Iowa Packing Co.

In the Matter of IOWA PACKING COMPANY and UNITED PACKING HOUSE WORKERS LOCAL INDUSTRIAL UNION No. 144 Case No. C-583.-Decided March 8, 1939 Meat Packing Industry-Interference, Restraint, and Coercion-Company- Dominated Union: domination of and interference with formation and adminis- tration ; support, through transfer of canteen business on company property at nominal rental , including prior profits thereof ; suggestion that employees repre- sentation plan be continued ; supervisory activities sponsoring and forming; dis- established, as agency for collective bargaining. Mr. Stephan M. Reynolds, for the Board. Carr, Cox, Evans & Riley, by Mr. Don Evans, and Mr. W. F. Riley, of Des Moines, Iowa, for the respondent. Mr. Francis Hoague, of counsel to the Board. DECISION AND ORDER STATEMENT OF THE CASE 7 Upon charges and amended charges duly filed by United Packing House Workers Local Industrial Union No. 144,1 herein called the Union, the National Labor Relations Board, herein called the Board, by Leonard C. Bajork, Regional Director for the Thirteenth Region (Chicago, Illinois), issued a complaint, dated February 15, 1938, against The Iowa Packing Company,2 Des Moines, Iowa, herein called the respondent, alleging that the respondent had engaged in and was engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (1) and (2), and Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat. 449, herein called the Act. The complaint alleged, in substance, so far as here material, that the respondent, by and through its officers and agents, dominated and interfered with the formation and administration of a certain 1 The charge and first amended charge was filed by Packing House Workers ' National Federation ( Des Moines Local ) which was the predecessor to the above -named organiza- tion. The second and third amended charges were filed by the above-named organization. 2 Throughout these proceedings the name "Iowa Packing Company " was incorrectly used to designate the respondent. 11 N. L. R. B., No. 83. 986 IOWA PACKING COMPANY ET AL. 987 labor organization of its employees, known as the Association of Packing House Workers, hereinafter called the Association, that it permitted the Association and its officers to engage in various union activities both on the respondent's property and during working hours, and that it contributed financial and other support to the As- sociation in that it permitted the Association to operate and main- tain for profit a commissary in the plant. On February 15, 1938, a copy of the complaint, accompanied by a notice of hearing, was duly served on the respondent, the Associa- tion, and the Union. Pursuant to notice a hearing was held in Des Moines, Iowa, on February 25, 26, and 28, and on March 1 and 2, 1938, before Peter F. Ward, the Trial Examiner duly designated by the Board. The Board and the respondent were represented by counsel. Full op- portunity to be heard, to examine and cross-examine witnesses, and to introduce evidence was afforded both parties. At the commence- ment of the hearing the respondent filed an answer in which it de- nied all of the material allegations of the complaint. During the course of the hearing the Trial Examiner made numerous rulings on objections to the admission of evidence and on motions of the parties. The Board has reviewed these rulings of the Trial Exam- iner and finds that no prejudicial errors were committed. The rulings are hereby affirmed. At the close of the hearing the Trial Examiner afforded the parties opportunity for oral argument and to file briefs. Thereafter the Trial Examiner filed his Intermediate Report, a copy of which was duly served on all parties, finding that the re- spondent had engaged in unfair labor practices affecting commerce, within the meaning of Section 8 (1) and '(2) and Section 2 (6) and (7) of the Act, and recommending that the respondent cease and desist from its unfair labor practices, withdraw all recognition from the Association as representative of its employees for collective bar- gaining, and take certain other action to remedy the situation brought about by the unfair labor practices. On May 10, 1938, the re- spondent filed exceptions to the Intermediate Report and requested oral argument before the Board. On October 6, 1938, pursuant to notice and amended notice duly served upon the respondent and the Union, a hearing was had before the Board in Washington, D. C., for the purpose of oral argument. The respondent appeared by counsel and presented oral argument to the Board. The Board has considered the exceptions of the respondent and, in so far as they are inconsistent with the findings, conclusions, and order set forth below, finds no merit in them. 988 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Upon the entire record in the case, the Board makes the following: FINDINGS OF FACT I. THE BUSINESS OF THE RESPONDENT The Iowa Packing Company is an Iowa corporation engaged at Des Moines, Iowa, in the general business of purchasing, slaughter- ing and processing hogs, cattle, calves, sheep, and lambs. All its capital stock is owned by Swift & Company, a Nation-wide meat- packing and processing organization. Almost all of the meat pur- chased by the respondent is shipped to it from points within the State of Iowa. During the fiscal year ending October 31, 1937, the respondent shipped products of the value of $3,724,289 to points within the State of Iowa. During the same period it