that there were plans for an increase for most people, and that he should prepare a list of all employees in his section and the amounts recommended according to some guidelines given by Ray. D. Other Alleged Misconduct On December 10, employees Bill Henninger and Joe Verduci were reading the Board election notice posted in the plant near their workplace. The manager of lab services, Elmer Hoff, an admitted supervisor, and Engineer V. K. Chandhok approached Henninger and Verduci. Hoff stated that "the last place he had worked had employed about 750 people and now employ none because of union activities." Hoff did not explain this statement. Verduci then told Hoff that his statement "sounds like a threat." Hoff provided no reasons for the reduction in employment. On December 18, in Hoff's office, Hoff told Henninger again "about the company he had previously worked for, and how it had employed 750 people, that it dwindled down from there, because of union activities." Henninger then suggested that a contributing cause may have been bad management and Hoff said, "yes, possibly both." In the same conversation, Hoff told Henninger that "if a union had come in that it would hurt the employees," and 726 DECISIONS OF NATIONAL LABOR RELATIONS BOARD that "if a union comes into the lab, that the benefits we receive would go to zero." No other persons were present. E. The Discharges As indicated, employee Edward Campbell was ap- proached by employees Joll, Trombetta, and Seaton about his contacting the Union in late September. Campbell then contacted Union Staff Representative Poff and secured union cards and literature which he took to the plant and put in his desk. Among the items of literature Campbell put in his desk was the Union's pamphlet on office and technical employee benefits. Supervisors, such as Welles and Subsaro, sat at his unlocked desk during the time the desk contained union literature. Campbell signed an authorization card for the Union on October 7. On October 15, Personnel Director Ray called Campbell to her office and informed him that she had bad news, that he was being retired. She also asked if he had any feelings about the situation and he replied that it did not make much difference about his feelings. The only reason given Campbell by Ray was that his retirement was due to economic reasons. After lunch on October 15, Ray and Technical Director Welles spoke with Campbell and during the conversation Ray informed Welles of Camp- bell's retirement. Welles said that he did not know about this and he asked if there was any way to get around it. After leaving Ray's office, Campbell told Welles that he thought he was being retired because he was trying to form a union. Welles stated that he thought it was Campbell's right to form a union. Bernard Hurley was also terminated on October 15. Hurley, a lab technician, was engaged in mechanical, elevated temperature, impact, and wear testing. Hurley was supervised by Technical Director August Kasak. Hurley, who did not sign a union card and who usually did not have much contact with Edward Campbell, started having frequent conversations with Campbell around the first of October regarding home improvements that Hurley con- templated making. Hurley discovered that Campbell was familiar with carpentry and bricklaying and stopped Campbell in the hallway and asked him information about remodeling. Around this period of time, they engaged in approximately half a dozen conversations of from 10 to 15 minutes in length. Supervisor John Subsaro observed the conversations between Campbell and Hurley and, on a couple of occasions, asked Hurley about the conversations and why they were talking to each other so often lately. Hurley answered that they were not talking about anything of any significance. On October 15, Hurley was terminated by Kasak who stated he had bad news for Hurley and because of a cut in expenditures he was going to be terminated. Hurley asked Kasak why he was chosen and Kasak replied that since his job was strictly research it could be absorbed by someone else. Kasak indicated to Hurley that this termination was a "rush-type" thing and that it had come up suddenly. Hurley then had a conversation with Personnel Director Ray in her office and she asked Hurley if he had been told why he was being terminated. Hurley replied that he had been told it was due to a cut in expenditures, among other things. Ray replied that Kasak was just to tell Hurely that Hurley was a cut in expenditures and nothing else. Robert Joll was employed by Respondent from August 1963 until October 15 as a technician. Joll processed and prepared steel for testing and metallographic examination. He was supervised by Technical Director Bressanelli. Joll became aware of the union campaign in late September and he signed a union card on October 10. Joll spoke in favor of the Union in a conversation with employee Osekowski in Supervisor Subsaro's presence around the first of October. Joll stated that if the employees had a union the Union would be able to help the employees get raises and protect their jobs. On October 15, Joll was asked to report to Bressanelli. Joll had heard of employee Trombetta being terminated, so, when he walked into Bressanelli's office, he