Bethlehem Shipbuilding Corp., Ltd.

In the Matter of BETHLEHEM SHIPBUILDING CORPORATION, LIMITED and INDUSTRIAL UNION OF MARINE AND SHIPBUILDING WORKERS OF AMERICA, LOCAL No. 5 In the Matter of BETHLEHEM SHIPBUILDING CORPORATION, LIMITED and INDUSTRIAL UNION OF MARINE AND SHIPBUILDING WORKERS OF AMERICA, LOCAL No. 5 In the Matter of BETHLEHEM SHIPBUILDING CORPORATION, LIMITED and INDUSTRIAL UNION OF MARINE AND SHIPBUILDING WORKERS OF AMERICA In the Matter of BETHLEHEM SHIPBUILDING CORPORATION, LIMITED and INDUSTRIAL UNION OF MARINE AND SHIPBUILDING WORKERS OF AMERICA Cases Nos. C-906, 8-830, C-907, and R-831, respectively. Decided February 10, 1939 Shipbuilding and Ship Repairing Industries-Interference, Restraint, and Coercion- Company-Domtinated Unions-Employee Representation Plans: form, analysis and operation; domination of administration; financial and other support; recognition as representative of employees; disestablished, as agency for collective bargaining-Unit Appropriate for Collective Bargaining: production, maintenance, and stockroom employees at respondent's Boston plant, excluding office, clerical, supervisory and executive employees, draftsmen, watchmen, and janitors; prior decisions of Board-Representatives: proof of choice : application cards ; partial stipulation ; pay roll and working forces- Collective Bargaining: refusal to recognize representative as exclusive bargain- ing agency; refusal to enter into any agreement, either oral or in writing: negotiation in good faith ; meeting with representatives but with no bona tide intent to reach an agreement ; failure to offer counterproposals ; refusal to embody understandings, if reached, in a signed agreement ; remedial order : enter into a signed agreement, if understanding is reached ; recognition as exclusive representative ; negotiation-Investigation of Representatives: con- troversy concerning representation of employees: appropriate unit; majority status of union-Unit Appropriate for Collective Bargaining: production, main- tenance, and stockroom employees at respondent's Fore River plant, excluding executive and supervisory employees, foremen, assistant foremen, quartermen, leading men, and others listed in Appendix-Election Ordered: time to be set in future when Board is satisfied a free choice of representatives can be made ; name of union found to be company-dominated, omitted from ballot. Mr. Edward Schneider, for the Board. Cravath, deGersdorff, Swaine d. Wood, by Mr. Bruce Bromley, Mr. Albert R. Connelly, and Mr. John Morse, of New York City, for the respondent. 11 N. L. R. B., No. 20. 105 106 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Mr. Robert A. Zottoli, of Quincy, Mass., for the General Body. Grant ct Angoff, by Mr. Samuel E. Angoff, of Boston, Mass., for Local No. 5 and Local No. 25. Mr. Wallace M. Cohen, of counsel to the Board. DECISION ORDER AND DIRECTION OF ELECTION STATEMENT OF THE CASE Upon a charge and amended charges duly filed by the Industrial Union of Marine and Shipbuilding Workers of America, Local No. 5, herein called Local No. 5, the National Labor Relations Board, herein called the Board, by its Regional Director for the First Region (Boston, Massachusetts), issued its complaint, dated April 13, 1936, and its amendment to the complaint, dated March 10, 1938, against Bethlehem Shipbuilding Corporation, Limited, Quincy, Massachu- setts, herein called the respondent, alleging that the respondent had engaged in and was engaging in unfair labor practices affecting com- merce within the meaning of Section 8 (1) and (2) of the National Labor Relations Act, herein called the Act. A copy of the complaint,,, accompanied by a notice of hearing, was duly served upon the re- spondent and a copy of the amendment to the complaint, accom- panied by notice of hearing, was duly served upon the respondent and the Plan of Employees' Representation at the Fore River Plant of Bethlehem Shipbuilding Corporation, Limited, herein sometimes railed the Fore River Plan. In respect to the unfair labor practices the complaint, as amended, alleged in substance that the respondent at its Fore River plant had dominated and interfered with, and has continued to dominate and interfere with, the Fore River Plan by causing its representatives to be a part of the Plan, thus exercising control over the deliberations. and activities of the employees and their representatives in the oper- ation of the Plan; that the respondent formed and assisted in the administration of the Plan and dominated and interfered with the Plan by contributing financial support to it. On March 14, 1938,1 the respondent filed its answer to the complaint, as amended, admitting that it is a Delaware corporation engaged in the construction and 1 On April 27, 1936, the respondent filed with the United States District Court for the District of Massachusetts a Bill of Complaint for an Injunction . An injunction was granted on June 2, 1936, and on February 12, 1937, the Circuit Court of Appeals for the First Circuit entered a decree sustaining the District Court The Supreme Court of the United States, on January 31, 1938, filed a decision vacating the injunction Myers v. Bethlehem Shipbuilding Corporation, Limited, 303 U. S 41. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 107 sale of ships, boats, and marine equipment, but denying all other allegations of the complaint. On January 21, 1938, a petition was filed on behalf of Local No. 5 with the Regional Director, alleging that a question affecting com- merce had arisen concerning the representation of employees of the Fore River plant of the respondent, and requesting an investigation and certification of representatives pursuant to Section 9 (c) of the Act. An amended petition was filed on February 18, 1938, and on June 2, 1938, leave to amend further was granted by the Trial Ex- aminer. Notices of hearing on the petition and amended petitions were duly served upon the respondent and the Fore River Plan. Upon a charge and amended charges duly filed by the Industrial Union of Marine and Shipbuilding Workers of America, herein called the Industrial, the Board, by the Regional Director, issued its com- plaint, dated February 18, 1938, against the respondent, alleging that the respondent had engaged in and was engaging in unfair labor practices affecting commerce within the meaning Section 8 (1), (2), and (5) of the Act. Copies of the complaint, accompanied by notice of hearing, were duly served upon the respondent and the Plan of Employees' Representation at the Boston Plant of Bethlehem Ship- building Corporation, Limited, herein sometimes called the Boston Plan. In respect to the unfair labor practices, the complaint alleged in substance that the respondent at its Boston plant had dominated and interfered with, and is dominating and interfering with, the forma- tion and administration of the Boston Plan, in that the respondent introduced, sponsored, and caused the formation of the Plan; par- ticipated in, and contributed financial support to the Plan, and is giving aid, support, and encouragement to the Plan ; that on Septem- ber 20, 1937, and at all times thereafter, the Industrial Union of Marine and Shipbuilding Workers of America, Local No. 25, herein called Local No. 25, reprebented a majority of the respondent's em- ployees in the appropriate unit; that the respondent refused to bar- gain collectively with Local No. 25 on October 7 and 27, November 12, December 8, 1937, and on January 4, 1938; that the respondent entered into negotiations with Local No. 25 on said dates with no purpose or intention of bargaining collectively, and refused to recog- nize Local No. 25 as the exclusive representative of all employees in said unit and refused to incorporate any results of the negotiations into a written contract. On February 25, 1938, the respondent filed its answer, admitting that it is a Delaware corporation, organized in 1917, and engaged in the construction and sale of ships, boats, and vessels and certain equipment therefor, and in the repairing, recon- ditioning, and converting of ships, boats, and vessels and certain equipment thereof, and that it has offices and places of business at 108 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Baltimore, Maryland, Quincy and Boston, Massachusetts, and San Francisco and San Pedro, California; asserting that it has no knowl- edge as to whether, on September 20, Local No. 25 represented a majority of the production, maintenance, and stockroom employees at the Boston plant for the purposes of collective bargaining; ad- mitting that Local No. 25 requested a conference by letter of Sep- tember 20, 1937; and denying all other allegations in the complaint. On November 1, 1937, a petition was filed on behalf of Local No. 25,2 with the Regional Director, alleging that a question affecting commerce had arisen concerning the representation of the employees of the Boston plant of the respondent, and requesting an investigation and certification of representatives pursuant to Section 9 (c) of the Act. An amended petition was filed on February 18, 1938. Notices of hearing on the petition and amended petition were duly served upon the respondent and the Boston Plan. On March 2, 1938, the Board, acting pursuant to Article III, Section 10 (c) (2), of National Labor Relations Board Rules and Regulations-Series 1, as amended, ordered that the four cases be consolidated for the purpose of hearing, and acting pursuant to Section 9 (c) of the Act and Article III, Section 3, of said Rules and Regulations, ordered an investigation in the two representation cases and authorized the Regional Director to conduct it and to provide for an appropriate hearing upon due notice. After several postponements, notices of which were duly served upon the parties, the hearing opened in Boston, Massachusetts, on March 21, 1938, before Henry W. Schmidt, the Trial Examiner duly designated by the Board. The hearing was closed on June 3, 1938. At the commencement of the hearing the General Body created under the Fore River Plan,-' herein called the General Body, sought to intervene in the case concerning the respondent's Fore River plant. Intervention was allowed by the Trial Examiner in the representa- tion case but denied in the complaint case. The Board, the respondent, and Local No. 5 and Local No. 25 were represented by counsel and participated in the consolidated hearing. The General Body was represented by counsel and participated in the representation case. Full opportunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing on the issues was afforded all parties, except that participation by the Gen- eral Body was limited to the Fore River representation case. At the close of the hearing, opportunity for argument was afforded all parties by the Trial Examiner. 2 This petition was filed by Lucien Koch, national organizer of the Industrial Union of Marine and Shipbuilding Workers of America. s The General Body, as provided for under the Fore River Plan , is composed of the employee representatives. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 109: At the hearing the respondent moved to vacate and set aside the Board's order for consolidation. The motion was denied by the Board at Washington, D. C., on March 26, 1938. At the close of the Board's case and again at the end of the hearing, the respondent moved to dismiss the complaints and petitions for want of juris- diction and failure of proof generally and specifically. These motions were denied by the Trial Examiner. At the conclusion of the hearing, counsel for Local No. 5 moved to amend the pleadings in the Fore River representation case to conform to the proof. The motion was granted. During the course of the hearing the Trial Examiner made a number of rulings on motions and on objections to the admission of evidence. The Board has reviewed these rulings and rulings made with respect to the afore-mentioned motions and finds that no prejudicial errors were committed. The rulings are hereby affirmed. On August 26, 1938, the Trial Examiner filed his Intermediate Report, copies of which were duly served upon the parties, finding that the respondent had engaged in unfair labor practices at the Fore River plant within the meaning of Section 8 (1) and (2) and Section 2 (6) and (7) of the Act, and finding that the respondent had engaged in unfair labor practices at the Boston plant within the meaning of Section 8 (1), (2), and (5) and Section 2 (6) and (7) of the Act. The Trial Examiner recommended that the respondent cease and desist from its unfair labor practices, withdraw recognition from and disestablish the Plans at the respondent's Boston and Fore River plants, and upon request proceed to bargain collectively with Local No. 25 as the exclusive representative of the employees in an appropriate unit at the Boston plant. Thereafter the respondent and the General Body filed exceptions to the Intermediate Report and the various rulings and recommenda- tions of the Trial Examiner, together with a motion to dismiss. Pursuant to notice, oral argument was had on October 25, 1938, before the Board at Washington, D. C. The respondent, Local No. 5 and Local No. 25, and the General Body were represented by counsel, the respondent and the General Body filed briefs, and all except the General Body participated in the argument. The General Body in effect moved to set aside the order of the Trial Examiner denying intervention in the Fore River complaint case. The Board has con- sidered the motion of the General Body and the exceptions of the respondent and the General Body to the findings, conclusions, recom- mendations and rulings of the Trial Examiner, but, save for those exceptions which are consistent with the findings, conclusions, and order set forth below, finds them to be without merit. • 110 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Upon the entire record in the case, the Board makes the following : FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT The respondent was incorporated in the State of Delaware on Octo- ber 15, 1917, and is a wholly owned subsidiary of the Bethlehem Steel Corporation, herein called Bethlehem Steel. The respondent has offices and places of business at Baltimore, Maryland; Quincy and Boston, Massachusetts; and San Francisco and San Pedro, California. Sales of ships are negotiated principally at the New York office, sales head- quarters for the eastern coast plants. Sales agents are located in Bos- ton, Baltimore, San Francisco and Los Angeles, and in foreign coun- tries. The plants at Boston and Quincy are the only plants involved in this proceeding. The Quincy plant, known as the Fore River plant, employs approximately 4,100 persons. The Boston plant, consisting of the Simpson works and the Atlantic works, both operating as a single plant, employs approximately 1,000 persons. The Fore River plant The Fore River plant is a completely equipped plant for the design- ing and building of merchant and naval vessels, and is located on the waterfront of Weymouth Fore River at Quincy and Braintree, Massa- chusetts. The respondent is engaged at this plant in the designing and building of vessels of various kinds, sizes and descriptions, ranging from "small steam fish trawlers to the largest American vessels afloat," but principally destroyers and cruisers for the United States Navy. All the vessels are built under specific contracts. The respondent does no other work at this Fore River plant except that, to the extent of a small percentage of its business, it manufactures on specific order mis- cellaneous machine products and performs certain metal processing operations for ships. It fabricates and shapes in its shops at the plant practically all materials used in the construction of its vessels and also manufactures, for the most part, the boilers and main propelling machinery for each of such vessels. The principal raw materials used (about 90 per cent of which con- sist of steel in one form or another, most of which is purchased from the parent corporation) are: Asbestos products, aluminum, blowers, brass, bronze castings, iron castings, malleable iron castings, steel cast- ings, chain, chemicals, coal, coke, compressors, copper, cordage, deck machinery, steel doors, drills, electrical materials and machinery, pipe fittings, steel forgings, reduction gears, glass, grating, hair, hardware, hoists, hose, instruments, iron bars, pipe and sheets, linoleum, lumber, machines, expanded metal, oakum, fuel oil, packing, paints, pipe, plate • BETHLEHEM SHIPBUILDING CORPORATION ET AL. 111 steel, pumps, rivets, rope wire, rubber, screening, screws, solder, spelter, steel bars and shapes, valves, and welding wire. Of the raw materials used in 1936, amounting to $6,648,480 in value, 56.1 per cent were pur- chased outside of Massachusetts. In 1937 55.5 per cent of the $6,805,885 in value of materials used were received from outside of Massachusetts. The respondent owns and operates the Fore River Railroad which con- nects with the New York, New Haven and Hartford Railroad, over which is hauled most of the raw materials purchased by the respondent for the Fore River plant. The finished products manufactured in 1936 consisted principally, exclusive of inter-plant and inter-company transactions, of seven ships amounting to $24,432,022, and in 1937 of seven ships amounting to $23,854,690. Between 1930 and 1937 the respondent constructed at Fore River for the United States Navy four cruisers, seven destroyers, and one seagoing hopper dredge. Between 1930 and 1938, seven freight and passenger vessels, one ferryboat, four oil barges, and two oil tankers, and between 1928 and 1938, 17 fishing trawlers were con- -structed for other customers. At the time of the hearing the respond- ent was building three cargo and passenger vessels for the Panama Canal, and two destroyers and an aircraft carrier for the United States Government. The Boston plant The Boston plant is engaged in the business of repairing, recondi- tioning and converting ships, boats and vessels of various kinds, sizes and descriptions. The principal raw materials used (about 30 per cent of which consist of steel in one form or another, most of which is purchased from the parent corporation) are: Acetylene and oxygen, asbestos products, babbitt, brass, canvas, bronze castings, iron castings, steel castings, chain, coal, coke, copper, electrical supplies, fuel oil, glass, hardware, hoists, hose, iron, lead, lumber, oakum, packing, paints, pipe and fittings, rubber, screws, steel, tools, and welding wire. Of the raw materials purchased in 1936, amounting to $527,713, 15.96 per cent were purchased outside Massachusetts. In 1937 the total purchases amounted to $609,644, 17.21 per cent of which were purchased outside Massachusetts.' Most of the vessels repaired at the Boston plant are engaged in service which takes them to ports of States other than Massachusetts and to foreign countries. During 1937 approximately 505 vessels were repaired. Of these, 31 were public vessels, 91 were fishing vessels, and & The percentages here are based upon actual purchases outside of Massachusetts and do not include purchases in Massaciiusetts of materials shipped to Massachusetts from outside the Commonwealth. 