Calco Chemical Company, Inc. and American Cyanamid Company

In the Matter of CALCO CHEMICAL COMPANY, INC., AND AMERICAN CYANAMID COMPANY and CHEMICAL WORKERs LOCAL No. 20923, A. F. of L. Case No. C-468.-Decided April 17,1939 Chemical and Dye Manufacturing Industries-Interference, Restraint, and Coercion: usuar order not issued in view of compliance with Intermediate Report- Company-Dominated Union: initiated by the employer as successor to outlawed representation plan and as first step in introduction of a program of employee organization and industrial relations , known as the "Hamilton Plan" ; accorded various forms of favored treatment and support in effort to foster its growth and eliminate A. F. of L. union as rival ; application of "Hamilton Plan" found illegal under Act ; discontinuance of domination, interference , and support and of use of "Hamilton Plan" or any similar program ordered ; usual remedial order not issued in view of compliance with Intermediate Report-Discrimination: no findings or order, in view of compliance with Intermediate Report and of fact that intervenor did not object to Trial Examiner's recommendations in this regard ; charges of, not dismissed-Complaint: dismissed without prejudice against one of the respondents. Mr. Lester M. Levin, for the Board. Mr. George R. Martin and Col. W. S. Weeks, of New York City, for the respondents. Mr. Louis Josephson, of Trenton, N. J., for the Chemical Workers. Mr. Edward W. Hainilton, and Mr. J. Eugene McMahon, of Buffalo, N. Y., for The Calcocraft. Miss Ida Klaus, of counsel to the Board. DECISION AND ORDER STATEMENT OF THE CASE Upon charges duly filed by Chemical Workers Local No. 20923, A. F. of L.,1 herein called the Chemical Workers, the National Labor Relations Board, herein called the Board, by the Regional Director for the Second Region (New York City), issued its complaint, dated September 2, 1937, against American Cyanamid Company and The Calco Chemical Company, Inc.,2 both of Bound Brook, New Jersey, 1 Referred to in the charge as Chemical Workers Local Union No. 20923 of Bound Brook, New Jersey. 2 The complaint was amended at the hearing to correct the names of both respondents and the names as corrected are herein given. 12 N. L. R. B., No. 39. 109134-39-voL 12-19 275 276 DECISIONS OF NATIONAL LABOR RELATIONS BOARD herein called the respondents, alleging that the respondents had en- gaged in and were engaging in unfair labor practices affecting com- merce within the meaning of Section 8 (1), (2), and (3) and Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat. 449, herein called the Act. The complaint and the accompanying notice of hear- ing were duly served upon each of the respondents, the Chemical Workers, and The Calcocraft, a labor organization alleged in the com- plaint to be dominated by the respondents. The complaint was there- after amended at the hearing upon motion of counsel for the Board, duly made and granted. The complaint, as amended, charged, in substance, (1) that the respondent, The Calco Chemical Company, Inc., herein called Calco, had initiated, formed, and sponsored a labor organization known as The Calcocraft and that each of the respondents had dominated it, interfered with its administration, and contributed support to it; and (2) that each of the respondents had, through threats, discharges, and other acts of coercion and discrimination, dis- couraged membership in the Chemical Workers. On September 14 each of the respondents filed a separate answer admitting that it was engaged in interstate and foreign commerce and denying that it had committed the unfair labor practices alleged in the complaint as amended. By order of the Board, issued September 3, 1937, pursuant to Arti- cle III, Section 10 (c) (2), and Article II, Section 37 (b), of National Labor Relations Board Rules and Regulations-Series 1, as amended, this case was consolidated, for purposes of hearing, with a proceeding for an investigation and certification of representatives under Sec- tion 9 (c) of the Act. 'Separate disposition will be made of each of these cases.3 The Decision and Order herein are concerned only with the charges alleged in the complaint as amended. Pursuant to notice, a hearing on the complaint and on the petition for investigation and certification of representatives was held on September 8 through September 30, 1937, before Charles E. Persons, the Trial Examiner duly designated by the Board. The Board, the respondents, the Chemical Workers, and The Calcocraft, whose motion for interven- tion in the proceeding on the complaint was granted by the Trial Examiner were represented by counsel and participated in the hear- ing. Full opportunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing on the issues was afforded all parties. During the course of the hearing on the complaint, various rulings were made by the Trial Examiner on motions and on objections to the admission of evidence. The Board has reviewed these rulings and 3 By order of the Board dated April 22, 1938, the instant case was severed from the proceeding for an investigation of representatives. CALCO CHEMICAL COMPANY, INC. 277 finds that no prejudicial errors were committed. The rulings are hereby affirmed. Upon the conclusion of the hearing, the parties were permitted to file briefs, as provided in Article II, Section 29, of National Labor Re- lations Board Rules and Regulations-Series 1, as amended. There- after the Chemical Workers and The Calcocraft filed briefs with the Board. On February 18, 1938, the Trial Examiner filed his Intermediate Report, finding that each of the respondents had engaged in unfair labor practices affecting commerce within the meaning of Section 8 (1), (2), and (3) and Section 2 (6) and (7) of the Act, and recom- mending that they cease and desist therefrom and take certain specified affirmative action. The Trial Examiner found that George A. Shea and Harry Ennis had not been discriminated against for union activity and recommended that the complaint be dismissed as to each of these individuals. Thereafter each of the respondents and The Calcocraft filed exceptions to the Intermediate Report. On April 28, 1938, in pursuance of an agreement of settlement en- tered into on March 28, 1938, on behalf of the Board, each of the respondents, and the Chemical Workers, the Board issued a Decision and Order in the case. Thereafter, on August 18, 1938, the Board set aside said Decision and Order upon due notice to all parties and proceeded toward a disposition of the case without regard to the agreement of settlement. Accordingly, due notice having been given to all parties, oral argument was held before the Board on November 17, 1938, on the exceptions to the Intermediate Report. The Calco- craft, although represented by counsel at the oral argument, did not argue on its exceptions to the Intermediate Report but contended that the Board was without jurisdiction in the proceeding.4 During the course of oral argument the respondents moved, with respect to four persons found by the Trial Examiner to have been discrimina- torily discharged, that the complaint be dismissed as to them or, in the alternative, that the Board order no affirmative relief as to them. The motion was based on the contention that supervening circum- stances had rendered moot the issue as to each of these persons. The motion is hereby granted as to its second alternative for reasons hereinafter stated. The respondent American Cyanamid Company excepted specifically to findings of the Trial Examiner that it had committed unfair labor & The contention was based upon the fact that The Calcocraft had, on November 10, 1938, obtained in the U. S Circuit Court of Appeals a 30-day stay of that Court's mandate of November 5, 1938, dismissing The Calcocraft's petition for review of the Board's order of April 28, 1938. On February 27, 1939, the Supreme Court of the United States denied The Calcocraft's petition for a writ of certiorari to review the Circuit Court's order of November 5, 1938. (Edward P. Harris v. National Labor Relations Board, No. 620.) On March 27, 1939, the Supreme Court of the United States denied The Calcocraft's petition for a rehearing in the matter. , 278 DECISIONS OF NATIONAL LABOR RELATIONS BOARD practices, and argued before the Board that the record did not justify the finding that it was responsible for whatever acts may have been committed by The Calco Chemical Company, Inc., its wholly owned subsidiary. In view of the absence of a showing that an order of the Board in this proceeding would be ineffective unless made to run against both respondents, we deem it unnecessary at this time to de- termine the issue as raised by American Cyanamid Company. We shall accordingly dismiss the complaint as to it without prejudice. The Board has considered the remaining exceptions to the Inter- mediate Report and, in so far as they are inconsistent with the find- ings, conclusions, and order set forth below, finds no merit in them. Upon the entire record in the case, the Board makes the following : FINDINGS OF FACT I. THE BUSINESS OF THE RESPONDENTS American Cyanamid Company is a Maine corporation, with its principal place of business and sales offices in New York City. Through its own operations and through seven controlled companies, six of which are wholly owned subsidiaries, this company is engaged in the manufacture and the sale, throughout a large part of the United States and in foreign countries, of chemicals, dyestuffs, and pharmaceutical and surgical products. This company owns and directly operates a plant at Bound Brook, New Jersey, where it employs somewhat over 200 people and is engaged chiefly in the manufacture of laminating syrups, of a chemical known as "beetle cream" for use in tracing textiles, and of powder for sale to molders of "beetleware" products. The name "beetle" is registered as a trade-mark for use in interstate commerce. In excess of 90 per cent of these products are sold to purchasers in various areas outside the State of New Jersey. The average monthly value of all sales is over $85,000. This company is the second largest manufacturer in the United States of products of the beetleware type. Approximately 60 per cent of the principal raw materials, including formaldehyde, urea, and pulp, and 80 per cent of the supplies used in the manufacturing operations at the' Bound Brook plant are derived from sources outside the State and amount in value to about $28,000 monthly. The Calco Chemical Company, Inc., a wholly owned subsidiary of American Cyanamid Company, maintains plants at Newark and Bound Brook, New Jersey. At Bound Brook this company employs about 2,500 people and is engaged in the manufacture of dyestuffs and intermediates. The latter type of product is sold for manufacture into dyestuffs and other materials. The Calco Chemical Company, Inc., is one of the largest dyestuff manufacturers in the United States. CALCO CHEMICAL COMPANY, INC. 279 This company maintains sales offices in New York City, Providence, Boston, Chicago, and Charlotte, North Carolina, and sells and delivers its Bound Brook products to the paper trades throughout the eastern half of the United States, to textile manufacturers in New England and the South, and to producers of printing ink in New York and New Jersey. Sales are also made on the Pacific Coast and in foreign coun- tries. Sales outside the State of New Jersey represent 89 per cent of its total Bound Brook production and, during the first half of 1937, amounted to about $4,450,000. During the first half of 1937 its expenditures for raw materials, including heavy chemicals and coal-tar products, exceeded $2,000,000, of which about 65 per cent represented purchases shipped directly to the Bound