opened the conversation with the statement that he knew why he was here, that he was being terminated. Bressanelli replied that it was true, "sad, but true." Bressanelli asked Joll his age and stated that if he had known of the termination 5 years ago, he would have laid him off then. Bressanelli told Joll that in a technical directors' meeting the day before, Dulis had brought up the question of the Union and he had tried to assure Dulis that the Union was just a passing fancy. Joll replied that he did not think that it was a passing fancy, and that he was for the Union because of what was happening to him that day. Bressanelli replied that if a union were to come into the lab it would probably mean the closing of the lab and everybody's jobs would be in jeopardy. Louis Trombetta was employed from January 1973 until October 15 as a technician. He prepared stainless steels for testing in Bressanelli's group. Trombetta and employees Henninger and Kasak complained about Dulls' directive which resulted in a loss of benefits for the employees and they decided, if they were represented by a union, they could possibly change things. Trombetta signed a union card on October 7 and placed it in employee Campbell's desk at the plant. Trombetta also had occasions to secure union pamphlets from Campbell's desk. On October 15, Trombetta was asked to see Bressanelli in his office. Bressanelli told Trombetta that there was bad news and, because of an economic crunch, Respondent had to have a cutback and Trombetta was chosen as one of the persons to be let go. Trombetta asked if there was any chance of being recalled and Bressanelli told him there was not. Bressanelli stated that Trombetta should have seen it coming and that he should go back to school. Following an exit interview with Personnel Director Ray, Trombetta was escorted back to his desk and to his locker to get his belongings out of the building. Barney Seaton was employed by Respondent from September 1966 to October 15 as a specialist technician and he was supervised by Technical Director Kasak. In mid or late September, Seaton spoke with employee Hoffman who informed him that a group of employees were thinking about getting a union organized and that the person to see for further information was Edward Camp- bell. Seaton secured an authorization card and signed it on October 8. On September 30, 1975, Seaton had a conversa- tion with employees Trombetta and Osekowski and CRUCIBLE, INC. 727 Supervisor Subsaro. In the conversation, Osekowski point- ed to Seaton and said to Trombetta that Seaton was for the Union, that he would sign a card, would join, and do everything for the Union. On October 15, Kasak informed Seaton, in his office, that he was being terminated. Kasak stated that it was not his decision and that he did not want it to happen. Kasak stated that he had fought for Seaton and had tried to get him transferred without success. Seaton asked why he had been chosen. Kasak replied that he was neither a technician nor an engineer but he was somewhere in between. Kasak replied that he would try to help Seaton get another job, but Seaton asked to talk to Dulis. Kasak replied that Dulis would not talk to him. Seaton stated that employees had been called back in the past and Kasak replied that Seaton did not have a chance of getting called back and for him not to waste his time but to get another job. In his exit interview with Personnel Director Ray, Seaton stated that he believed he was being selected for termina- tion because he had been accused of union activity. Ray replied that as far as she was concerned it was economic. Seaton was crying in the interview and asked Ray if he could talk to Dulis. She replied that she did not think that Dulis would see him. When Seaton was preparing to leave the plant, Kasak came over to him at his desk and Seaton stated that his discharge was going to make it a lot easier for the Union to come in. Kasak replied that it was impossible for a union to get in, to which Seaton stated that he had been accused of union activity and he thought this was the reason for his selection. Kasak made no reply. Kasak then stated that he would give Seaton every help he could to get another job. In late October or early November, Kasak prepared a letter of recommendation for Seaton which stated, in part, that Seaton performed his duties conscientiously and competently and that he would be pleased to be contacted by potential employers for details if desired. On October 21 Seaton talked with Kasak about picking up his belongings and was told that he was not permitted in the building and would have to make other arrangements to pick up his belongings. On April 12, 1976, Seaton visited the Pennsylvania Employment Security Office and applied, through that office, for an engineer's position at Respondent's CMRC •s In making the findings herein, I have considered the demeanor and the testimony of all the witnesses. To the extent that there are conflicts with the findings I have made, that testimony is not credited . In making findings concerning the circumstances surrounding the discharges, I have credited the testimony of the discharged employees They impressed me as reliable witnesses and their testimony was not contradicted