Northeast Oklahoma City Mfg., Co.

NORTHEAST OKLAHOMA CITY MFG. CO. Northeast Oklahoma City Manufacturing Company and International Brotherhood of Electrical Work- ers, Local 2021, AFL-CIO. Case 16-CA-5929 June 10, 1977 DECISION AND ORDER REMANDING BY MEMBERS FANNING, PENELLO, AND MURPHY On November 28, 1975, Administrative Law Judge Almira Abbot Stevenson issued the attached Deci- sion in this case. Thereafter, the General Counsel filed exceptions and a supporting brief, the Charging Party filed conceptions, and the Respondent filed a brief in opposition to the exceptions of the other parties. 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 but only to the extent consistent with the following: The complaint alleges that the Respondent violated Section 8(a)(5) and (1) and Section 8(a)3) and (1) of the Act, respectively, by failing to pay timely contractually established monthly production bonus- es1 and by discharging 12 employees who struck assertedly over the failure of the Respondent to make such timely payments. The parties' collective-bar- gaining agreement contains what can be denominat- ed a typical grievance-arbitration provision and a no- strike clause. 2 The Administrative Law Judge con- cluded that the fundamental issue in the case was whether or not the Respondent's conceded delin- quencies in paying the monthly bonuses were material breaches of article XII, section VI, of its contract with the Union. In her view not only the 8(a)(5) violation turned upon the resolution of that issue but also the 8(a)(3) violation as well. As she conceived the situation, the legality of the employees' strike in the face of the contract's no-strike clause required a finding that the Respondent's bonus delinquencies, which, as noted, the strike allegedly protested, constituted a unilateral change in the employees' wages and working conditions. There- fore, she concluded that the whole case turned ultimately upon an interpretation of the parties' contract, and thus did not pass on the merits of the issue, but held, rather, that the case was an appropriate one for deferral to arbitration. We disagree with the Administrative Law Judge's proposed disposition of this case. Whether or not the 230 NLRB No. 26 Respondent's changes in the payment of bonuses and its conceded delinquencies in such payments violate Section 8(aX5) is an issue involving not only the "private" contractual rights of the Respondent and Union, but also the quite separate rights of employees to engage in conduct ostensibly coming within the protection of Section 7 of the Act. In such circumstances, we perceive no just basis for deferring this case to arbitration, 3 and, on the contrary, shall remand it to the Administrative Law Judge for a full decision on the merits and such recommended Order as she deems appropriate. ORDER It is hereby ordered that this proceeding be, and it hereby is, remanded to the Administrative Law Judge for a full decision on the merits of the allegations of violations of the Act set forth in the complaint and for such recommended Order as she finds necessary and proper. MEMBER PENELLO, dissenting: I would adopt the Administrative Law Judge's Decision herein to defer to the parties' grievance and arbitration procedure for the reasons stated in Roy Robinson, Inc., d/b/a Roy Robinson Chevrolet, supra, and Member Walther's and my dissenting opinion in General American Transportation Corporation, supra. 'Art. Xll, sec. VI. 2 Art. 1, sec. 11 and art. V, respectively. 3 See General American Transportation Corporation, 228 NLRB 808 (1977). Chairman Fanning would not defer the 8(aX5) allegations to arbitration irrespective of the presence of 8(aX3) and (I) allegations. See his and Member Jenkins' dissenting opinion in Roy Robinson, Inc., d/b/a Roy Robinson Chevrolet, 228 NLRB 828 (1977). DECISION STATEMENT OF THE CASE ALMIRA ABBOT STEVENSON, Administrative Law Judge: This case was heard at Oklahoma City, Oklahoma, on September 16-18, 1975. The original charge and the first amended charge were filed by the Union and served on the Respondent February 10 and June 27, 1975, respectively. The complaint was issued July 2, 1975, and amended at the hearing. The issues in this case are whether the Respondent, as alleged in the complaint and denied in the answer, violated Section 8(aX5) of the National Labor Relations Act, as amended, by unilaterally changing wage rates and other terms and conditions of employment by chronically failing and refusing to make timely bonus payments required under its collective-bargaining agreement with the Union, and violated Section 8(a)(3) of the Act by discharging 12 strikers; and whether these issues should be deferred to arbitration under the principles adopted in Collyer Insulat- ed Wire, A Gulf and Western Systems Co., 192 NLRB 837 (1971), as requested by the Respondent and as opposed by the General Counsel and the Charging Party. For the 135 DECISIONS OF NATIONAL LABOR RELATIONS BOARD reasons set forth below, I find, without ruling on the merits, that the issues should be deferred to