Uarco Inc.

298 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD UARCO Incorporated and Graphic Communications Union District `Council No. 2, International Printing and Graphic Communications Union, AFL-CIO and ' Graphic Communications Dis- trict Council No. 2, and its Local 388M, Inter- national Printing and Graphic Communications Union, AFL-CIO. Cases 21-CA-24219 and 21- CA-24425 19 March 1987 DECISION AND ORDER BY CHAIRMAN DOTSON AND MEMBERS STEPHENS AND CRACRAFr On 30 September 1986 Administrative Law Judge Gerald A. Wacknov issued the attached de- cision. The Respondent filed exceptions and a sup- porting brief. The Respondent further filed `a motion to reopen the record for the purpose of in- troducing additional evidence. The General Coun- sel filed an answering brief and a response to the motion to reopen the record. The National Labor Relations; Board has delegat- ed its authority in this proceeding to a three- member panel. - The Board has considered the decision and the record' in light of the exceptions and briefs and has decided to affirm the judge's ruling, fmdings,2 and conclusions and to adopt the recommended Order. Frank M. Wagner, Jr., Esq., for the General Counsel. William P. Treacy, Esq., of Lake Forest, Illinois, for the Respondent. DECISION STATEMENT OF THE CASE GERALD A. WACxxov, Administrative Law Judge. Pursuant to notice, a hearing with respect to this matter was held before me in Riverside , California, on 10 June 1986. The initial charge in Case 21-CA-24219 was filed on 16 October 1985 by Graphic Communications Union District Council No. 2, International Printing and Graph- ic Communications Union, AFL-CIO (the Union) and was amended on 28 February 1986. The chargein Case 21-CA-24425 was filed by the Union on 16 - January 1986. Thereafter, on 31 March 1986 , the Regional' Direc- tor for Region 21 of the National Labor ,Relations Board (the Board) issued 'a consolidated complaint and notice of hearing alleging a' violation by UARCO Incorporated (Respondent) of Section 8(a)(1), (3), and (5) of the Na- tional Labor Relations Act. -The parties were afforded a full opportunity to be heard, to call, examine and cross-examine witnesses, and to introduce relevant evidence. Since the close of the hearing, briefs have been received from the General Counsel and counsel for Respondent. On the entire record,' and based on my observation of the witnesses and consideration of the briefs submitted, I make the following FINDINGS OF FACT 1. JURISDICTION ORDER The ,National Labor Relations Board adopts the recommended Order of the administrative law judge and orders that the Respondent, UARCO In- corporated, Riverside, California, its officers, agents, successors, and assigns, shall take the action set forth in the Order. 1 The Respondent in its motion to reopen urges that the record be re- opened to permit the introduction of certain records regarding the rela- tive number of data mailer operators employed by it as of the date of the hearing. The Respondent does not state any reason why this evidence was not presented at the hearing nor does the Respondent state that this is newly discovered evidence or evidence which has become available only since the close of the hearing. The Respondent's motion is therefore denied. 2 In adopting the judge's conclusion that the Respondent violated Sec. 8(a)(5), we rely on the total lack of notice to the Union regarding the wage freeze prior to its implementation The record reveals that the Respondent has consistently used its regu- lar press operator wage rate than its data mailer press operator wage rate for purposes of comparison in its annual wage survey We note that the data mailer machine is unique to the Respondent and its competitors do not have data mailer operators. The judge, in the remedy section of his decision, ordered that backpay be computed in accordance with the formula set forth in F W Woolworth Co., 90 NLRB 289 (1950). That formula is only applicable in circum- stances involving computations of interim earnings The correct backpay formula for unilateral changes is set forth in Ogle Protection Service, 183 NLRB 682 (1970) The Respondent is a Delaware corporation engaged in the manufacture and sale of business forms with a facility located in Riverside, California. In the course and con- duct of its business operations, the Respondent annually sells and ships goods and products valued in excess of $50,000 directly to customers located outside the State of California. It is admitted, and I find, that the Respondent is, and has been at all times material, an employer engaged in commerce and in a business affecting commerce within the meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED It is admitted that the Union is, and has been at all times material, a labor organization within the meaning of Section, 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICE A. The Issues The principal issues raised by the pleadings are wheth- er the Respondent, in violation of Section 8(a)(3) of the 1 The General Counsel's motion to amend exhibit by attaching to G C Exh 11 a 7-page document entitled "1984 Area Wage Summary" is granted. Further, the General Counsel's unopposed motion to correct transcript is granted. 