Brook plant from points outside the State of New Jersey and east of the Mississippi River and north of the Ohio River. Some of the products of this company appear under trade-marks, registered for use in interstate commerce, including the word "Calco" placed inside a diamond. Each of the companies admits that, in the course of its operations, it has caused a substantial amount of raw materials and manu- factured products to be transported in interstate and foreign commerce. II. THE ORGANIZATIONS INVOLVED Chemical Workers Local No. 20923, A. F. of L., chartered by the American Federation of Labor as a federal labor union, is a labor organization. It admits to membership all employees of both re- spondents who are paid on an hourly basis, excepting clerical workers and those having the power to hire or discharge or enforce company discipline. The Calcocraft is an unaffiliated organization. It admits to mem- bership all employees of The Calco Chemical Company, Inc., except- ing certain classes of supervisory and other types of employees. III. THE UNFAIR LABOR PRACTICES A. Domination and support of The Calcocraft 1. The Hamilton Plan It is necessary at the outset, for reasons hereinafter apparent, to consider the legality of a program of employee organization and industrial relations, entitled "The Hamilton Plan for the Settlement of Labor Disputes," herein called the Hamilton Plan. Edward W. Hamilton, attorney and labor organizer, is the author of the Hamil- ton Plan and the chief officer of the Hamilton Labor Bureau con- cerned with the introduction of the Hamilton Plan among industries 280 DECISIONS OF NATIONAL LABOR RELATIONS BOARD throughout the country. Two labor organizations which were estab- lished in Buffalo, New York, through the Hamilton Labor Bureau and pursuant to the Hamilton Plan are The Aircraft and The Cablecraft. The Hamilton Plan is to be found in two documents, the one en- titled "The Hamilton Plan for the Settlement of Labor Disputes," and the other called "Form of Contract Completing the Hamilton Plan for the Settlement of Labor Disputes." The first document purports to set forth the general principles by which employee or- - ganization and collective action are to be governed. The general principles are grouped under two headings, the first reading, "The Means and the Methods Workers Must Use to Acquire Independence and the Right to Make Valid Contracts With Their Employer" and the second, "The Means Now Available to the Workers Through the NLRA, After They Have Organized Themselves in Any Plant or Industry as Stated in Part I, of Meeting Their Employer as an Equal Before the Law and of Settling All Disputes With Him ..." The first set of principles requires (1) the organization of at least a majority of all workers within a plant or industry "exclusive of the Management," into an "independent, vertical, labor union" upon the sole initiative of the workers, at their own expense, pursuant to the advice of their own "legal counsel," and without any contact with their employer until organized, (2) the adoption of a constitu- tion stating the object of the union as therein specified and providing for the election of officers and representatives, the holding of meet- ings, and the prompt settlement of complaints, (3) the incorporation in the constitution or bylaws of "principles and pledge which the members of every union organized under the plant must agree to," (4) the obtaining of "evidence of the Union's independence and right to contract" in the form of a "Certificate of Representation" from the National Labor Relations Board authorizing the Union to act as the sole agent of the employees with regard to hours, wages, and con- ditions of employment. Among the provisions to be embodied in the constitution or bylaws is "the right to organize, free from inter- ference, restraint or coercion from any source." The pledge to be taken by the members and to be incorporated in the constitution or bylaws binds the pledgers "neither to demand nor to accept `financial or other support' from the employer by way of favor, gratuity, or `contribution'; but to demand, and to insist upon obtaining in addi- tion to their wages, a just and reasonable consideration for all services performed by the Union for the employer pursuant to the terms of a contract made by the Union with him as the result of collective bargaining, a breach of which by either party will render that party liable for all damages caused by the breach." CALCO CHEMICAL COMPANY, INC. 281 The second set of principles deals with the execution of a "bilateral, express contract between the Union and the Employer, based on a mutual understanding of their common problems * * * and supported by a just, reasonable and adequate consideration from each party to the other." Aside from the statement that the con- stitution and bylaws of the Union will be incorporated in the con- tract and that both parties will bind themselves to put into actual practice the "principles and pledge of the Union," there is no specific enumeration of provisions to be contained in the contract., The "Form of Contract Completing the Hamilton Plan for the Settlement of Labor Disputes" is the other basic document comprising the Hamilton Plan. Blank only as to the date of its execution, the names of the parties, the date of incorporation and principal place of business of the employer, and a few other minor items, it is a fully prepared draft of a contract to be entered into between the Union and the employer. Its function is to put into operation the principles expressed in the general statement of objectives contained in the first document, thereby completing the program of organiza- tion and of employer-employee relations advocated under the Hamil- ton Plan. After providing for mutual agreement between the par- ties as to certain stated functions of labor and management and for a general pledge by each party of cooperation in the execution of those functions, the Union represents that it was organized for the purpose, "among others," of exposing and advocating the correction of the "inequalities and injustices" of the Act both with respect to employees and employers. Then follow the substantive provisions, whereby the Union promises to seek to achieve its stated purpose through the publication of a plant paper and through concerted action with other independent labor organizations, "especially those which have adopted `The Hamilton Plan' for the settlement of labor disputes." It agrees also to avail itself of the rights assured to it by the Act as a means "to secure peace and harmony not only between the Men and the Management of the Corporation but also between employees and their employers generally," and not as a means to harass the corporation by the display of economic force. The Union further undertakes to perform certain enumerated activities, in the capacity of independent contractor, for the mutual benefit of the corporation and its employees, which activities, the parties recognize, can be carried on more economically, efficiently, and satisfactorily by the onion than by the management. Included among these activities are the publication of a newspaper or magazine, the care of ill or distressed employees, the extension of legal aid to needy employees, the sponsorship of cooperative marketing functions and of credit unions for the benefit of employees, and "such other activities as may be covered by supplemental agreement." In furtherance of its per- 282 DECISIONS OF NATIONAL LABOR RELATIONS BOARD formance of these activities and of its purposes and objectives, the Union agrees to collect from its members and to expend no less than a stated weekly minimum. The corporation, in turn, "as a just and reasonable consideration and compensation to the Union for the services promised and performed or to be performed by the Union," binds itself to permit the Union to enjoy the freedom accorded to it by the Act, to furnish the Union with office space and equipment, and to pay the Union monthly a sum of money, to be specified, "which the Union represents to be the lowest possible cost to it" of the per- formance of the services required of it under the contract. The corporation also agrees to pay the Union "such consideration and compensation for the performance of all services rendered by it to the Corporation at its request, whether they be specifically enumer- ated herein or not." The constitution of the Union is incorporated by reference in the contract and is expressly made a part thereof with the proviso that no amendment to the constitution shall affect the contract unless the corporation consents thereto in writing. The remaining substantive sections deal with questions of wages, hours, and conditions of employment. They provide for appoint- ment by the corporation of two union members "to offer suggestions from the Men, to ascertain the financial and operation conditions of the Corporation, receive reports on its profits and losses, and keep the Union advised of all facts governing the hours, wages, and condi- tions of work of the Men." There is a further exchange of promises consisting of the Union's undertaking to keep on file a list of em- ployees eligible for promotion and the company's assumption of the obligation to consult the list and "give careful consideration to the qualifications of all employees named in it when making promo- tions." With respect to wages, both parties agree to establish basic rates of pay with differentials to be determined by several factors, including that of "loyalty to the Corporation and the Union" and to set up a reclassification of all labor at the plant. A principle of seniority is to be formulated in a written statement of rules. Vaca- tions are to be granted to certain classes of employees. The last sub- stantive provision empowers either party, upon written notice to the other that it finds a closed shop to be necessary "for its protection," to condition employment by the corporation upon membership in the Union. The contract is made expressly subject to the Act, and the performance of obligations thereunder is excused, if rendered unlawful or impossible by reason of the Act. The Hamilton Plan is patently vulnerable under the Act. The heart of the plan, and its fundamental provision, is the contribution of financial aid by the company to the Union for the performance of services at the behest of the company. All other provisions are incidental and subsidiary but are, nevertheless, inseparable from the CALCO CHEMICAL COMPANY, INC. 283 basic undertaking of the company. Accession to the basic terms of the contract would spell complete loss of independence to any organ- ization. Indebted at all times to the company for its financial and other contributions, such organization would be devoting its efforts almost solely to the advancement of the company's interests for the price of such dubious rewards as the employer wished to bestow upon it. The Hamilton Plan is a brazen device for perpetuating the evils of employer domination and inequality of bargaining power between employers and their employees which the Act was designed to cure. Its appeal is only to those employers who are seeking, through the guise of a collective contract, to evade their duties under the Act and to nullify the rights guaranteed to their employees. We find that application of the Hamilton Plan, whether through an organization established with the aid of the employer or through one initiated independently, would be in direct contravention of Section 7 of the Act and would constitute an unfair labor practice within the meaning of Section 8 (2) of the Act. As we hereinafter find, the respondent Calco sought to introduce the Hamilton Plan among its employees by sponsoring the formation of The Calcocraft as a labor organization at its plant. 