112 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 244 were cargo and passenger vessels, at least 210 of which were en- gaged in coastwise, intercoastal and foreign commerce.5 We find that the respondent is not only engaged in commerce to a, substantial degree but is also engaged in the construction, repairing, and overhauling of instrumentalities of commerce. A stoppage of the respondent's operations would burden commerce by depriving com- merce of its instrumentalities and by depriving its instrumentalities of the repairs necessary to their continued operation. We further find that the activities of the respondent set forth hereinafter, occurring in connection with the operations of the respondent described in this section, have a close, intimate, and substantial relation to trade, traffic, transportation and commerce among the several States and between the several States and foreign countries, and tend to lead to labor dis- putes burdening and obstructing commerce and the free flow of commerce. H. THE ORGANIZATIONS INVOLVED Industrial Union of Marine and Shipbuilding Workers of America, Local No. 5, is a labor organization affiliated with the Committee for Industrial Organization, admitting to its membership all production, maintenance and stockroom employees at the respondent's Fore River plant, excluding office, clerical and supervisory employees, executive, powerhouse, and Fore River Railroad employees, draftsmen, appren- tice, draftsmen, tool designers, supervisor-inspectors, timekeepers, watchmen, and janitors. Industrial Union of Marine and Shipbuilding Workers of America, Local No. 25, is a labor organization affiliated with the Committee for Industrial Organization. It admits to its membership all pro- duction, maintenance and stockroom employees at the respondent's Boston plant, exclusive of office, clerical, supervisory, and executive employees, draftsmen, watchmen and janitors. The Employees' Representation Plan at the Fore River Plant of Bethlehem Shipbuilding Corporation, Ltd., and the Plan of Em- ployees' Representation at the Boston Plant of Bethlehem Ship- building Corporation, Limited, are labor organizations 6 admitting 5 Twenty-one of the 210 vessels were built by the respondent, 3 at the Fore River plant. Respondent also repairs tugs, barges , dredges, scows, ferryboats , lighters, submarines, schooners , destroyers, towboats and trawlers. 6 Since the Plan purports in its "Principles of Representation" to provide a "means of representation of employees . . . to meet in conference periodically or otherwise as the occasion shall require with representatives of the management to discuss and adjust mat- ters of mutual interest . " the Plan is a labor organization within the meaning of Section 2 ( 5) of the Act which defines a "labor organization " as "any agency or em- ployees' representative committee or plan in which employees participate and which exists, for the purpose in whole or in part of dealing with employers ." As we have heretofore stated, "It is obvious that the term 'labor organization ' is not used in its ordinary mean- ing but in a special and technical sense solely for the purpose of statutory draftsmanship and to make the prohibition of Section 8 subdivision ( 2) all Inclusive." Matter of Inter- nattonal Harvester Company and Local Union N. 57, International Union, United Auto- mobile Workers of America, 2 N. L. R. B. 310. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 113 to membership all production, maintenance, and stockroom employees .at the respondent's Fore River and Boston plants who do not have the power to recommend the hiring and discharging of other employees and who do not regularly hold a supervisory position. III. THE UNFAIR LABOR PRACTICES Introduction In considering the charges that the respondent dominated and in- terfered with the formation and administration of the Plans of Employees' Representation at the Fore River and Boston plants of the respondent and contributed financial and other support thereto, we will observe their formation, analyze their formal structure, and examine them in operation as agencies for collective bargaining. For reasons of convenience and expediency, our consideration of the Plans herein has not been subdivided into sections dealing with the operations of the Plans prior and subsequent to July 5, 1935, the effective date of the Act. However, we make no findings of unfair labor practices with reference to actions of the respondent prior to July 5, 1935. They could not constitute unfair labor practices under the Act. They are set forth here merely for the purpose of evaluating the respondent's conduct in the operation of the Plans after that date.7 Wherever the word "Plan" is used hereinafter, without other designation in the text, it is meant to include both the Fore River and Boston Plans. A. Plan of Employees' Representation at the Fore River plant 1. Formation of the Plan The Plan of Employees' Representation, which since has come to be known as the "Bethlehem Plan," was first installed by Bethlehem Steel in its Steelton and Lebanon, Pennsylvania, and Sparrows Point, Maryland, plants in 1918. On January 7, 1919, the respondent entered into a written agreement with the Metal Trades Department of the American Federation of Labor covering certain employees at the Fore River plant. The agreement was terminated by mutual consent in July 1921. Thereafter certain of the grievance committees which had been functioning under the agreement continued in existence, but without the sanction of any formal agreement. Late in February 1923, the respondent, through Harry E. Parker, employment manager, and later Management's Special Representative under the Plan, assembled 25 employees in the board room on the second floor of the combination building where offices of the superin- ' National Labor Relations Board v. Pacalc Greyhound Lines, Inc., 303 U. S. 272. 114 DECISIONS OF NATIONAL LABOR RELATIONS BOARD tendent, general manager, and employment manager were located. Harry E. D. Gould, superintendent and later general manager, Samuel W. Wakeman, vice president and later general manager, and Parker were present. There is some conflicting testimony as to what occurred at this meeting; but, in general, Parker informed the employees pres- ent that the respondent had a plan that it wanted to submit to its em- ployees. He explained the Plan and asked the men present to explain it to the employees in their respective departments. Wakeman said that the Plan had been introduced and was in successful operation at the Sparrows Point, Maryland, plant of Bethlehem Steel. On the following day, notices explaining the Plan and stating that the Plan would be put into effect were posted on the bulletin board in the plant. These notices suggested that all persons interested consult with the representatives listed, and informed the employees that any inquiries they might wish to make would be answered. The representatives named were those persons who were called to the original meeting. There is evidence that the company-designated representatives dis- cussed the Plan with other employees. No general meeting of all employees was held. Approximately 10 days later the same 25 em- ployees were again called to the board room, where Parker told them that the Plan was ready to go into effect and asked them to serve as tellers at the nominations for the positions of employees' regular representatives, which the respondent was about to hold among its employees. "He told us the voting hours would be from ... 8 in the morning until 12 noon for nominations, and that we were to go out and get the employees to vote, or ask them to vote, or talk it up among the employees, and also to talk to the employees and ask them, and make suggestions so that they would be nominated. The more nomi- nated, the better they liked it, and that anybody was eligible to run for nominations." On March 8, 1923, a committee "of five men was appointed to adopt rules and regulations for election of Employees' Representation." This committee assigned voting places, appointed tellers for the various departments, and "it was voted that a list of all employees in each department would be presented to tellers of these departments." The election was held and 21 employee representatives were elected. On March 20, 1923, following the nominations and elections, the first meeting of the 21 elected representatives was held in the board room. Wakeman and Parker were present. The latter outlined func- tions of various committees to be chosen by the General Body of em- ployee representatives and gave the representatives instructions in their new duties. The four committees, provided for in the Plan, were chosen and a list- of procedure or order of business used at another plant where a similar plan was in effect was given the representatives BETHLEHEM SHIPBUILDING CORPORATION ET AL. 115 together with a "schedule of regular meetings for 1923" of all of the committees and the General Body to be held in the board room. The employees assumed no initiative or responsibility in the forma- tion of the Plan. The Plan was furnished and installed in its entirety by the management. Those employees who- were convened by the respondent for the purpose of disseminating information concerning the Plan had no knowledge of the purpose for which they had been called together prior to their being called. The employees had no knowledge concerning the Pltn prior to its being put into effect, other than that provided by personal conversation with individuals com- posing the committee of 25 or by analysis of the Plan booklets. We find that the respondent dominated and interfered with the forma- tion of the Plan of Employees' Representation at the Fore River plant.8 2. Description and analysis of the Fore River Plan (a) Prior to July 5, 1935 The formal provisions of the Plan were drawn by the management and presented to the respondent's employees in booklet form as de- scribed above. The Plan contains a section entitled "Principles of Representation," ° and 11 articles embracing representation, terms of employees' representatives, qualifications of employees' representatives and voters, nominations and elections, management's representative committee, committee meetings, conferences, procedure for adjust- ments, guaranteed independence of employees' representatives and amendment. In substance, the Plan provides that representatives (one for each 200 employees or major fraction thereof) covering each de- partment are to be elected by secret ballot in March, following nomi- nations. These representatives compose the General Body, the func- tion of which is to receive, discuss, and generally report all matters of interest to employees and refer such matters to the proper committees for adjustment. The Plan has four regular employee committees composed of five representatives each, and four joint committees composed of the cor- responding five employee representatives and five management regular representatives. The four employee committees are : Committee on a Counsel for the respondent , in argument before the Board in Washington , D. C., admit- ted that the respondent prepared and formulated the Plan and that the Board would probably hold such conduct to be illegal now ° The Plan, dated March 1, 1923, provides under "Principles of Representation" : In order to give the employees of the Company a voice in regard to the conditions under which they labor, and to provide an orderly and-expeditious procedure -for-the prevention and adjustment of any future differences , and to anticipate the problem of continuous employment , a method of representation of employees is to be established. The representation of employees, as hereinafter provided , shall in no way abridge, or conflict with, the right of employees to belong to labor unions 116 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Rules, Ways and Means; Committee on Wages, Bonus and Piecework; Committee on Safety and Pensions; and the General Committee. These are known respectively as Nos. 1, 2, 3, and 4 Committees. The corresponding joint committees are likewise numbered. A joint com- mittee may ascertain facts and effect settlement of matters properly referred to it. The No. 4 Joint Committee constitutes a Joint Com- mittee on Appeals. All committees meet monthly but special meetings may be called. Special meetings of joint committees can only be called by the committee chairman with the approval of the General Body chairman and Management's Special Representative. There is no quorum at a joint committee meeting unless at least three employee representatives and three management regular representatives are present. Each group has the same number of votes regardless of the number attending the meeting. Conferences of employee representa- tives and management regular representatives are held annually. Management's Special Representative represents the management in negotiations and conferences with employee representatives. He may attend any committee meeting upon request, but has no vote. The management may refer any matter through its Special Repre- -sentative to any proper committee or joint committee for considera- tion, and any committee or joint committee may present any matter to the management through Management's Special Representative. The Plan contains a procedure for the adjustment of grievances, providing for six stages of review from department foremen to the president of the corporation. For time necessarily occupied through actual attendance at regular or special meetings or conferences held pursuant to the Plan, em- ployee representatives are to receive payment commensurate with their average earnings. In addition, the respondent is to defray such expenses as are necessarily incident to the discharge of Plan duties. In considering the question of employer domination of the Plan and the contribution of financial and other support to it, the follow- ing aspects of the Plan are of particular significance : (1) Membership.-Membership in the Plan is automatic. All em- ployees on the pay roll of the respondent who are not officials of the corporation and who do not have the power to recommend, hire or discharge employees, or who do not regularly hold a purely super- visory position are members and eligible to vote if they have been on the pay roll of the respondent for 60 days prior to the nominations. Membership ceases upon termination or severance of employment. There are no applications for membership, no initiation fees, no dues, and no membership cards. Hence, employees are without representa- tion for a period of 60 days, membership is subject to the employer's BETHLEHEM SHIPBUILDING CORPORATION ET AL. 117 control through the provision for termination ,of membership upon severance of employment, and no independent method of financing the Plan is provided. (2) Employee representatives.-Only employees who have been on the pay rolls of the respondent for 6 months immediately prior to nominations and who are American citizens, 21 years of age, are quali- fied for nomination- and election as employee representatives. An employee representative vacates office upon termination of his em- ployment at, the plant, upon transfer to a voting district other than the one he was elected to represent, or upon appointment to a posi- tion rendering him ineligible. Accordingly, no outside person or organization may represent the employees. ,(3) Amendment to the Plan.-Amendments to the Plan, proposed at a preceding regular meeting, may be made at any meeting of the General Body by a two-thirds vote. Immediately after a meeting at which an amendment is proposed, Management's Special Representa- tive must be notified and furnished with a copy of the proposed amendment.10 The Joint Committee on Rules, Ways and Means must approve an amendment materially changing the procedure for griev- ance adjustment, or which might prevent the Plan from operating as a fair method of selecting representatives of the whole body of employees of the corporation and as a fair method of collective bargaining, or which might materially increase the obligations im- posed upon the corporation. There is a conflict of testimony as to who determines whether a change or increase is "material." However, both George McConnell, Management's Special Representative at the Boston plant, and William H. McDermott, chairman of the General Body at Fore River until 1936, are of the opinion that the Joint Committee would resolve the question. As stated above, the mem- bership on a joint committee is divided equally between the employees and the management and voting rights are equal regardless of the number of representatives attending a meeting. Thus, in fact, the decision on the materiality of any amendment promulgated by the employees rests ultimately with the management. It is difficult to conceive a substantive change that could not be strongly urged as falling within the exceptions requiring submission of proposed amendments to the No. 1 Joint Committee. To add to the ambiguity, Article 7, Section 10, of the Plan provides that "any matter may be referred by the management through the Manage- 10 This provision for amendments first appears in the booklet containing the Plan as amended to May 15, 1936 The Plan as 'originally adopted contains the following provi- sion for amendments : "Any method of procedure hereunder may be amended at any time by two-thirds vote of the entire membership of the Joint Committee on Rules, or by con- current majority vote of the Employee Representatives and of the Representatives of the Management at an Annual Conference." 164275-39-vol xi -9 118 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ment's Special Representative to any proper Committee or Joint Committee for consideration and report, and any matter may be presented by any Committee or Joint Committee to the Management through the Management's Special Representative." Since, in any event, management determines whether a change or increase is "material," thus requiring Joint Committee action, the management thus has, as a practical matter, the veto power over any proposed change in the Plan. The provision requiring Joint Committee, ergo,, management ap- proval of an amendment "which might prevent the Plan from operat- ing as a fair method of selecting" Plan representatives permits man-, agement to interfere with the employees' selection of representatives under the Plan. The method of choosing its representatives is the concern of the employees only. It is not within management's prov- ince to dictate a method of selection. (4) Management veto by inaction.-Since no less than three man- agement representatives and three employee representatives must be present at joint committee meetings in order to constitute a quorum, the management can prevent a matter from being considered by a joint committee by merely withholding the attendance of its repre- sentatives. After a reasonable time the matter could be referred to the Joint Committee on Appeals, where it could be subject to similar treatment. Beyond the Joint Committee on Appeals ,the management control is direct and unqualified. (5) Procedure for adjustment of grievances.