283 NLRB No. 48 UARCO INC. Act, withheld a wage increase from its Riverside 'em- ployees, and whether it violated Section 8(a)(5) of the Act by unilaterally changing employees' terms and con- ditions of employment. B. The Facts The Union was certified on 20 December 1984 as the collective-bargaining representative of the Respondent's employees in the following unit: All production and maintenance employees, ware- house employees, shipping and receiving employees and truck drivers employed by Respondent at its fa- cility located at 990 Palmyrita Avenue, Riverside, California, excluding all office clerical employees, professional employees, guards and supervisors as defined in the Act. The unit is comprised of approximately 85 employees. Bargaining commenced on 21 February 1985,2 and con- tinued until 11 December when negotiations broke off as a result of the Union's failure to accept the Respondent's last and final proposal which provided for a 12-month wage freeze. The parties had, at Respondent's request, deferred negotiations on wages and other economic items until noneconomic matters had been explored, and Respondent's first offer on wages, namely, to freeze them, came on 8 October, 2 days after the date on which the annual wage increase, infra, had always become ef- fective. William Gordon, who has been Respondent's River- side plant manager for 17 years, testified that the unit employees herein have received a general pay increase the first Sunday in October in each of these 17 years except for 1985, when no pay increase was granted.3 Gordon testified that during each prior year he an- nounced and promised to the unit employees at company meetings that they could expect to receive a substantially similar pay increase that was granted to production em- ployees' at Moore Business Forms of Fullerton, Califor- nia (Moore), a unionized plant which was Respondent's primary local competitor. Gordon testified that this had been Respondent's "principal promise" to the employees at least since he became plant manager, and that the pay scale of Moore "was the principal ' criteria we used in de- termining our wage package every year," which was based on an annual survey of local printing firms. Re- spondent's 1985 survey was completed in August. Gordon testified that no 1985 wage increases were granted the production employees at the Roseburg, Oregon plant, a facility also under Gordon's supervision. Gordon's affidavit, referring to the Roseburg plant, states as follows: No wage increase was given for two reasons: first, it is located in the heart of the lumber industry which is suppressed and suffering large layoffs; sec- ondly, we were able to obtain additional business if 2 All dates or time periods hereinafter are within 1985 unless otherwise specified. 2 However, the Respondent's clerical employees did receive a 3-per- cent wageincrease on this day, 6 October 1985. 299 we could control our cost. We told the employees that, "In lieu of wage increases, that the wages would remain the same, but because of the increase of business they would be assured no layoffs would occur. Thus we effectively traded wage increases for as- sured work. Moore's contract with Printing Specialties and Paper Products Union Local 522, a sister local of the Union herein, extended from 1 September 1983 to 31 August 1986. It provided for a wage increase during each year of the contract, including a 4-percent increase for pro- duction employees on 1 September 1985. This brought the rate of Moore's press operators from $12.45 per hour to $12.95 per hour. Respondent's 1984 rate was at $12.55 per hour for comparable positions4 and has remained at that rate due to Respondent's failure to increase its wages in October 1985. From 1974 through 1984 the sig- nificant wage rates of Moore and Respondent, used by Respondent for comparison purposes, have been as speci- fied in the following exhibit introduced into evidence by the Respondent: The5 Respondent advanced various reasons for its de- cision to deviate from its admitted past practice of main- taining close comparability with Moore . According to Edward Werhand, Respondent's vice president of engi- neering, the production standards, which are based on the time it should take to print or process a specified quantity of business forms, had declined at Respondent's Riverside plant, and compared unfavorably with the av- erage companywide production standards of each of its 12 plants. In this connection, documentary evidence con- sisting of monthly published production standards data shows that since 1981 the Riverside plant has been among the top six plants in production standards. How- ever, the most current data as of August 1985 , when the Respondent determined that no wage increase was war- ranted, reflects that the Riverside press" department was ranked ' number 9 out of 12 plants, with a 104.96 perform- ance standard for the 13 weeks ending 30 June 1986, and was rated in