2. Outline of events leading up to formation of The Calcocraft In 1934 the respondent Calco sponsored the formation among its employees of a Works Council, a delegate body composed of repre- sentatives elected from the various divisions of its plant. The dele- gates met monthly in the office of Calco's works manager and on the company's time to discuss problems relating to working conditions and employee welfare. Calco's works manager and its employment manager attended the meetings and participated in the discussion of the delegates. Minutes of the meetings were prepared by the em- ployment manager. Notices of meetings were signed by the works manager. The Works Council functioned continuously in this man ner until June 1937. It was, during this period, the sole organiza- tion of Calco's employees. At a regular meeting of the Works Council held on June 2, 1937, its illegality under the Act was admitted and recorded for the first time, and need for altering its structure was recognized. The minutes of that meeting, prepared by Calco's employment manager, read as follows in this connection : "The Supreme Court having passed fav- orably on the constitutionality of the Wagner Act, it becomes neces- sary to change the Works Council set-up to conform to this law. The following men were constituted a committee to draw up a plan which will conform with the law, by which employees can then deal with the management on matters of mutual interest * * *. This 284 DECISIONS OF NATIONAL LABOR RELATIONS BOARD committee will obtain legal advice to guide them in setting up a plan which will conform with the law and meet the needs of the em- ployees." There is disagreement between the two witnesses who testi- fied concerning the action taken at this meeting as to the source from which the suggestion first emanated that the Works Council be changed to conform with the law. The chairman of that body, a delegate from the storage department, testified that he was the fa- ther of the idea but admitted that the minutes created the impression that the suggestion had come from the management. The testimony of a delegate from another department is that Dempsey, Calco's works manager, informed the councillors of their inability to continue to function as they had; declared that a change of organization and operation would have to be effected; and explained that the kind of change and the machinery for producing it would be a matter for the councillors to decide. Dempsey did not testify on this point. We believe, and accordingly find, that the decision of the councillors to alter the set-up of the Works Council to comply with the law was prompted by Dempsey's suggestion in that regard. No announce- ment was made at this meeting, and the delegates testified that they were not left with the impression, that the Works Council would be disbanded or its activities held in abeyance pending completion by the committee of the task assigned to it. Nor was any time limit imposed upon the committee for the execution of its function. In fact, the committee submitted no proposals to the Works Council or its delegates. In May 1937 the carpenters in the new construction unit of Calco prepared and signed a "round robin" petition for presentation to the Works Council. The petition requested a wage increase and addi- tional pay for overtime work. It concluded with the warning that, in the event the requests therein made were not acted upon favorably, Uwe will be compelled to organize." Upon failure of the councillors to consider the petition at their meeting of June 2, it was presented to Dempsey, who stated that he would receive a delegation of car- penters and give his reply. Accordingly when such delegation ap- peared before him on June 3, Dempsey announced that he could not meet their demands but that he would welcome the opportunity to sign an agreement with "some good vertical union," which term he clarified at the time to mean an organization other than the American Federation of Labor or the Committee for Industrial Organization. Later that day the carpenters called upon the American Federation of Labor, herein called the A. F. of L., for aid and direction in or- ganizing a local at Calco. First signs of A. F. of L. organization appeared thereafter at Calco on June 8, when pledge cards were openly and widely distributed among its employees. CALCO CHEMICAL COMPANY, INC. 285 On the morning of June 10, when the A. F. of L. organization campaign had been under way only 2 days, one Duncan Lamond ex- tended an invitation to seven Calco employees to a meeting to be held that evening for the alleged purpose of establishing an independent union to replace the Works Council. Lamond had been a delegate to the Works Council but was not a member of the committee appointed on June 2. His brother, father, and wife were also employed at Calco at the time here in question, his brother serving in the capacity of foreman. The meeting was held at Lamond's home. One of the men who attended the meeting subsequently reported that fact to Dempsey. Of the eight employees who attended six were then or had formerly been Works Council delegates. One of them had served as its presi- dent for 3 years, while another had resigned from the Works Council upon his promotion to a supervisory job. None of the six was a mem- ber of the committee appointed on June 2 to study the problem of re- vamping the Works Council. Of the two non-delegates one was George Shea, the leader of the movement to establish a Calco local of the A. F. of L. Shea testified that he had accepted Lamond's in- vitation in the hope that he might convince the others of the wisdom of joining the A. F. of L. After a preliminary and rather vague discussion of the nature and purpose of the projected enterprise and the manner of its execution, the men proceeded to name the organiza- tion the "Independent Workers Union of Calco," herein called the Independent Union, and to select officers. At this point Shea left, explaining that he would not be a party to the designation of officers when the number of positions to be filled was no greater than the number of persons present and that he was opposed to soliciting mem- bers to support a group of officers chosen in that manner. The testimony is indefinite and rather conflicting as to what busi- ness was transacted after Shea's departure. Various subjects, includ- ing the immediate printing and distribution of pledge cards and the hiring of a lawyer, appear to have been considered. The hour at which the meeting was concluded is also not clearly established by the record. Shortly after midnight Lamond sent, at his own expense, a telegram to Edward Hamilton at his home in Buffalo, New York, which, as received, read as follows : CALICO EMPLOYEES ORGANIZING DEPENDANT UNION NEED ASSISTANCE ON LEGAL ADVISE CAN YOU COME PROMPTLY TO BOUNDBROOK PLEASE WIRE TERMS AND WHEN YOU CAN COME NECESSARY TO HAVE QUICK ACTION. Lamond testified that he transmitted the message over the tele- phone and that the words "Calico" and "dependant" were incorrectly recorded, having been originally "Calco" and "independent," respec- tively. 286 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Early the following morning Walter Evans, a foreman who had attended the meeting the previous evening, left an order with a printer in Somerville, New Jersey, who usually filled the company's orders, for the printing on that day of 3,000 pledge cards. The cards were ready that afternoon when Evans called for them. They read as follows : I, the undersigned, wish to be represented by a vertical union of Calco employees on all matters pertaining to wages, hours, working conditions and other matters of mutual interest with The Calco Chemical Co., Inc., Bound Brook, N. J., and I desire those elected members of the present and past Works Councils, who favor such action, to organize such a union free of all in- fluence from the Management or other unions and I will join it when organized. Lamond received the following "day letter," dated June 11, from Edward Hamilton : LEAVING BUFFALO TONIGHT TEN THIRTY EASTERN STANDARD TIME ON LEHIGH TRAIN WHICH WILL LET ME OFF AT BOUNDBROOK TOMOR- ROW MORNING SEVEN TWENTY THREE EASTERN STANDARD TIME SHALL BE GLAD TO MEET YOU. Hamilton arrived in Bound Brook on June 12 accompanied by one Catozzi. After having been told by Lamond that 90 pledge cards had been distributed, Catozzi suggested that immediate arrangements be made with Calco for a collective bargaining conference. Hamilton deferred action on the suggestion until a preliminary meeting of the men could be held. A meeting of seven employees was thereupon scheduled for that afternoon at Lamond's home. Hamilton had brought with him from Buffalo an original and 200 multigraphed copies of a fully prepared but unexecuted document entitled "Cer- tificate of Association of The Calcocraft," a pamphlet entitled "An Analysis of The Hamilton Plan for The Settlement of Labor Dis- putes," and copies of the constitution and bylaws and collective agree- ment of a Buffalo labor organization known as The Aircraft. The certificate of association recited in its first paragraph that its signers, "for the purpose of forming an independent vertical labor union of the employees of the Calco Chemical Company at Boundbrook, New Jersey," certified and stated the provisions thereinafter set out. The paragraphs which followed recited the name of the Union, its object, the territory of its operations, the seat of its principal office, the amount of the initiation fee, and the authority of its officers. At the meeting that afternoon, Hamilton outlined his general plan of organization; stated that an independent union could bargain more successfully with the management than could an outside organiza- CALCO CHEMICAL COMPANY, INC. 287 tion; discarded the Independent Union pledge cards; announced that he had chosen "The Calcocraft" as the name of the organization to be formed at Calco; asked those present to execute the certificate of association by affixing their signatures; and directed the election of officers. Thereupon there emerged at Calco a labor organization known as The Calcocraft. According to Lamond's testimony, the birth of The Calcocraft marked the end of the Independent Union. Sometime during the early part of July the Works Council held its last meeting. No business was transacted and the delegates were informed by Dempsey that the Works Council would cease to meet. Roy M. Taylor, Calco's vice president, testified that he was responsi- ble for the decision to discontinue the Works Council. There is no conflict in the evidence as to the foregoing outline of events which preceded the formation of The Calcocraft and the dissolution of the Works Council. a. Testimony of Calco employees and Hamilton as to the foregoing events Aside from the testimony of Roy M. Taylor denying categorically that Calco had dominated, interfered with the administration of, or contributed support to, The Calcocraft, the respondents presented no evidence on the initiation of the Independent Union or The Calco- craft. All testimony on this question was offered through the Board and The Calcocraft, as intervenor, with the Chemical Workers and the respondents participating in the cross-examination of witnesses. Lamond testified that he was the prime mover in the campaign to form an independent union; that he had consulted with no one until June 10, the day on which the idea had occurred to him; that the inspiration for the idea came to him from a news item he had seen in a New York newspaper in May or June 1937, which reported, "The Works Council would no longer be in effect"; and that