-Where any matter arises which, in the opinion of an employee, requires adjustment and which the employee has been unable to adjust with the person in charge of his work, it may be taken up by such employee personally, or through his employee representative, in order, with the foreman of his department, with Management's Special Representative, with the management of the plant which shall endeavor to effect a settle- ment or which may, with the approval of all parties, refer the matter to the proper joint committee or which may do both, and unless a satisfactory disposition of the matter shall have been effected within a reasonable time, such employee, through his employee representa- tive, or the management through Management's Special Representa- tive, may require such matter to be referred to the-Joint Committee on Appeals. The Joint Committee on Appeals shall consider the matter with reasonable promptness and adopt whatever means it deems necessary in order to ascertain the facts and effect a settlement. Should the Joint Committee fail to effect a settlement, the president of the corporation shall be notified and the matter may be referred if the president and a majority of the employee representatives on the Joint Committee on Appeals agree to such reference to an arbi- BETHLEHEM SHIPBUILDING CORPORATION ET AL. 119 trator, to be determined at the time according to the nature of the controversy. (6) Duration of the Plan.-There is no provision in the Plan or in the amendment procedure to prevent the respondent from totally abolishing the Plan at any time it deems fit to do so. The amendment procedure and the respondent's superior bargaining position forestall any employee attempt to terminate the functioning of the Plan. (7) Compensation of employee representatives and expense of Plan operation.-The Plan provides that the respondent is to defray all Plan expenses and is to compensate representatives for time spent on Plan duties.'1 The Plan was so operated. Thus the respondent provided all the financial requirements of the Plan. (8) Independence of employee representatives guaranteed.-The Plan purports to protect an employee representative against possible employer discrimination where any action has been taken by the representative in good faith in his representative capacity. Nothing in the Plan or the record is decisive of who determines whether any action has been taken in good faith. An aggrieved representative is offered a procedure for adjustment that entails three management- controlled steps, namely, appeal to the management, thence to the Joint Committee on Appeals, then to the president of the corporation, and thereafter appeal to the United States Department of Labor or to the Secretary of Labor of the United States. (b) Subsequent to July 5, 1935 The booklet containing revisions made prior to May 15, 1936, differs (except in certain minor respects) from the Plan as originally in- stituted only in the sections devoted to the "Principles of Repre- sentation712 and "Amendments," as heretofore considered. There- after the Plan continued substantially in the form described in the foregoing analysis until it was further amended, to become effective June 14, 1937. The latter amendments restricted the respondent's 71 A substantial portion of the time of the representatives Is devoted to Plan duties 12 As amended sometime prior to May 15, 1936, this paragraph reads : In order that there may be a definite method and means of representation of the employees of the Corporation with regard to all questions relating to rates of pay, hours of labor , rules, working conditions , health, safety , and other similar matters of interest to such employees, and an orderly and expeditious procedure for the preven- tion and adjustment of any future differences between such employees and the Coi- poration, and in order to anticipate the problem of continuous employment as it will present itself through trade fluctuations and other conditions , and for the purpose of protecting and promoting the interests of such employees through representatives whom they shall elect annually to represent them under this Plan and to meet in conference periodically or otherwise as occasion shall require with representatives of the Management to discuss and adjust matters of mutual interest, the method of rep- resentation of employees provided herein is hereby established. Representation hereunder shall in no way discriminate against-any employee be- cause of rate, sex, or creed or abridge or conflict with his or her right to belong or- not to belong to any lawful society, fraternity , union or other organization. 120 DECISIONS OF NATIONAL LABOR RELATIONS BOARD undertaking to compensate employee representatives for time spent on Plan duties and defray the expenses of the Plan to the "extent permitted by law." After June 14, 1937, the respondent discontinued its practice of compensating employee representatives for time spent on Plan duties and of defraying Plan expenses. Thereafter funds for the operation of the Plan were raised by dances, socials, and the like. It is apparent that the formal provisions of the Plan still vest complete control in the respondent over the membership in the Plan, the employee representatives, amendment to the Plan, grievance ad- justment procedure, and duration of the Plan. The Plan is, there- fore, through its very structure, denied the independence essential to the effective existence of a collective bargaining agency. 3. Operation of the Fore River Plan Prior to April 12, 1937' The method of operating the Plan prior to July 5, 1935, the effec- tive date of the Act, continued without substantial change until April 2, 1937. The ability of the respondent to control and dominate the Plan, inherent in the formal structure of the Plan, as demonstrated by the foregoing analysis, is attested by the following examples of the operation of the Plan. The early meetings were for the most part presided over by either H. E. Parker , Management's Special Representative , Harry E. D. Gould, superintendent, or Samuel Wakeman, general manager and subsequently vice president . Meetings were called and meeting sched- ules prepared by the management. Minutes of the meetings were mimeographed by management , copies retained for its files, and copies distributed by representatives and posted on the bulletin boards of the respondent . On one occasion Wakeman sought to obtain in- formation concerning the attendance of representatives at meetings. On another the respondent required that a representative absent from a joint committee meeting write a letter of explanation to the general superintendent. Reports on Plan activities and annual sum- maries of cases disposed of by the Joint Committee were sent to J. M. Larkin, vice president in charge of industrial relations for Bethlehem Steel and its subsidiaries , at Bethlehem, Pennsylvania. All election materials and lists of employees eligibile to vote were supplied by the respondent to the Plan from 1923 to and including the 1937 elections. The 1934 election ballot contained a printed state- 13 Date of decision in National Labor Relations Board V. Jones & Laughlin Steel Corpo- ration, 301 U. S. 1. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 121 ment that the voter using the ballot endorsed the Plan and authorized the Plan to act in his behalf for the purpose of collective bargain- ing. This endorsement was removed from later ballots. In 1930, when a resolution was being considered by the General Body concerning a bill in the Massachusetts legislature increasing weekly and death benefits under the Workmen's Compensation Act, the respondent wrote to the General Body informing it that "The management maintains that the Representation Plan as set up in the plant is an instrument for the settlement of any differences which may arise between the employees and the management and it is in no way concerned with any matters outside of the plant, therefore, this being the purpose of the Plan the management disapproves of any action of its committee with matters outside of the plant." However, in 1934 the respondent urged that another bill concerning the licensing of welders "be vigorously opposed," and later in 1934 called a special meeting of the General Body to inform representa- tives of a protest meeting to be held in Washington, D. C., on the Wagner Act. In the minutes of the meeting of the Joint Committee on Rules, Ways and Means, May 18, 1926, appears : "this Body has heard with regret the proposal from the management that a notice is to be posted to the effect that overtime hereafter will be paid for at the rate of time and a half. We, the General Body, feel that the question of overtime was taken away from us when an investigation was in progress to find out what practices are in effect in other yards." Conferences of employee and management representatives were held annually 14 on the respondent's premises. These conferences were attended by executives of the respondent, and all expenses, including dinner and the preparation and printing of programs, were paid by the respondent. In each of the programs there ap- peared a statement of Eugene G. Grace, president of the respondent, praising the operations of the Plan 16 The following statement is taken from the program for the conference of February 26, 1937: ". . . The elected representatives under the Plan have performed their duties in a fearless, intelligent and constructive manner. I urge all employees to use to the full the facilities of the Plan, for presenting their needs and views." In existence at Fore River and woven into the administration of the Plan were the Community Chest Fund, the Relief Plan, the 14 The conferences continued through 1937, with the exception of the years 1930 through 1933. 11 On the programs from 1934 to 1937 appear statements identical with those on the programs of the annual conferences held in connection with the Plan of Employees' Representation at the Boston plant 122 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Pension Plan, and the clothing store and gasoline station operated by the respondent. Profits from the clothing store and gasoline sta- tion were paid over to the Community Chest Fund. No formal arrangement existed whereby the respondent could be prevented from closing the station and the store, or from appropriating the profits. The Community Chest Fund established by the respondent in December 1928 was not limited in its activity to charitable purposes, but was also used to combat "outside agitation" and legislation deemed inimical to the employer's interests. For example, funds were provided for employee representatives to attend hearings in Washington on the National Industrial Recovery Act and to protest the passage of the Wagner Bill, to oppose a petition of the Industrial requesting an election of the old Labor Board in 1934, and to reprint articles antagonistic to the Industrial's efforts to organize the em- ployees of the respondent. The Fund was administered by the board of trustees, composed of a chairman, who was also the chairman of the General Body, an employee trustee, and a management trustee of the Relief Plan, and a treasurer and secretary, one of whom was to be a representative of the management and one a representative of the employees. Fred- erick C. Stevens, who became Management's Special Representative in 1934 and since has been personnel manager in charge of the respondent's industrial relations, served as a trustee of the Fund until the 1937-1938 elections. Minutes of meetings of the Plan show various memoranda from the general manager, assistant general manager, and general superintendent to foremen, requesting them to "get behind the various Community Chest drives," and informing them that "your allotment of tickets has been distributed to your department and you will please see that they are distributed to both supervisors and employees alike." The Relief Plan was formed by the respondent in 1926 and ad- ministered through the No. 3 Joint Committee. Among its chari- table functions, it distributes to needy employees Christmas and Thanksgiving baskets. The Pension Plan,16 providing for a disability pension and a voluntary pension after 25 years of continuous service, was created by the respondent in 1931. Questions of eligibility for pensions are brought before the No. 3 Joint Committee. From time to time the respondent distributes at its Fore River and Boston plants the "Bethlehem Review-a Bulletin of News for the Employees of the Subsidiary Companies of the Bethlehem Steel 16 In Article 4, Section 3, of the Pension Plan it is provided : This Pension Plan is a purely voluntary provision on the part of the company for the benefit of the employees after long and faithful service and does not constitute any contract or confer any vested or legal right on any employee. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 123 Corporation." These bulletins are utilized by the management for the purpose of acquainting employees with management's views on labor relations generally. In addition, they contain statements by Grace lauding the Plan and emphasizing its importance to the respondent and to the employees alike. In the issue of September 25, 1933, in a statement entitled, "Fifteen Years of Employee Representation," Grace related: This issue of Bethlehem Review marks the fifteenth anni- versary of our Employees' Representation Plan. Our Plan was among the first of its kind to be introduced in American in- dustry. It was a pioneer step in labor relations. Now, 15 years later, the National Industrial Recovery Act recognizes the value of such a plan under its provision for collective bargaining. This means of collective bargaining has stood the test of time. It has served both employees and management in prosperous days and in hard times, and meets the requirements of the new law. At its inception I stated that our Plan would be made an inte- gral part of our business. That this has been done is evidenced by the important place it has come to occupy in our current af- fairs. The Plan has become vital in the administration of our business, affording as it does a method for the establishment of fair and proper schedules of wages, hours, and other working conditions, and for guiding the various economic betterment plans which have been organized among and for the benefit of the employees over the last 15 years. No outside agency could possibly take the place of our Em- ployees' Representation Plan without destroying that all-essential direct contact and relationship so necessary to insure to em- ployees the best possible working and living conditions, and to management the cooperation of an intelligently informed body of employees -.. . In view of misleading statements on the much discussed sub- ject of the open and closed shop, of union and non -union labor, and in fairness to our employees, I feel it my duty to say plainly that no Bethlehem employee is required to belong to a labor union to get the full advantages of collective bargaining under the National Industrial Recovery Act. The Act provides for collective bargaining quite independent of an employee's affilia- tion or non-affiliation with any organization, union, or otherwise. All of these benefits of collective bargaining are afforded under our Employees' Representation Plan without cost to the em- ployee [italics ours]. 124 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The foregoing typifies management's promotion and encouragement of the Plan.17 Here, the respondent in effect advised its employees not to join "outside" labor organizations, but to utilize the Plan for equivalent benefits. In a message to its employees, posted on January 18, 1937, the respondent stated unequivocally : "In their effort to get you to join their union, the C. I. 0. organization are saying-`Do not 17 Other excerpts from statements of Grace appearing in various issues of the "Bethle- hem Review" : "Security of Employment," July 3, 1936: To the Employees . . . The employees in the [ steel] industry have enjoyed a long era of industrial peace during times when other industries dominated by labor unions ha%e been torn with strife . However it may be described , the real purpose of the unionization campaign is to force the "closed -shop " on all employees in the steel industry and thus to compel you and all other employees in the industry to join and pay dues to the union in order to hold your jobs We believe that no worker should be required to pay tribute to anyone or to any organization for the right to work. Realizing its obligation to the employees , to the owners, and to the public, after careful consideration of all phases of the threatened drive, the industry issued through the American Iron and Steel Institute the statement reprinted in this num- ber of the Review Our management firmly believes in the views expressed in that statement They express the policies which have controlled our dealings and rela- tionships for many years . . . "Bethlehem Moves Forward," January 1937: . . . For nearly twenty years now the Representation Plan has served the inter- ests of employees . What it has accomplished is reflected in the greatly improved wages and working conditions that exist today . Based as it is on confidence and cooperation it promotes industrial peace Industrial peace , not strife, is what we need. Those who would serve best the interests of labor will protect the Plan They will protect it for what it is-a fair, square, effective and responsible method of collective bargaining. "Times are Better," March 1937: This issue of the Bethlehem Review is the annual report to the employees , dealing with a number of subjects related to the economic progress and working conditions of employees. Annual reports to stockholders and the public on the financial status of companies are customary . I believe it is quite as fitting that there should be an annual audit and report on the human factors which make possible these accomplishments, espe- cially as the employees are so directly concerned in the proper conduct and accounting of these activities . . . The Employees ' Representation Plans which were established in our plants nearly 20 years ago continue to operate with ever increasing effectiveness . . . After all , this question of collective bargaining that we hear so much about these days is nothing new in the Bethlehem organization The, principle was accepted many years before it became so widely publicized and enacted into law. From the start we have recognized that real collective bargaining must achieve a definite goal, and that goal must be to elevate the working and living standards of the employees. That collective bargaining with us has accomplished this in our institution is evident from the record. "Our Labor Situation," January 15, 1938: To the employees : . Businesses like ours have grown and prospered because of an intimate contact and relationship between employees and management . It will be a sorry day for this country, if that relationship ever is permitted, to be undermined . . . Prior to the decision of the Supreme Court upholding the National Labor Relations Act we assisted you in the operation of your Plan by paying some of the expenses incident thereto . Following such decision, upon the advice of counsel, we informed you that we could not thereafter render such assistance . Since then your organiza- tions have been carried on on a self-supporting basis Our belief in collective bargaining and our long established policy of meeting, deal- ing and negotiating with you through your freely chosen representatives will continue. We stand firmly on that ground . . . [ Italics ours.] BETHLEHEM SHIPBUILDING CORPORATION ET AL. 