shipped prod- ucts of the value of $13,928,958 to points outside the State of Iowa. The respondent has approximately 470 production employees not in supervisory positions. II. THE LABOR ORGANIZATIONS INVOLVED United Packing House Workers Local Industrial Union No. 144 is a labor organization affiliated with the Committee for Industrial Organization, admitting to membership all production employees in the respondent's plant, excluding supervisory employees. Association of Packing House Workers is an unaffiliated labor organization, admitting to membership all production employees of the respondent's plant, excluding some supervisory employees. III. THE UNFAIR LABOR PRACTICES A. The Representation Plan About the middle of October 1935 the respondent at the suggestion of some of its employees instituted the "Swift & Company Employees Representation Plan." The Representation Plan had been originated by Swift & Company in 1921 and since then had been adopted in many of the plants of its subsidiaries. The governing body of the Repre- sentation Plan, known as the Plant Assembly, consisted of nine em- ployee representatives elected by secret ballot, one from each of the divisions of the plant, together with an equal number of representatives chosen by the management. Under the Representation Plan, an em- ployee might present a grievance to his employee representative, who would confer with the corresponding management representative. If the paired representatives could not dispose of the matter it was then referred to the Plant Assembly or to a committee thereof. A decision of the Plant Assembly was binding on the management only if passed by a two-thirds vote. Even then the respondent's board of directors IOWA PACItING COMPANY ET AL. 989 could reopen the matter within 14 days of the vote. Meetings of the Plant Assembly, elections, and other activities were carried on during working hours in the respondent's plant and with its permission. The respondent paid the employee representatives for the time they spent on the work of the Representation Plan. It furnished the necessary materials and paid all the expenses of the Plan. These practices con- tinued until April 20,1937, when the Representation Plan was officially dissolved. It is clear that for a year and a half the respondent domi- nated and interfered with the formation and administration of a labor organization, and contributed financial and other support thereto, in violation of Section 8 (2) of the Act.8 The participation of the man- agement in the administration of such an organization necessarily has the effect of interfering with, restraining, and coercing employees in the exercise of the rights guaranteed in Section 7 of the Act .4 B. Dissolution of the Plan and formation of the Association At a meeting of the Plant Assembly on April 20, 1937, H. J. Nelson, the respondent's president and manager, read to the assembled repre- sentatives the following statement, which was posted in the plant soon afterwards : STATEMENT TO EMPLOYES AND THEIR REPRESENTATIVES On Monday, April 12, the United States Supreme Court made public its decisions on several cases under the National Labor Re- lations Act (The Wagner bill) and held the Act valid. It is Swift & Company's intention to comply with the law as the court has now construed it and it is not possible to continue the present Representation Plan. Whether you wish to establish an employes' representation plan for collective bargaining, that will comply with terms of the law, is a matter for you to decide. If you wish to adopt a plan for negotiating with the company on wages, hours, and working con- ditions, it should not include management participation in elections of employe representatives, the furnishing of printed material by the company, nor company compensation to employe representatives for time spent away from their work, except when conferring with management, as this latter is not prohibited by law. It shall be the policy of the company to continue to consult with its employes on all matters of mutual interest in an honest effort to find the proper solution to problems. Finally, the company 8 The identical plan was involved in Matter of Swift d Company and United Automobile Workers of America, Local 265, 7 N. L. R. B. 287. 4 See Matter of International Harvester Company and Local Union No. 57, International Union, United Automobile Workers of America, 2 N. L. R. B 310. 990 DECISIONS OF NATIONAL LABOR RELATIONS BOARD earnestly desires that the understanding growing out of our re- lationships during these past many years will be the basis upon which the continued good relations between employes and the company will be maintained. THE IOWA PACKING COMPANY, H. J. NELSON, Manager.5 In answer to an inquiry from one of the employee representatives "as to whether the company would be willing to continue negotiations should they form an organization," Nelson stated that if it was within the scope of the law, the respondent would be glad to. There- upon all the employer representatives withdrew from the meeting, leaving the employee representatives remaining in the room. The employee representatives decided to organize an "inside" or un- affiliated organization to take the place of the Representation Plan. At this meeting the main points of the "Rules and By-Laws" of the Association were drafted. A rough outline of the Association was then posted on the respondent's bulletin board with an announce- ment that on