on June 10 he first revealed his plan to Henderson and Meigs, former Works Council delegates, both of whom he had met together casually in the plant. The reason for singling out these two men as the first before whom to uncover his plan was that he had known them "real well" and that they "happened to be the first ones" he had met after his private decision to do something about replacing the Works Council. After relating to them the news about the dissolution of the Works Council, he offered the suggestion that the men in the plant needed "protection of some kind to fight their battles," and added, "what we need is an independent union around here." When Henderson and Meigs expressed agreement with his suggestion, Lamond asked them to come to his house that evening. He also asked them to invite any 288 DECISIONS OF NATIONAL LABOR RELATIONS BOARD men "they thought would be all right" but limited the attendance to 10. This, according to Lamond's testimony, was the genesis of the movement to establish an independent union at Calco. He explained that the term independent union, as he conceived it, connoted an in- dependence of all other unions and restriction of membership to Calco employees. Although Lamond admitted on further examination that no steps had been taken by June 10 to dissolve the Works Council and that he had made no inquiry among the delegates with regard thereto, he stated that "in his mind" he was satisfied the men would have no more Works Council representation after that time. Neither Meigs nor Henderson contradicted Lamond's testimony as to his con- versation with them at the time he first made known his plans. Lamond also testified with regard to the pledge cards which the Independent Union had ordered printed. He stated that the decision to have pledge cards printed was made at the meeting of June 10, although-he could not remember who had made the suggestion. The reason for the extreme haste in preparing and printing the cards, he explained, was that the founders of the Independent Union were anxious to start their activities before Shea "got too much of a jump" on them in his organizational work on behalf of the A. F. of L., which had launched its membership drive a few days earlier. He had paid the costs of printing out of his own pocket and was sub- sequently reimbursed by The Calcocraft. In reply to questions con- cerning the wording of the pledge card, Lamond stated that all who attended the meeting had had "something to do with it" and that he had delegated Evans, one of those present, to prepare the final draft. He could not, however, remember any discussion at the meet- ing of the term "vertical union" but said, in reply to a question as to how those words had appeared on the card, that the term had probably been discussed. With regard to the reference to the Works Council contained in the pledge cards, Lamond testified that those who had attended the meeting decided to enlist as many delegates as possible to participate in the Independent Union for the reason that they were men with whom the employees had worked in the past and upon whom they could depend in the future to "fight with the management." Henderson testified that Evans had composed the card after the meeting, while he and Evans were together drink- ing beer at a tavern ; that he thought Evans had modeled the first part of his composition on the A. F. of L. card; and that no mention had been made by anyone at the meeting, or subsequently by Evans at the time he drafted the card, of the words "vertical union." Evans had little to add to Henderson's testimony except that he had deemed it wise to phrase the card in such manner as to obtain the consent of the people in the plant before forming an organization and that the card as printed was the last of a dozen attempts at wording. CALCO CHEMICAL COMPANY, INC. 289 He offered no explanation for his choice of the words "vertical union" or for his employment of the technique of having the signer author- ize "members of the present and past Works Councils" to organize "such a union." Although somewhat vague and at times conflicting, the testimony of those who attended the meeting as to how the name of Edward Hamilton was first brought up may be summarized as follows : The question of the need for legal advice and the possible choice of a lawyer for the projected organization was raised and explored to some extent during the course of the general discussion. The names of several New Jersey lawyers were mentioned and each was turned down as being "to close" to the company. Shea named several law- yers whom he recommended as trustworthy but they too were re- jected. Sometime after Shea's departure, Henderson whispered to Lamond that he had read in a newspaper, in which some materials at the Calco plant had been wrapped, of a man called Hamilton who had organized the employees of the Curtis Aircraft Company of Buffalo and who was then engaged in forming a union at the General Cable Company of Buffalo. Evans, who was seated beside Henderson, overheard the words "General Cable Company" and leaned over and joined in the conversation by volunteering the infor- mation that he knew a man who had worked for that company. When Lamond asked Henderson Hamilton's address, Henderson an- swered that he knew no more than that Hamilton lived in a city called Buffalo, which might be in New York State or in some other State. Lamond testified that, as the meeting broke up, he told the men he would get in touch with a lawyer and that he believed he had mentioned Hamilton's name to them, although he could not state so positively. Henderson's testimony is that he could not remember whether they had really decided at the meeting that they needed the advice of a lawyer and that no decision had in fact been made at that time to engage Hamilton. It was Evans' recollection when he testified that Lamond had stated at the close of the evening that he, Lamond, would communicate with Hamilton either by telegraph or telephone as soon as Evans obtained his address. There is no evi- dence of a formal decision of the meeting to inquire about legal advice or to communicate with any lawyer. Evans and Henderson testified that they procured Hamilton's address at about 11 o'clock that night under the following circum- stances : Both men left the meeting together and went to a beer parlor in the vicinity called Foley's Tavern. Here Evans drafted the pledge card. Then he recalled that the name of the man who had worked for the General Cable Company was Felch and that he was at that time employed as an engineer at the Calco plant. Remembering that 290 DECISIONS OF NATIONAL LABOR RELATIONS BOARD he would not be at work the following day, Evans thought it better to get Hamilton's address that night instead of waiting until the next day. Thereupon he went to a telephone at Foley's Tavern, called Felch at his home in Plainfield, New Jersey, and, after intro- ducing himself, asked whether Felch could give him some informa- tion concerning "a Mr. Hamilton in the Cable Company," whose address he was desirous of obtaining. Felch replied that he would look in one of his files, where he thought he might find Hamilton's address, and suggested that Evans call him again. Five or 10 min- utes later Evans called again and obtained Hamilton's home address. Both men left the tavern; drove back to Lamond's house; and gave him Hamilton's address. Felch stated at the hearing that he was a supervisor of several shops at Calco; that Evans was a foreman in one of the shops; that he had met Evans in the course of his duties as supervisor; and that his work as supervisor brought him in touch with Calco's execu- tives, including its vice president and its works manager. He cor- roborated Evans' testimony concerning the telephone call and added that Evans had prefaced his request for Hamilton's address with the statement that some of the Calco employees were meeting to discuss the formation of a union. Felch testified further that he had learned of Hamilton's organizing efforts and had obtained literature on Hamilton's labor relations activities in the course of a number of business visits he had made on behalf of Calco to the General Cable Company plant at Perth Amboy, New Jersey. It was on one of the pieces of literature thus obtained that he had found Hamilton's home address for Evans. He could recall neither the date of the visit during which he had acquired the literature nor the name or position of the person who had presented it to him. On the morn- ing following his telephone conversation with Evans, he testified, he had turned over the literature on Hamilton's work to one of Calco's officers whose identity he could not recall. All literature pertaining to Hamilton's plan of organizing and to his labor rela- tions work was available at the hearing and shown to Felch but he could identify none of it as being an exact copy of what he had received at Perth Amboy. None of these documents bore Hamilton's home address. On the last day of the hearing, Lester Levin, counsel for the Board, was sworn in as a witness and made a direct statement with regard to the prior testimony of Evans, Henderson, and Felch on how Hamilton's address had been obtained. Levin opened his state- ment by pointing out that Evans and Henderson had both testified that the former had called Felch at Plainfield, New Jersey, from Foley's Tavern in Bound Brook on the night of June 10 and that Felch had corroborated the date and approximate hour of the call. CALCO CHEMICAL COMPANY, INC. 291 Levin then explained that he had ascertained from one Bittig, a member of the legal division ' of the Bell Telephone Company of New Jersey, that the company kept a record of all toll calls, which meant calls for which the initial charge was more than 5 cents. He was also informed by the telephone company that calls from Bound Brook to Plainfield were toll calls. After having ascertained that there had been only one telephone at Foley's Tavern on June 10, Levin requested Bittig to furnish him with a record of all toll calls made on June 10 from the telephone listed for Foley's Tavern. Levin received the following telegraphic reply from Bittig addressed to him as "Attorney, National Labor Relations Board" : AM ADVISED THERE ARE NO TOLL TICKETS SHOWING ANY CALLS IN AMOUNT OF TEN CENTS OR OVER FROM BOUNDBROOK 189 TO ANY POINT ON JUNE TENTH 1937. Neither counsel for the respondents nor Hamilton, counsel for The Calcocraft, cross-examined Levin with regard to his direct state- ment on this point. As the hearing entered its last week, Hamilton took the stand as a witness for The Calcocraft, after having evinced considerable re- luctance to testify. He stated that he was an attorney, having been admitted to practice before the courts of the States of New York and Iowa. He also served in the capacity of attorney and labor organizer for the Hamilton Labor Bureau, a New York organization which he had founded for the principal purpose of establishing labor unions and advising employees with regard to organizational problems. Hamilton made the following direct statement on the history of his association with The Calcocraft : On the morning of June 11 he received a telegram, hereinbefore set out in full, from one D. Lamond. After having been provoked to considerable laughter by the words "Calico" and "dependant," which appeared in the telegram, he pro- ceeded to give serious consideration to its contents by instructing one of his associates to study the New Jersey law and by directing his stenographer to draw up a certificate of association, similar to that which he had used for The Cablocraft. When the certificates had been multigraphed, he made arrangements to leave for Bound Brook and sent Lamond, in