Good GMC, Inc.

GOOD GMC, INC. Good GMC, Inc. and General Teamsters Union, Local 406, International Brotherhood of Team- sters, Chauffeurs, Warehousemen and Helpers of America. Case 7-CA-19397 26 August 1983 DECISION AND ORDER BY MEMBERS JENKINS, ZIMMERMAN, AND HUNTER On 24 September 1982 Administrative Law Judge Karl H. Buschmann issued the attached De- cision in this proceeding. Thereafter, Respondent filed exceptions and a supporting brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the Na- tional Labor Relations Board has delegated its au- thority in this proceeding to a three-member panel. The Board has considered the record and the at- tached Decision in light of the exceptions and brief and has decided to affirm the rulings, findings, and conclusions of the Administrative Law Judge only to the extent consistent herewith. The Administrative Law Judge found that Re- spondent violated Section 8(a)(5) and (1) of the Act by refusing to execute a written contract embody- ing its agreement with the Union and by demand- ing as a condition precedent to its acceptance of the agreement that a nonmandatory subject of bar- gaining be resolved. We find merit in Respondent's exceptions, for the reasons stated below. The pertinent facts are as follows: Respondent had been operating under its predecessor's (Krob- len GMC Truck Sales, Inc.) collective-bargaining agreement with the Union. Prior to the expiration of that collective-bargaining agreement on 31 May 19811 Respondent and the Union met on two sepa- rate occasions to negotiate the terms of a new col- lective-bargaining agreement. At the first bargaining session on 21 May Re- spondent was represented by its attorney, Clary, and Jacobus, its general manager and 25-percent owner. Union Business Agent Mosqueda and shop steward Guild represented the Union. It is uncon- troverted that on 21 May the parties agreed upon certain "ground rules" for the negotiation sessions. Clary announced these ground rules, as follows: (1) that he and Mosqueda would be the spokespersons for Respondent and the Union, respectively; (2) that, although Guild and Jacobus would be permit- ted to speak at the negotiation sessions, "any talk by the steward or Mr. Jacobus was just talk"; (3) that only the spokespersons would have authority to make any tentative agreements; and (4) that any agreements reached in the course of negotiations All dates are in 1981 unless indicated otherwise. were tentative only and subject to ratification by both the unit employees and Respondent's princi- pals. At the 21 May negotiation session, Mosqueda orally outlined the Union's proposed collective-bar- gaining agreement. Clary then expressed his intent to respond to the proposal at a later session, but emphasized Respondent's desire to resolve the "Harry Smith" matter.2 Mosqueda informed Clary that he had no authority to settle the Smith matter because Mosqueda could be subjected to a fair rep- resentation suit for doing so, and that any settle- ment of that matter would have to be negotiated with Kleiner, the Union's attorney. Nevertheless, Mosqueda agreed to act as a conduit by contacting Smith, in Clary's presence, and relaying Respond- ent's desire to settle the matter. When Mosqueda asked Smith if he would be willing to settle his case, Smith responded that he wanted about $40,000 in settlement. The parties met for a second negotiation session on 29 May, at which time Clary presented Re- spondent's written contract proposal. After Mos- queda and Guild discussed Respondent's contract proposal between themselves, they expressed to the company representatives their intent to recommend acceptance of the proposal to the unit employees, with the exception of item 3. Item 3 stated: "Satis- factory resolution of the Harry Smith dispute." Mosqueda emphasized once again that settlement of the Smith matter would have to be effectuated through the Union's attorney. Jacobus then alleg- edly stated, in Clary's presence and without Clary's disavowal, that there would be no contract unless the Smith matter was resolved. Clary stated that he had been unable to contact Kleiner, but that he "would try to get ahold [sic] of Mr. Kleiner again and that we would then see if we could resolve the total matter, and we would get back to the union or schedule another meeting to get the matter re- solved." Following the 29 May bargaining session, Respondent's contract proposal was presented to the unit employees for ratification, and they voted to ratify the proposal with the exception of item 3. Mosqueda called Jacobus on 2 June to inform him of the ratification vote. Jacobus responded that there would be no contract unless the Smith matter ' Harry Smith had been an employee of Respondent's predecessor, Kroblen GMC. Smith was discharged by Kroblen GMC and, after a grievance challenging his discharge was taken to arbitration, the Western Michigan Industrial Board ordered his reinstatement. Kroblen GMC rein- stated Smith, but subsequently discharged him. The Western Michigan Industrial Board again ordered his reinstatement. This second order of re- instatement was rendered against Kroblen GMC prior to Respondent's acquisition of its assets in March 1981. Respondent was reluctant to rein- state Smith as ordered by the Industrial Board and requested that the matter be resolved instead by a monetary settlement with Smith. 