125 be deceived by such false statements, there is no authority for them.' Your Employee Representation Plan does constitute a legal method of collective bargaining. Outsiders have not been necessary in the past-nothing has happened to make them necessary now." From the statements set forth above, we find a frank admission that the respondent "formulated" the Plan and "assisted" in its op- eration "by paying some of the expenses incident thereto." We per- ceive a well-defined program initiated by the respondent to propa- gandize employees concerning the benefits of the Plan and the Plan's importance in the "administration" of the respondent's business. Thus the respondent has saddled its employees with the responsibility of maintaining the Plan and has given as a reason therefor the "vital" necessity and importance of the Plan to the respondent's business. B. Plan of Employees' Representation at the Boston plant 1. Formation of the Plan The Plan was introduced at the Boston plant in a manner similar to that employed; at Fore River. On June 15, 1933, George H. Steb- bins, general manager, informed the respondent's employees of its installation in a printed statement, a portion of which follows : To Our Employees : Until the present time the Boston plant has not had in effect the Bethlehem Plan of Employee Representation which exists in practically'alfof the other Bethlehem plants. I am glad to advise you that Mr. S. W. Wakeman, vice president of the Bethlehem Shipbuilding Corporation, Ltd., is now extending to the em- ployees of the Boston Plant the Bethlehem Plan of Employee Representation .. . An appreciation of this opportunity can best be shown by the whole-hearted and enthusiastic participation of all employees in the inauguration and operation of this Plan. Two employees from each of the five units into which the plant was divided were called to the board room at the Atlantic works and addressed by Stebbins, Herbert Blaney, general manager's secretary and later Management's Special Representative, and Parker, Man- agement's Special Representative at the Fore River plant. Parker explained the operation of the Plan at Fore River and stated that the Boston plant would have a similar Plan. Several days later the same 10 employees were again summoned to the board room and addressed by Blaney and Parker. They were informed that nomina- tions for permanent offices would be held, that ballot boxes would be brought from the Fore River plant and ballots printed, and that all election materials and the eligibility lists would be furnished by 126 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the respondent. On the following day the 10 employees, pursuant to instructions, reported at the board room at 7 a. m. andtwere given various election materials and sent to their respective departments. At the close of the nominations the ballot boxes were brought back to the board room, where they were opened and the ballots counted. Parker and Blaney were at hand for consultation and were consulted concerning the validity of several ballots. During the counting of the ballots the names receiving the three highest votes were written on a piece of paper and the ballots sealed in an envelope which was delivered to Blaney. Several days later the election was held for those previously nominated and the same procedure was followed. The results of the election were posted on the bulletin boards at both works of the Boston plant. We find that the respondent dominated and interfered with the formation of the Plan of Employees' Representation at the Boston plant. 2. Description and analysis of the Boston Plan The Plan of Employees' Representation at the Boston plant was contained in a booklet bearing the notation "Adopted June 1933 as Amended to August 13, 1936." This booklet, which was made avail- able to all employees, is substantially identical to the booklet con- taining the Plan of Employees' Representation at the Fore River Plant. The Plan is divided, as is the Fore River Plan, into 11 sections. The section headings are substantially the same as those contained in the Fore River Plan. The major differences between the Plans are that the Boston Plan provides for (1) representation by one employee representative for each 100 employees or major fraction thereof; (2) an employee must have been on the pay roll at least 1 year prior to nomination, 21 years of age, and an American citizen in order to be qualified for nomination and election as an employee representative; and (3) only two committees are provided for, the Committee of Representatives and the Joint Committee. The Joint Committee consists of all employee representatives and management's regular representatives. The provision relating to equality of voting between employee representatives and manage- ment's regular representatives at Joint Committee meetings is the same in effect as a similar provision in the Fore River Plan. The amendment and adjustment procedure and the provision "Guaran- teeing the Independence of Employee Representatives" are identical with corresponding provisions in the Fore River Plan. The discussion contained in the section relating to the analysis of the Fore River Plan is equally applicable to the Boston Plan. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 127 3. Operation of the Boston Plan Prior to April 12, 1937 After July 5, 1935, and until April 12, 1937, the Plan continued to operate in substantially the same manner as it had operated prior to the effective date of the Act. Blaney, general manager's secretary and later Management's Spe- cial Representative, presided at the early meetings of the Plan. Minutes of Plan meetings were mimeographed by the respondent, copies retained, and other copies distributed to the employee repre- sentatives and posted on the bulletin boards of the respondent. Steb- bins, the general manager, and Blaney attended a special meeting of employee representatives on May 14, 1935, at which was discussed the question of reinstatement of men involved in a walk-out which occurred in 1932. The minutes read : They feel that if the Plan of Employee Representation had been in effect at the time, there would have been no walk-out. The absence of the Plan at that time was not because the men had refused it but only because the company had not suggested it and the Employees had never had enough interest to request it at the Plant. On June 12, 1935, Blaney attended a meeting at which the last sen- tence of the above minutes was amended because "The Committee felt that this sentence had been put in the minutes through some misunderstanding and could not remember having discussed this point." No mass meetings of the body of employees were held to accept or reject the Plan, and no machinery was set up for holding such meet- ings. No dues or initiation fees were charged, and no treasury was created. The expenses of the Plan and compensation of employee representatives for time spent on Plan duties were paid by the re- spondent. All meetings and annual conferences, substantially iden- tical with those held at Fore River, were held on the respondent's premises. The respondent prepared and paid for the conference pro- grams and dinners. The respondent's officers and executives attended the conferences and addressed the employee and management repre- sentatives assembled there. The annual conference programs for the Boston plant contained the same statements by Eugene G. Grace as the programs for the Fore River conferences. Reports on Plan activ- ities and annual summaries entitled "Disposition of Cases Brought before the Joint Committee" were sent to J. M. Larkin, vice president in charge of industrial relations for Bethlehem Steel and its sub- sidiaries, at Bethlehem, Pennsylvania. 128 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The Bethlehem Review, excerpts from which are set forth in the section dealing with the Fore River Plan, was distributed by the respondent at the Boston plant. The respondent distributed a leaflet, dated June 4, 1934, entitled "A Statement by the Iron and Steel Institute on• the Demands Submitted by the Amalgamated Associa- tion of Iron, Steel and Tin Workers," and concluding as follows : Peaceful relationship exists between the workers and manage- ment. The only threat comes from union leaders who are seek- ing Government intervention and thereby to maneuver them- selves into positions of power and domination over the steel workers of the nation. The Steel Industry will not be a party to such a program and believes that its employees generally will resist all efforts to force them under closed shop domination. A pamphlet, issued in June 1934 by the same Institute, entitled "Collective Bargaining in the Steel Industry," and bearing the subtitle "Why Steel favors Employee Representation Plans and is opposed to Professional Labor Unions," was distributed by the respondent to all employees and representatives. The respondent also distributed among its employees a pamphlet entitled "Progress in Labor Rela- tions," which contained an address by Frank Purnell, president of Youngstown Sheet and Tube Company, at the 44th general meeting of the American Iron and Steel Institute at New York on May 23, 1935. In part the article states : ... The whole question of labor relations is one of the most important problems before this country today. In my opinion, the argument is not about collective bargain- ing-we are all in favor of collective bargaining, and writing collective bargaining into the law of our country simply legalized what had long been recognized as a necessary industrial practice. The question at issue is the type of collective bargaining which will prove the most practical and most beneficial to the employees and to employers; which will promote harmony in industrial relationships and contribute greatly to industrial recovery ... In my opinion, Employee Representation Plans are here to stay-and are proving to be the solution of our problems. C. The Fore River and Boston Plans After April 12, 1937 Following the decision of the Supreme Court in the Jones & Laugh- Zin case there was discussion among the representatives as to the effect of the decision upon the Plan. At a special meeting of the BETHLEHEM SHIPBUILDING CORPORATION ET AL. 129 General Body on April 21, 1937, F. C. Stevens informed the employee representatives that "from the best legal opinion" no change in the Plan would be necessary. At the suggestion of the respondent's coun- sel, Hoyt Moore, whom Stevens consulted at Bethlehem, Pennsylvania, Stevens asked MacKenzie, chairman of the General Body, to write to the respondent and inquire concerning the status of the Plan in view of the "recent Supreme Court Decision." According to Stevens, this was done "for the record." "I mean that since 1934 we have been rather careful at Fore River to keep things clear. We learned that it is advisable sometimes to do that." Stevens' reply of May 6, 1937, to MacKenzie's inquiry analyzed the Jones & Laughlin decision, de- cided "to assume" that the decision was applicable to the business conducted by the respondent, advised amendment of those sections of the Plan relating to payment of employee representatives for attend- ance at Plan meetings and to defrayment of Plan expenses, and con- cluded as follows : As to the expenses of the Plan which the Corporation under the Act cannot pay, I think I should add that I do not believe that they will be burdensome and I believe that you will be able to make arrangements that will properly take care of such expenses. I have again carefully read your Plan of Employees' Represen- tation in the light of the decision of the Supreme Court in the J. & L. case and of discussions I have had with counsel and I be- lieve that it will not be necessary for you to adopt any amendments to the Plan other than those to which I have referred above in order that you may make it strictly comply with the provisions of the Labor Relations Act. It, however, may well be that you and the other Employees' Representatives will think it advisable to make some other changes in your Plan. All such changes will undoubtedly occur to you and the other Employees' Representatives as you and they shall review your Plan in the light of what I have said above. If after you and the other Employees' Representatives on the General Body shall have given such consideration to the matter as you shall think it requires, you shall desire to confer with me regarding it, I shall be glad to do whatever you shall wish in that regard. Both MacKenzie's letter and Stevens' reply were read by MacKenzie at a General Body meeting on May 10, 1937. Stevens was present, spoke, of conditions on the west coast, and stated that "Bethlehem was defi- nitely in favor of the Representation Plan." George McConnell, Management's Special Representative at the, Boston plant, also journeyed 'to Bethlehem, Pennsylvania, and con-- 130 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 1 suited with the respondent's general counsel with reference to the status of the Plan under the Act. The chairman of the Committee of Representatives at the Boston plant addressed an inquiry concerning the status of the Boston Plan to McConnell and received in reply a letter identical in form and substance (except in certain minor re- spects) with the letter of Stevens to MacKenzie. In both letters, after advising the representatives as to the changes necessary to conform the Plan to the provisions of the Act, the respond- ent assured its employees that they would be able to make the necessary arrangements to take care of Plan expenses in the future and that it would be unnecessary to adopt any amendments to the Plan other than those suggested by the respondent. Furthermore, the respondent in- vited its employees to confer with it concerning any other changes in the Plan which the representatives might deem it advisable to make. Both the Fore River and the Boston Plans were amended identically to comply strictly with the recommendations of the respondent. At a meeting of the General Body on May 11, 1937, Stevens explained "that each representative was free to continue to represent his men, but -when not doing representation work should put some time in on the job." Following the amendment effective May 10, 1937, limiting the payment of expenses of the Plan and also the payment to representa- tives for the time spent on Plan duties "to the extent permitted by law," the respondent discontinued its financial support. At Fore River the respondent sold the voting booths and ballot boxes to the Plan and charged for the distribution of the materials sold and for compiling pay-roll lists for the 1938 elections. It also charged rent for the use of the board room for meetings from March 15, 1937, to March 18, 1938. Rent was not exacted for use of the premises during the elections. Late in 1937 or early in 1938 the Fore River Plan for the first time elected a treasurer who was an employee representative and trustee of the Community Chest Fund in 1937. Thereafter, funds were raised by a dance held in February 1938. Following the 1937 elections at Boston, there were very few meetings of the Joint Committee. No meetings were held after November 10, 1937, for lack of a quorum, three of the employee representatives not attending due to their membership in Local No. 25. The record shows no further changes in the operations of the Fore River and Boston Plans after April 12,1937, other than the withdrawal by the respondent of its financial support. D. Conclusion as to domination and interference with the Plan The Plans at Fore River and Boston are but counterparts of the -"Bethlehem Plan," created in 1918 to meet contemporary exigencies. The concept of industrial relations, epitomized by the "Bethlehem BETHLEHEM SHIPBUILDING CORPORATION ET AL.. 131 Plan," was the outgrowth of, and a relatively progressive departure from, the industrial ideology of an era when suppression of labor's organizational activity and of concerted employee action was the prev- alent method of eliminating industrial unrest. Employers had recog- nized the necessity of granting employees a voice in the determination of their conditions of work, but safeguards were provided to insure the Maintenance of this restricted employee participation under the direc- tion and control management theretofore enjoyed./The Plan evolved as a method whereby the semblance of collective bargaining was vouch- safed employees without relinquishment of the ultimate control of the bargaining agency by'the management. In time, the Plan became out- moded by the development of a more realistic approach to employer- employee relationships culminating in the passage of the Act. Under the Act employees are guaranteed complete freedom in the selection and control of their collective bargaining representative. For this reason the concept inherent in the Fore River and Boston Plans is repugnant to, and their formal structures proscribed by, the Act. The Plan is designed to perpetuate the employer's control over all phases of industrial relations. The employees as a whole do not have the opportunity of formulating demands for submission to their bar- gaining agency. They do not meet in a group to instruct their chosen representatives, to secure in turn information from them or to consider as a group problems that affect them as a group. Their only means of contact is through occasional, informal individual conversation with their respective representatives. The General Body refers wage-in- c'rease questions to the appropriate committee which discusses the mat- ter in joint conference with management representatives. In fact, the individual employee's role in the operation of the Plan is insignificant. He is introduced to the Plan when he is hired."' Thereafter, his direct contact with the Plan is limited to the annual elections. No election has even been held on substantive questions or on the advisability of changes in the Plan-each election exists merely for the purpose of choosing representatives under the Plan-and even at such an election, the vote concerns personalities and not issues and the candidates have no platform. An employee is without represen- tation for 60 days and his membership in the Plan or his tenure as an employee representative may be terminated by the respondent at will. In marked contrast, an employee who is a member of a labor organiza- tion, independent of management, has a voice in union affairs and may retain his membership throughout periods of unemployment. The major role in the Plan is occupied by the joint committees to which we have referred. They are designed, within the scope of their 18 John S . Coughlin , chairman of the Plan at Boston , testified : "When he is hired in at the employment office, he is supposed to be given a book telling about the Plan as nearly as I know, that is the only way he joins it that I know about , that is the only way." 132 DECISIONS OF NATIONAL LABOR RELATIONS BOARD functions, to "consider and discuss matters of mutual interest to the employees of the corporation and management" and ",shall adopt such means as shall be necessary in order that [they] may ascertain the facts and may effect a settlement of any matter which shall have been properly referred to them." The employee representatives are given an equal vote with the management. The provision for free discus- sion and settlement of problems of employment appears theoretically to provide an admirable and efficient method of collective bargaining. But as we have said in commenting upon a similar condition, which we found to exist in the International Harvester Company case, "even the sincerest employee representatives are ati.a'hopeless disadvantage. On one- side are management representatives possessing complete in- formation, statistical and factual, relating to the business and able to command the resources of a huge and efficient organization. On the other are employee representatives with no information other than that which their working experience has given them. Intelligent dis- cussion of the -complex problems involved in the fixing of wages, hours and general working conditions in an organization of the re- spondent's size is impossible under such conditions." The only pos- sible weapon of employee representatives, the assistance of outside experts, is effectively denied to them, since the management controls the purse strings . . . When a deadlock is reached on any matter, the employee representatives can do nothing. They possess no funds, no organization to fall back upon, no mass support." 