April 26 there would be a balloting on the question : "Shall the Plan of Representation as posted on the bulletin board be adopted?" At this time the organization was named "Employees' Representation Committee." Arrangements were made with the re- spondent to use the respondent's voting booths for the election. On April 26 the balloting was held during working hours on the re- spondent's property. A member of the committee appointed to handle the election went to the different departments during the day and arranged for the particular employees to be released, one or two at a time, in order to vote. A system was worked out with the fore- men for relieving each employee as he came to vote, so that there would be no interruption in the work of his department. A copy of the pay roll, obtained from the respondent's time office, was used as a tally of the eligibility of voters. Of 488 employees at the plant on that day 335 voted in the affirmative and 117 in the negative. In the same manner elections were held on April 29 and May 4 to nominate and elect representatives to the Executive Committee. Although the employees were paid on an hourly basis no evidence was introduced to show that there had been deductions from the wages of those participating in the election, for the time spent away from their work. I In two previous Board decisions concerning employees of two plants of Swift & Com- pany identical statements were read on this same day to the Plant Assembly of each of the two plants : Matter of Swift & Company, a corporation and Amalgamated Meat Cut- ters and Butcher Workmen of North America, Local No. 641, and United Packing House Workers Local Industrial Union No. 300, 7 N. L. R. B. 269; and Matter of Swift & Com- pany and United Automobile Workers of America, Local No. 265, 7 N. L. R. B. 287. IOWA PACKING COMPANY ET AL. 991 At some time after the first balloting, the Association drafted the, Rules and By-Laws into a more complete form and had them printed in booklets. The Rules and By-Laws set up an Executive Committee composed of representatives, each elected by one of the divisions in the plant, to deal with the respondent on behalf of the employees. Just as under the Representation Plan there had been nine employee representatives, there now were nine representatives on the Executive Committee. No provision was made for membership meetings. Among other things the Rules and By-Laws provided : (c) The employes and their representative on the payroll shall receive their regular pay from the employer for such time as is necessary to adjust grievances. It is obvious that this provision, which imposes duties on the re- spondent, has no place in the constitution of a labor organization organized independently of the employer. On June 1, 1937, the Association sent a letter to the management, stating the results of the balloting for the Association, and request- ing "exclusive bargaining rights for the hourly paid employees of this plant." On June 3, 1937, the respondent replied-that it would recognize the Association "as the sole bargaining agency for all em- ployes of The Iowa Packing Company as long as the Association of Packing House Workers has the majority of employees in its mem- bership." Thereafter until the date of the hearing the Association representatives dealt with the respondent regarding grievances of the employees. The Association took no steps to negotiate a collec- tive contract with the respondent dealing with wages, hours, and working conditions. Three of the moving spirits in the formation of the Association, Griffiths, Quinn, and Sample, were gang leaders at the respondent's plant. All three had been employee representatives under the Plan and all three were elected to the Executive Committee of the Associa- tion. At the hearing there was considerable testimony as to the status of a gang leader. The respondent's superintendent testified that "a gang leader is someone who takes a group of men and sees that the work is followed out in the sequence of the operation, as in- structed by either the foreman or the division superintendent." When the foreman is absent a gang leader takes his place and sees that the work is carried out according to the plan left with him by the foreman or given him by the division superintendent. From the specific examples given of the duties of a gang leader it is apparent that he has authority to give directions and orders to the men in his gang. The fact that these orders are specific and not general, and that the gang leaders have no authority to hire and discharge, does 992 DECISIONS OF NATIONAL LABOR RELATIONS BOARD not eliminate the fact that in giving orders they act on behalf of the management and are, therefore, in a supervisory capacity. The activities of these three gang leaders in sponsoring and developing the Association are attributable to the respondent. C. Financial support Max D. Griffiths, the Association chairman, testified that he spends approximately 40 per cent of his working time handling grievances of the employees. The employee or his representative either comes to him or sends for him. Griffiths discusses the grievance with the em- ployee and -then takes it up with the foreman. Griffiths testified as follows : Q. Well, do you talk to the men about grievances? A. Yes; I talk to the men about grievances all day long. I go around all day long talking to them about grievances, working conditions, and so on. Q. Don't you talk with them