finishing department standards (of the 8 plants with finishing departments), with ' a 96.1 perform- ance standard for the same period of time. No evidence was, presented by Respondent to show the cause for this decline. Nor was any evidence adduced to show that wage increases had ever been withheld at any of its plants ,because of a low performance standard ranking. Respondent also maintains that for purposes of its 1985 area wage survey, it no longer considered Moore as the bellwether plant, apparently taking the position that the ' Respondent's rate for data mailer operators is $12.76 per hour. How- ever it appears that this rate is paid to relatively few employees, and the record evidence shows that the Respondent has consistently used its reg- ular press operators' rate, rather than its data mailer press operator 's rate, for purposes of its annual wage survey comparisons Chart goes here 5 This heading denotes nondata mailer press rates Moore does not have data mailer presses s The percentage figure is based on 100 percent, which is the amount of output that all the presses, collectively, are designed to produce in a specified period of time. Thus, the Riverside plant was operating above standard in the press department 300 DECISIONS OF THE NATIONAL LABQR RELATIONS BOARD plant had closed or moved between 1984 and 1985, and ceased to be a significant basis for comparison. Thus, Plant Manager Gordon testified that for purposes of the 1985 wage survey he never compared the Riverside plant with Moore's new plant located in the City of In- dustry . The evidence shows that Moore's facility was moved from Fullerton to the City of Industry, some 10 miles distant, sometime after August 1984, and that the existing collective-bargaining agreement between Moore and Printing Specialties and Paper ; Products Union, Local 522 was continued without negotiation or inter- ruption at the new location . While the Union's president, Bernard Sapiro, testified that he believed Moore's new plant employs fewer than 100 employees, Sapiro's testi- mony reveals that he is not entirely aware of the situa- tion at that plant asits employees are represented by an- 'other Local Union. However, according to Sapiro, Moore's_Fullerton plant had been gradually reduced in size since about 1975 . Moreover, the Respondent's 1984 wage survey shows that, Moores Fullerton plant had 180 employees,- and its 1985 wage survey, which specifically included Moore's City ,of Industry plant as one of the plants surveyed in Respondent's 1985 wage study, shows that it has 190 employees.' C. Analysis and Conclusions The reasons advanced by the Respondent for deviating from its promised annual wage increase to the produc- tion employees, consistently honored for at least the past 17 years, simply are not supported by the record evi- dence. The 1985 area wage survey report was submitted to Plant Manager Gordon by R. D. Kozaki, supervisor, in- dustrial relations, on 12 August 1985. Kozaki, who was not called as a,witness in-this proceeding, recommended no wage -increase for 1985 , despite the fact that the aver- age .increase for - the Southern .California firms surveyed was 4 .60 percent. As noted above, assuming that the then most recent 1985 performance standard statistics, speci- fied above, were known to Kozaki at the time he issued his report, the Respondent's press department ranked 9 (out of 12 plant) and was well above 100-percent effi- ciency. In the finishing department it was six .(out of eight plants), with 96. 1 efficiency. More importantly, the Respondent has adduced no evidence , purporting to show that the employees of any of its, plants, at any time during 'the past 17 years, have ever been punished by the withholding of a wage increase for having relatively low performance standards in any category. Further, it is .sig- nificant that Respondent deemed it necessary to raise the wages of the nonunit clerical employees by 3 percent. Fi- nally, it is clear that The Respondent's failure to grant a wage increase to the Roseburg, Oregon production em- ployees was based on extraordinary circumstances not relevant' or comparable to the issues ,in the instant case. The Respondent's contention that it discontinued its policy of maintaining close comparability between its wage rate and those of its primary competitor in the area because, according to Plant Manager Gordon, Moore 7 In 1983, according to Respondent's survey, Moore's Fullerton plant had 197 employees "closed sometime between, `84 and, `85," is patently friv- olous. The clear and -credible record evidence shows that Moore did not close. Rather it moved to another loca- tion just 10 miles away from its original facility . There is no evidence that its general manufacturing operations changed in any material respect . Nor does Gordon speci- fy with any clarity what caused him to cease giving any consideration to Moore's existence for purpose of the wage survey, or why, given Respondent's position, Moore was even included in the 1985 wage survey. Indeed, the Respondent's wage survey specifically in- cluded the applicable