on essential matters. As to other issues I have credited the testimony of employee witnesses over that of Supervisor Subsaro concerning his interrogation of employees and over that of Bressanelli concerning his statements about closing the lab Bressanelli's testimony was not as clear and precise on this issue as that of employees Joll, Rossome, and Berg. On other issues , for example the statements of Supervisors Eckenrod and Holt, I note that their testimony and that of employee witnesses is substantially the same . Finally, for reasons I state hereafter, I am unable to credit the testimony of President Dulls on the crucial issues in this case, particularly those surrounding the wage freeze and the discharges a General Dynamics Corp., 213 NLRB 851, 857 (1974) '' B F Goodrich Co, 115 NLRB 722 (1956). 6 He found that the technicians involved herein generally assist engineers facility. Seaton received a reply through the security office that he was thought not to be qualified for the position. The evidence indicates that the only position which became vacant at CMRC between October 15, 1975, and June 15, 1976, was that of a metallurgist and it was filled by a new hire on May 5, 1976.3 III. DISCUSSION A. The Status of the Technicians Respondent alleges that the technicians involved herein are not employees within the meaning of the Act but rather are managerial or confidential employees who, under applicable law, are excluded from the protection of the Act. The Board has defined managerial employees as those who "formulate and effectuate management policies by express- ing and making operative the decisions of their employer, and those who have discretion in the performance of their jobs independent of their employer's established policy."4 Confidential employees are those who "assist and act in a confidential capacity to persons who formulate, determine, and effectuate management policies in the field of labor relations." 5 In the earlier representation case, the Regional Director found Respondent's technicians to be statutory employees and not managerial or confidential employees within the meaning of the applicable case law. The Regional Director set forth in detail the facts upon which he relied.6 The Board declined to review the Regional Director's decision on the ground that no substantial issues of law or fact were presented. I nevertheless permitted the parties full opportunity in this case to relitigate the issue of whether the technicians involved herein were managerial or confidential employ- ees.7 Respondent did not specifically adduce additional evidence on the issue and relies essentially on evidence submitted in the representation case which was introduced into evidence in the instant case as Respondent's Exhibit 1. In its brief to me, Respondent relies on evidence contained in its Exhibit 1 and makes no additional argument not made in the representation case.8 The General Counsel elicited additional evidence in support of his position that the technicians were employees. Thus, the evidence in the instant case shows that technicians Campbell, Hurley, Joll, Seaton, and Trombetta did not negotiate contracts with by conducting and writing up experiments and tests on products and manufacturing processes. While their experiments may improve production efficiency and result in loss of Jobs elsewhere in Respondent's operation, the technicians themselves have no part and certainly no discretion in implementing any decisions of Respondent in this respect They do not work in a confidential capacity for persons who make labor relations decisions for Respondent. 7 See Suburban Homes Corp., 173 NLRB 497, In. 1 (1968) 8 Respondent does refer to testimony in the proceeding before me concerning the job of employee Seaton which was that of a technical specialist. The evidence indicates that he was given that title after obtaining a degree and was in training for possible promotion to engineer status. The evidence does not indicate , however, that the substance of his job was any more managerial or confidential than that of the other technicians. He did not have the discretion to implement any managerial policies as a result of his experiments or tests and was not involved directly or indirectly in labor relations matters. He had no authority to assign work to others Indeed, Respondent's position was that he was selected for layoff because he did not show potential for advancement 728 DECISIONS OF NATIONAL LABOR RELATIONS BOARD unions or process grievances on behalf of management. They did not assist supervisors or management officials in employee relations matters or have access to such employ- ee relations matters. I have considered the entire record, including Respon- dent's Exhibit I and the Regional Director's decision in Case 6-RC-7313, of which I take official notice and which I find to have "persuasive relevance,"e as well as the briefs of Respondent herein. I find no evidence or arguments which would persuade me to make a determination contrary to that of the Regional Director. Accordingly, I find, upon the entire record, that the technicians against whom Respondent is alleged to have committed unfair labor practices are employees within the meaning of the Act and not managerial or