arbitration. Upon the entire record, and after due consideration of the briefs filed by the General Counsel, the Charging Party, and the Respondent, I make the following: FINDINGS OF FACT AND CONCLUSIONS OF LAW 1. JURISDICTION The amended complaint alleges, the answer admits, and I find that the Respondent is an Oklahoma corporation engaged in the manufacture of electrical hardware; its principal office and place of business is located in Oklahoma City, Oklahoma; during the past calendar year the Respondent sold and shipped goods and materials valued in excess of $50,000 to points located outside Oklahoma. The Respondent concedes, and I conclude, that it is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. II. LABOR ORGANIZATION The Respondent admits, and I conclude, that the Charging Party Union is a labor organization within the meaning of Section 2(5) of the Act. III. ALLEGED UNFAIR LABOR PRACTICES The Respondent and the Union are parties to a collective-bargaining agreement effective from November 13, 1972, until November 12, 1975. That agreement contains the following relevant provisions. Article I, Section II. The purpose of the Agreement is to provide orderly collective bargaining arrangements between the Com- pany and the Union and to secure a prompt and fair disposition of all disagreements. The Union agrees that there will be no strikes, slowdowns or walkouts and that there will be no interruption of work or interference with the efficient operation of Company business or instigation of a boycott or lockout on the part of the Company during the term of this Agreement. In the event of the violation of this Section, the Union shall endeavor to obtain the cessation of the violation. Any employee who violates this paragraph shall be subject to discharge. In the event that the Union authorizes a violation of this Article, the Company has the option of canceling this agreement at any time thereafter upon written notice to the Union, such cancellation to become effective immediately. Article V contains a three-step "oral or informal" grievance procedure and provides that: A grievance which has not been satisfactorily settled through the foregoing procedure shall, within thirty (30) days, upon written request from either party, be submitted to an impartial arbitrator whose decision shall be final and binding upon both parties and his fees and/or expenses shall be shared jointly by the Company and the Union. Section V of this article states, among other things, that the arbitrator is not empowered to modify, add to, subtract from, or otherwise alter the provisions of the agreement, and "that the authority of the arbitrator shall be limited to the interpretation and application of the express provisions of this Agreement." In article XII, the collective-bargaining agreement provides for the classification of employees and prescribes wage rates to be paid. It also contains the following provision: Section VI In addition to the above described wages, the Company will pay monthly, a bonus to all qualified employees based upon the following formula: Five per cent (5%) of production attributable to labor minus the cost of labor. Labor costs shall include the wages of all hourly employees in the production unit. Computation and payment shall be made in accordance with the following product groups: I. All Western Electric Products 2. All Honeywell Products 3. Government and IBM Products In order to qualify an employee must have a minimum of two (2) months service; must work a minimum of Eighty Percent (80%) of the hours available for work; must be present as of the end of the month for which the bonus is paid; and must meet minimum expected output and quality requirements set by supervisors. In addition an employee may be absent for a maximum of five (5) days without jeopardizing participation in payment for the month during which the absences occur. The sixth (6th) day of absence eliminates employee participation completely. Production and materials control employees covered by this agreement shall receive said bonus based upon the following formula: .35% of total production attributable to labor minus the total cost of labor. Article XVII provides for paid sick leave, the number of days increasing as seniority is acquired. As indicated above, the complaint alleges and the answer denies that the Respondent unilaterally changed existing wages and working conditions in violation of Section 8(a)(5) by chronically failing and refusing to make timely bonus payments required by article XII, section VI, set forth above. That provision of the contract represents the codification, so to speak, of a practice in effect at the plant prior to the advent of the Union. It is substantially undisputed that it was company practice to pay the bonus to employees during the second week of the month following that in which it was earned. The parties stipulated that, during a 10-month period, the bonus was paid on the following dates: 136 NORTHEAST OKLAHOMA CITY MFG. CO. Date Earned Date Paid May 1974 June 14, 1974 June 1974 