on the job while you are working, Mr. Griffiths? A. Yes; I have. I have run over and talked with the foreman on the job, then gone over and talked to the man, then go back and talk to the foreman, then go back and talk to the man, doing it in that way many times. Many times the foreman might be busy at one thing and the man working twenty feet from there busy doing something else. For this work the respondent paid Griffiths his usual hourly wage. Another Association representative, Don Mahon, testified that he spends 5 to 6 hours a week on grievances, for which time he is paid by the respondent. Article III of the Association's Rules and By-Laws provides : No dues for the maintenance of this Association will be charged its members ... The affairs of the Association shall be financed from the profit of such activity that may be undertaken by the Committee. The expenses of the Association have been defrayed by the profits of a canteen located in the Recreation Room, which the respondent main- tains for its employees. The canteen--is a booth measuring 9 by 15 feet, at which are sold candies, milk, -ice cream, gloves, clocks and other articles. The canteen was started in December 1936 under the supervision of the Plant Assembly for the purpose of raising money for social and athletic activities of the employees. M. M. Wolf, superintendent of the division of standards, was the secretary and general manager of the canteen. The net profit from the canteen IOWA PACKING COMPANY ET AL. 993 runs from $50 to over $100 per month. After the creation of the Association, some of the employees asked the respondent's manage- ment if the Association could take over the canteen. After consul- tation, the respondent replied they could take it over but that they would have to pay rent for it figured on "a floor space basis." There- upon the Association took over the management of the canteen and also took over the sum of over $400 which had accumulated from the prior profits of the canteen. The rent charged by the respondent was $4.75 per month, a figure reached by taking a proportion of the expenses of maintenance of the building, commensurate with the floor space occupied by the canteen. In reaching this rental figure, the respondent did not take into consideration the size or the value of the canteen's business. Wolf, because of his supervisory status, resigned as secretary of the canteen. However he continued to assist the Association first by teaching the new management how to run the canteen and thereafter by helping in selling goods at various times during the morning and lunch hours. It is significant that when one employee was laid off during the summer of 1937 the respondent's cashier sent him to see Wolf in regard to settling his bill with the canteen. Griffiths was permitted by the respondent to spend some of his working time in canteen work. It was maintained, however, that his pay stopped for time so spent and that he was reimbursed from canteen funds for wages thus lost. Although the canteen did pay him for time so spent from November 29, 1937, on, no such payments were made prior to that date. William Pratt, the division superin- tendent, was aware of this activity on Griffiths' part, and "never paid a great deal of attention to it." We find that prior to the week of November 29, 1937, Griffiths spent a part of his working hours on the work of the canteen and was knowingly paid by the respondent for time so spent. After 4: 30 p. m. the girl in charge of the canteen customarily closes the canteen and leaves for the day. Thereafter Harvey Masi- more, the night superintendent of the plant, opens up the canteen at times and sells canteen merchandise to employees. There is no evidence that his pay was in any way decreased by time so spent. The Association keeps its records in the respondent's office, and uses the respondent's office equipment, mimeographing machine, and typewriters. For the use of the equipment a nominal charge is made. It is evident that the Association was materially benefited by this arrangement, if one considers what they would have been compelled to do, had they been forced to obtain these facilities from outside the plant and at standard rates. 994 DECISIONS OF NATIONAL LABOR RELATIONS BOARD D. Conclusions The foregoing facts show the Association to be an openly company- inspired and supported labor organization. In two earlier cases 8 we have held that the same statement as that read and posted on April 20, 1937, constituted an invitation to form an "inside" union. As in those two instances, here the employee representatives responded to the invitation in the expected manner. The form of the body set up was as close a copy of the Representation Plan as could be made without coming into open conflict with the Act. After its formation, the Association functioned in the same manner as the former com- pany-inspired Representation Plan. The fact that the Association was considered as merely a continuation of the Representation Plan with technical changes is shown by the provisions of the Rules and By-Laws which impose obligations on the respondent, obligations which the respondent had discharged under the Representation Plan. The framers of the Rules and By-Laws did not presume to impose these obligations in vain. The respondent not only paid the Asso- ciation representatives for time spent in conferring with it, but also for time spent in investigating grievances. As to support of the Association