267 NLRB No. 99 - 583 DECISIONS OF NATIONAL LABOR RELATIONS BOARD was resolved. On the same day, Jacobus also was informed that Respondent's employees had request- ed the Union's decertification; a decertification pe- tition was filed on 5 June. The Administrative Law Judge concluded that Respondent insisted to impasse that the Union settle the Smith matter, a nonmandatory subject of bargaining, and withdraw the employee grievance before it would sign the contract. The Administra- tive Law Judge predicated his conclusion on the fact that Respondent persistently expressed its desire to settle the matter, even though it had been informed by the Union's negotiation representative that he had no authority to settle the matter and that Respondent would have to look to the Union's attorney to dispose of it. The Administrative Law Judge found that even though Respondent attempt- ed to incorporate resolution of the Harry Smith dispute in its written contract proposal, the record was clear that at no time in the negotiation sessions did that issue become an integral part of the "agreement." He further found that the Union's ac- ceptance of Respondent's proposed contract in its entirety, with the exception of item 3, reflected a meeting of the minds with respect to all subjects other than item 3. The Administrative Law Judge concluded that Respondent's refusal to sign the contract after the employees' ratification demon- strated that Respondent had made item 3, a non- mandatory subject of bargaining, a condition prece- dent to its acceptance of the agreement. Therefore, the Administrative Law Judge found that Respond- ent violated Section 8(a)(5) and (1) of the Act and ordered, inter alia, that Respondent sign and retro- actively implement, upon the Union's request, the collective-bargaining agreement ratified by the Union on 29 May. Contrary to the Administrative Law Judge, we cannot find that Respondent violated the Act as al- leged. As noted above, in setting the ground rules for the negotiation sessions, Clary stipulated, as ad- mitted by Mosqueda, that any tentative agreement reached was subject to the approval of Respond- ent's principals. It is clear that Respondent's princi- pals never ratified the alleged agreement and, indeed, there is no evidence that all of Respond- ent's principals even were apprised of the employ- ees' ratification of the alleged agreement or of the Union's request on 2 June that Respondent sign a collective-bargaining agreement. Therefore, con- trary to the Administrative Law Judge, we find that the parties never had an agreed-upon contract. Moreover, contrary to the Administrative Law Judge, we find that Respondent's reliance on Nord- strom, Inc., 229 NLRB 601 (1977), and Laredo Packing Co., 254 NLRB 1, 18 (1981), for the propo- sition that the parties never had reached agreement on the collective-bargaining proposals, was not misplaced. The issue in Nordstrom, like the instant case, was whether one party to collective-bargain- ing negotiations could effectively conclude negotia- tions by agreeing only to those demands of the other party which constituted mandatory subjects of bargaining. The Board in Nordstrom noted that it was clear that a party could not lawfully insist upon the inclusion in a collective-bargaining agree- ment of proposals which were nonmandatory in nature. Nevertheless, the Board noted that non- mandatory subjects of bargaining could, as a func- tion of cost, bear upon a party's mandatory sub- jects of bargaining. Thus, to say that the proponent of the nonmandatory proposal could not insist upon the inclusion of such a proposal meant just that, and no more. Once the nonmandatory proposal was removed from the bargaining table, there was nothing to prohibit the proponent of the nonman- datory subject from altering its proposals concern- ing mandatory subjects in light of the removal of the nonmandatory subject. s The Board in Nordstrom acknowledged that cir- cumstances may exist in which a party unlawfully insists on the inclusion of a nonmandatory subject of bargaining at a time when all other matters have previously, and independent of the outstanding nonmandatory subject of bargaining, been agreed upon.4 The consequences of such insistence are not, on the facts presented, at issue in the instant case, because it is clear that the nonmandatory sub- ject of bargaining proposed by Respondent was part of a package proposal. Consistent with the position advanced by the Board in Nordstrom, the Board in Laredo Packing found that no agreement had been reached on all the terms of a collective-bargaining agreement be- cause the nonmandatory subjects of bargaining ad- vanced by the respondent as a condition for exe- cuting a collective-bargaining agreement were part of one collective-bargaining package and were an essential quid pro quo for the respondent's contract proposal.5 Likewise, in the instant case, the Union selectively accepted part of Respondent's package proposal and claimed that an agreement had been reached thereon, in disregard of the fact that Re- spondent had proposed item 3 as part of a com- plete package proposal. In these circumstances, the Union was not entitled to pick and choose those contract proposals which suited its needs and demand execution of a collective-bargaining agree- ment limited to those proposals. Therefore, and be- a See Nordstrom. supra at 601. I· d. at 602. ' See Laredo Packing, supra at 18. 