Amoco Oil Co.

918 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Amoco Oil Company and Oil, Chemical and Atomic Workers International Union, Local 7-15 and Oil, Chemical and Atomic Workers Internation- al Union Local 7-776 and James E. Gray and Oil, Chemical and Atomic Workers Internation- al Union. Cases 14-CA-13423, 14-CA-13424- 1, 14-CA-13424-2, 14-CA-13482, and 14- CA-13504 21 September 1987 DECISION AND ORDER BY CHAIRMAN DOTSON AND MEMBERS JOHANSEN, BABSON, AND STEPHENS On 31 December 1980 Administrative' Law Judge Robert M. Schwartzbart issued the attached decision. The Respondent filed exceptions and a supporting brief. The Board has considered the decision and the record in light of the exceptions and brief and has decided to affirm the judge's rulings, findings,' and conclusions only to the extent consistent with this Decision and Order. The pertinent' facts are as follows: OCAW and its locals involved herein have represented three units of employees at the Respondent's Wood River, Illinois refinery since 1964-1965. Each unit was covered by a separate collective-bargaining agreement effective from 8 January 1979 to 7 Janu- ary 1981. The contracts contained reopener provi- sions pursuant to which the parties could negotiate during the terms of the agreements regarding wages and certain specified benefits. These reopen- er clauses permitted the Unions to strike within 60 days of their giving notice to reopen negotiations, but not prior to 8 January 1980. In addition to contractual benefits, the Respond- ent maintains several other benefit programs at all the Respondent's facilities for which all individuals employed by the Respondent, regardless of wheth- er they are covered by a collective-bargaining agreement, are eligible. The program involved in the instant proceeding is the Sickness and Disabil- ity (S&D) and Occupational Illness and Injury (OI&I) Plan.2 S&D benefits are paid to any em- ployee with 1 or more years of service who is unable to work because of sickness or disability. Depending on length of service and the duration of illness, eligible employees receive payments equal to 2 to 12 weeks' full pay and 4 to 40 weeks' half I In sec I of his decision, the judge states that the charge in Case 14- CA-13423 was filed by OCAW International rather than by OCAW Local 7-15. 2 As the judge described them, the collective-bargaining agreements between the Respondent, OCAW, and its locals refer to the S&D and OI&I benefit plans The agreements provide that the parties may bargain about them, although they are not subject to arbitration pay. Immediately on employment, any employee, rendered unable to work by a job-related disability is eligible for 12 weeks' full'pay and 40 weeks"half pay pursuant to the OI&I plan. An employee hand- book, which was the only written description of S&D and OI&I benefits introduced into evidence at the hearing, states: "You are not eligible for bene- fits while you are on vacation, leave of absence, suspension, or layoff. You will become eligible for these benefit at the time you are otherwise due to return to work."3 The director of benefits plans and personnel policy for the Respondent and its parent company testified without contradiction that the purpose of the S&D and OI&I benefits is to re- place the wages employees would have earned had they not been disabled, and that employees may collect these benefits only if they are ill and sched- uled to work. For example, he testified that bene- fits being paid to an employee when a layoff begins will continue until and unless the first employee with less seniority than the disabled employee is laid off. When that junior employee is laid off, the disabled employee's benefits cease, and payments are resumed only if the junior employee is recalled before the disabled employee recovers. The super- visor of labor relations at the Respondent's Texas City, Texas refinery testified that no S&D or OI&I benefits were paid during strikes at that facility in 1969, 1974, and 1980, in which the Respondent ap- plied its "closed gate" policy to lock out OCAW- represented employees.4 The record contains no evidence that any employee has ever received S&D and-OI&I benefits unless he was both unable to work and otherwise scheduled to work.5 Pursuant to the reopener provisions described above, Locals 7-776 and 7-15 gave timely notice that they desired negotiations regarding wages and benefits. No agreement was reached at bargaining sessions held on 21 and 28 December 1979 and 3, 4, and 7 January 1980.6 On 3 January the Unions an- a The booklet was put into evidence as a joint exhibit pursuant to the parties' stipulation that it "described" the benefit plans 4 Under the "closed gate policy," the Respondent does not permit em- ployees in units represented by striking unions to work during strikes The General Counsel did not allege that this lockout policy was unlaw- ful The Respondent presented evidence that its "closed gate policy" was adopted corporatewide after 1959 when its prior policy of permitting em- ployees to work during strikes allegedly resulted in violence and long- lasting hostility between strikers and nonstrikers at two other refineries not involved herein We express no opinion on the lawfulness of the "closed gate policy" or its application at the Wood River refinery in 1980. 