through the canteen, the respond- ent cannot have seriously felt that it did not confer a benefit on the Association by turning over the canteen to it, despite the rent charge. The canteen had proved to be a valuable business. A nominal rent charge does not derogate from the essentially gratuitous nature of the canteen privilege. Furthermore the respondent turned over more than $400 that had been earned by the canteen under the respondent's management. A high supervisory official devoted time and energy in assisting the canteen. The fact that some of this time was not during working hours does not make it any the less of an aid to the Associa- tion. Wolf was a part of the management in his free time as well as in working hours. His support was support from the respondent. The canteen activity of Masimore and Griffiths during working hours contributed to the profit of the canteen. The respondent's contribution of time, property, and cooperation to the Association's elections constituted further financial aid and support. We find that the respondent has dominated and interfered with the formation and administration of the Association, and has con- tributed financial and other support to it; that by its aforesaid acts, 6Matter of Swift & Company, a corporation and Amalgamated Meat Cutters and Butcher Workmen of North America, Local No. 641, and United Packing House Workers Local Indus- trial Union No. 800, 7 N. L. R. B. 269; and Matter of Swift 6 Company and United Auto- mobile Workers of America, Local No. 265, 7 N L. R. B 287 IOWA PACKING COMPANY ET AL. 995 the respondent has interfered with, restrained, and coerced its em- ployees in the exercise of their right to self-organization, and to form, join, and assist labor organizations. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE We find that the activities of the respondent set forth in Section III above, occurring in connection with the operations of the respondent described in Section I above, have a close, intimate, and substantial relation to trade, traffic, and commerce among the several States, and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY We have found that the respondent has dominated and interfered with the formation and administration of the Association and has contributed support to it. The Association, being the product of the respondent's domination and support, does not offer to the respond- ent's employees the free representation for collective bargaining which is guaranteed by the Act. We shall, therefore, order the re- spondent to withdraw all recognition of the Association as repre- sentative of the respondent's employees for the purposes of collective bargaining, and to disestablish it as such representative. Upon the basis of the above findings of fact and upon the entire record in the case, the Board makes the following : CONCLUSIONS OF LAW 1. United Packing House Workers Local Industrial Union No. 144, and Association of Packing House Workers are labor organizations, within the meaning of Section 2 (5) of the Act. 2. The respondent, by interfering with, restraining, and coercing its employees in the exercise of rights guaranteed in Section 7 of the Act, has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (1) of the Act. 3. The respondent, by dominating and interfering with the forma- tion and administration of Association of Packing House Workers and by contributing financial and other support to said organization, has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (2) of the Act. 4. The aforesaid unfair labor practices are unfair labor practices within the meaning of Section 2 (6) and (7) of the Act. 996 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ORDER Upon the basis of the above findings of facts 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 re- spondent, The Iowa Packing Company, and its officers , agents, suc- cessors, and assigns shall : 1. Cease and desist : (a) From in any manner dominating or interfering with the ad- ministration of Association of Packing House Workers, or the forma- tion or administration of any other labor organization of its employ- ees, or from contributing financial or other support to Association of Packing House Workers or to any other labor organization of its employees ; (b) From in any other manner interfering with, restraining, or coercing its employees in the exercise of the right 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 by Section 7 of the Act. 2. Take the following affirmative action which the Board finds will effectuate the policies of the Act : (a) Withdraw all recognition from Association of Packing House Workers, as the representative of its employees for the purpose of dealing with the respondent concerning grievances , labor disputes, wages, rates of pay, hours of employment or other conditions of em- ployment, and completely disestablish said Association of Packing House Workers as such representative; (b) Post immediately and keep posted for a period of at least sixty (60) consecutive days from the date of posting, notices to its employees in conspicuous places throughout its plant, stating that the respondent will cease and desist in the manner set forth in 1 (a) and (b), and that it will take the affirmative action set forth in 2 (a) of this Order; (c) Notify the Regional Director for the Thirteenth Region, in writing, within ten (10) days from the date of this Order what steps the respondent has taken to comply herewith.