care of Calco, the "day letter" hereinbefore set out in full. Sometime during the day Catozzi, president of The Air- craft, called Hamilton on the telephone and asked whether he could accompany Hamilton on the trip to Bound Brook. Hamilton con- sented and they left for Bound Brook on the night of June 11. Upon arriving at Bound Brook the following morning,- he and Catozzi spent some time looking for Lamond's house and for possible 169134-39-vol 12-20 292 DECISIONS OF NATIONAL LABOR RELATIONS BOARD meeting halls. In the course of their explorations, they were offered a ride to the Calco plant by two young men. seated in a passing truck. They accepted the offer and discovered that their hosts were Calco summer student workers. When they reached the Calco plant, Hamilton introduced himself to the guard at the gate as a labor organizer from Buffalo and asked to see Lamond. The guard re- fused to let them go through the gate without the permission of Dempsey, Calco's works manager. At that moment Dempsey ap- proached the gate at which Hamilton had been standing. Dempsey too had been standing outside, talking to a man in a parked limousine, whose occupant, Hamilton later learned, was Jeffcott, Calco's presi- dent. Hamilton introduced himself to Dempsey as a labor organizer from Buffalo who wished to see Duncan Lamond. Dempsey asked Hamilton to wait while he sent for Lamond. Presently Lamond ap- peared and identified himself to Hamilton and Catozzi. In the short conversation which followed arrangements were made for a meeting that afternoon at Lamond's home. Dempsey took no part in the conversation of Hamilton, Catozzi, and Lamond. On cross-examination by the Board, Hamilton stated emphatically that it had been his policy as chief officer of the Hamilton Labor Bureau to defer action on any request for aid or advice in organizing a labor union until he was fully satisfied that the request had not been instigated by the employer and that the organization bore no taint of company domination. Asked to explain how he had pur- sued that policy in the case of Lamond's request, Hamilton supple- mented his earlier testimony to the following extent : Until his receipt of Lamond's telegram, Calco represented, in his mind, "nothing but a name" seen from time to time on railroad advertising media in the course of visits he had made to friends and relatives who lived in the vicinity of the Calco plant. Although the message had stated that a "dependant" union was being organized, he regarded that designation as "a most ridiculous typographical error" and deter- mined that, in any event, he would not make his services available if the organization was in fact "suspicious." He thereupon launched his investigation into the bona fides of the organization by instruct- ing his stenographer to ascertain and report to him the names of Calco's officers, its financial condition, and the number of its em- ployees. Although she had been given no directions as to source materials, his stenographer produced, as a result of whatever research she may have conducted, the correct name of the company and of its president and "just the briefest kind of memorandum" as .to its financial condition and the number of its employees. While he was unable at the hearing to recall the exact contents of that memoran- dum, he did remember that the document served to confirm his idea CALCO CHEMICAL COMPANY, INC. 293 that Calco, because of its size, represented the kind of company for which his plan of organization was suitable. He believed that his decision to go down to Bound Brook was directly motivated by the nature of the information contained in that memorandum. The na- ture of the preliminary inquiry he had made in connection with Lamond's request, he admitted, constituted a departure from his usual form of preliminary investigation, which, he explained, was necessitated by the demand for immediate action contained in the telegram. Although he had gone down to Bound Brook hoping that he would be retained as counsel and fully prepared for immediate action in that capacity, he was by no means satisfied that his prospec- tive client was an independent organization. He therefore conducted a further personal investigation "right on the ground" by inter- rogating the men who attended the meeting of June 12, including particularly Duncan Lamond, who was subjected to a private inquisi- tion after the close of the meeting. The separate questioning of Lamond was motivated by Hamilton's feeling that "it all had not come out" and by a lingering desire to know "if the company had anything to do with it." It took the form of a request that Lamond tell Ham- ilton "how this thing happened to be done, and how they happened to get me." In reply, Lamond merely smiled and said, "I will tell you later, maybe." There is no showing in the record that Lamond did in fact carry out his indefinite promise. Further cross-examination of Hamilton was directed at eliciting an explanation for various elements in his conduct which seemed inconsistent with his general protestations that he had had no assur- ance when he went down to Bound Brook that he would be employed as an attorney or organizer, or which appeared to have exceeded the scope of the request contained in Lamond's telegram, or which were in obvious disregard of some aspects of that request. Thus he was questioned concerning the preparation of a certificate of association upon the mere request for information as to his services, concerning his failure to comply with Lamond's telegraphic request that he wire the cost of his legal services, and concerning his sending of a "day letter" when an immediate reply was desired by Lamond. In the course of his efforts to explain these points, he made statements wholly unresponsive to the questions asked and at variance with his earlier testimony and demonstrated a marked vagueness of memory with respect to certain aspects of his otherwise vivid story. b. Evidence obtained through the release of Hamilton's file During the course of his testimony, Hamilton had been referring quite frequently, for the alleged purpose of refreshing his recollection, to documents contained in an envelope, which Hamilton referred to 294 DECISIONS OF NATIONAL LABOR RELATIONS BOARD as his file. No objections had been made to this practice by counsel for the Board or the Chemical Workers until, toward the close of the hearing, it had become so marked as to arouse suspicion as to the contents of the envelope. Counsel for the Board claimed the right to examine the documents, and, after considerable argument by Ham- ilton and his counsel, the Trial Examiner ruled that the file should be released for examination by counsel for the Board. Hamilton's counsel objected to the ruling; was overruled by the Trial Examiner; and Hamilton handed the documents to counsel for the Board., Its contents afforded the clue to evidence, theretofore suppressed by Ham- ilton, which demolished in large measure the story of the initiation of The Calcocraft as related by Hamilton and other important wit- nesses . Among the documents contained in this file was a copy of a letter on The Calcocraft which Hamilton had sent to his brother, Christie P. Hamilton. The latter was thereupon produced by the Board as a witness. He testified that he was a resident of Plainfield, New Jersey, a town situated near Bound Brook, and that he had been personally acquainted with Jeffcott, Calco's president, for about 37 years. He had spent the Decoration Day week end of 1937 with Jeffcott as a guest on the latter's yacht. Taylor, Calco's vice presi- dent, was also present and shared a cabin with Christie Hamilton. At some point during the week end the conversation of the three men turned to the labor problems of Calco, and Christie Hamilton alluded to his brother's plan of organization. At the end of the trip, Christie Hamilton handed Taylor a copy of an address by Edward Hamilton in which the Hamilton Plan was analyzed. Christie Hamilton's talk about his brother's plan appears to have led to no action by Calco until June 9, the second day of the A. F. of L. organization campaign. On the evening of that day, Christie Hamil- ton testified, Taylor called upon him at his home; announced that the company was interested in Edward Hamilton's work; and asked whether Edward Hamilton would address a mass meeting of the Calco workers. At Taylor's request and in his presence, Christie Hamilton telephoned his brother Edward; informed him that Calco was inter- ested in his plan of organization; and repeated Taylor's request about addressing a mass meeting. Edward told his brother that he would be glad to comply with a request of that nature if it came directly from the employees. Thereupon Christie related to Taylor the substance of the telephone conversation and gave him his brother 5 The contention of counsel for the Board was that he had a right to examine the file because the witness Hamilton had referred to its contents in the course of his testimony ; had allegedly used it to refresh his recollection ; and had indicated that the documents contained therein constituted a complete record of his connection with The Calcocraft . Hamilton and his counsel objected on two grounds : (1) that "it is going into the records regarding which the government has no right to pry" ; and (2) that "it is illegal and unlawful seizure of personal records in which the government or the National Labor Relations Board has no right." CALCO CHEMICAL COMPANY, INC. 295 Edward's home address and a copy of the Hamilton Plan. The follow- ing morning Christie Hamilton wrote a letter to his brother Edward supplementing the telephone conversation of the previous evening. A copy of this letter was found in Hamilton's file. The letter explained the corporate relationship between Calco and American Cyanamid Company and recited the name of Calco's president. It stated that Christie Hamilton had given Jeffcott, Calco's president, a copy of an article by Edward and that Jeffcott had read it and telephoned Christie that he was "very much interested" in its contents. After stating further that Christie had explained to Jeffcott that his brother did not assist employees in their collective bargaining with the manage- ment until after the men had organized independently without dic- tation from the management, Christie wrote as follows : Mr. Jeffcott fully understands your position and is hopeful that some of his employees may learn of your plan, be interested in it and ask for your assistance. So, that situation is the cause for my telephoning you last night. You may get a request from the workmen of the Calco Chemical Co., asking if you will come to Bound Brook to explain your plan to a meeting called by the men, which meeting would be held outside the company's prop- erty at some suitable place in Bound Brook, which is but a few miles from Plainfield. I gave Mr. Jeffcott the analysis of your plan so that he could see the principles under which you are working, and it is to be returned to me. Mr. Jeffcott and his organization are worthy of your assistance, the only question being the proper mode of approach. Possibly if you arrange to address a meeting, you could have one of your enthusiastic Aircraft members accompany you to explain the plan from the workman's viewpoint. Christie Hamilton testified with respect to this letter that the ref- erence to Jeffcott rather than Taylor was probably an error, although he admitted that the letter might be a more accurate record of what had occurred than his subsequent recollection at the hearing. With regard to his reference to the possibility of Edward's receipt of a request from the Calco employees, Christie Hamilton testified that, although he could not