5 In this connection, we note that the Respondent's director of benefits plans and personnel policy testified without controversion that in a situa- tion where a strike occurs and employees receiving such benefits are scheduled to work, their benefits would continue, but that employees not scheduled to work would have their benefits discontinued He further tes- tified in response to a question by the Respondent's counsel that both of those situations have existed at some point 6 Hereinafter all dates are 1980. 285 NLRB No. 117 AMOCO OIL CO. nounced that if no agreement were reached by 8 January, they would strike. The Respondent then announced that if the Unions struck, the refinery would operate with personnel not represented by OCAW, no work would be made available to any employees represented by OCAW, and benefits, in- cluding S&D and OI&I benefits, would be discon- tinued. The Unions struck on 8 January. Pursuant to its "closed gate policy," and as announced on 3 Janu- ary, the Respondent did not permit any OCAW- represented employees to work during the strike. Letters dated 4 and 8 January were sent by the Re- spondent to all employees represented by OCAW announcing that they would not be eligible for ben- efits for any sickness having its onset during the strike. On 8 January the Respondent sent letters to the eight OCAW-represented employees who were receiving S&D or OI&I benefits when the strike began stating, inter alia, "Until such time as the strike ends or work is 'made available to employees in the bargaining unit . . . your current . . . pay- ments 'are hereby suspended in accordance with the terms of the Plan." No payments were made during the strike and lockout, which ended on 1 April, The: judge found that the Respondent violated Section 8(a)(1) of the Act by announcing the cessa- tion of S&D and OI&I benefits and Section 8(a)(3) and (1) of the Act by actually terminating the ben- efits of the eight employees. The judge rejected the Respondent's contention that S&D and OI&I bene- fits were terminated because the eight employees were not scheduled to work due to the lockout and therefore were not entitled to 'the benefits under the terms of the applicable plan. He found instead that they were removed from the disability rolls in response to the strike. He based his finding on Em- erson Electric Co., 246 NLRB 1143 (1979), enfd. as modified 650 F.2d 463 (3d Cir. 1981), cert. denied 455 U.S. 939 (1982), which he concluded was not factually distinguishable.? For the reasons stated belowy, we disagree with the judge's conclusions and shall dismiss the complaint in its entirety. In Texaco, Inc., 285 NLRB 242 (1987), we held that: [T]he question of whether an employer vio- lates Section 8(a)(3) or (1) by refusing to con- tinue benefit payments to a disabled employee on commencement of a strike will be resolved ' The judge also rejected the Respondent's contention that the Unions waived all pending claims when they entered into strike settlement agree- ments on ' 30 March in which, inter alia, they agreed to withdraw all unfair labor practice charges relating to benefits In view of our disposi- tion of the case, we find it unnecessary to reach this contention Cf Texaco, I, c., 273 NLRB 1335 (1985), in which the Board gave effect to a strike settlement agreement in the circumstances presented there 919 by application of the test for alleged unlawful conduct [set forth in NLRB v. Great Dane Trailers, 388 U.S. 26, 34 (1967)]. [Footnote omitted.] Under this test, the General Counsel bears the prima facie burden of proving at least some adverse effect of the benefit denial on employee rights. The General Counsel can meet this burden by showing that (1) the bene- fit was accrued and (2) the benefit was with- held on the apparent basis of a strike. . . . Once the General Counsel makes a prima facie showing of at least some adverse effect on employee rights the burden under Great Dane then shifts to the -employer to come for- ward with proof of a legitimate and substantial business justification for its cessation of bene- fits. The employer may meet this burden by proving ' that a collective-bargaining represent- ative has clearly and