July 12, 1974 July 1974 Aug. 23, 1974 Aug. 1974 Oct. 4, 1974 Sept. 1974 Nov. 1, 1974 Oct. 1974 Dec. 13, 1974 Nov. 1974 Dec. 13, 1974 Dec. 1974 Feb. 14, 1975 Jan. 1975 Feb. 28, 1975 Feb. 1975 Mar. 14, 1975 It is thus clear that the employees never failed to receive a monthly bonus, and that the bonuses for May, June, and November 1974, were paid before the middle of the following month. On the other hand, as of February 5, 1975 (when the walkout occurred), the Respondent had been a week later than mid-month paying the July bonus; 2-1/2 weeks later in paying the August bonus; 2 weeks later in paying the September bonus; and a month later in paying the October bonus. Moreover, as of February 5, 1975, almost 3 weeks had passed since the middle of January and the December bonus had not been paid. President Dean James testified that it was his responsibil- ity to determine when bonuses were paid. He testified that paying bonuses later than the second week of the month was occasioned by cash flow problems or by Plant Manager Ralph Stevenson's being late in turning in the list of employees who were qualified to receive a bonus to the accountant for computing the amount each was to receive. The complaint also alleges that 121 of the 18 or 19 employees covered by the contract engaged in an unfair labor practice strike on February 5, 1975, in protest against the Respondent's violation of Section 8(aX5) as alleged above, and that the Respondent discharged them the same day for striking and thereby violated Section 8(aX3) and (I) of the Act. The Respondent contends that the strike was a breach of the no-strike clause and therefore unprotected and illegal, and that the discharges were permitted by the contract and were unlawful. The General Counsel presented testimony, which was contradicted by the Respondent's witnesses, of efforts made by the chief steward, shop stewards, and employees to protest and grieve the Respondent's failures to pay the bonuses by the middle of the month following the month they were earned, and of management's brushoffs, cryptic answers, and unavailability. Chief Steward Hill testified that he asked Plant Manager Stevenson in January why the December bonus had not been paid, and Stevenson replied he "was tired of fooling with it," and Hill should talk to President James. Hill testified that he then asked James the same question and that James told him, "they didn't have 'Dollie Gaddis, Wilma Wright, Rita Rich, Velma Wright, Jackie Shinault, Dorothy Jackson, Wardree Stevenson, Shirley Wilson, Lena Johnson, Bernice Washington, Billy Lewis, Charles Wyatt. 2 San Juan Lumber Company, 154 NLRB 1153 (1965), enfd. 367 F.2d 297 (C.A. 9, 1966). Cumberland Shoe Corporation, 156 NLRB 1130 (1966), The Hearst Corporation, News American Divisions 161 NLRB 1405 (1966), Hoffman Beverage Company, et al., 163 NLRB 981 (1967), and Kellogg Company, 189 NLRB 948 (1971), cited by the General Counsel and the Charging Party, were decided before Collyer, and no deferral issue was raised in Duqal, Lid., 196 NLRB 511 (1972). Cf. Capitol Roof & Supply Company, Inc., 217 NLRB 1004 (1975), a post-Collyer decision in which the Board refused to defer to arbitration on the ground that the respondent had any money," but when Hill asked why they did not have any money, James replied, "it wasn't any of my business." This testimony was also denied. The General Counsel's witnesses testified that the Wednesday, February 5, walkout was triggered by infor- mation received by employees that morning indicating that the December bonuses would not be paid the coming Friday as Plant Manager Stevenson had promised. The Respondent presented testimony indicating that the strike was triggered partly or entirely by employee complaints regarding sick leave. The parties stipulated that the Respondent discharged all the strikers the day they walked out, February 5, by letters addressed to them by President James which were identical in the following respect. You are advised that effective February 5, 1975, your employment with NEOC Manufacturing Company, Inc. was terminated. NEOC discharged you from its employ because of your participation in the walkout and strike on February 5, 1975. This walkout and strike was in violation of Section II, General Agreement by and between NEOC Manufacturing Company, Inc. and Local 2021, International Brotherhood of Electri- cal Workers, AFL-CIO. That section provides that any employee violating the, "No Strike," provisions of the General Agreement is subject to discharge ... In my opinion, there is no merit in the General Counsel's and the Charging Party's contention that the issues in this case should not be deferred to arbitration because the Respondent's conduct constituted such a material breach by its late bonus payments and by President James' and Plant Manager Stevenson's alleged statements quoted above as to amount to a repudiation of the collective- bargaining agreement. Indeed, the Respondent does not deny its contractual obligation to pay the bonuses involved herein; it contends only that it did