confidential employees who are excluded from the protection of the Act. B. Threats and Interrogations As indicated, the credited testimony establishes that employees Hurley, Connors, and Marchionna were talking about the Union organizing campaign in their work area. Admitted Supervisor Subsaro came in and asked each of them what they knew about the Union and whether they had seen union authorization cards. No purpose was given for the questioning and the employees replied they did not know anything about the Union. In the context of Respondent's other unfair labor practices, the fact that no lawful purpose was stated or shown for the questioning, that no assurances were given against reprisals for the answers sought and the evasive response of the employees who had been talking about the Union before Subsaro came in, I find that the interrogations were coercive and violative of Section 8(a)(1) of the Act.10 The evidence also shows that Technical Director Bressa- nelli, Laboratory Services Manager Hoff, and Supervisor John Eckenrod made statements to employees about plant closures and reduction of benefits due to unionization. Bressanelli told employee Joll that if a union came into the lab it would probably mean closing the lab and "every- body's jobs would be in jeopardy." That same day he told assembled employees that he and President Dulis felt that if a union came in it would be "the end of the lab." He repeated the substance of these remarks at another employee meeting several days later. The same statement in substance-"if we get a union at the lab, they might close the lab"-was admittedly made by Supervisor Eckenrod in a discussion with employee Rossome. These statements were made after several employees were discharged on October 15 and after the initiation of union activities. Neither Bressanelli nor Eckenrod gave concrete factual support for his remarks and Respondent offered no evidence of factual support at the hearing in this case. The General Counsel asserts that these statements threaten economic reprisals for support of the Union and are thus violative of the Act. Respondent contends that they are merely predictions of economic consequences. I find that the statements were violative of Section 8(a)(1) of the Act. 9 National Freight, Inc, 154 NLRB 621 (1965), cited with approval in Amalgamated Clothing Workers ofAmerica AFL-CIO ISagamore Shirt Co.]. 365 F 2d 898,904 (C A.D.C., 1966); and see Suburban Homes, supra The guidelines for such statements have been set forth as follows by the Supreme Court in N.L.RB. v. Gissel Packing Co., Inc., 395 U.S. 575, 618 (1969): [An employer ] may even make a prediction as to the precise effects he believes unionization will have on his company. In such a case, however, the prediction must be carefully phrased on the basis of objective fact to convey an employer's belief as to demonstrably probable consequences beyond his control or to convey a management decision already arrived at to close the plant in case of unionization.... If there is any implication that an employer may or may not take action solely on his own initiative for reasons unrelated to economic necessities and known only to him, the statement is no longer a reasonable prediction based on available facts but a threat of retaliation based on misrepresentation and coercion, and as such without the protection of the First Amendment. We therefore agree with the court below that "[c]onveyance of the employer's belief, even though sincere, that unioniza- tion will or may result in the closing of the plant is not a statement of fact unless, which is most improbable, the eventuality of closing is capable of proof." Applying the above guidelines, I am convinced that Respondent's suggestions of plant closure and loss of jobs were conscious overstatements, incapable of proof, which had the tendency to create in the minds of the employees the impression that Respondent would use its economic power to see that its predictions came true. There was no statement of why unionization would necessarily cause the lab to be closed or jobs to be lost. Indeed, the statements were made in the context of other unfair labor practices- discharges of union adherents and wage increases after the announcement of a wage freeze-which dramatized Re- spondent's intention to utilize its economic power to halt unionization. In these circumstances the statements were coercive. See N.LRB. v. Dowell Division of the Dow Chemical Company, 420 F2d 480 (C.A. 5, 1969); Compo- nents, Inc., 197 NLRB 163, 164 (1972); American Manufac- turing Company, Inc., 196 NLRB 248, 257 (1972). There is also testimony concerning the remarks of Supervisor Hoff to the effect that the last place where he worked had closed because of unionization. The first time this remark was made no factual support for the assertion was given. The statement carries more credence because it purports to have been based on personal experience. However, nothing was said by Hoff as to why or how the unionization of the plant caused its closure. In a subse- quent conversation, Hoff admitted that the plant closure might have been due to bad management. This simply highlights the imprecision of Hoff's assertions and the danger in even suggesting that plant closures