definitely recall any statement by Jeffcott or Taylor on which he may have based that prediction, he nevertheless supposed that he had made that assumption from Taylor's conver- sation or from his general attitude. Jeffcott did not appear as a witness. Taylor, who testified earlier than Christie Hamilton, made no reference to his dealings with Christie Hamilton and merely stated categorically that Calco had not dominated, or interfered with the 296 DECISIONS OF NATIONAL LABOR RELATIONS BOARD administration of, or contributed support to, The Calcocraft. He was not recalled by either of the respondents or The Calcocraft. On the morning of June 11 Edward Hamilton sent his brother the following telegraphic reply to the letter of June 10: THANKS FOR LETTER ALL I NEED IN BEGINNING IS CHANCE TO MEET SMALL GROUP COMPOSED OF LEADERS WITH THESE WON THE REST IS EASY IF WORKERS AS WHOLE ARE REASONABLY INTELLIGENT ADVISE AGAINST GENERAL MEETING BEFORE STAGE IS COMPLETELY SET MAY HAVE TO ACCEPT YOUR OFFER LATER. A copy of the telegram was found in Hamilton's file. This tele- gram was sent after Edward Hamilton's receipt of Lamond's tele- gram and before the "day letter" reply to Lamond. Christie Hamilton testified that he did not know how Lamond had learned his brother's home address and stated that his knowledge of the events which followed his letter of June 10 was limited to the actual materialization of his prediction that the workers themselves would communicate with Edward Hamilton. Also contained in Hamilton's file was an anonymous undated mem- orandum containing the following statements : Calco is somewhat unusual in several ways. 1st-a young company (started in 1915), owned since 1929 by American Cyanamid Company but still headed and run by its founder. 2nd-a new industry for this country-organic chemicals and dyes-and in competition with such large and wealthy companies as Du Pont, Allied Chemical and the German I. G., and with its line of products not yet complete enough to parallel them. 3rd-It has made profits but has plowed them all back into plant. Cyanamid bought the business with its stock-also put cash into plant and hasn't even gotten back its cash yet-let alone return on its stock. 4th-On account of its rapid growth and the recent bulge in business has two classes of employees-those over four years with the company (mostly a fine lot of men-not half of total) and those employed only six months to three years, many of whom are the New Deal type of today and young incompetents. 5th-The development of this business has been a fortunate thing, even during the depression, for its men and the commu- nities; and besides wage earners it has probably over 400 college men, chemical engineers, etc. Ph. D.'s, Masters and Bachelors. 6th-Have never had any labor trouble. Have had a Works Council for 21/2 to 3 years. CALCO CHEMICAL COMPANY, INC. 297 7th-Have made a practice of advancing so many men to fore- men and superintendents that its soundest men are generally in that group. Edward Hamilton testified that it was his "best recollection" that he had obtained the memorandum from his brother, who told him that he had found it. He admitted that a conclusion could unques- tionably be drawn that the document had been written by someone who was very familiar with the internal affairs of Calco, "or pre- tended to be." Christie Hamilton stated at the hearing that he was ignorant as to how or when or from whom he had obtained the memorandum. All he could remember was that it had been delivered to his house enclosed in an envelope, anonymous as to the sender, and that he had turned it over to Edward on about June 12 because he assumed that Edward would be interested in the kind of infor- mation it contained. In reply to further questions of counsel for the Board as to whether he had made inquiries as to the original source of the memorandum, and the manner in which it had found its way to his house, Christie Hamilton stated, "That is the best I can do for you. These things don't register very strongly on my mind. It is not my business." "I don't get one in a blue moon." "It was there. That is all I know." c. Conclusions with respect to the initiation of The Calcocraft We find the testimony of Lamond, Evans, Henderson, Felch, and Edward Hamilton, as hereinbefore related, to be wholly valueless as an explanation of the events which culminated in the initiation of The Calcocraft. Implausible, inconsistent, and incomplete on its face, their testimony is rendered incredible by the documentary evi- dence, found in Hamilton's file and supplemented by the testimony of Christie Hamilton. Relying upon those portions of the record which we deem to be of probative value and without attempting to recon- struct herein a detailed and complete history of actual events, we find that the respondent Calco conceived, executed, and sought to impose upon its employees the Hamilton Plan described above, of which the formation of The Calcocraft was an integral part. Ad- mittedly aware of the illegality of the Works Council, a representa- tion plan to which it had subjected its employees for over 3 years, and confronted for the first time with a threat by the A. F. of L. of genuine organization at its plant, the respondent Calco deter- mined that some other form of organization should be established by it as a successor to the outlawed Works Council and as an impedi- ment to the free choice of its employees. Accordingly, the respond- ent Calco selected as suitable for its purposes the program of organization embodied in the Hamilton Plan and proceeded to intro- 298 DECISIONS OF NATIONAL LABOR RELATIONS BOARD duce that program at its plant. It was as the first step in the in- troducion of the Hamilton Plan among its employees that Calco sponsored the formation of The Calcocraft. To conceal the impro- priety of its scheme and to create the impression that The Calcocraft represented the spontaneous and independent choice of its employees, it delegated the performance of all overt acts in connection with the execution of its plan to a selected group of employees, who had been members of the Works Council and with whom its works man- ager was personally acquainted. It was thus pursuant to the re- spondent's instructions that The Calcocraft emerged as a rival to the A. F. of L. and a successor to the Works Council, which was formally dissolved shortly after the creation of The Calcocraft. 3. Support and favored treatment of The Calcocraft a. Dealings with The Calcocraft The contract forming a part of the Hamilton Plan was not to go into effect at Calco until The Calcocraft, the mechanism created by the respondent Calco as a part of that plan and as a device for furthering the materialization of the principles underlying the plan, had absorbed as members a majority of Calco's production employees. The record shows that the respondent Calco sought, through various means, to recruit to the ranks of The Calcocraft the requisite percentage of em- ployees at the plant. On Sunday June 13, the day following the crea- tion of The Calcocraft and while its membership consisted of the eight persons who had signed the certificate of association, the three officers and Hamilton met to make plans for immediate collective bargaining with the management. After arousing the men to a realization of the disparity between the prevailing cost of living and their current in- come and after eliciting from them other sources of dissatisfaction with their working conditions, Hamilton aided the officers in crystallizing the demands to be put before the management. They were concerned with an increase in wages of 15 cents per hour, a liberalization of the vacations policy, the gratuitous supplying of overalls by the manage- ment, and the working out of a more scientific classification of labor. At the, close of the meeting an appointment was made for that after- noon with Dempsey, Calco's works manager, who had been called at his home by Benjamin Meigs, treasurer of The Calcocraft and a former Works Council member. Dempsey met The Calcocraft president and treasurer and Edward Hamilton, at the plant. Hamilton opened the negotiations by stating that, in view of the fact that The Calcocraft had not as yet enlisted as members a majority of Calco's employees, the requests which The Calcocraft was about to present were being made solely on behalf of its members. Presentation of the demands was CALCO CHEMICAL COMPANY, INC. 299 made by The Calcocraft's president. Dempsey replied that he lacked authority to represent the management but promised to apprise his superiors of the substance of the demands. On June 14 Hamilton wrote Dempsey concerning his understanding of the scope and results of the conference. Both Dempsey and Jeffcott replied on June 17 denying emphatically the implications in Hamilton's letter that either an agreement or an understanding had been reached with The Calco- craft. With respect to the demands made by The Calcocraft, Jeffcott stated in his reply, "The Company has received the requests made by the Calcocraft on behalf of its members as set forth in Paragraph 3 of your letter and will give the same careful consideration." On the same day the company announced a liberalization of its vacations policy, a condition expressly sought by The Calcocraft on June 13. After a further exchange of telegrams and letters between Hamil- ton and Jeffcott, in the course of which Hamilton declared that, as of July 3, The Calcocraft represented a majority of Calco's em- ployees and demanded its recognition as exclusive bargaining agent, a conference with the management was arranged for July 8. En- closed in a letter of Hamilton to Jeffcott, dated July 6, was a notice of a wage increase which had been posted at the plant of the Curtiss Aeroplane Division of the Curtiss-Wright Corporation, where The Aircraft, a Hamilton creation, was in existence. Commenting to Jeffcott on the notice, Hamilton stated : ". . . The Aircraft has never obtained a Certificate of Representation from the National Labor Relations Board, and the Curtiss Aeroplane Division of the Curtiss-Wright Corporation has never, technically, recognized The Aircraft as the sole and exclusive bargaining agency for all its em- ployees. However, it has been the practice of the Curtiss Aeroplane Division of the Curtiss-Wright Corporation to announce wage in- creases and other action taken as the result of negotiations between The Aircraft and the Management in the form of the enclosed notice ..." Present for the company at the conference of July 8 were its ranking officers and counsel and its works manager. The record does not show by whom The Calcocraft was represented in addition to Edward Hamilton and its president. Hamilton repeated his de- mand for exclusive recognition and requested the company to bar- gain with The Calcocraft on that basis with respect to the demands made on June 13 at the first conference with Dempsey and repeated in Hamilton's letter of June 14. Without requiring proof of Hamil- ton's claim, the company announced that, since the question of the right to exclusive representation would have to be decided by the Board, negotiations at the conference would be undertaken with The Calcocraft as representative of its members. After the close of the 300 DECISIONS OF NATIONAL LABOR RELATIONS BOARD meeting, a notice addressed to all employees of Calco was posted on the plant bulletin board. It announced the granting of a wage in- crease of five cents per hour, to be effective after the vacation period, and the supplying of overalls by the management. The opening paragraph of the notice read as follows : Following requests made by the Calcocraft in a letter to the Company dated June 14, 1637, and following collective