584 GOOD GMC, INC. cause no agreement on item 3 had been reached, here was no agreement on all terms of the pro- posed package collective-bargaining agreement, we conclude that there was no agreed-upon contract here and that Respondent's refusal of the Union's request to execute the proposed collective-bargain- ing agreement was not violative of the Act. Additionally, we find that Respondent did not insist to impasse on the resolution of the Harry Smith matter as a condition precedent to its signing of the contract, for the reasons stated below. Thus, Clary's statement at the termination of the 29 May negotiation session that he would contact the Union's attorney about the Harry Smith matter and then "would get back to the Union or schedule an- other meeting to get the matter resolved" clearly demonstrates that the parties had not exhausted their bargaining efforts. In determining whether impasse has been reached, the Board examines whether further bargaining would be futile; in other words, impasse is not reached because of a mere exchange and rejection of proposals.6 In the instant case, it is clear that both parties anticipated about a week's hiatus of bargaining after the 29 May session, during which time Clary was to ap- proach Kleiner about negotiating a settlement of the Harry Smith matter. Therefore, it cannot be said that as of 29 May the parties contemplated no further bargaining after discussion between Clary and Kleiner. We also find that the Union's failure ever to demand that the Harry Smith matter be re- moved from the bargaining table and its apparent willingness to let Kleiner handle the matter is fur- ther evidence that the parties had not exhausted bargaining and that the Union's position was not intractable. Furthermore, we find, contrary to the Adminis- trative Law Judge, that the alleged statement by Jacobus to Mosqueda on 2 June that "as far as he was concerned there was no contract unless [the Harry Smith matter] was resolved" does not estab- lish that Respondent, in fact, was insisting to im- passe on that matter. In light of Clary's statement that further negotiations would be arranged, Jaco- bus' 2 June statement merely was consistent with a stance of hard bargaining in the context of the then as yet unresolved status of the Smith matter pend- ing the attempt to resolve it in the hiatus between negotiation sessions.7 6 Inta.Rota Inc., 252 NLRB 764, 768 (1980). 7 We note, once again, that Clary stipulated in the ground rules to ne- gotltionrs that only he would be the spokesperson for Respondent and that "any talk by ... Jacobus was just talk." Moreover, we note that the Administrative Law Judge, without making a clear-cut credibility resolu- tion, decided not to rely on Jacobus' earlier alleged statement as an accu- rate reflection of Respondent's position for purpose of making a determi- nation on the impasse issue. On the basis of all of the foregoing, we find that Respondent has neither failed to execute an agreed- upon contract nor insisted to impasse on the inclu- sion of a nonmandatory subject of bargaining in the contract. Therefore, we shall dismiss the complaint in its entirety. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Re- lations Board hereby orders that the complaint be, and it hereby is, dismissed in its entirety. MEMBER JENKINS, dissenting in part: I agree with the majority that, under Nordstrom, Inc., 229 NLRB 601 (1979), and Laredo Packing Co., 254 NLRB 1 (1981), there was no agreed-upon contract and Respondent therefore did not violate Section 8(a)(5) of the Act by refusing the Union's request to execute the proposed collective-bargain- ing agreement. Contrary to my colleagues, howev- er, I agree with the Administrative Law Judge that Respondent violated Section 8(a)(5) of the Act by conditioning its acceptance of a contract upon the settlement of an arbitration decision's reinstatement order, a nonmandatory bargaining subject. As credited by the Administrative Law Judge, the evidence shows tht after the Union presented its contract proposal at the parties' first bargaining session on 21 May 1981,8 Respondent's chief nego- tiator, Clary, raised the Harry Smith arbitration de- cision and indicated that Respondent wanted to re- solve the matter. The Western Michigan Industrial Board had ordered on 27 January that Smith be re- instated to his mechanic's job. Respondent, howev- er, was reluctant to reinstate Smith and wanted Smith to waive his right to reinstatement in return for a monetary settlement. The Union's chief spokesman, Mosqueda, responded to Clary's intro- duction of the Smith issue by stating that he had no authority to resolve the matter, but he agreed to call Smith to determine if the latter would be will- ing to settle the case. Mosqueda reported Smith's interest in settling, but he also told Clary that any settlement had to be negotiated with the Union's attorney, Kleiner. 