were the result of union activity when such cannot be proved. Hoff also stated that, if a union came into the lab, the benefits "would go to zero" thus tying loss of benefits clearly to the CMRC lab and a union coming on the scene . Employees are inhibited by such remarks. Absent some proof of causal 10 I find no persuasive ipliable evidence that Subsaro also interrogated employees on November 15, 1975, as alleged in the complaint . I therefore dismiss this allegation of the complaint. CRUCIBLE, INC. 729 connection between the loss of benefits and unionization, the implication is that the employer, who has the means at his disposal, will make such predictions come true at his plant just as the employer did at another plant because a union entered the picture. Thus, I find that Hoff's statements of a plant closure where he previously worked and a loss of benefits at the lab had no factual basis and implied that CMRC might close or trim benefits because of union activity. Accordingly, these statements were also violative of Section 8(a)(1) of the Act. C. The Discharges The General Counsel contends that employees Seaton, Joll, Trombetta, Hurley, and Campbell were discharged on October 15 because of their real, or, in the case of Hurley, suspected union activities. Respondent contends that they were laid off as part of an economy move due to severe budgetary restrictions and that they were selected for layoff because they were the least competent and most expenda- ble employees. I reject Respondent's contention and find that the employees were discriminatorily discharged in violation of Section 8(a)(3) and (1) of the Act. The timing of the discharges supports the finding that the five employees named above were discriminatorily dis- charged. Four of the selected employees were leading union activists. By October 15, early in the campaign, Seaton, Joll, Trombetta, and Campbell were the only union authorization card signers. Campbell had contacted the Union at the request of the other three in late September. On October 15, these four employees, as well as Hurley, were peremptorily discharged. The circumstances under which the discharges were implemented were also unusual and thus confirm their discriminatory character. Most of the employees were escorted to the office of their technical director, then to the office of Personnel Director Ray. There was some discus- sion in some of the exit interviews about unions and the Union never coming into the lab. Trombetta was asked to remove his belongings from his locker and escorted out of the building. Seaton was not permitted back in the building to get his belongings a week after the discharge. Seaton, Joll, Trombetta, and Campbell had openly engaged in union discussions in the lab. Campbell's desk was the source of union cards and literature. Supervisors normally sat at his desk; they engaged in discussions where these employees were identified as union adherents. Joll and Seaton were identified as union adherents in conversa- tions with Supervisor Subsaro. Trombetta was present during one of these conversations and had other conversa- tions about the Union with fellow employees. President Dulis himself knew that there was some talk of a union in mid or late September after some economy measures were instituted. Respondent's hostility toward the Union is ' clearly established. On numerous occasions Respondent's repre- sentatives threatened closure of the lab and loss of jobs- conduct which I have found to be unlawful. Moreover, Respondent rescinded a wage freeze and implemented raises after the union campaign commenced-further unlawful conduct. One of the was threats was made to Joll at the time of his discharge and another to assembled employees after the discharges were announced. I also find that Hurley was selected along with the other four employees because he was suspected of being a union supporter and thus that his discharge was also unlawful. He had been unlawfully questioned by Supervisor Subsaro about his knowledge of union activities and also about his conversations with Campbell, the leading union activist. It is clear that Respondent chose to terminate all five employees for the same reason and Hurley was discharged under the same circumstances as the four union adherents. It is settled that if an employer's action is based on a fear or belief of an employee's union activity it is prohibited." And the discharge of an employee-even one known not to have engaged in union activity-simply to lend the appearance of regularity to discriminatory discharges is unlawful. N.L.RB. v. Dorn's Transportation Company, Inc., 405 F.2d 706, 713 (C.A. 2, 1969). Respondent's contention that the five employees were laid off due to economic reasons is unconvincing. Respon- dent lifted a wage freeze shortly after their terminations and thereafter unlawfully implemented wage increases for most of its employees. The raises over the next 8 or 9 months amounted to about $100,000. According to President Dulis' testimony, the financial difficulties of CMRC were alleviated by January 1976. Nevertheless, none of the five employees was recalled. Indeed, a new employee was hired in the spring of 1976 and Seaton was apparently rejected for a metallurgist's job at this