bargain- ing between the Management and representatives of the Calco- craft on behalf of its members, the Company makes the follow- ing announcement : The notice closed with the statement that "other requests made by the Calcocraft in its letter will be the subject of further collective bargaining." While Taylor admitted at the hearing that the terms of the announcement affected all employees, he contended that the company had, nevertheless, bargained with The Calcocraft only on behalf of its members. A member of the Chemical Workers testi- fied that he had inferred from the announcement that The Calco- craft had been accorded exclusive bargaining rights. While, under certain circumstances, it would not be improper under the Act for an employer to deal with an organization representing a minority group of employees, we find that the notice of July 8 was reasonably sub- ject to the inference that the respondent had in fact invested The Calcocraft with exclusive dealing rights and that credit was due The Calcocraft for the more favorable working conditions which all the employees were to enjoy. De facto recognition of The Calcocraft as sole bargaining agent, suggested by Hamilton in his letter of July 6 to Jeffcott, was thus achieved. Such recognition, we find, constituted an attempt on the part of Calco to nurture the develop- ment and growth of an organization which it had brought into existence a few weeks earlier. By July 8 The Calcocraft had held three general meetings; had elected delegates to the central council, a representative body called for by the Hamilton Plan; had adopted unanimously and with little discussion the constitution prepared by Hamilton for The Aircraft and required by his plan; and had been confronted with a series of resigna- tions on the part of its officers. It had, according to the minutes of the meeting of July 2, authorized Hamilton to deal with the man- agement on the basis of the requests of June 13 and to demand exclusive bargaining rights "if it'appeared that there were a majority belonging to The Calcocraft." Although it had selected a secretary, minutes of general membership meetings and of those held by the Executive Board were prepared by Hamilton. At a meeting of the membership on July 8 Hamilton announced the 5-cent increase promised by the Company earlier that day and explained that Calco's CALCO CHEMICAL COMPANY, INC. 301 financial condition did not warrant a greater concession. The mem- bership found the increase unsatisfactory and, according to the min- utes, passed a resolution directing the Executive Board and Hamilton to engage in further bargaining on that point. Although the minutes do not reflect the nature of the discussion at this meeting, there is testi- mony showing that the membership expressed disappointment at the failure of Hamilton to exact a 15-cent increase, as he had uncondi- tionally promised at earlier meetings, and at the inability of Hamilton to explain why the delegates had not been consulted prior to acqui- escence to the company's terms. A subsequent conference between the Executive Board of The Calcocraft and the Board of Directors of Calco, held on July 12, brought no further concession from the com- pany as to the extent of the announced wage increase. Thereupon The Calcocraft 'requested an advancement of the effective date of the increase as announced on July 8, and the company posted a second notice at the plant on August 4 declaring that the increase would become effective at an earlier date. Taylor, testifying on behalf of Calco, stated that the company's action in altering the terms of the July 8 notice was due to a "combination of circumstances." "As time went on, and prior to the ending of the vacations," he said of the com- pany, "it considered the feeling that existed, that we heard around the plant, that it would be more proper to advance that date, and it de- cided to do it." We find that the company's action was motivated by a desire to mollify those employees who had joined The Calcocraft with the expectation that it would operate as a genuine collective bar- gaining agency and to attract, by further concessions represented to have been achieved through the efforts of The Calcocraft, those who had abstained from becoming members. A considerable exchange of correspondence and several conferences, between Hamilton and the company's officers, followed the posting of the August-4 notice. Demands for exclusive bargaining rights were made by Hamilton and the form and substance of his proposed con- tract were discussed. The record does not show, however, that Calco formally acceded to the demands for recognition and there is no evidence that the proposed contract, completing the Hamilton Plan, was entered into between the company and The Calcocraft. The Calcocraft had, on July 13, 1937, petitioned the Board for an investi- gation and certification of representatives and, on August 10, 1937, the Chemical Workers filed charges with the Board alleging that The Calcocraft was a company-dominated union. 302 DECISIONS OF NATIONAL LABOR RELATIONS BOARD b. Comparative treatment accorded the Chemical Workers and The Calcocraft During the period of negotiations between Calco and The Calco- craft, the A. F. of L. was attempting to forge ahead in its promotional efforts. By July 8 the Chemical Workers had been chartered by the A. F. of L. as a federal labor union for the production employees of both respondents, and permanent officers had been elected. About 900 pledge cards had been signed, and the most energetic support of the A. F. of L. and the Chemical Workers came from the employees in the new construction and instrument units of the plant. The record shows that, during the coexistence of both organizations, there was heated and continuous rivalry between them for the membership of Calco's employees. There is also evidence that Calco did not main- tain a position of neutrality but allied itself with The Calcocraft in its battle against the A. F. of L. and the Chemical Workers. Thus during the first week of A. F. of L. organizational activity, accord- ing to the testimony of George Shea, the most active solicitor for that organization, the superintendent of the new construction unit, in which Shea was employed, informed him that installation of an A. F. of L. local at Calco would bring about a serious curtailment of work in his unit and advised him that he was "too old" to engage in organizational work. The testimony of another active A. F. of L. member is that early in July a foreman in the new construction unit announced to him that if the A. F. of L. came into the plant the unit would be shut down in three months. According to the testimony of a third A. F. of L. member, a supervisor in the instrument department, one Reeves, questioned the witness about the A. F. of L. and about the wisdom of having "an outside organization" handle his affairs and commented, "Well, I don't think that is a good idea to have outside men." During the middle of July one of the witnesses heard the superintendent of one of the Calco buildings express his belief to the men in his building that an independent union was the best type of organization for a plant of Calco's size and that the advent of the A. F. of L. at Calco would mean strikes and trouble to the com- pany and a loss of time to the men. Late in July or early in August a superintendent in the instrument division questioned one of the wit- nesses about his union affiliation and declared, in reply to the witness' admission that he was an A. F. of L. member, "I didn't think you would let me down like that." The record shows that the hostility of Calco's supervisory officials toward the A. F. of L. contrasted mark- edly with the favored treatment bestowed upon The Calcocraft. There is evidence that foremen and other supervisors extolled the virtues of The Calcocraft to the employees under them, urged employees to join it, and encouraged attendance at its meetings. An employee in CALCO CHEMICAL COMPANY, INC. 303 the instrument department testified, in this connection, that his super- visor had suggested that he attend a meeting of The Calcocraft and prepare for that supervisor a list of the persons present. Efforts to impede A. F. of L. organization and encourage member- ship in The Calcocraft took the further form of proscribing solicita- tion of members by the A. F. of L. and according freedom to The Calcocraft to engage in organizational activities prohibited to its rival. Thus, although both unions solicited members on company time and property during the first days of their existence, only the leader of the A. F. of L. was reprimanded by Calco's works man- ager and ordered to refrain from such action. It was only after the works manager, at the behest of the A. F. of L. leader, had looked out of the window of his office and observed a representative of the rival organization engaged in signing up'members, that both organ- izations were allowed three days of unhampered solicitation. After the expiration of the three-day period, The Calcocraft, according to the uncontroverted testimony of several witnesses, held informal pub- lic organization meetings on company property and solicited members on company time without hindrance or restraint. A number of fore- men attended these informal meetings. The A. F. of L. did not, how- ever, enjoy the same good fortune. Shea, chairman of the Chemical Workers, testified that, when he and the financial secretary of the Chemical Workers engaged in soliciting members on company prop- erty but on their own time, although those whom they approached were disabled from working because of rain, Calco's chief guard or- dered them off the company's property. The guard explained to Shea and his associate that his action was in pursuance of instructions from the works manager. When, further according to Shea's testimony, Shea complained to the works manager, the latter merely enunciated a general prohibition against solicitation during working hours. On July 8 the works manager informed both unions that thereafter there was to be no solicitation by either on company time. The record reveals the use by Calco of still another device for eliminating the Chemical Workers as a rival of The Calcocraft. This manifested itself in the demotion, transfer, lay-off, or discharge of active members of the Chemical Workers. Patrick J. McCloskey, financial secretary of the Chemical. Workers and an ardent solicitor in its behalf, testified that about June 24 John Malloy, foreman of carpenters in the new construction unit, told him to report to the labor gang "indefinitely," saying, "You are running all over the plant. I got to have some place where I can watch you." When McCloskey asked for an explanation, his foreman stated, "Well, your union activities." Although the change did not carry a decrease in wages, it was a demotion for McCloskey, who had been a carpen- 304 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ter's helper, because the work done by the labor gang was of a menial character, consisting mainly of ditch digging. McCloskey was returned to his regular work a few days later after he had complained to the works manager. The superintendent of the new construction unit cautioned him, upon his return, that if he left the immediate locale of his job at any time for any reason he would be discharged. A few days later the prohibition was relaxed but, McCloskey testified, his activities were thereafter closely watched by the superintendent. McCloskey was discharged a few weeks after he had been restored to his job as carpenter's helper. Lamond, charter member of The Calcocraft, appeared to have learned of the discharge before notice thereof was given to McCloskey. The