20 Mr. Justice Stone was commenting upon corresponding circumstances when he wrote that ". . . Collective bargaining is a sham when an employer sits on both sides of the table by supporting a particular organization with which he deals." 21 The procedure for amendment embodied in the Plan is for prac- tical purposes worthless to the employees. In the Plan as it was originally drawn the employer did not disguise its control of amend- ment procedure. In the Plan as amended the same purpose was achieved but is clothed with an aura of ambiguity. Even if amend- ment by the employees were possible, viewed realistically, the Plan's in Jacob van Vloten, an employee for 31 years , decided , after 5 years of being an em- ployee representative under the Plan, not to run for the position of employee representa- ti%e, stating, "After 5 years I was quite disillusioned . My enthusiasm had more or less gone Q. You say you were disillusioned and your enthusiasm was gone. A Yes Q Why do you say that9 A Well, the last 3 years of my term I ierved on the wage committee and that is the important committee where all their hopes are centered and I was disappointed in that. =° Matter of International Harvester Company and- Local Union No. 57, International Union, United Automobile Workers of America, 2 N L. R. B 310 $ National Labor Relations Board v Pennsyl4ania Greyhound ,Lines , Inc, 303 U S 261, 268 BETHLEHEM SHIPBUILDING CORPORATION ET AL. 133 purported importance to employer and employees has been so indeli- bly stamped upon the minds of the respondent's employees by em- ployer publicity that it is unimaginable that an employee would attempt to limit employer control of the Plan by proposing a sub- stantive amendment. An employee cherishing his job would be un- likely to display such temerity. Before 1937 the Plan had no means of independent financial sup- port. Until the Plan was amended, all expenses, including those for time spent by representatives on Plan duties, were paid by the re- spondent. The consequences of such complete support are manifold. The management pays the agent who is supposed to bargain with it on behalf of the employees, an intolerable condition ; it creates the illusion of "something for nothing," thus making more difficult a fair consideration of the advantages of an "outside" labor organization ; and, further, such complete support of the Plan makes its existence entirely subject to the will of the respondent. In operation the Plan functioned, as intended, under the direction and control of the management. The minutes of the meetings of the General Body and the various Standing and Joint Committees for the period during which the Plan has operated bear witness to that fact. The matters dealt with at the Joint Committee meetings, where presumably such collective bargaining as existed took place, were, for the most part minor problems relating to working condi- tions in the plant.22 Substantial changes in working conditions were effected at the plant; but they were for the most part voluntarily in- troduced by the respondent and were not the result of collective bar- gaining. In the matter of wages, the respondent urges that it gave wage increases from time to time. Granting that wage increases were made, we find that they were not accomplished by the practice of collective bargaining as it is generally accepted. No agreement n The following are typical examples taken at random : The No 1 Joint Committee, on February 15, 1937, voted to table indefinitely a com- munication that a committee investigate the revision of the membership of the Repre- sentative Body and remuneration for its members , to table until Parker could obtain more information the suggestion that a notary public be appointed in the yard and that a communication for reconsideration of an employee ' s suggestion be sent to the Joint Committee on Appeals The No. 2 Joint Committee, on January 20, 1931, took up the matter of giving piece workers their piece-work slips and "an interesting General discussion" ensued on all piece-work conditions in the yard. At several No. 3 Joint Committee meetings, November 9, 1937, September 15, 1937, and July 14, 1938, there appeared a motion relating to the Community Chest Christmas drive, a suggestion that the traffic commissioner investigate certain matters and a discussion of the annual outing. At a No. 4 Joint Committee meeting on June 17, 1932 , the report of a sub-committee investigating suggestions was read, accepted and filed as was a report on the sale of gasoline and oil and the clothing store sales . The sub-committee investigating the sale of milk to employees was unable to obtain a reduction in the price of milk but did obtain a reduction in the price of box lunches 164275-39-vol xi-10 134 DECISIONS OF NATIONAL LABOR RELATIONS BOARD relating to hours, wages, or conditions of employment has ever even- tuated from the so-called bargaining. Yet, the objective of the Act in providing for collective bargaining is that employers shall enter into contracts with labor organizations.23 Hence, "by keeping itself, free from any binding commitments in these fields so that it may at will make any changes that it desires, the management has at the same time denied to its employees the advantages of collective labor agreements. As a result its employees possess only the shadow,, not the substance, of collective bargaining." 24 In practice, the management has pursued a policy of interference with the Plan whenever it deemed it necessary. On occasion, as, stated above, fundamental changes in working conditions have been announced without opportunity of concerted action on the part of the employees. "Outside" matters heretofore discussed, such as the pro- posed bills increasing death benefits and licensing welders and the proposed Wagner Act were vetoed as of no interest to Plan repre- sentatives or urged as of vital interest, depending upon the respond- ent's immediate predilections. When the Plan was amended in 1937, it was the respondent who suggested amendment and the respond- ent's attorneys who advised the employees as to the form of amend- ment. In addition, the respondent proffered its further advice in the event future problems arose. The respondent has utilized its Bethlehem Review and other peri- odicals, annual conferences, and various media of propaganda for the purpose of representing the Plan as a proper object for employee support. The respondent has fortified its propaganda by providing the employees with the Community Chest Fund, Relief Plan, Pen- sion Plan, and other benefits, and by linking these benefits to the Plan, thus lending to them the verisimilitude of Plan benefits. Their existence, however, is completely subject to the respondent's whim 25 We find that prior to July 5, 1935, the date of the enactment of the Act, the respondent formed the Plan, fostered its existence, interfered with and dominated its administration, and contributed financial and other support to it. The interference with and domination of the, Plan administration and the contribution of financial and other sup- port continued without change after July 5, 1935, and until the 28 Consolidated Edison Co v National Labor Relatcon4 Board, ' 305 U S 197. 24 Matter of International Harvester Company and Local Union No. 57, International Union, United Automobile Workers of America, 2 N. L. R. B. 310. 21 ". . . By careful manipulation and scrupulous adherence to the outward forms of collective bargaining the respondent has so interwoven the Plan into the numerous bene- ficial activities designed to improve the welfare and morale of the employees and thus increase their efficiency-vacation plan , Credit Union , Athletic Association , Pension Plan, safety measures , etc., that the Plan receives credit for many of these benefits in the eyes of the employces . . Matter of International Harvester Company and Local Union No. .7, International Union, United Automobile Workers of America, 2 N L R B 310 BETHLEHEM SHIPBUILDING CORPORATION ET AL.,, 135 decisions of the Supreme Court in April 1937. Thereafter the Plan was amended to provide for the withdrawal of financial support. The mere withdrawal of financial support cannot operate to eradicate the deleterious effects of many years of employer control and legiti- mize the fruit of the respondent's unlawful conduct. By virtue of the Plan's structure, wherein management control is complete, by reason of the Plan's operations exhibiting the respondent's constant interference with and domination of the Plan, and because of the management's systematic propaganda extolling the virtues of the Plan and emphasizing the Plan's vital importance as an integral part of the respondent's business, the respondent' has created ' a condition, which was not substantially affected by the withdrawal of financial support. To hold otherwise would ignore the fact that the employees have been fettered by the Plan for many years. "The respondent has unquestionably made the Plan its own representative. It controls it today as effectively as it controlled it in 1934." 28 The respondent contends that the Plan comprises both a labor organization of employees and a procedure for collective bargaining and that the formal provisions of the Plan negative domination by the respondent. The formal structure of the Plan precludes such claim of duality. We have found the Plan in its entirety to be a labor organization within the meaning of the Act and we have found that the bargaining procedure afforded by it has operated under the domination and control of the respondent., In support of its contention that the formal provisions of the Plan negative the Trial Examiner's conclusion that the Plan was purposely designed to insure the respondent's complete control and domination of Plan activities, the respondent points to the Plan's marked simi- larity to the written agreement with the Metal Trades Department of the American Federation of Labor. Even though it is clear that substantially similar Plans were in effect at other plants of Bethle- hem Steel, the respondent's parent corporation, prior to the agreement with the A. F. of L., and the form of agreement was probably modeled after the Plans, nevertheless, certain important and fundamental differences distinguish the two. The agreement was made with a self-integrated labor organization, was signed by both parties, and was terminable upon notice ; the Joint Committee under the, agreement was composed of five presi- dents of various metal trades associations of the American Federation of Labor and five of the principal officers of the respondent; and compensation and expenses of the union officers, agents, and delegates were to be paid by the union. w Matter of H. E. Fletcher Co. and Granite Cutters' International Association of Ameica, 5 N L. R. B 729. 136 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The respondent urges as a defense to the charge of employer domi- nation that the Fore River Plan was introduced for a trial period of 6 months and accepted and adopted by the employees. It is true that an employee, John M. Regan, testified that the Fore River Plan was introduced for such a 6 months' trial period, but the minutes of Plan meetings are singularly free of the mention of a trial period. Further- more, as no mass or general meetings were held during the so-called trial period or at any time thereafter to permit the employees to record their attitude toward the Plan, such a trial period, if it existed, was meaningless. Nor can we find that the Plan was adopted by the employees. The fact that the majority of the Fore River employees voted for it for 15 years can be accorded little significance in view of the fact that the respondent introduced the Plan, dominated its in- ception, and administration and contributed financial and other sup- port to it. We find that the employees did not adopt or accept the Plans inaugurated by the respondent. The respondent argues that it has never exercised any of the veto powers inherent in the, Plan structure and that no amendment to the Plan has ever failed of adoption. However, limitation of the freedom of action of the employees can be imposed by existence of the power as fully as by its exercise. The respondent contends that only those actions which affect the respondent's rights under the Plan are subject to the respondent's approval. We have found that as a practical matter the amendment provision requires approval of every conceivable type of action, not merely those affecting the respondent's rights. In conclusion, the formation of the Plan by the respondent, the formal provisions of the Plan with its employer "checks" and con- trol over the Plan procedure, the administration of the Plan, guarded, nurtured and dominated by the respondent, the respondent's contri- bution of financial and other support to the Plan, when taken in conjunction with the intolerance of the respondent towards "outside" organizations and its active resistance to them, render the Plan but an elaborate structure designed and maintained to canalize the em- ployees' desire for representation in channels controlled and directed by the respondent. On the basis of the foregoing facts, we find that the respondent sponsored and dominated the formation of the Plans of Employees' Representation at the Fore River and Boston plants. We further find that after July 5, 1935, the respondent dominated and interfered with the administration of the Plans, contributed financial and other support to them, and thereby interfered with, restrained, and coerced its employees in the exercise of their rights guaranteed in Section 7 of the Act. BETHLEHEM SHIPBUILDING CORPORATION ET AL . 137 E. The refusal to bargain collectively 1. The appropriate unit Local No. 25 claims that the production, maintenance and stock- room employees at the Boston plant of the respondent, exclusive of office, clerical, supervisory and executive employees, draftsmen, watch- men, and janitors, constitute a unit appropriate for the purposes of collective bargaining. The respondent contends for a like unit, including, however, draftsmen, watchmen, and janitors. Such a unit -constitutes all the respondent's employees eligible under the Plan and has been customarily used by the Plan since its inception at the Boston plant. No evidence was introduced to show the duties of the employees in the classifications in dispute. In other of our decisions, involving similar plants and the In- dustrial, we have found a unit similar to that contended for here by Local No. 25 to be the appropriate unit.27 Accordingly, and since no bona fide labor organization has opposed the contention of Local No. 25, we find that the unit composed of the respondent's production, maintenance, and stockroom employees at its Boston plant, exclusive ,of office, clerical, supervisory and executive employees, draftsmen, watchmen, and janitors, constitutes an appropriate unit for the pur- poses of collective bargaining with respect to rates of pay, wages, hours, and other conditions of employment. 2. Representation by Local No. 25 of a majority in the appropriate unit The Industrial began organizing the employees of the Boston plant in the spring of 1937. A meeting was held on May 6, 1937. Seventy-four of the approximately ninety persons attending signed application cards authorizing the Industrial to act as their "collective bargaining agency in all matters pertaining to rates of pay, wages, hours of work, and other conditions of employment." A temporary president, vice president, and secretary were elected. Thereafter meetings were held every 2 weeks until June 8, 1937, by which time 424 signed applications had been obtained. On that date a charter was granted to Local No. 25 and officers were elected. 27 Matter of Todd Shipyards Corporot2on, Robins Drydock and Repair Co , and Tietjen and Lang Drydock Co. and Industrial Union of Marron & Shipbuilding Workers of America, 5 N. L. R. B 20; Matter of Ira S. Bushey & Sons, Inc and Industrial Union of Marine & Shipbuilding Workers of America, Local No. 13, 4 N L. R B. 1181 ; Matter of Unsted Shipyards, Ina and Locals No 12, No 13, No 15 of the Industrroal Unroon of Marine & Shropbutildsng Workers of America, 5 N. L. R. B. 742; Matter of Pier Machine Works, Ina and Industrial Union of Maine & Shipbuilding Workers of America, Local No. 13, 7 N. L R. B. 401. 138 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Local No. 25, produced at the hearing 7 09 application cards for membership signed by employees of the respondent at its Boston plant. The Local obtained 623 members by September 20, 1937; 12 more by October 7, 1937; 64 more in October and November; and 10 additional prior to September 20, 1937. A. representative of the Board and a representative of the respondent compared the signa- tures on the cards with those on the respondent's pay rolls and as- certained that 559 signatures were authentic, 143 were unverified, and 7 names were not on the pay roll. Of the 143 unverified applica- tion cards, 15 bore the names of employees who testified as to the authenticity of their own signatures and to the validity of other in- formation thereon contained. John S. Coughlin, former chairman of the Committee of Representatives and now secretary of Local No. 25, produced,.over the objection of the respondent the Local's ledger cards showing, in addition to the 709 names appearing on the application cards, the number of each applicant's dues book, the date of his initiation and payment of fees or dues, if any, and dates of payment. Coughlin testified concerning the above information with reference to 92 of the applicants and his testimony was stipu- lated with reference to the remaining applicants. Three names were discarded, which, together with the seven other discarded names not on the pay roll, reduced the Local's proof of representation to 699 of the respondent's employees. Since the respondent was offered ample opportunity to challenge the proof offered by Local No. 25 that it represented 699 (comprising the 559 authenticated and 140 un- verified signatures) of the respondent's employees at the time of the hearing, and since such proof as was adduced by the Local to sustain its claim stands uncontradicted upon the record, we find that the 699 cards were in fact signed by the persons whose names appear on them and that such persons were employees of the respondent. The business of the Boston plant is both seasonal and fluctuating. Certain types of vessels are periodically overhauled; the repair of others, incapacitated by damage, break-down or other causes, are often of an emergency nature. The latter type of business is periodic and at times highly fluctuating. Accordingly, the respondent main- tains a pay-roll force and a working force. The latter comprises about 50 per cent of the former. There is a weekly pay-roll period. Employees on the pay-roll force who are not working are not paid but are considered employees for certain purposes. From time to time the respondent "cleans out" the pay-roll force with the result that those eliminated are no longer considered employees for any purpose. However, upon being recalled and carried on either pay-roll or working force they regain their employee status and its incidents. We find, accordingly, that a determination of a majority must be based upon both the pay-roll and working forces. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 139 Two charts have been prepared showing the total number of employees at the Boston plant, the monthly average working force, monthly average pay-roll force, the number of Local No. 25 members on the pay-roll force, and the working force carried in the weekly pay-roll period nearest the dates when the respondent is alleged to have refused to bargain with Local No. 25, and also nearest the date of the hearing. From these charts 28 it is clear that on September 20, October 7, October 27, November 12, December 8, 1937, and January 4 and March 21, 1938, Local No. 25 had been designated by a majority of the employees of the respondent within the appropriate unit to represent them for the purposes of collective bargaining. 96 See charts below. CHART No. ONE Date Number of employees receiving wages Monthly average pay-roll force Monthly average working force May 1937------- --------------------------------------------------- 861 881 659 June 1937 ----------------------------------------------------------- 800 1 , 060 619 July 1937----------------------------------------------------------- 880 943 698 August 1937--------------------------------------------------------- 860 1,097 665 September 1937 ----------------------------------------------------- 776 1,162 554 October 1937------------------------------------------------------- 929 1,133 685 November 1937- ----------------------------------------------------- 841 1,090 524 December 1937-- --------------------------------------------------- 549 1,079 344 January 1938-------------------------------------------------------- 509 705 330 February 1938-------------- ---------------------------------------- 464 729 367 March 1938----------------------------------------------------- 415 735 289 CHART No. TWO-PRODUCTION , MAINTENANCE AND' STOCKROOM B C D On pay roll Working Total em- ployee A member- Boston Local Boston Local ship in Total Boston Total Local (1) (2) (3) (1) (2) (3) Sept.20, 1937---------- 1,088 496 117 613 574 343 70 413 623 Oct. 7, 1937------------ 1,081 499 122 621 673 395 89 484 635 Oct 27 1937 --------- 954 460 110 570 847 431 93 524 667 , - Nov. 12, 1937---------- 1,009 461 ill 572 553 328 73 401 667±`21 Dec 8,1937----------- 1,010 459 111 570 406 263 44 307 687±•1 Jan 4,1938 ------------ 618 377 79 456 321 212 46 258 687±'1: Mar 21,1938 ---------- 656 380 82 462 321 213 44 257 699 A-Bargaining dates except March 21, 1938, the date the hearing commenced B-Total number of employees carried on pay-roll force (during weekly pay-roll periods reflecting dates In Column A) of which number (1) (2) (3) were members of Boston Local C-Total number of employees on working force (during weekly pay-roll periods reflecting dates in Col- umn,A) of which number (1) (2) (3) were members of Boston Local D--Self explanatory (1) Employees of respondent whose signatures appeared on the 559 verified cards. 2) Employees of respondent whose signatures appeared on the 140 unverified cards (3) Total number of employees of respondent whose signatures appeared on all cards The number after ± signs represents employees of respondent whose exact membership date is uncertain on dates indicated. NOTE -Chart No. 2 was prepared primarily from Board Exhibit No 152-A compiled by respondent. Since this exhibit, however, reflects information on the total of 709 application cards, the 10 unverified cards have been deducted from columns (1), (2) and "Working Total." The ratio remains the same 140 DECISIONS OF NATIONAL LABOR RELATIONS BOARD We find that on September 20, 1937, and at all times thereatrer, Local No. 25 was the duly designated representative of a majority of respondent's employees in an appropriate -unit at the Boston plant of the respondent and pursuant to Section 9 (a) of the Act was the ex- clusive representative of all the employees in such unit for purposes of collective bargaining in respect to rates of pay, wages, hours of work, and other conditions of employment. 3. The refusal to bargain On September 20, 1937, John Mullin and John S. Coughlin, presi- dent and secretary, respectively, of Local No. 25, wrote to Andrews, general manager of the Boston plant, stating that "we have been authorized to request a conference with you for the purpose of secur- ing recognition and negotiating a collective bargaining agreement covering wages, hours, and working conditions. A majority of your employees in the Atlantic works and Simpson plant are members of this union." McConnell, Management's Special Representative, informed Coughlin that the respondent would meet with the Local on October 7, 1937, at the board room in the Atlantic works. In the meantime, Samuel Wakeman, vice president of the respondent, met Coughlin in the plant and said : "I don't see why you have to have outside organization representation come in and do any collective bargaining for you, although we are willing to meet you on the 7th as you asked in the letter." During this period Andrews offered Coughlin the job of night superintendent but Coughlin refused it. Thereafter conferences were held on October 7, October 27, Novem- ber 12, December 8, 1937, and January 4, 1938. All conferences, with the exception of that of December 8, were held at the board room of the Atlantic works. The December 8 conference was held at the office of the Regional Director of the Board at Boston. Demands were prepared at a union meeting of September 17, but the Local's desig- nated representatives, Gahens, Coughlin, and Mullin, decided among themselves to appear at the conference of October 7 without bringing in "outsiders." They met with representatives of the respondent and used, as the basis for their proposals, a contract printed in the Oc- tober 1, 1937, issue of the "Shipyard Workers." 29 The meeting lasted only about three-quarters of an hour because McConnell said that he had no authority to negotiate and that "he would have to see his superior, Mr. Andrews." Coughlin asked for another conference and McConnell said "he would see about it." The second conference, on October 27, began at 10 a. m. and did not adjourn until about 5 p. m. Present were Angoff, attorney for 20A newspaper published by the Industrial Union of Marine and Shipbuilding Workers of America. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 141 Local No. 25, Koch, organizer, Mullin, Coughlin, and Gahens in be- half of the Local, and McConnell and Andrews in behalf of the respondent. The Local presented its proposals consisting of a skele- ton outline of 25 items. These were read by Koch and written down by McConnell. The proposals were dealt with as follows : (1) Recognition.-Angoff stated that the union was prepared to prove that the Local No. 25 represented a majority of the employees in the maintenance, production, and stockroom departments of the respondent's plant and asked the respondent if it would recognize Local No. 25. McConnell replied : "We will bargain with our em- ployees individually or collectively with anyone who represents them or claims to represent them." Angoff asked if the respondent would recognize the Local as the exclusive bargaining agency if it had a majority. Andrews' reply was identically the same as McConnell's. Angoff then offered to satisfy the respondent that the Local had a majority. McConnell replied : "We do not question it." Relevant portions of the Act were read to the respondent and the respondent's representatives and in response the original statement of McConnell was repeated. Angoff then said : "Suppose we agree on sections of this topical outline, would you put it in writing ?" The response was, "It is not necessary." About an hour and a half was spent on the question of recognition and, according to Koch, "We came back to that proposal time and again . . . 15 or 20 times," and on each occasion was answered with McConnell's original statement. (2) and (3) Machinery for adjustment of grievances.-McConnell claimed that the grievance machinery was satisfactory and that he did not think these provisions were necessary. (4) Provisions against strikes or lock-outs.-The respondent stated that it did not see why such a provision was necessary in that it had never locked out its employees and would have no occasion to do so_ Angoff said : "Even providing we can come to an agreement now, will you put that down in writing?" A union representative sug- gested that it be agreed orally or that it be posted on the bulletin boards of the respondent. The respondent's answer to each sugges- tion was "We do not think that is necessary." (5) Guarantee against discrimination.-Andrews said there would be no discrimination because the Act prohibited it. The same sugges- tions and responses were made as in (4) above. (6) Time off for union business.-There was "not much talk" about this provision. (7) Thirty-six hour week.-Andrews said with reference to this suggestion, "No, we will have to go along as we have." Koch testified, "We could not get anywhere on that provision." (8) and (9) Wages.-Angoff stated: "We did not say very much on that." Koch testified that Angoff asked, "Will you make a counter 142 DECISIONS OF NATIONAL LABOR RELATIONS BOARD proposal as a basis for further discussion?" and the answer was "Well, what is your next point? Let's discuss your next point." (10) Overtime.-This provision was discussed but no agreement reached. (11) Rate for dirty work.-This provision was discussed and the respondent agreed to look into the matter of equipment used on such work. (12) Overtime for Sundays and holidays.-This matter was dis- cussed but no agreement was reached. (13) Wage increases for shifts other than day shifts.-The respond- ent pointed out that the night shift was already receiving 17.6 per cent higher wages than the day shift. The union suggested that the rate be made the subject of a written or verbal agreement or the post- ing of notices on the bulletin boards of the respondent but the re- spondent replied to such suggestion : "We don't think that is necessary." (14) and (17) Day's wage for employee called to work and elimi- nation of the "shape-up."-These suggestions were discussed together. A counterproposal was requested but McConnell stated that he had no counterproposal to offer, saying : " . . . he thought the present sys- tem was satisfactory." Andrews said that he did not think he could do business on that. (15) Week's vacation with pay.-The respondent insisted that it would abide by its policy of a week's vacation with pay after 5 years of continuous employment and that that was the "best they could offer." They refused to make any counterproposal to the union's suggestion. (16) Seniority.-McConnell said that the respondent was following seniority principles. Angoff said, "We seem to be rather close to- gether on that proposal. If we could come to an agreement on that point, would you put the agreement in writing?" McConnell said, "We do not think that is necessary," and replied in like manner to the suggestion that the matter be the subject of an oral agreement or that there be a posting of the understanding on the bulletin boards of the respondent. (18) Exemption from work involving labor controversy.-Andrews agreed that men should not work on "hot" ships. However, when Angoff suggested that an agreement to that effect be placed in writing or that the matter be made the subject of an oral agreement or be posted on the bulletin boards of the respondent, McConnell replied, "We do not think it is necessary." (19) Reimbursement for travel.-"Andrews said that he thought we would get together on that; I (Angoff) said `That is swell, let's, put it in writing."' McConnell replied "That is not necessary" and BETHLEHEM SHIPBUILDING CORPORATION ET AL. 143 gave the same response to suggestions concerning a verbal agreement .and posting. (20) Elimination of piece work.-It was agreed that there was very little piece work in the plant. Koch said, "Now, Mr. Andrews, will you agree not to extend that piece work system?" Andrews re- plied, "I do not think it will be necessary to extend it." (21) Elimination of combination work.-After a discussion, Mc- Connell and Andrews said that they would do away with combination work so far as possible. Angoff asked, "If we could come to a final agreement on this point . . . [would] . . . the Company . . . put it down in writing?" McConnell replied, "We do not think it is necessary." (22) Health and safety precautions.-Andrews said he would be glad to do something and Koch testified, "So we left it there." (23) Less compensation to Industrial members by reason of agree- ment.-There was little discussion on this since no agreement had been reached. (24) and (25) Signed agreement to terminate September 30, 1938.- The respondent's reply to this suggestion was that it was "not neces- sary." Angoff then said, "Tell me now, will you ever sign a contract if we agree on any clause?" The respondent replied that it was not necessary and made the same reply to the suggestion for a verbal agreement and to the suggestion that there be a posting of a state- ment on the bulletin boards of the respondent. Angoff again asked for exclusive recognition and received the reply, "We will bargain with our employees individually or collectively with anyone who represents them, or claims to represent them." Koch insisted, "Well, can't you give us a yes or no answer on that?" McConnell answered as above. Angoff suggested an election. The respondent replied that it was not necessary. At the conclusion of the conference Angoff asked Andrews and McConnell "Will you prepare and bring in counter-proposals as a basis for direct collective bargaining? A fur- ther conference was suggested by Angoff but the date was not fixed. Angoff claimed that lie asked for exclusive recognition "at least 25 times" during the second conference. The third, fourth and fifth conferences were, for the most part, a repetition of the second. Similar questions were asked by the union and the same replies given by the respondent. At the opening of the conference on November 12, Andrews and McConnell were asked if they had brought any counterproposals and they replied "you start talking." The conference of December 8, 1937, held at the office of the Board, was attended by the Regional Director and Claude Branch, attorney for the respondent, as well as the individuals attending the prior conference. Again, Angoff asked if the respondent had brought 144 DECISIONS OF NATIONAL LABOR RELATIONS BOARD any counterproposals and upon Andrews' indicating that he had not, Angoff said, "All we can do is go over the proposals again." The fifth conference on January 4, 1938, began with a charge by the union committee "that there was always some stalling or delay in getting a conference; that the men were always anxious and willing to confer, but that the company always found some reason to delay negotia- tions." Angoff asked whether or not the company had counterpro- posals and McConnell said, "We will go through the same procedure, you start reading." According to Angoff, "Mr. Koch and the men be- came infuriated and there were some hot words passed, but we had to start all over again, and had to read each proposal again. This time we did it very hurriedly. I started out again on the recognition clause. I said, again, that we were prepared to prove that the union repre- sented a majority of the men in the various departments; would the company recognize the Industrial Union of Marine and Shipbuilding Workers of America'? Mr. McConnell answered `We will bargain with our employees individually or collectively with anyone who rep- resents them or claims to represent them.' I said that was no answer, that I had heard that Mr. McConnell sounded like a parrot-that by this time we should be given a forthright answer." Gahens added, "Now, you are stalling. You cannot give us a yes or no answer. We have asked you for it time and again. You don't mean business. Let's go to the Labor Board." In its exceptions to the Trial Examiner's Intermediate Report, the respondent contends that 9 of the 25 proposals (strikes or lock- outs, discrimination against union members, time off for shop stew- ards, rate for night-shift work, seniority, work involving labor con- troversy, reimbursement for travel time, elimination of combination work, health and safety precautions) were agreed to by the respond- ent and 7 (exclusive recognition, machinery for the adjustment of grievances, rate for dirty work, elimination of piece work, guarantee against reduction, signed agreement and termination date) were the subject of discussion and negotiation at the time of the commencement of this proceeding. The testimony of Koch, Angoff, and Gahens with respect to what transpired at the conferences between the represen- tatives of Local No. 25 and the respondent stands unrefuted on the record and fails to sustain the respondent's contention. None of the proposals were "agreed to" by the respondent and many were re- jected. The question of exclusive recognition was not the subject of discussion and negotiation at the time of the commencement of this proceeding. The respondent has failed in three vital respects to satisfy the statutory requirement that it bargain with the freely chosen repre- sentative of a majority of the respondent's employees. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 145 First, the respondent's conduct at the conferences constituted an absolute refusal to recognize the Industrial as the exclusive bargain- ing agency of the respondent's employees. Consistent with its stated policy,30 the respondent had established a pre-determined bargaining formula which was closely adhered to throughout its dealings with the Industrial. As we have heretofore stated : "To meet and ne- gotiate with a committee of employees while deliberately withhold- ing union recognition does not satisfy the requirements of the Act. The paramount importance of the effect of union recognition alone in securing collective bargaining has been asserted repeatedly in our decisions." 