9 The parties met again on 29 May when Respond- ent submitted a complete proposal to the Union and explained it item by item. In presenting the item 3 proposal to satisfactorily resolve the Smith dispute, Clary again stated that Respondent wanted 8 All dates are in 1981. * In referring Clary to attorney Kleiner, who was not involved in the contract negotiations, Mosqueda expressed concern that any attempt on his part to settle the Smith matter might subject him to a fair representa- tion suit by Smith. 585 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to enter into a settlement providing for Smith's waiver of reinstatement. After discussing Respond- ent's entire package, Mosqueda and shop steward Guild agreed to the proposal except for item 3. Mosqueda repeated the Union's position to Clary- that he did not have the authority to settle the Smith case and that Respondent should pursue the matter with Kleiner.'o Respondent's general man- ager, Jacobus, responded that there would be no contract unless the Smith matter was resolved. Shortly thereafter, the unit employees voted to accept Respondent's proposal except for item 3. When Mosqueda advised Jacobus on 2 June of the ratification vote, Jacobus again stated that there would be no contract unless the Smith case was re- solved. No further contract talks took place. ' I agree with the Administrative Law Judge that the facts set forth above show that Respondent in- sisted to impasse on the Smith matter, a nonmanda- tory subject of bargaining, as a condition precedent to its agreement on a contract. The Union's chief negotiator plainly stated at both bargaining sessions that he did not have the authority to resolve the Smith issue and that Respondent would have to handle the matter with the Union's attorney. 1 Re- spondent undoubtedly understood the Union's posi- tion since Clary's notes of the negotiating sessions reflect the Union's desire that Respondent deal with Kleiner regarding the Smith matter. There- fore, as of 29 May, the Union had agreed to Re- spondent's entire contract proposal except for item 3, and Respondent understood the Union's position that the Smith matter would have to be handled with Kleiner. Respondent was free at that point to modify the mandatory subject portion of its pro- posal, but did not do so. Instead, it withheld agree- ment to a contract pending the Union's acceptance of the nonmandatory bargaining subject. 3 1' Moaqueda reiterated his concern about a fair representation suit if he tried to resolve the Smith case. 11 On 2 June Respondent was also informed that the employees had requested the Union's decertification. A decertification petition was filed on 5 June. " Contrary to the majority, I find that Mosqueda's statements express- ing his lack of authority in the Smith case and referring the matter to Kleiner effectively put Respondent on notice that the Smith matter would not be handled at the bargaining table and made any formal demand by the Union to that effect unnecessary. 's My colleagues rely on a statement by Clary at the conclusion of the 29 May bargaining session to show that the parties had not exhausted their bargaining efforts. Clary's testimony concerning the 29 May meet- ing reveals that after the Union accepted all but item 3 of Respondent's proposal, Clary advised Mosqueda that Respondent still wanted to re- solve the Smith matter. According to Clary, Mosqueda agreed but stated, "You have to handle that with Mr. Kleiner." Clary indicated he would continue his efforts to contact Kleiner and that "we would then see if we could resolve the total matter, and we would get back to the Union or schedule another meeting to get the matter resolved." I find Clary's testimony consistent with the view that Respondent in- sisted on a settlement of the Smith matter as a condition precedent to its agreement on a contract. The testimony reflects Respondent's constant interjection of the Smith matter and the Union's position that the issue be Respondent's insistence on the Union's accept- ance of a nonmandatory subject as a condition precedent to a bargaining agreement is further evi- denced by Jacobus' statements linking Respond- ent's agreement on a contract to the resolution of the Smith matter. Contrary to my colleagues' refer- ences to "alleged" statements by Jacobus, I believe the Administrative Law Judge clearly found that Jacobus stated on two occasions that there would be no contract unless