unmistakably waived its employees' statutory right to be free of such discrimination or coercion. . . . If the employ- er does not seek to prove waiver, it may still contest the disabled employee's continued enti- tlement to benefits by demonstrating reliance on a nondiscriminatory contract interpretation that is "reasonable and . . . arguably correct" [emphasis in original, footnote omitted], and thus sufficient to constitute a legitimate and substantial business justification for its conduct. Moreover, as under Great Dane, ^ even if the employer proves business justification, the Board may nevertheless find that the employer has committed an unfair labor practice if the conduct is demonstrated to be "inherently de- structive" of important employee eights or mo- tivated by antiunion intent.8 Applying these principles articulated in Texaco to the facts here, we find that the General Counsel has proven a prima facie 8(a)(3) and (1) case. The disabled employees were entitled to and in fact were receiving benefits under the plan when the strike began, and the Respondent undisputedly sus- pended benefits on commencement of the strike.9 s Texaco, Inc., supra at 246-247. 9 Because Member Stephens agrees that, given the stipulations and the judge's unexcepted-to findings of fact, we must accept the conclusion that the disability plans made it a condition of eligibility for the benefit that the employee be "scheduled to work," he would find under the cir- cumstances here that there was no accrued right to-disability benefits for any day on which the unit employees' jobs were closed to all unit em- ployees without regard to their sentiments respecting the strike Thus, the evidence on which his colleagues rely for proof of the Respondent's re- buttal of the General Counsel's prima facie case, he would construe as evidence that there was no accrued right to benefits for the period in question He recognizes, however, that his colleagues' analysis is consist- ent with that of the court of appeals in NLRB v. Sherwin-Williams Co, 714 F 2d 1095, 1098-1101 (11th Cir 1983), a case with a similar eligibility Continued 920 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Thus, we must determine whether the Respondent has come forward with evidence of a -legitimate and substantial business justification for its suspen- sion of benefits. We conclude that it did. As noted above, the Respondent's S&D and OI&I plan re- ferred to in the parties agreements, was designed to replace the wages that disabled employees would have earned had they not been disabled. Also as noted, the employee, handbook that describes these benefits lists certain -situations in which payments will be discontinued, such as vacations, suspen- sions, approved leaves of absence, and layoffs, and further states that benefits will resume when dis- abled employees, are "otherwise due to return to work." These -listed events are illustrative of the general requirement that work must be available in order for a disabled employee to be entitled, to con- tinued payment of disability- benefits. Undisputed testimony in the record shows that this general re- quirement has been applied by the, Respondent con- sistently in the past on a corporatewide basis to various situations including lockouts. Pursuant to the lockout, no work was available to employees in the represented units regardless of their participa- tion . in, the strike. Thus, as would have been the case during a, layoff, the employees previously re- ceiving benefits, could not have been "due to return to work", regardless of their medical, conditions, and there were no available wages to replace. Therefore, j, becausethe eight employees did not, during the' - lockout, meet the plan's dual require- ments of being disabled and otherwise scheduled to work, they were not, under the plan, entitled,to S&D or OI&I benefits at that time. Furthermore, the Respondent's- implementation of the plan's dual eligibility requirements in this case was not discriminatory. The Respondent's treatment -of the- alleged discriminatees was no dif- ferent from its treatment of others who, having become eligible- for benefits by virtue of their being disabled and scheduled to work, subsequently had their ' benefits suspended because junior employees were laid off or because other conditions arose pur- suant to which they no longer were scheduled to work. S&D and OI&I benefits were not cut off simply because of any unlawful, disparate treatment on the part of the Respondent towards the disabled employees based on union activity. Rather, it is requirement. Assuming that the benefits here are properly regarded -as "accrued," he agrees with the,majority that, under the circumstances here, the benefit termination was not inherently