not materially breach that obligation.2 Contrary to the General Counsel, I see this case as suitable for the application of Collyer. The threshold issue is whether the Respondent unilaterally changed its employ- ees' wages and working conditions on those occasions when it paid out bonuses on dates later than the middle of the month. This depends on the meaning of article Xll, section VI, which ambiguously requires that a bonus be paid "monthly" under the described conditions, in light of the intent or practice of the parties.3 Moreover, whether the discharge of the strikers was a violation of Section 8(aX3) of the Act turns on the reason or reasons for the strike and repudiated its collective-bargaining agreement by notifying the union that the agreement was "cancelled and rescinded." 3 Cases in which the Board has deferred to arbitration issues involving comparable alleged unilateral changes in wages and working conditions include Collyer, supra, J. Weingarten, Inc., 202 NLRB 446 (1973): Western Electric, Inc., 199 NLRB 344 (1972), enfd. sub nom Local Union No. 2188, International Brotherhood of Electrical Workers, AFL-CIO 494 F.2d 1087 (C.A.D.C., 1974); Urban N. Patman, Inc., 197 NLRB 1222 (1972), enfd. sub noma Provision House Workers Union Local 274, AFL-CIO 493 F.2d 1249 (C.A. 9); Great Coastal Express, Inc., 196 NLRB 871 (1972): Coppus Engineering Corporation, 195 NLRB 595 (1972). The absence of language in the agreement involved in this case specifying the time, method, and manner (Continued) 137 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the employees' obligations and the Respondent's privileges under article I, section II, of the collective-bargaining agreement. 4 The following statement of the Board, in Gary-Hobart Water Corporation, 200 NLRB 647, 648, is applicable: It is our judgment that when, as here, the alleged unfair labor practices are so intimately intertwined with the interpretation of the parties' contract, it would best effectuate the policies of the Act to remit the parties to the procedures they have devised for determining the meaning of their agreement. In the above circumstances, and in view of the contract provisions for the filing and processing of grievances culminating in final and binding arbitration, and in view of the Respondent's willingness expressed at the opening of the hearing and reasserted in its brief that these issues be resolved by those procedures, 5 I conclude that this is an appropriate case for deferral to the machinery agreed upon by the parties for resolution of disputes arising under their contract. If those procedures fail to resolve the issues, my recommended Order permits any party to move for further consideration. Accordingly, I shall recommend that the complaint be dismissed, but that jurisdiction be retained in this proceeding for purposes of entertaining an appropriate postdecree motion. of payment of the bonuses contribute to the ambiguity of the bonus provision. The Charging Party's contention that the absence of such language removes this entire dispute from the cognizance of an arbitrator raises an issue which in the circumstances of this case is properly determinable by the arbitrator. Urban N. Patman, supra, Collyer Insulated Wire, supra. 4 Jemco, Inc., 203 NLRB 305 (1973); Gary-Hobart Water Corporation, 200 NLRB 647 (1972); Wrought Washer Manufacturing Co.. 197 NLRB 75 (1972). 5 Although the record contains no information on the subject other than IV. REMEDY Without prejudice to any party and without resolving credibility issues or deciding the merits of the controversy, I shall recommend that the complaint herein be dismissed, but that jurisdiction be retained for the following limited purpose to eliminate the risk of prejudice to any party. Specifically, jurisdiction of this proceeding will be retained for entertaining an appropriate and timely motion for further consideration upon a proper showing that (a) the dispute has not, with reasonable promptness after the issuance of this Decision, either been resolved by amicable settlement in the grievance procedure or submitted to arbitration, or (b) the grievance or arbitration procedures have reached a result which is repugnant to the Act. Upon the entire record in this proceeding, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: 6 ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the complaint herein is dismissed provided, however, that: Jurisdiction of this proceeding is retained for the limited purpose indicated in that portion of my Decision herein entitled "Remedy." an assertion by counsel to the Charging Party, it would not be determinative if the Respondent had not proposed, or had resisted, arbitration before the opening of the hearing herein. Western Electric, supra, Great Coastal Express, supra. 8 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 recommended Order herein shall, as provided by in Sec. 102.48 of the Rules and Regulations, be adopted by the Board and become its Order, and all objections thereto shall be deemed waived for all purposes. 138