time. Most unpersuasive is Respondent's explanation for the selection of the five employees for layoff and its attempt in litigation to question their competence. Dulis testified that Personnel Manager Ray, who did not testify and who had no technical expertise, made the selections as early as September 15. Respondent has not persuaded me that the 1-month hiatus between the decision and the announce- ment of the terminations was reasonably based. Dulls also testified that this was necessary in order to process the paperwork and to allow for a period after October 15 to the end of the year to budget accrued vacation time and other benefits of the employees. Yet Dulis also testified that there was a pressing financial reason for the layoffs. It is incongruous to me that there would be such a delay if Respondent's asserted economic reasons were as pressing as Dulis suggested in his testimony. Furthermore, it is incongruous to me that selections for layoffs of technicians would be made without checking with the technical directors who evaluate the employees and supervise them in their day-to-day operations. Indeed, Bressanelli testified that he argued with Dulis against the layoff of two people chosen from his group and Kasak told Seaton that he tried to get him transferred rather than fired. Finally, Dulis' testimony that the five selected employees had weak employment records was effectively and persua- sively refuted. First of all, Dulis admitted he did not check the last yearly appraisals of the employees before approv- ing the final selections. More importantly, Dulis' reasons 1' N L.R B v. Link Belt Co., 311 U.S. 584,589,590(1941); N.L R.B. v Fredrica Clausen, d/b/a Luzerne Hide & Tallow, 188 F.2d 439, 443 (C.A 3, 1951), cert denied 342 US. 868. 730 DECISIONS OF NATIONAL LABOR RELATIONS BOARD were not borne out when he was referred, in cross- examination, to the appraisals themselves. For example, Dulis testified that Trombetta was selected because he was "not working out" and had an absentee problem. However, Trombetta's last evaluation in June 1974 indicates that after an initial period of adjustment he was thought to be doing generally a "fine" job and "should develop into an excellent employee." The only reason given for Campbell's forced retirement was his alleged absentee problem which, on cross-examination, Dulis admitted had been tolerated for years and as his last evaluation showed was much improved. Dulis' characterization of Joll as a "goof off" was likewise not reflected in a generally favorable evalu- ation. Thus, Respondent's reliance on Dulis' testimony in support of its position is not well taken. Dulis did not impress me as a candid witness and, as I have indicated, his testimony on crucial matters does not withstand analysis. His reasons for the selection of the employees for layoff was refuted by reference to their favorable evaluations and I find it difficult to accept testimony that Dulis permitted Personnel Director Ray to make the crucial decision as to who would be laid off without consulting the technical directors who knew the employees involved and their work. I am likewise unconvinced that the peremptory layoffs on October 15 were decided on 1 month before and held up for a month for any justifiable business reason . For all these reasons, including Dulis' demeanor on the witness stand, I do not credit Dulis' testimony as to the crucial issues in this case. See Shattuck Denn Mining Corporation. v. N. L. R. B., 362 F.2d 466, 470 (C.A. 9, 1966). In short, I reject Respondent's reasons for the alleged layoffs in general and for the particular employees selected. Indeed, the implausibility of Respondent's reasons for the layoffs is further evidence which reinforces my finding that the employees were discriminatorily discharged. D. The Wage Increases As shown in the statement, Respondent raised the wages of unit employees from October 1975 to April 1976-the period during which the union campaign was in progress. The General Counsel alleges that the raises from October 15, 1975, through January 28, 1976, were discriminatorily motivated and thus unlawful under N.L.R.B. v. Exchange Parts Co., 375 U.S. 405 (1964). That case holds that the grant of economic benefits to discourage union support violates Section 8(a)(1) of the Act. As the Supreme Court stated: The danger inherent in well-timed increases in benefits is the suggestion of a fist inside the velvet glove. Employees are not likely to miss the inference that the source of benefits now conferred is also the source from which future benefits must flow and which may dry up if it is not obliged. (Id. at 409.) Respondent contends that the increases during the applica- ble period were simply normal raises, in accordance with its policy of providing merit raises for employees every 12 or 18 months. I reject Respondent's contention and find that the raises were motivated by a purpose to discourage union support and thus violative of Section 8(a)(1) of the Act. The most critical evidence on this aspect of the case is the testimony concerning Respondent 's wage freeze in September and October 1975. According to Respondent- through its witness, President Dulis-the economic situa- tion at CMRC was poor in September 1975 and