31 Second, the respondent's repetition that it did not think it "neces- sary" to reduce to writing any understandings reached is tantamount to an absolute refusal to do so. The respondent, however, contends in its brief that "nothing in the Act purports to compel an agree- ment between the parties or to require the execution of a written document giving expression to the matters agreed upon. Certainly a written agreement cannot be required where, as here, only part of the demands have been negotiated and agreed upon." Without passing on the question of the respondent's obligation to enter into a written agreement where only part of the terms have been 30 Frederick C. Stevens , Management's Special Representative at Fore River , testified at the hearing , "It has always been our policy to bargain with anybody and everybody who claim to represent any individual or group of individuals " Q It is the policy then in the Foie River plant not to question how many anybody represents but to deal with anybody and everybody who would claim to represent anybo(1v or everybody inside the plant? A. In oider to be fair to everybody, yes William H. Collins , general manager at Fore River , testified at the hearing as follows : Q It has been the policy of the Bethlehem Shipbuilding Corporation , has it not, to negotiate with anybody and everybody for such individuals as they may represent about dealings with anybody exclusively on behalf of all employees , is not that true? . . . A At Fore River . we have never had any groups certified by the National Labor Relations Board or anybody else as exclusive bargaining agencies for our men, and until such certification were made we felt that we were morally obligated to deal i ltli people who said that they were the representatives of our employees and never questioned their right or how many they represented Q. Then my statement is true and you have just given the explanation for it. Is not that right? A Your statement involves a matter of policy. I can tell you what we have done, not what our policy has been necessarily. Q Well , if I eliminate the word "policy " and say that has been the practice, will you then, say I have stated it, correctly and your answer is your explanation? A Yes, sir; that is what we have done in the past. In 1934 Coughlin , as a member of a committee of the Boston Metal Trades Council, affiliated with the American Federation of Labor, presented a proposed bargaining agree- ment to Stebbins , then general manager of the Boston plant, in the presence of Andrews, then assistant manager, at the board room at the Atlantic works at Boston Coughlin testified that shortly thereafter Stebbins said to him • "It is the policy of the Bethlehem Company not to sign any agreement with any organization of any description . . . 81 Matter of The Griswold Manufacturing Company and Amalgamated Association of Iron, Steel and Tin Workers of North America , Lodge No . 1197, 6 N. L. R. B 298. 146 DECISIONS OF NATIONAL LABOR RELATIONS BOARD negotiated, the respondent's position was that it would not enter into a signed agreement even though understandings were reached, thereby indicating that even if there was accord between the parties the respondent would refuse to embody such understanding in a signed agreement. Since the respondent advanced no other reason for its conduct other than that set forth above, we concluded that the respondent's refusal to enter into a signed agreement with Local No. 25 in the event that an understanding was reached was motivated by a desire to check the progress of Local No. 25 by damaging its prestige as a bargaining agency in the plant. We have held under sub- stantially similar circumstances in language equally applicable here that such a refusal by the respondent is contrary to Section 8 (5) of the Act 82 Third, the respondent's tactics in repeatedly participating in discussions in which its agents carefully avoided any definite com- mitment on proposed terms and offered no suggestions of changes acceptable to them convinces us that the respondent only sought to give the appearance of obedience to the Act without ever entering into genuine collective bargaining, looking toward the consummation of a collective agreement.'8 Obviously, this conduct was designed to defeat 'the Act, which in words of Mr. Chief Justice Hughes, "contemplates the making of contracts with labor organizations. That is the manifest objective in providing for collective bargain- ing." 84 To summarize, the respondent deliberately engaged in a course of conduct designed to evade its duties under the collective bargaining provisions of the Act. It attempted to create a semblance of bargain- ing without ever having intended to bargain. It refused to recog- nize Local No. 25 as the exclusive bargaining agency of its employees and negotiated with the Plan despite the fact that the Local clearly represented a majority of the employees in the respondent's plant. It refused to enter into any agreement with the Local, thus emasculat- ing it as an effective bargaining agency. 82 Matter of Inland Steel Company and Steel Workers Organizing Committee and Amal- gamated Assooaation of Iron, Steel, and Tin Workers of North America. Lodoe No 64, 1010, and 1101, 9 N. L. R. B. 783 ; Matter of Western Felt Works and Textile Workers Organizing Committee, Western Felt Local, 10 N. L. R. B. 407. 83 "An assertion that collective bargaining constitutes no more than discussion designed to clarify employer policy and does not include negotiation looking toward the adoption of a binding agreement between an employer and employees is contrary to any realistic view of labor relations . The definition of these relations had progressed too far when the Act was adopted to permit the conclusion that the Congress intended to safeguard only the barren right of discussion " Matter of St. Joseph Stockyards Company and Amalgamated Meat Cutters and Butcher Workmen of North America, Local Union No. 159, 2 N. L. R. B. 39. 84 Consolidated Edison Co., of New York, Inc, and its affiliated Companies V. National Labor Relations Board, 305 U S. 197. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 147 In conclusion we find : 1. That throughout the negotiations from October 7, 1937, to Janu- ary 4, 1938, the respondent refused to recognize Local No. 25 as the exclusive bargaining agency of the respondent's employees in the appropriate unit; 2. That throughout the negotiations from October 7, 1937, to Jan- uary 4, 1938, the respondent, with the purpose and effect of denying Local. No. 25 the status and prestige of an equal contracting party, deliberately and steadfastly refused to enter into any signed agree- ment with Local No. 25, even if an accord were reached ; 3. That the respondent, throughout the negotiations from October 7, 1937, to January 4, 1938, refused to bargain collectively in good faith with Local No. 25. We find, therefore, that on October 7, October 27, November 12, December 8, 1937, and January 4, 1938, the respondent has refused to bargain collectively with Local No. 25 as a representative of its em- ployees at the Boston plant, of Bethlehem Shipbuilding Corporation, Ltd., in respect to wages, rates of pay, hours of employment, and other conditions of employment, and has thereby interfered with, restrained, and coerced its employees in the exercise of their rights to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purposes of collective bargaining and other mutual aid and protection as guaranteed in Section 7 of the Act. IV. THE REMEDY Having found that the respondent has engaged in unfair labor practices, we will order it to cease and desist therefrom and to take certain affirmative action designed to effectuate the policies of the Act and to restore as nearly as possible the condition which existed prior to the commencement of the unfair labor practices. We have found that the respondent has dominated and interfered with the formation and administration of the Plan of Employees' Representation at the Fore River plant and at the Boston plant, and has contributed financial and other support to them. Although the formation of the Plan occurred prior to the effective date of the Act and financial support did not continue after May 10, 1937, neverthe- less, it is manifest that the continued existence of the Plan would operate to prevent the exercise by employees of their free choice of bargaining representatives, which our order seeks to render possible. In this' connection, the' reasoning of the Court in National Labor Relations Board v. Pacific Greyhound Lines, Inc., is peculiarly ap- 148 DECISIONS OF NATIONAL LABOR RELATIONS BOARD plicable here. In that case, Mr. Justice Stone said ". . . a mere order to. cease the unfair labor practices `would not set free the employee's impulse to seek the organization which would most effec- tively represent him'; that continued recognition of the Drivers' Association would provide respondent `with a device by which its power may now be made effective unobtrusively, almost without fur- ther action on its part. Even though he would not have freely chosen `the Association' as an initial proposition, the employee, once having chosen, may by force of a timorous habit be held firm to his choice. The employees must be released from these compulsions'." 15 Accordingly, in order to effectuate the policies of the Act and free the employees of the respondent from such domination and interfer- ence, and the effects thereof, which constitute a continuing obstacle to the exercise by the employees of the rights guaranteed them by the Act, we will order the respondent to withdraw all recognition from the Plans as representatives of the respondent's employees for the purposes of dealing with the respondent concerning grievances, labor disputes, wages, rates of pay, hours of employment, and conditions of work, and to disestablish them as such representative. We will also order the respondent to bargain collectively with the Industrial Union of Marine and Shipbuilding Workers of America, Local No. 25, and if understandings are reached to embody such understandings in a signed agreement upon request. We will further order the respondent to post notices in its Boston plant, stating that the employees are free to become or remain mem- bers of Local No. 25 and that the respondent will not discriminate against any employee because of such membership. In conjunction with the Plan, the management has from time to time used other methods in conducting its personnel activities. For example, the Community Chest Fund, the Pension Plan, the Relief Plan, the clothing store and the gasoline station, have been tied in with Plan operations. Our order disestablishing the Plan as a collective bargaining representative is not intended to interfere with any such activities, provided that they are divorced from functioning in conjunction with any labor organization and are continued without discrimination against or in favor of any labor organization.3e V. THE QUESTION CONCERNING REPRESENTATION As heretofore stated, the Industrial Union of Marine and Ship- building Workers of America, Local No. 5, filed a petition and an 38 National Labor Relations Board v. Pacific Greyhound Lines, Inc., 303 U. S. 272. 31 Matter of Utah Copper Company , a corporation, and Kennecott Copper Corporation, a corpoi ation and International Union of Mine, Mill, and Smelter Workers, Local No. 39$, 7 N. L R. B. 928. BETHLEHEM SHIPBUILDING CORPORATION ET AL . 149 amended petition claiming 2,000 of the respondent's 3,000 employees at its Fore River plant in a unit composed of production and mainte- nance employees with the exception of office, clerical, supervisory and executive employees, draftsmen, watchmen, and janitors. Local No. 5 began organizational activities in the Fore River plant in the sum- mer of 1934 and elected permanent officers on July 21, 1934, and received its charter September 29, 1934. On or about September 6, 1934, Local No. 5 delivered to the Fore River employees stamped post cards, with a place for name and address, addressed to the Regional Office of the old National Labor Board, requesting an election. On or about September 10, 1934, the Plan at Fore River distributed similar cards opposing the election. The old Labor Board found 308 employees in favor of an election and 1,524 opposed. It stated : "Believing, therefore, that an election conducted by this Board would not in the present circumstances be in the public interest we deny the petition for an election." The Local ran 10 candidates at the March 1935 election under the Plan and succeeded in electing six. The Local sought to boycott the Plan and distributed in the plant circulars and leaflets at intervals up to, and including, the 1938 elec- tions. The Plan countered with a newspaper reprint antagonistic to the Local. In 1936, due to internal dissention in the Local, the national organization suspended the Local's autonomy. Autonomy was restored on February 19, 1938. Frederick C. Stevens, Management's Special Representative at the Fore River plant testified that late in 1937 Lucien Koch, organizer for the Industrial, asked "when the union was set up, would we recognize it and deal with it. I told Mr. Koch that I rather expected that question, and I could not answer it for two reasons : In the first place, it was a hypothetical question; and in the second place it was contrary to the Act because I would be telling him something that could be used for organization purposes, and he would not be complying with the law." At the hearing, the respondent challenged the contention of Local No. 5 both as to the appropriate unit and as to the Local's claim that it represented a majority of the respondent's employees. We find that a question has arisen concerning representation of the employees of the respondent at its Fore River plant. VI. THE EFFECT OF THE QUESTION CONCERNING REPRESENTATION UPON COMMERCE We find that the question concerning representation which has arisen, occurring in connection with the operations of the respondent described in Section I above, has it close, intimate, and substantial 164275-39-vol. xi-11 150 DECISIONS OF NATIONAL : LABOR RELATIONS ; BOARD relation to trade, traffic, transportation, and commerce among the sev- eral States and between the several States and foreign countries and tends to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. VII. THE APPROPRIATE UNIT Local No. 5 contends that the appropriate unit should consist of all production, maintenance and stockroom employees, excluding' of- fice, clerical and supervisory employees, executive, powerhouse and Fore River railroad employees, draftsmen, apprentice draftsmen, tool designers, the supervisor-inspector, timekeepers, watchmen and janitors. The respondent claims that the appropriate unit consists of all its production, maintenance and stockroom employees who do not have the' power of recommending the discharge of other em- ployees and who do not regularly hold a purely supervisory position. The unit claimed by Local No. 5 is substantially the same as tUft' held to be an appropriate unit in other decisions of the Board iii; volving the same national labor organization and companies en- gaged in business similar to that of the respondent .3 Testimony was offered as to the duties of each classification where dispute existed as to inclusion. The disputed classifications were chauffeurs, clerks, draftsmen and apprentice draftsmen, Fore River railroad employees, inspectors, janitors, learners, powerhouse em- Dloyees, radio operators, the stationary engineer, supervisors of apprentices, tool designers, and working leaders. With due regard to the fact that only one bona fide labor organization is claiming an appropriate unit, the disputed classifications are treated herewith : Chauffeurs.-The sole function of approximately four chauffeurs is to drive the respondent's executives, Naval officials, guests and others in company-owned automobiles. Their hours are irregular and they are salaried employees, whereas for the most part the other employees are paid by the hour. They are excluded by Local No. 5 and included by the respondent. Since their interests are in many respects not closely identified with the great body of produc- tion, maintenance and stockroom employees, the chauffeurs are to be excluded from the appropriate unit. Clerks.-The duties of a clerk vary in different departments. Local No. 5 excludes clerks whose sole or principal duties are those of "pencil pushers" and record keeping. This type of clerk performs little or no manual labor. Where a clerk is primarily a tool dis- penser and record keeping is merely incidental to such duty, he' is eligible for membership in Local No. 5. We have examined the 31 See footnote 27, supra. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 151 specific duties of the various types of clerks in the different depart- ments and find that the distinction drawn by the Local accords with our usual practice of including or excluding clerical employees. We have adopted this distinction in excluding those clerical em- ployees occupying the positions listed in Appendix A. Draftsmen.-There are draftsmen in several departments, all of whom are ineligible for membership in Local No. 5, but are eligible for membership in a labor organization at the plant, admitting draftsmen. The respondent contends that they should be included in the appropriate unit. The draftsmen are skilled employees, en- gaged in designing vessels and portions thereof. They work in one of the office buildings of the respondent, perform few or no manual duties and in general have no community of interest with the main- tenance and production employees of the respondent. As is our usual practice with respect to draftsmen, we shall exclude them from the appropriate unit."' Apprentice draftsmen.-The respondent operates an apprentice school consisting of a 4-year course dealing with various crafts and arts employed in the building of vessels. Upon completion of the course a diploma is awarded. Apprentices studying to be drafts- men work in various departments and crafts throughout the plant but spend approximately the last 2 or 21/2 years in the drafting department. Stevens, personnel manager, testified that the records of the respondent show which apprentices are destined ultimately to become draftsmen. Accordingly, we find that apprentice draftsmen should be accorded the same treatment as draftsmen and excluded from the appropriate unit. Fore River Railroad employees.-The respondent operates a rail- road connecting its Fore River plant with the New York, New Haven and Hartford Railroad. The railroad employees were mem- bers of the Plan but Local No. 5 contends that they should be ex- cluded from thq appropriate unit. Inasmuch as the interests and functions of the railroad employees are distinct from those of other employees of the respondent, we find that the employees of the Fore River Railroad should be excluded from the appropriate unit. Inspectors.-The inspector employed in the electric-welding de- partment is employed in a supervisory capacity and is excluded by both the Local and the respondent. The inspector in the machine department has no supervisory duties and is solely a skilled employee who determines whether or not certain work has been performed 8 Matter of United Shipyards, Inc. and Locals No. 18, No. 13, No. 15, of the Industrial Union of Marine and Shipbuilding Workers of America, 5 N. L. R. B. 742; Matter of Marlin-Rockwell Corporation and Local No. 338, United Automobile Workers of America, 5 N. L. R B. 206; Matter of Westinghouse Airbrake Company and United Electrical and Radio Workers of America, Railway Equipment Workers Local No. 610, 4 N. L. R. B. 403. 