destructive of employee rights and that the Respondent advanced a legitimate and substantial busi- ness justification for terminating them To the extent that our finding of business justification for the Employ- er's action is based on the defeasance of a prior accrued right to benefits under the terms of the plan, we agree with our concurring colleague that, on the dates in question, the benefits no longer were "accrued." clear that the benefits were terminated because no work was available pursuant to -a lockout which has not been alleged to be unlawful. And, most sig- nificantly, the termination of such'benefits was con- sistent with the terms of the plan and the Respond- ent's past practice with respect to disabled employ- ees for whom no work was available both due to lockouts and for reasons other than a lockout. In these circumstances, we conclude that the Re- spondent has met its burden of proving its reliance on a reasonable' and arguably correct nondiscrim- inatory interpretation of its plan, incorporated by reference in the parties' collective-bargaining agreements, sufficient to constitute legitimate and substantial business justification for its conduct.' Proceeding with the Great Dane analysis, if the conduct itself can reasonably be found to be "`in- herently destructive' of important employee rights, no proof of anti-union motivation" 10 is required, and we can find an unfair labor practice despite the Respondent's, proof of legitimate business justifica- tion. We conclude in this regard that there is no evidence in the record to support a conclusion that the Respondent's conduct here was inherently de- structive of employee rights, i.e., had "far reaching effects which would hinder future bargaining or . . , discriminated solely upon the basis ^ of partici- pation in strikes or union activity," Portland Wil- lamette Co. v. NLRB, 534 F.2d 1331, 1334 (9th Cir. 1976), or that it created "visible and continuing ob- stacles to the exercise of employee rights." Inter- Collegiate Press v. NLRB, 486 F.2d 8-37, 845 (8th Cir. 1973).11 In this regard, the Respondent's treat- ment of the eight employees, ' as discussed above, was no different from its treatment of other em- ployees who did not meet its plan's dual eligibility requirements. Thus, its actions clearly did not con- stitute conduct which discriminated solely on the basis of participation in strikes or union activity. Moreover, as-detailed herein, the Respondent,has an established past practice of suspending S&D and OI&I benefits during strikes including lockouts. There is no evidence in the record indicating that this practice hindered future , bargaining or created continuing obstacles to the exercise of employee rights. To the contrary, the, parties have continued their bargaining relationship despite this practice and, specifically, have entered into strike settlement agreements resolving the issues that culminated in 10 Texaco, Inc, supra at 244 fn 12, quoting 388 U .S. at 34. 11 Accord NLRB v Borden, Inc, 600 F 2d 313, 321, (1st Cir 1979), Vesuvius Crucible Co v NLRB, 668 F.2d 162, 169 (3d Cir 1981), and NLRB v. 'Sherwin-Williams Co, 714 F.2d 1095, 1101 (11th Cir 1983), cited in Texaco, Inc, supra at fn 19 AMOCO OIL CO.- the strike at issue here despite the Respondent's denial of benefits.12 In light of the above, and in the absence of any evidence in the record to support a finding of an- tiunion motivation, we conclude that the Respond- ent did not violate Section 8(a)(3) and (1) as al- leged.13 In this regard, because we have found that the Respondent's suspension of the S&D and OI&I benefits was not unlawful, it follows that the Re- spondent's announcements of the suspension of such benefits similarly was not unlawful. Accord- ingly, we shall dismiss the complaint in its entirety. ORDER The complaint is dismissed. 12 We overrule Emerson Electric, supra, Conoco, Inc, 265 NLRB 819 (1982), and Texaco, Inc., 259 NLRB 1217 (1982), to the extent that they suggest denial of accrued sick leave benefits necessarily has inherently destructive effects on protected employee rights. '3 In Texaco, Inc., supra, 285 NLRB 242, we concluded that the re- spondent there failed to prove a legitimate and substantial business justifi- cation for its suspension of benefits. Thus, we found it unnecessary to decide whether the respondent's conduct was "inherently destructive" of employee rights In this regard, in Texaco we determined that the'"te- spondent had not demonstrated reliance on the terms of the contractual benefit plan to justify its discontinuance of benefits We further found that, even assuming such reliance, the respondent's contractual interpreta- tionwas both unreasonable and not arguably correct In contrast, we find here that the