the projected budget deficits necessitated cutbacks and belt- tightening measures. As a result he announced a wage freeze-tentatively in late September and more firmly on October 15, when five employees were discharged for union activities. However, shortly thereafter, on or about October 20, according to Dulis' testimony, the freeze was lifted, and, in the face of asserted economic difficulty, Respondent thereafter raised the wages of all the employ- ees in the election unit. This resulted in an additional deficit, in a projected budget which was already in deficit, of about $ 100,000. Certainly, if there was a financial problem, the wage freeze would have been justified. However, it was lifted without explanation after the union activity commenced and wage increases followed. There was no evidence that the financial situation was any different on October 20 when the wage freeze was lifted than it was on October 15 or September 24 when it was announced. What intervened was the discriminatory discharges of leading union adherents . Moreover, Techni- cal Director Bressanelli testified that in November 1975, after the union campaign had commenced , Personnel Manager Ray asked , him to make recommendations for merit increases. This was barely 1 month after the abortive wage freeze and well before the January 1976 date when Dulis testified that increased revenues became available to ease the financial crisis . Ray also told Supervisor Welles that Respondent was planning an increase for employees "after the first of 1976" and that he should prepare a list of employees in his section and the amounts that they were to be given, according to her guidelines . The raises were effectuated. In these circumstances , the timing of the increases shortly after the unexplained lifting of the salary freeze and in the context of other serious unfair labor practices, including the discharge of leading union adherents and threats to close the lab, strongly supports the inference that the wage freeze was lifted and the wage increases implemented because of the commencement of union activities in order to discourage union support. In view of all the evidence, it is likely that the granting of the increases after the onset of the union activities and after a wage freeze was announced was part of the "same course of illegal conduct embarked upon earlier to defeat the Union." N.L.R.B. v. Pyne Moulding Corp., 226 F.2d 818, 821 (C.A. 2, 1955). In a case such as this, where the objective evidence establishes at least a prima facie violation, it is incumbent on Respondent to establish a legitimate reason for its actions. As shown below, Respondent has not convincingly overcome the evidence which shows a violation. Respondent argues that it had a policy of granting merit raises every 12 or 18 months and that it continued this policy during the preelection period . The evidence does not establish a clear policy on wage increases . Most of the CRUCIBLE, INC. employees listed on Respondent's Exhibit 9 and General Counsel's Exhibit 7 who received increases during the applicable period last received increases some 12 months before. Some, however, had received increases 6 or 7 months before. Moreover, the testimony of Bressanelli and Welles convinces me that they, as technical directors, were told by Personnel Manager Ray to recommend increases at intervals which were not predictable. Although Dulis and the present personnel manager, Brandenberg, testified that the policy was to have increases at 12- to 18-month intervals, I am unable to accept that testimony as reflecting a policy that was firmly established. There is no evidence that this policy was announced or well known. Considering the evidence in the light most favorable to Respondent, however, it appears that it had an informal policy of granting wage increases about every year or year and a half. Despite the above, however, I am not persuaded that Respondent has overcome the prima facie case of discrimi- nation. While evidence of an informal policy of giving wage increases at somewhat regular intervals might be convincing in other circumstances, I do not find it so in the circumstances of this case. First of all, Respondent had made it clear that it was having financial problems and planned a wage freeze in September and October 1975. Respondent has not shown any evidence to support a change in financial circumstances to justify a reversal of that position. The only evidence is Dulis' testimony that an order from March, his superior, caused the wage freeze to be lifted and that financial relief came in January 1976. However, I find Dulis' testimony on this issue as implausi- ble as it was on the discharge issue and I do not credit his testimony. No corroborative evidence was submitted to support Dulis' contentions. March did not testify and Respondent did not offer any reason for March's reversal of Dulis. There is no evidence that Dulis told his technical directors the reason for lifting the wage freeze. Nor was there corroboration of Dulis' testimony that the financial picture for CMRC brightened in January 1976 due to increased revenues from Government contracts. Indeed, some of the raises were implemented in late 1975 even before the financial picture assertedly brightened and contrary to Dulis' statement, according to Supervisor Welles' testimony, that there would be very few raises in late 1975. Respondent asked its supervisors to recommend raises in late 1975 and some raises were implemented in October, November, and December 1975. For example, in its brief, Respondent lists a table obtained from Respon- dent's Exhibit 7 of wage increases ranging from 8.3 to 12.7 percent for seven technicians and two machinists imple- mented from November 1, 1975, to January 1, 1976. In these circumstances, I am convinced that Respondent's wage increases were implemented-at a time when Re- spondent purportedly was in financial difficulty-in order to discourage union support. See Texas Transport & Terminal Co., 187 NLRB 466,468 (1970). 