next transfer of importance affected George Shea, chairman of the Chem- ical Workers and the prime mover in the campaign to establish a Calco local of the A. F. of L. Shea testified that, during the middle of August, he was transferred from the new construction unit of Calco to the Beetle building, located within the same geographical area as Calco but operated directly by American Cyanamid Com- pany. Upon his return to Calco on August 31, the superintendent of the new construction unit directed him to quit entirely his "God damned labor activities." When Shea protested that the breadth of the order constituted an interference with his rights under the Act, the superintendent replied, "You are either going to cut them out, or it is going to be you or me." There is also evidence of a number of lay-offs in the new construction unit during the early part of August. Of those affected, all but a negligible proportion were members of the Chemical Workers. Members of The Calco- craft appear to have escaped these further forms of mistreatment visited upon their competitors. None of the foremen or other supervisory officials, to whom mem- bers of the Chemical Workers attributed the foregoing statements and actions, testified at the hearing. Taylor, Calco's vice president, stated on behalf of Calco that he had issued instructions to the company's works manager that a policy of impartiality was to be followed with regard to the union activities of its employees but that he, Taylor, had not discussed the company's policy with the foremen and other supervisors.. This contention cannot validly be interposed as a defense. The respondent is answerable for the con- duct of those who represent it among its employees.6 We find, upon the basis of the evidence, that Calco, through its supervisory officials, 9 Matter of The A. S. Abell Company and International Printing and Pressmen's Union, 5 N. L. R . B. 644, 97 F. 2d 951; Matter of Virginia Ferry Corporation and International Seamen's Union, 8 N. L. R. B. 730, 101 F. (2d) 103 (C. C. A. 4 , January 9, 1939) ; Matter of Ward Baking Company and Committee for Industrial Organization, 8 N. L. R. B. 558; Matter of Tennessee Copper Company and A. F. of L. Federal Union No. 2116¢, 8 N. L. R. B. 575, 9 N. L. R. B. 117. CALCO CHEMICAL COMPANY, INC. 305 uttered hostile statements against the A. F. of L. and the Chemical Workers, impeded membership solicitation by it, and singled out its members for punishment and abuse, while The Calcocraft was clearly favored and supported. We find that the contrast in treatment was motivated by a desire to foster the growth of The Calcocraft and to eliminate the A. F. of L. and the Chemical Workers as a rival to the organization which the respondent Calco had selected for its employees. 4. Conclusions as to domination and support of The Calcocraft We have found, in the foregoing, that the respondent Calco ini- tiated and sponsored the formation of The Calcocraft and engaged in various forms of promotional activity on its behalf. We find that such conduct, standing alone, constitutes an unfair labor practice within the meaning of Section 8 (2) of the Act. Moreover, the respondent's acts in this connection constituted part of a broader program of employee relations which it aimed to impose upon its employees by adopting the Hamilton Plan at its plant. The Ham- ilton Plan, we have found, if followed, would subject a labor organi- zation to utter domination by the employer, regardless of how such organization first came into being. The Calcocraft was thus not only brought into existence by the respondent Calco and thereby deprived congenitally of the power to function as a true bargaining agency but the pattern of its operation was to be of such a nature as to perpetuate its subjugation to the will of its creator. We find that the respondent Calco, by initiating the formation of The Calcocraft, by engaging in promotional activities on its behalf, and by attempting to introduce the Hamilton Plan among its em- ployees through the medium of The Calcocraft, has dominated and interfered with the formation and administration of The Calcocraft and has contributed support to it. The respondent Calco has thereby interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed by Section 7 of the Act. B. The discharges In his Intermediate Report, the Trial Examiner found that John J. Wheeler, Patrick McCloskey, Woodrow Hardy, and Thomas Littell had been discharged "by agents of the respondents" for the reason that each of them "joined and assisted a labor organization known as the Chemical Workers Union, Local No. 20923, and engaged in concerted activities for the purpose of collective bargaining and other mutual aid and protection." He found, further, that, by these dis- charges, the respondents have discouraged membership "in the labor 306 DECISIONS OF NATIONAL LABOR RELATIONS BOARD organization known as the Chemical Workers Union, Local No. 20923," and have interfered with, restrained, and coerced their employees in the exercise of their right to self-organization under Section '7 of the Act. The Trial Examiner recommended that the respondents, in order to effectuate the policies of the Act, offer to the four persons named above "employment in the positions formerly held by them with all the rights and privileges previously enjoyed by them" and make each of them whole for any loss of pay each may have suffered by reason of his discharge "by payment to each of them of such sum of money as they would normally have earned as wages from the date of dis- charge to the date of offer of employment, less the amount earned by each of them during such period." A further recommendation of the Trial Examiner in this respect was that the respondents cease and desist from discouraging membership in any labor organization by discrimination in regard to hire and tenure of employment or any term or condition of employment. While we have deemed it necessary, because of the objections of the intervenor, to make independent findings upon the record as to the respondent's interference with, domination and support of The Calcocraft, no objections have been raised as to the Trial Examiner's findings of discrimination under Section 8 (3) of the Act, and, since the respondent has complied with the Trial Examiner's recommenda- tions for remedying the latter unfair labor practice, it is unnecessary to make findings on the allegations in this branch of the case. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE We find that the activities of the respondents set forth in Section III above, occurring in connection with the operations of the respond- ents described in Section I above, have a close, intimate, and substan- tial 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 Calco sponsored the initiation of The Calcocraft as a labor organization of its employees and engaged in promotional activities on its behalf by various acts of favoritism and support. We have also found that initiation of The Calcocraft was effected by the respondent Calco as the first step in the execution of the Hamilton Plan, a unified and interrelated program of employees- organization and industrial relations, which we deem to be patently unlawful under the Act, and inseparable as to its component parts CALCO CHEMICAL COMPANY, INC. 307 and provisions . Since the respondent Calco has complied with the Trial Examiner's recommendation that it disestablish The Calco- craft as a bargaining agency for its employees and that it withdraw recognition therefrom as such agency , we consider it unnecessary to order Calco to take the affirmative action which we usually deem neces- sary to effectuate the policies of the Act in this respect. We shall, however, order Calco to cease and desist from dominating or inter- fering with the administration of, or contributing support to The Calcocraft. We shall also order it to cease and desist from executing or attempting to execute the Hamilton Plan or any part or provision thereof or any similar plan or program . Because we deem it neces- sary to effectuate the policies of the Act, we shall require Calco to cease and desist from recognizing The Calcocraft as the bargaining agency for any of its employees. We have also found that the respondent Calco has interfered with its employees in the exercise of the rights guaranteed in Section 7 of the Act. In view, however , of Calco's compliance with the Trial Ex- aminer's recommendations also in this respect, we shall issue no order as to these unfair labor practices . Nor do we deem it necessary to require it to post notices stating that it will cease and desist from engaging in the unfair labor practices hereinbefore found to have been committed by it. The Trial Examiner found that the respondents had engaged in unfair labor practices within the meaning of Section 8 (3) of the Act, and recommended that the respondents cease and desist from such conduct and reinstate with back pay Wheeler, McCloskey, Har- dy, and Littell. Since the respondent Calco has complied with the latter recommendation and to that extent with the former , it is un- necessary for us to make findings of fact and conclusions of law, or to issue an order based thereon. We shall not, however , dismiss the complaint in this respect, as the recommendations of the Trial Ex- aminer contemplate a continuing course of conduct on the part of the respondent Calco. Upon the foregoing findings of fact and upon the entire record in the case, the Board makes the following : CONCLUSIONS OF LAW 1. Chemical Workers Local No. 20923, A. F. of L., and The Calco- craft are labor organizations, within the meaning of Section 2 (5) of the Act. 2. By attempting to introduce the Hamilton Plan among its em- ployees and by sponsoring the initiation of The Calcocraft and en- gaging in promotional efforts on its behalf by various acts of favor- itism and support, concurrently with mistreatment of the Chemical 169134-39-vol 12-21 308 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Workers, the respondent, The Calco Chemical Company, Inc., has engaged in and is engaging in unfair labor practices, within the meaning of Section 8 (2) of the Act. 3. By interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act, the respondent, The Calco Chemical Company, In, has engaged in and is engaging in unfair labor practices, within the meaning of Section 8 (1) of the Act. 4. The aforesaid unfair labor practices are unfair labor practices affecting commerce, within the meaning of Section 2 (6) and (7) 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 re- spondent, The Calco Chemical Company, Inc., Bound Brook, New Jersey, and its officers, agents, successors, and assigns shall: 1. Cease and desist from: (a) In any manner dominating, or interfering with the adminis- tration of, or contributing support to, The Calcocraft or any other labor organization of its employees; (b) Executing or attempting to execute the Hamilton Plan or any part or provision thereof or any similar plan or program; (c) Recognizing The Calcocraft as a representative of any of its employees for the purpose of dealing with the respondent concern- ing grievances, labor disputes, rates of pay, wages, hours of employ- ment, or other conditions of employment. 2. Notify the Regional Director for the Second Region in writing within ten (10) days from the date of this Order what steps the respondent, The Calco Chemical Company, Inc., has taken to comply herewith. The Board finds that this action will effectuate the policies of the Act. It is further ordered that the complaint be, and it hereby is, dismissed without prejudice in so far as it charges that the re- spondent, American Cyanamid Company, has engaged in unfair labor practices.