152 DECISIONS OF NATIONAL LABOR RELATIONS BOARD properly. He is included by both the union and the respondent. Since no labor organization objects and there appears to be no reason for his exclusion, we find that the inspector in the machine depart- ment should be included in the appropriate unit. Janitors.-There is some dispute in the record as to the duties of janitors. Local No. 5 differentiates between janitors and sweepers and excludes the former. The respondent does not exclude either, claiming that their duties are identical and that a distinction be- tween them is one in name only. There is evidence that the sweepers are employed at sweeping up steel shavings and other material re- sulting from fabrication and that the material is assorted and sold to third parties or reclaimed by the respondent. It is also alleged that sweepers sometimes assist other employees in the performance of their duties and, in some instances, are permitted to become regu- lar production employees. Janitors perform the ordinary duties of keeping their respective departments clean. We find that the duties of sweepers are closely identifiable with those of the production em- ployees and that, therefore, the sweepers should be included in the appropriate unit. In accordance with our usual practice, we shall exclude the janitors.3° Learners.-There are two classes of learners, those who have no technical schooling or education and those who have had a technical education and who are, in most instances, college, graduates. The latter are referred to by the employees as "loopers." The respondent does not distinguish between "loopers" and other classes of learners. The union contends that "loopers" are generally being prepared for supervisory positions and should not be included. We find that the distinction drawn by the Local is proper, and that those learners who are "loopers" are a select group, slated for supervisory posts, and should be excluded from the appropriate unit.40 Powerhouse employees. - The powerhouse workers are all em- ployed on a salary basis and upon shifts different from the shifts of most of the other employees. Although the respondent contends that they should be included in the appropriate unit, we, neverthe- less, find that they are properly excluded in that they lack a com- munity of interest with the other employees. Radio operators.-The respondent maintains a radio station, licensed by the Federal Communications Commission, for the pur- pose of communicating with ships at sea on trial and test runs. as Matter of Fedder8 Manufacturing Company and Lodge No. 1753, Amalgamated Asso- ciation of Iron, Steel and Tin Workers of North America, Through the Steel Workers Organ- izing Committee, 3 N. L. R B. 818. Matter of Armour & Company and United Packing House Workers Industrial Local Union No 389 Affiliated with C I. 0., 7 N. L R B. 710 40 Matter of Goodyear Tire and Rubber Company of California and United Rubber Work- era of America, Local No. 131, 3 N. L. R. B. 431. BETHLEHEM SHIPBUILDING CORPORATION ET AL . 153 When not actually communicating with ships at sea the two or three radio operators work on radio equipment to be installed on ships built by the respondent. When a ship is on a trial run these opera- tors are engaged in 24-hour duty. The respondent desires their in- clusion but Local No. 5 insists that they should be excluded from the appropriate unit. Because of the differences in their functions and in the technical skill involved in their work as compared to the work of the other employees of the respondent, we find that the radio operators should be excluded from the appropriate unit. Stationary engineer.-The stationary engineer is an engineer on the steam barge, "Margaret." There is a crane on the "Margaret" which is used for lifting materials from the docks to the ship. Although the stationary engineer spends most of his time on the barge, he works on the same shifts as other employees and receives an hourly wage. Local No. 5 contends that he should be excluded. Since his duties do not differ materially from those of an ordinary crane operator, we find that the stationary engineer should be in- cluded in the appropriate unit. Supervisor of apprentices.-The only supervisor of apprentices in dispute is located in the electrical department. He receives an hourly wage not in excess of that paid other employees doing elec- trical work and is a skilled electrician. He was given the position because of his executive ability. A part of his time is spent on elec- trical work and the remainder on supervising the work of appren- tices in the electrical department. He is responsible to both the fore- man of the electrical department and to the chief supervisor of apprentices. We find, as contended by the union, that the super- visor of apprentices in the electrical department should be excluded from the appropriate unit. Tool designers.-Tool designers are eligible for membership in the national organization but Local No. 5 desires to exclude them and has made no attempt to organize them. They are classified as drafts- men by the respondent. We find that the tool designers should be excluded from the appropriate unit. Working leaders.-The respondent contends that there is no fixed classification of working leaders comparable to the classification of foremen, assistant foremen, quartermen, and leading men. It de- fines a working leader as any worker who performs a particular job with the help of two or more other workmen. The respondent desires working leaders to be included in the appropriate unit. Local No. 5 excludes working leaders on the ground that although they cannot recommend hiring, they can recommend the discharge of employees. Working leaders are only in charge of a particular job until it is completed but may retain the status of working leaders 454 DECISIONS .OF NATIONAL, LABOR RELATIONS BOARD for several months at a time. Inasmuch as a working leader may, at the end of a particular job, resume his status as an ordinary employee, we will include working leaders in the appropriate unit.,,- On the basis of the foregoing findings, Appendix A has been prepared. We find that all production, maintenance and stock- room employees in the production departments of the respondent, including the inspector in the machine department, the stationary engineer, and the working leaders, but excluding foremen, assistant foremen, quartermen, leading men, executives, and the classifications listed in Appendix A, constitute a unit appropriate for the purposes of collective bargaining and that said unit will insure to employees of the respondent the full benefit of their right to self-organization and otherwise effectuate the policies of the Act. VIII. THE DETERMINATION OF REPRESENTATIVES Local No. 5, in its petition as amended, claimed to represent 2,000 of the respondent's production, maintenance, and stockroom em- ployees. The respondent's monthly pay-roll summaries show that, for February 1938, 4,604 workers were carried on the pay-roll force, 4,408 were carried on the working force, and 4,074 was an average force per day. For March 1938, 4,669 were carried on the pay-roll force, 4,478 on the working force and 4,146 was the average working force per day. Local No. 5 produced its membership cards but re- fused to offer them in evidence. Upon stipulation between counsel for the respondent, the intervenor and Local No. 5, the cards were counted by a reporter in the presence of all parties and 1,789 deter- mined to be the number. Local No. 5 has requested the holding of an election. By this method the question concerning representation can best be resolved. We shall provide for an election to be conducted upon our further order after we are satisfied that a free choice of representatives can be made.42 Since the election date is uncertain we shall not deter- mine at this time what pay-roll period will govern eligibility to participate in the election. IX. THE PETITION OF LOOAL NO. 25 In view of the findings in Section III above as to the appropriate unit and the designation of Local No. 25 by a majority of the re- spondent's employees in the appropriate bargaining unit as their representative for the purposes of collective bargaining, it is not 41 Matter of Alabama Drydock & Shipbuilding Co. and Industrial Union of Marine and Shipbuilding Workers of America, Local No. 18, 5 N. L. R B. 149. 42 Matter of Eagle Manufacturing Company and Steel Workers Organizing Committee, 6 N. L. R B 492, order enforced in National Labor Relations Board v. Eagle Manufac- turing Company, 99 F. (2d) 930. BETHLEHEM SHIPBUILDING CORPORATION ET AL. 155 necessary to consider the petition of Local No. 25 for certification of representatives. Consequently the petition will be dismissed. - Upon the basis of the foregoing findings of fact and upon the entire record in the case, the Board makes the following : CONCLUSIONS OF LAW 1. The Industrial Union of Marine and Shipbuilding Workers of America, Locals Nos. 5 and 25, the Plan of Employees' Representa- tion at the Fore River Plant of Bethlehem Shipbuilding Corpora- tion, Limited, and the Plan of Employees' Representation at the Boston Plant of Bethlehem Shipbuilding Corporation, Limited, are labor organizations within the meaning of Section 2 (5) of the Act. 2. The production, maintenance and stockroom employees, em- ployed by the Bethlehem Shipbuilding Corporation, Limited, at its Boston, Massachusetts plant, exclusive of office, clerical, supervisory and executive employees, draftsmen, watchmen, and janitors, consti- tute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9 (a) of the Act. 3. Industrial Union of Marine and Shipbuilding Workers of America, Local No. 25, was on September 20, 1937, and at all times thereafter has been, the exclusive representative of all employees in such unit for the purposes of collective bargaining within the mean- ing of Section 9 (a) of the Act. 4. By refusing to bargain collectively with the Industrial Union of Marine and Shipbuilding Workers of America, Local No. 25, as the exclusive representative of its employees in the appropriate unit, the respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (5) of the Act. 5. By dominating and interfering with the formation and ad- ministration of, by contributing financial and other support to the Plan of Employees' Representation at the Fore River Plant of Bethlehem Shipbuilding Corporation, Limited, and to the Plan of Employees' Representation at the Boston Plant of the Bethlehem Shipbuilding Corporation, Limited, the respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (2) of the Act. 6. By interfering with, restraining, and coercing its employees in the exercise of their rights guaranteed in Section 7 of the Act, the Bethlehem Shipbuilding Corporation, Limited, has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (1) of the Act. 7. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2 (6) and (7) of the Act. 156 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 8. A question affecting commerce has arisen concerning representa- tion of employees of the Bethlehem Shipbuilding Corporation, Lim- ited, at its Fore River plant, Quincy, Massachusetts, within the mean- ing of Section 9 (c) and Section 2 (6) and (7) of the Act. 9. The production, maintenance and stockroom employees in the production departments of the respondent at its Fore River plant at Quincy, Massachusetts, including the inspector in the machine de- partment, the stationary engineer, and the working leaders, but excluding supervisory and executive employees, foremen, assistant foremen, quartermen, leading men, and those listed in Appendix A, constitute a unit appropriate for the purposes of collective bargain- ing within the meaning of Section 9 (b) of the Act. ORDER Upon the basis of the above findings of fact and conclusions of law, and pursuant to Section 10 (c) of the National Labor Relations Act, the National Labor Relations Board hereby orders that the respondent, Bethlehem Shipbuilding Corporation, Limited, and its officers, agents, successors, and assigns shall: 1. Cease and desist from : (a) Dominating or interfering with the administration of the Plan of Employees' Representation at the Fore River Plant of Bethlehem Shipbuilding Corporation, Limited, or the Plan of Em- ployees' Representation at the Boston Plant of Bethlehem Ship- building Corporation, Limited, or the formation and administration of any other labor organization of its employees, and contributing financial or other support to the Plan of Employees' Representation at the Fore River Plant of Bethlehem Shipbuilding Corporation, Limited, or to the Plan of Employees' Representation at the Boston Plant of Bethlehem Shipbuilding Corporation, Limited, or to any other labor organization of its employees; (b) Recognizing the Plan of Employees' Representation at the Fore River Plant of Bethlehem Shipbuilding Corporation, Limited, or the Plan of Employees' Representation at the Boston Plant of Bethlehem Shipbuilding Corporation, Limited, as the representative of any of the employees for the purposes of dealing with the respondent con- cerning grievances, labor disputes, wages, rates of pay, hours of employment and other conditions of work; (c) Refusing to bargain collectively with the Industrial Union of Marine and Shipbuilding Workers of America, Local No. 25, as the exclusive representative of the production, maintenance and stock- room employees of the respondent at its Boston plant, excluding office, clerical and supervisory and executive employees, draftsmen, watchmen, and janitors; BETHLEHEM SHIPBUILDING CORPORATION ET AL. 157 (d) In any other manner interfering with, restraining or coercing its employees in the exercise of their rights to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purposes of collective bargaining or other mutual aid or protection as guaranteed in Section 7 of the National Labor Relations Act. 2. Take the following affirmative action which the Board finds will effectuate the policies of the Act : (a) Withdraw all recognition from the Plan of Employees' Repre- sentation at the Fore River Plant of Bethlehem Shipbuilding Corpo- ration, Limited, and from the Plan of Employees' Representation at the Boston Plant of Bethlehem Shipbuilding Corporation, Limited, as the representative of any of its employees for the purpose of deal- ing with the respondent concerning grievances, labor disputes, wages, rates of pay, hours of employment or conditions of work and com- pletely disestablish said Plans as such representatives; (b) Upon request bargain collectively with the Industrial Union of Marine and Shipbuilding Workers of America, Local No. 25, as the exclusive representative of all the production, maintenance and stockroom employees of the respondent at its Boston plant, Boston, Massachusetts, exclusive of office, clerical, supervisory and executive employees, draftsmen, watchmen, and janitors, in respect to rates of pay, wages, hours of employment and other conditions of employ- ment, and if an understanding is reached on any of such matters, embody such understanding in a signed agreement; (c) Post immediately in conspicuous places in each department of the respondent's Fore River and Boston plants notices stating: (1) that the respondent will cease and desist as aforesaid; (2) that the respondent withdraws and will refrain from all recognition of the Plan of Employees' Representation at the Fore River Plant of Beth- lehem Shipbuilding Corporation, Limited, and the Plan of Em- ployees' Representation at the Boston Plant of the Bethlehem Shipbuilding Corporation, Limited, as the representative of any of its employees; (3) that the respondent completely disestablishes said Plans as such representatives; (d) Maintain such notices for a period of at least sixty (60) con- secutive days from the date of posting ; (e) Notify the Regional Director for the First Region in writing within ten (10) days from the date of this Order what steps the respondent has taken to comply herewith. IT IS FURTHER ORDERED that the petition for investigation and certi- fication of representatives filed by the Industrial Union of Marine and Shipbuilding Workers of America in behalf of Local No. 25 be, and it hereby is, dismissed. 158 DECISIONS OF NATIONAL LABOR RELATIONS BOARD DIRECTION OF ELECTION By virtue of and pursuant to the power vested in the National Labor Relations Board by Section 9 (c) of the National Labor Relations Act, 49 Stat. 449, and pursuant to Article III, Section 8, of National Labor Relations Board Rules and Regulations-Series 1, as amended, it is hereby DIRECTED that, as part of the investigation directed by the Board to ascertain representatives for the purposes of collective bargaining with employees at the Fore River plant of the Bethlehem Shipbuild- ing Corporation, Limited, an election by secret ballot shall be con- ducted at such time as the Board shall hereafter direct under, the direction and supervision of the Regional Director for the First Region, acting in this matter as the agent for the National Labor Relations Board and subject to Article III, Section 9, of said Rules and Regulations , among the production, maintenance, and stockroom employees employed by the Bethlehem Shipbuilding Corporation, Limited, in the production departments at its Fore River plant within a period to be determined by the Board hereafter, excluding executive and supervisory employees, foremen, assistant foremen, quartermen, leading men, and those classifications listed in Appendix A, to determine whether or not they desire to be represented by the Industrial Union of Marine and Shipbuilding Workers of America, Local No. 5, for the purposes of collective bargaining. APPENDIX A Name of department Symbol Classification of employees excluded Blacksmith__________________ B Clerks; apprentice draftsmen; learner. Pipe and copper ------------- DB Clerk, but not tool dispenser, apprentice draftsmen. Electrical___________________ EA Supervisor of apprentices, radio operators; apprentice drafts- men, clerk. Electric welding_____________ EB Inspector; production clerks; learner. Carpenter and Joiner-------- H Clerk; apprentice draftsmen. Pattern --------------------- K Apprentice draftsmen. Sheet metal_________________ L Clerk, apprentice draftsmen. Machme-------------------- M Clerk, material clerk; office clerk; timekeeper; apprentice draftsmen, apprentice supervisor; draftsmen. Boiler----------------------- N Clerk; timekeeper; apprentice draftsmen. Paint------------------------ P Clerk, shop leader. Outside machinist___________ Q Chief clerk. Ship fitters__________________ SC Berthing clerk; clerk; apprentice draftsmen; learner. Erecting____________________ So Material clerk. Plate and shape yard-------- TA Clerk Mould loft__________________ TB Apprentice draftsmen; learner; clerk. Steel mill ___________________ TC Clerk, apprentice draftsmen. Hull drafting________________ UA All excluded. Engine drafting_____________ UB All excluded. Electrical drafting ---------__ UC All excluded Stores-- --------------------- w Storekeeper; assistant storekeeper; material man; clerk; ste- nographer typist Transportation______________ x , . Chauffeurs Yard labor__________________ Y Janitors; clerk. Powerhouse_________________ Z All excluded. Fore River R R____________ All excluded.