12 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 CONCLUSIONS OF LAW 731 1. By discharging and refusing to recall Edward Campbell Bernard Hurley, Barney Seaton, Lou Trombetta, and Robert Joll, in order to discourage union membership, Respondent has violated Section 8(a)(3) and (1) of the Act. 2. By coercively interrogating employees concerning their union activities, by threatening that Respondent would close the lab resulting in the loss of jobs and benefits, and by increasing wages of employees to discour- age union activity, Respondent has interfered with, restrained, and coerced employees in the exercise of their rights guaranteed by Section 7 of the Act, thereby violating Section 8(a)(1) of the Act. 3. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. 4. The Respondent has not otherwise violated the Act. THE REMEDY Having found that Respondent has engaged in certain unfair labor practices, I shall recommend that it be ordered to cease and desist therefrom and to take affirmative action designed to effectuate the policies of the Act. Having found that Respondent discriminatorily dis- charged and refused to recall Edward Campbell, Barney Seaton, Lou Trombetta, Bernard Hurley, and Robert Joll, in violation of Section 8(a)(3) and (1) of the Act, I shall recommend that Respondent be ordered to offer them reinstatement and make them whole for any loss of earnings resulting from their termination by payment to them of a sum of money equal to the amount they would normally have earned as wages from the date of their termination to the date of a bona fide offer of reinstate- ment. Backpay shall be computed on a quarterly basis in the manner prescribed in F. W. Woolworth Company, 90 NLRB 289 (1950), and shall include interest at 6 percent as provided in Isis Plumbing & Heating Co., 138 NLRB 716 (1962). Upon the foregoing findings of fact and conclusions of law, and upon the entire record in this proceeding, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: ORDER 12 The Respondent, Crucible, Inc., Division of Colt Indus- tries, Inc., Robinson Township, Allegheny County, Penn- sylvania, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Discharging, refusing to recall, or otherwise discrimi- nating against employees because they have joined or supported a labor organization or because they are suspected of engaging in such activity. (b) Interrogating employees concerning their union activities. 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 732 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (c) Threatening employees with closure of the lab and loss of jobs and benefits if the Union were selected as bargaining representative. (d) Raising the salaries or wages of employees to discourage support for a union. (e) In any other manner interfering with , restraining, or coercing employees in the exercise of their rights under Section 7 of the Act. 2. Take the following affirmative action which is deemed necessary to effectuate the policies of the Act: (a) Offer to Edward Campbell, Barney Seaton, Lou Trombetta, Bernard Hurley, and Robert Joll immediate and full reinstatement to their former jobs, or, if those positions no longer exist, to substantially equivalent positions, without prejudice to their seniority or other rights and privileges, and make them whole for their loss of earnings in the manner set forth in the section of this Decision entitled "The Remedy." (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 records necessary to analyze the amount of backpay due. (c) Post at its CMRC facility copies of the attached notice marked "Appendix." 13 Copies of the notice on forms provided by the Regional Director for Region 6, after being duly signed by Respondent's authorized respresentative, 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 ensure that said notice is not altered, defaced, or covered by any other material. (d) Notify the Regional Director for Region 6, in writing, within 20 days from the date of this Decision, what steps Respondent has taken to comply herewith. IT IS ALSO ORDERED that the complaint be dismissed insofar as it alleges unfair labor practices not found herein. 13 In the event the Board's Order is enforced by a Judgment of the to a Judgment of the United States Court of Appeals Enforcing an order of United States Court of Appeals, the words in the notice reading "Posted by the National Labor Relations Board." Order of the National Labor Relations Board" shall read "Posted Pursuant