information regarding Moore's City of Industry plant and, perhaps most importantly, the 1985 wage survey compiled by Respondent8 shows that the number of Moore's employees increased between 1984 and 1985 , and its employee complement is apparent- ly more than double the size of Respondent's work force of some 85 unit employees. In summary, the facts prove the converse of Respondent's contention that Moore ceased to be a viable business or that Moore's work force or business operations changed in any significant respect. The Respondent asserts that its current press wage rate, the standard used as a basis for its wage survey, is substantially similar to the, $12 .77-per-hour average,press rate of competitors in the area, and that this is also a reason for not increasing wages in 1985 . However, the evidence shows that the Respondent's area wage surveys have always been premised on the nondata mailer press rate which, for the Respondent, has remained at $12.55 since October 1984. Thus, the Respondent's nondata mailer press rate, the standard used for purpose of com- parison, is some 25 cents per hour below the average press rate of its acknowledged competitors; and 40 cents per hour below the comparable press rate of Moore. As discussed above, Respondent has presented no valid reasons for deviating- from its 17-year history of granting on the first Sunday in October -of each year wage increases comparable to the annual wage increases granted by Moore. There is only one additional element that may reasonably account for Respondent 's deviant conduct, namely, the advent of the Union. On the basis of the, foregoing it is clear , and I find, that the 1985 wage increase was denied because the employees 'selected the Union as their collective-bargaining representative, and that Respondent's conduct is therefore violative of Sec- tion 8(a)(1) and (3) of the Act. The Respondent's promise to grant and the granting of an annual wage increase at the same time each year makes' this wage increase a condition of employment. Its decision to withhold any wage increase , which was always instituted in October of each year, was made in mid-August at a time when the parties were engaged in negotiations. However, the Respondent admittedly did not so , advise the Union of this change in past practice 8 I regard this as more reliable evidence as to the number of employees at Moore's City of Industry plant than Union President Sapiro's testimo- ny. Sapiro was admittedly not conversant with the details of Moore's plant, having no direct relationship with it, whereas Respondent 's survey is apparently based on specific information furnished by Moore subse- quent to its move from Fullerton to the City of Industry UARCO INC. until about 8 October. By failing to timely , notify the Union of this change in a condition of employment, the Respondent has violated Section 8 (a)(5) of the Act, as al- leged. Liberty Telephone & Communications, 204 NLRB 317, 318 ( 1973). The Respondent's unfair labor practices herein, tend- ing to cause employee disaffection, clearly have a sub- stantial adverse effect on the Union's status as representa- tive of the Respondent's employees. Such, it appears, was Respondent's contrived intent . It may fairly be pre- sumed that this conduct on the part of Respondent re- sulted in the filing of the decertification petition by the employees, on which the Respondent now relies as a basis for establishing doubt about the Union's majority status and permitting it to withdraw recognition. Under the circumstances, the Respondent is not privileged to withdraw recognition or to refrain from bargaining with the Union. Moreover, such conduct is violative of Sec- tion 8(a)(5) of the Act. Sacramento Clinical Laboratory, 242 NLRB 944 (1979); Guerdon Industries, 218 NLRB 658 (1975); Abbey Medical/Abbey Rents, '2.64 NLRB 969 (1982). CONCLUSIONS OF LAW 1. Respondent is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. The Union is a labor organization within the mean- ing of Section 2(5) of the Act. 3. The Respondent has violated Section 8(a)(1), (3), and (5) of the Act as alleged. THE REMEDY Having found that the Respondent violated and is vio- lating Section 8(a)(1), (3), and (5) of the Act, I recom- mend that it be required to cease and desist therefrom and from in any other manner interfering with, restrain- ing, or coercing its employees in the exercise of their rights under Section 7 of the Act. Moreover, Respondent shall be required to post an appropriate notice attached as an Appendix. Further, the Respondent shall be required to grant the wage increase to the bargaining unit employees it would have granted, retroactive to 6 October 1985 , and make the bargaining unit employees whole by paying them backpay in the amount of the wage increase that they would have received from that date in the manner pre- scribed in F. W. Woolworth Co., 90 NLRB 289 (1950), plus interest, as set forth in Florida Steel Corp., 231 NLRB 651 (1977).9 The Respondent shall also be re- quired to bargain, on request, with the Union. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed10 See generally Isis Plumbing Co, 138 NLRB 716 (1962). io If no exceptions are filed as provided by Sec 102.46 of the Board's Rules and Regulations, the findings, conclusions, and recommended Order shall, as provided in Sec 102.48 of the Rules, be adopted by the Board and all objections to them shall be deemed waived for all pur- poses ORDER 301 The Respondent, UARCO Incorporated, Riverside, California, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Unlawfully withholding the 6 October 1985 annual wage increase from the unit employees because the em- ployees selected the Union as their collective- bargaining representative. (b) Refusing to negotiate in good faith with the Union by failing to timely advise the Union of the decision to withhold the annual wage increase. (c) Withdrawing recognition from the Union and thereafter refusing to bargain with the Union. (d) In any other manner interfering with, restraining, or coercing employees in the exercise of the rights guar- anteed in Section 7 of the Act. 2. Take the following affirmative action necessary to effectuate the purpose of the Act. (a) Place in effect the hourly wage increases which would have been granted the unit employees on 6 Octo- ber 1985. (b) Make the unit employees whole for the discrimina- tion against them by paying them backpay in the amount of the wage increase they would have received, retroac- tive to 6 October 1985, with appropriate interest. (c) Bargain, on request, with the Union as the repre- sentative of employees in the following unit: All production and maintenance employees, ware- house employees, shipping and receiving employees and truck drivers, employed by Respondent at its fa- cility located at 990 Palmyrita Avenue, Riverside, California, excluding all office clerical employees, professional employees, guards and supervisors as defined in the Act. (d) Preserve and, on request, make available to the Board or its agents, for examination and copying, all payroll records, social security payment records, time- cards, personnel records and reports, and all other records necessary to analyze the amount of backpay due under the terms of this recommended Order. (e) Post at Respondent's facilty at Riverside, Califor- nia, copies of the attached notice marked "Appendix." I' Copies of the notice, on forms provided by the Regional Director for Region 21, after being signed by the Re- spondent's authorized representative, shall be posted by the Respondent immediately upon receipt and maintained for 60 consecutive days in conspicuous places including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respond- ent to ensure that the notices are not altered, defaced, or covered by any other material. ' i If this Order is enforced by a judgment of a United States court of appeals, the words in the notice reading "Posted by Order of the Nation- al Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board " 302 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD (f) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Re- spondent has taken to comply. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated the National Labor Relations Act and has or- dered us to post and abide by this notice. The Act gives employees the following rights: To engage in self-organization To , form, join, or assist any union To bargain collectively through representatives of their own choice To engage in activities together for the purpose of collective bargaining or other mutual aid or pro- tection To refrain from the exercise of any or all such activities. WE WILL NOT unlawfully withhold the 6 October 1985 annual wage increase from you because you selected Graphic Communications Union District Council No. 2, and its Local 388M, International Printing and Graphic Communications Union, AFL-CIO as your collective- bargaining representative. WE WILL NOT refuse to negotiate in good faith by fail- ing to timely advise the Union of our decision to with- hold the annual wage increase. WE WILL NOT unlawfully withdraw recognition from the Union and thereafter refuse to bargain with it as the certified' collective-bargaining representative of employ- ees in the following unit: All production and maintenance employees, ware- house employees, shipping and receiving employees and truck drivers employed by Respondent at its fa- cility located at 990 Palmyrita Avenue, Riverside, California, excluding all office clerical employees, professional employees, guards and supervisors as defined in the Act: WE WILL place into effect the wage increase which the unit employees were entitled to receive on 6 October 1985 and WE WILL pay the unit employees backpay, with appropriate interest, for the wages they would have re- ceived since that date. WE WILL bargain collectively and in good faith with the Union as the exclusive collective-bargaining repre- sentative of our employees in the unit described above. WE WILL NOT in any other manner interfere ' with, re- strain, or coerce our employees in the exercise of the rights guaranteed them by the National Labor Relations Act. UARCO INCORPORATED