Respondent proved it based its suspension of benefits on its interpretation of the benefit plan We further find that the Respondent's interpretation of the plan-to the effect that an employee must meet its dual eligibility requirements to be entitled to continued benefit pay- ments-is reasonable and arguably correct based on both the language of the plan and the Respondent's past practice Finally, in contrast to Texaco, we find that the Respondent here has consistently applied the dual eligibility requirements nondiscnminatordy with respect to disabled employees for whom no work was available both during lockouts and during other situations not related to employees engaging in union or other protected concerted activities. Michael T Jamison, Esq., for the General Counsel. George J. Zazas and Robert K. Bellamy, Esqs. (Barnes, Hickham, Pantzer & Boyd), and Robert M. O'Connell, Esq. (on brief), of Indianapolis, Indiana, for the Re- spondent. Richard Sorg, International representative, of Wood River, Illinois, for Oil, Chemical and Atomic Workers International Union. Ralph Kulenkamp, president, of Wood River, Illinois, for Local 7-15. Horace Farnell, president, of Wood River, Illinois, for Local 7-776. James E. Gray, of Alton, Illinois, pro se. DECISION STATEMENT OF THE CASE ROBERT M. SCHWARTZBART, Administrative Law Judge. These cases were heard in St. Louis, Missouri, on November 6, 1980,1 on an amended consolidated corn- ' All dates hereinafter are within 1980 unless stated to be otherwise 921 plaint issued October 9,2 pursuant to charges filed by Oil, Chemical and Atomic Workers International Union (OCAW), its Locals 7-776 and 7-15, and James E. Gray, an individual. The amended complaint alleges that Amoco Oil Company (the Respondent) committed cer- tain violations of Section 8(a)(I) and (3) of the National Labor Relations Act (the Act). The Respondent denies the commission of unfair labor practices. All parties appeared at the hearing, the Respondent by counsel, and were given the opportunity to be heard, to present evidence, to examine and cross-examine wit- nesses, and to file briefs. Briefs, thereafter filed by the General Counsel and the Respondent, have been careful- ly considered. On the entire record,3 the briefs of the parties, and my observation of the witnesses, I make the following FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT The Respondent, a corporation licensed to do business in Illinois, and a wholly-owned subsidiary of the Stand- ard Oil Company of Indiana, has maintained an office and place of business in Wood River, Illinois, called the Wood River refinery. The Respondent is engaged in the processing and nonretail sale and distribution of petrole- um and related products. During the year ending December 31, 1979, a repre- sentative period, the Respondent, in the course and con- duct of its business operations, sold and 'distributed at its Wood River refinery products valued in excess of $50,000, of which products valued in excess of $50,000 were shipped from the refinery directly to points located outside the State of Illinois. The parties stipulated and I find that the Respondent is engaging in commerce within the meaning of Section 2(2), (6), and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED OCAW and its Locals 7-776 and 7-15 are labor orga- nizations within the meaning of Section 2(5) of the Act, III. THE ALLEGED UNFAIR LABOR PRACTICES A. Background The issues are principally matters of law.4 The Gener- al Counsel, citing Emerson Electric Co.,5 contends that the Respondent violated Section 8(a)(3) and (1) of the Act by discontinuing Sickness and Disability (S&D) Ben- 2 The relevant docket entries are as follows! The charges in Cases 14- CA-13423 and 14-CA-13504 were filed by OCAW on January 31 and February 22, respectively The charges in Cases 14-CA-13424-1 and 14- CA-13424-2 were filed by Locals 7-15 and 7-776, respectively, on Janu- ary 31, and the charge in Case 14-CA-13482 was filed by Gray on Feb- ruary 19 The original order consolidating these cases and the initial com- plaint was dated May 20 3 The transcript record, p 101, is corrected by deleting "1959" on LL 21 and 23 and by substituting "1952" therefore 4 The facts of this matter are largely undisputed and the General Counsel's direct case is presented by a series of stipulations and by the introduction of documents of unquestioned authenticity. 