the Smith matter was settled. Despite this finding, the Administrative Law Judge chose not to consider the remark as an accurate re- flection of Respondent's position. I find the state- ments to be highly probative of Respondent's stance in view of Jacobus' status as Respondent's general manager, Clary's silence at the time of Ja- cobus' 29 May statement, and the consistent nature of the statements with Respondent's conduct during the negotiations.1 4 Given these circumstances, I would find that Re- spondent conditioned its acceptance of a collective- bargaining agreement upon the settlement of the Harry Smith arbitration award, a nonmandatory bargaining subject, and therefore violated Section 8(a)(5) of the Act. 15 See Laredo Packing Co., supra at 18-19. handled with Kleiner away from the bargaining table. Furthermore, Clary's statement alluding to future contact with the Union appears to concern the Smith matter and, in my view, fails to demonstrate that fur- ther negotiations were to be arranged. Given the fact that Respondent did not seek to modify its contract proposal following the Union's ac- ceptance of all but item 3, the only "bargaining" that can be said to have been contemplated was by one party-Respondent-with respect to one subject-the Smith matter. 14 The majority finds that Jacobus' 2 June statement, considered in light of Clary's statement at the end of the 29 May negotiating session, is consistent with a stance of hard bargaining and does not establish that Respondent was insisting to impasse. I find the meaning of Jacobus' state- ment to be clear on its face. Moreover, as discussed in fn. 13, the only bargaining contemplated by Clary involved the settlement of the Smith matter. Viewed in that light, Jacobus' statement reflects Respondent's po- sition of linking a contract to the settlement of the Smith case. '1 Since I would find an unfair labor practice in this context, I would reject Respondent's assertion of a good-faith doubt as to the Union's con- tinued majority status. DECISION KARL H. BUSCHMANN, Administrative Law Judge: This case was heard on June 18, 1982, in Grand Rapids, Michigan. The charges were filed by General Teamsters Union, Local 406, International Brotherhood of Team- sters, Chauffeurs, Warehousemen and Helpers of Amer- ica, on June 5, 1981, and the complaint issued on July 23, 1981. It charged Respondent Good GMC, Inc., with vio- lating Section 8(a)(5) and (1) of the National Labor Rela- tions Act (the Act) for refusing to execute a written con- tract embodying the agreement with respect to terms and conditions of employment, demanding as a condition to the bargaining agreement that the Union withdraw a grievance involving Harry Smith, a former employee. 586 GOOD GMC, INC. Respondent filed a timely answer in which it admitted the jurisdictional allegations in the complaint. The answer denied any allegation that the Company violated Act. Upon the entire record including my observation of the demeanor of the witnesses, and after consideration of the briefs filed by the General Counsel and the Compa- ny, I make the following: FINDINGS OF FACT Respondent Good GMC, Inc., a Michigan corpora- tion, is located at 4800 Clyde Park, S.W., in Wyoming, Michigan. It is engaged in the retail sale and servicing of General Motors Corporation trucks. It is admittedly an employer within the meaning of Section 2(6) and (7) of the Act. The Union, General Teamsters Union, Local 406, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, is a labor orga- nization within the meaning of Section 2(5) of the Act. Respondent's predecessor, Kroblen GMC Truck Sales, Inc., and the Union were parties to a collective-bargain- ing agreement, effective June 1, 1978, through May 31, 1981, which covered the approximately 11 service de- partment mechanics. On March 1, 1981, Good GMC, Inc., acquired the assets of Kroblen and continued the operation without substantial changes. Good GMC also continued to'honor the terms of the bargaining agree- ment. Since the agreement was about to expire in May, the Union notified the Company approximately 60 days prior to the expiration date of May 31, 1981, that it wished to negotiate a new contract. Benjamin Mosqueda, the Union's business agent, also informed Peter Jacobus, Re- spondent's general manager, sometime in May 1981, that the Union was ready to meet with the Company on a new agreement. On May 21, the parties met for their first bargaining session. The Company was represented by attorney Jack Clary and General Manager Peter Jacobus, the former acting as chief spokesman. The Union, represented by Benjamin Mosqueda and employee Larry Guild, had a completed proposal ready for presentation to the Compa- ny. But the parties first discussed the company's inten- tions with respect to its profit-sharing plan. When the Company agreed that it would continue the same plan, the Union outlined its proposed package for a new agreement. It included a wage increase for the first year, a wage reopener for the second and third year, one addi- tional holiday, and an increase in the health and accident insurance. The Company expressed its intention to re- spond to the Union's proposal at a subsequent meeting and emphasized that it wanted the "Harry Smith matter" resolved. Harry Smith had been a mechanic employed by Krob- len. He had also been a union steward when he was dis- charged in December 1980. A grievance challenging his discharge was taken to arbitration and ultimately before the Western Michigan Industrial Board. The decision of the Industrial Board, dated December 16, 1980, ordered that Smith be reinstated. He was reemployed by Krob- len. His subsequent discharge became the subject of yet another grievance which was eventually taken before the Western Michigan Industrial Board. By order of January 27, 1981, the Board ordered the reinstatement of Smith with backpay. Respondent, however, was reluctant to re- instate Smith as ordered by the Industrial Board and, in- stead, wanted to settle the matter by the payment of a sum of money. When during the bargaining session on May 21, Re- spondent's chief negotiator Clary stated that he was in. terested in resolving the Smith matter, Mosqueda re- sponded that he had no authority to enter into a settle- ment. But he agreed to talk to Smith. In the presence of Clary Mosqueda called Smith to ask whether he would be willing to settle his case. Smith apparently indicated that he wanted about $40,000 in settlement of his case. Mosqueda so informed Clary, and also told him that any settlement had to be negotiated with Robert Kleiner, the attorney for Teamsters Local 406, because any attempt on his (Mosqueda's) part might subject him to a fair rep- resentation suit by Smith. On May 29, the same parties met for their second ne- gotiation session. The Company handed a complete pro- posal to the Union. Clary explained it item-by-item (G.C. Exh. 5). Item 3 stated: "Satisfactory resolution of the Harry Smith dispute." Clary reminded the union repre- sentative that the Company wanted to settle the Smith dispute and offer a dollar figure in exchange for Smith's waiver of reinstatement. The two union members dis- cussed the entire proposal briefly and informed the com- pany representatives that all items were acceptable except for item 3. Mosqueda emphasized again that he did not have the power to withdraw the grievance and settle the Smith dispute, and that the Company should contact attorney Kleiner concerning that matter. Mos- queda repeated his apprehension about a fair representa- tion suit if he attempted to a settlement. ' Although Clary attempted to call Kleiner on several occasions, the two men never got together to settle the Smith dispute. Following the bargaining session, Mosqueda assembled the unit employees, explained the Company's offer to them and recommended that they accept it in its entirety except for item 3, the Smith matter. The employees promptly voted to accept the Company's proposal with the exception of item 3. On June 2, 1981, Mosqueda called Good GMC and in- formed Jacobus that the employees had voted to accept the Company's proposal but not item 3. Jacobus howev- er, replied, that there would be no contract unless the Smith matter was resolved. On the same day, the Com- pany was finally informed that the employees no longer wanted the Union to represent them. A decertification petition was filed on June 5. In his testimony, Moequeda recalled that Jacobus made a statement to the effect that there would be no contract unless the Smith matter was resolved. Clary could not remember whether that statement wa made and Jacobus unconvincingly denied that he said that. The General Coun- sel would attach a great deal of significance to that statement even though it is clear that Clary was the chief negotiator on behalf of Re- spondent. In any case, Respondent's conduct is more accurately reflected by an appraisal of all surrounding circumstances. I have therefore decid- ed not to consider that statement as an accurate reflection of the Compa- ny's position. 587 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The General Counsel argues that the record supports a finding that Respondent violated Section 8(a)(5) and (1) of the Act when it refused to execute a written agree- mert demanding as a condition precedent to its accept- ance of any bargaining agreement that the Smith matter, a nonmandatory subject of bargaining, be resolved. Re- spondent maintains that the Union declined to agree to part of the package proposal thus rejecting the Compa- ny's entire proposal, and that item 3, although a nonman- datory subject of bargaining, was properly a part of the entire package proposed by the Company. According to Respondent, it did not insist to the point of impasse on the resolution of the Smith matter. Section 8(a)(5) of the Act makes it unlawful for an em- ployer "to refuse to bargain collectively with representa- tives of his employees .... " And Section 8(d) of the Act provides that the parties' obligation is "to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employ- ment . . . and the execution of a written contract incor- porating any agreement reached . . . but such obligation does not compel either party to agree to a proposal or require the making of a concession." The duty to bargain in good faith, as provided above, is limited to those areas considered mandatory subjects of bargaining. "But that good faith does not license the employer to refuse to enter into agreement on the ground that they do not in- clude some proposal which is not a mandatory subject of bargianing." NLRB v. Borg-Warner Corp., 365 U.S. 342, 349 (1958). Here, there is no serious question 2 that the "Smith matter" was a nonmandatory subject of bargain- ing. The question remains whether the Employer insisted to the point of impasse upon the resolution of the Smith dispute as a condition to the agreement. Consideration of all surrounding circumstances indi- cates that Respondent in effect insisted that the Union enter into a settlement in the Smith matter and withdraw the grievance before it would sign the contract. When the Union made its first proposal, Respondent interjected the Smith matter. The Union, while attempting to coop- erate and ascertain whether a settlement was possible, made it clear from the outset that it had no authority to settle the matter and that, indeed, it was apprehensive about a fair represenation suit if it attempted to do so. Accordingly, insofar as the Union was concerned, the Smith dispute was not even a legitimate area of bargain- ing. And the record shows, contrary to Respondent's as- sertion, that the Union had not attempted to bargain over that issue. Mosqueda consistently advised Clary that he should deal with attorney Kleiner and not with anyone on the negotiation team. The Union took the same position at the second negotiation session. At that meeting, the Union adopted all items of the Company's proposal except for item 3, the Smith matter. While the s Respondent suggests that a serious question remains whether it is the "successor employer" of Kroblen and that the Smith dispute might there- fore be considered a mandatory subject of bargaining. To the contrary, lack of successorship would remove the issue only further. Company attempted to incorporate that issue into its written package proposal, the record is clear that no- where in the discussions did that issue become an inte- gral part of the agreement. To be sure, Respondent stated that it wanted to start with a clean slate, the record is also clear that the Union did not regard it as a negotiable item. Significantly, since the Western Michi- gan Industrial Board had issued a decision in the Smith matter, the dispute had been resolved and was indeed no longer negotiable. The fact that the Company made an offer which the Union accepted in its entirety, with the exception of the Smith matter, shows that there was a meeting of the minds with respect to all subjects in the contract with the exception of item 3. And the Compa- ny's refusal to sign the contract after the Union had ac- cepted the Company's proposal without change shows that Respondent had made item 3, a nonmandatory sub- ject, a condition precedent to its acceptance of the agree- ment. For these reasons, the Respondent violated Section 8(a)(5) and (1) of the Act.3 CONCLUSIONS OF LAW 1. Respondent Good GMC, Inc., is an employer en- gaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. The Union, General Teamsters Union, Local 406, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, is a labor orga- nization within the meaning of Section 2(5) of the Act. 3. Respondent has assumed the collective-bargaining relationship with the Union as the bargaining representa- tive of all service department employees employed by Kroblen GMC Truck Sales, Inc., located at 4800 Clyde Park Avenue, S.W., Wyoming, Michigan, including lead- man; but excluding clerical employees, guards and super- visors as defined in the Act, as constituting a unit appro- priate for bargaining within the meaning of Section 9(b) of the Act. 4. By failing and refusing to execute a written contract embodying the agreement reached on May 29, 1981, de- manding as a condition to consumating any collective- bargaining agreement that the Union resolve the Smith matter and withdraw a grievance and thereby waive the arbitration award favorable to Harry Smith, Respondent violated Section 8(a)(5) and (1) of the Act. REMEDY Having found that Respondent has engaged in the unfair labor practices found above, I shall recommend that it cease and desist therefrom and that it take affirma- tive action designed to effectuate the purpose of the Act. [Recommended Order omitted from publication.] I Respondent's reliance upon Nordstrom, Inc., 229 NLRB 601 (1977), and some aspects in Laredo Packing Ca, 254 NLRB 1, 18 (1981), is mis- placed. Those cases did not deal with nonmandatory subjects of bargain- ing which had been finally resolved by arbitration and which might expose the Union to fair representation suits if it were to bargain over them. 588