5 246 NLRB 1143 (1979) 922 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD efits and Occupational Illness ,and Injury (OI&I) Benefits during the term of a strike for eight employees at its Wood River, Illinois refinery, who had been receiving such benefits when the strike began , and that the Re- spondent did so without first investigating whether these employees, all union members actively supported the strike. The General Counsel also asserts that the Respondent violated Section 8(a)(1) of the Act when it informed em- ployees at its Wood River refinery that during a strike by OCAW and its Locals, S&D and OI&I benefits would be discontinued for employees represented by the striking labor organizations. The -Respondent, denying liability, principally con- tends that under the terms of the relevant benefit plans, in the context of its 21 -year-old "closed gate" policy in effect during the strike, & these employees had become in- eligible for such benefits as they had not been scheduled to work, such scheduling being a prerequisite of eligibil- ity. The Respondent's other arguments will be consid- ered below. The Respondent, the manufacturing and marketing subsidiary of Standard Oil Company of Indiana with principal offices in Chicago, Illinois, operates refining, storage, and distribution facilities throughout the United States. Included among the Respondent's facilities are 10 refineries where crude oil, is refined into gasoline, fuel oil, asphalt, and other petroleum-related products. At the Respondent's Wood River, Illinois refinery, the only facility directly involved in this proceeding, OCAW and its Local -7-776 represent 467 operating and mainte- nance employees, and OCAW and its Local 7-15 repre- sent 28 clerical employees in the Respondent's manufac- turing department and 14 clerical employees in the Re- spondent's distribution terminal , operated in conjunction with.the Wood River refinery . Each of these three bar- gaining units are covered by separate collective -bargain- ing agreements, respectively, effective from January 8, 1979, to January 7, 1981.7 OCAW and its Local Unions also represent thousands of the Respondent's employees employed at various, fa- cilities throughout the country . OCAW and its Locals have represented employees at Wood River since 1964- 1965.8 As the three collective-bargaining agreements at Wood River do not provide for union security, membership in OCAW is voluntary. The contracts also contain reopener clauses whereby, on written notice to the Respondent the parties agreed to -negotiate during the contracts' terms with respect to wage increases , a fully paid uni- form health care benefits package, and improvement in vacation schedules. In the event that the parties did not reach agreement within 60 days, OCAW and its Locals would have the right to strike as of January 8. 6 Under the Respondent's "closed, gate" policy, employees represented by a striking union are not permitted to work while the strike continues, even if they should so desire. 7 The contracts were signed in February 1979. 8 Central States Petroleum Union, which had represented employees at Wood River for many years , merged with the Independent Petroleum Workers to form the Independent Oil Workers Union, effective October 1, 1959. The I O.W U at Wood River , in turn, affiliated with OCAW in 1964-1965 B. The Facts 1. The 1980 strike at Wood River Locals 7-776 and 7-15 gave timely notice of their desire to negotiate the economic items listed in the con- tractual reopener provisions, and bargaining sessions were held on December 21 and 28, 1979, and January 3, 4, and 7. No agreement was reached at these meetings. During these sessions, union representatives gave notice to the Respondent that a strike against the Respondent would commence at 4 p .m. on January 8, absent an accord. At the January 3 meeting, the Respondent's refinery employee relations manager, Jerry W. Thomas, advised the representatives of OCAW and its two Locals that should a strike occur, the Respondent intended to contin- ue to operate without interruption using supervisors and personnel not represented by OCAW, and that the Re- spondent's "closed gate" policy would be implemented in that no work would be made available during the strike to employees in the bargaining units represented by OCAW and its two Locals who might want to work. Thomas also then' informed the Union that during a strike, wages and certain benefits , including S&D and OI&I, would not be paid to employees represented by OCAW. The Unions did not protest this projected sus- pension of benefits on January 3 or during the negotiat- ing sessions that followed. On January 4, the Respondent, by letter to'all OCAW- represented employees, noted that no agreement had yet been reached and restated its intent to continue oper- ations during any forthcoming strike . Employees were advised that no work would be made available to OCAW-represented employees during the period of a strike and that S&D and OI&I benefits would be sus- pended.9 At 4 p.m. on January 8, the Unions began what is agreed was a lawful strike at the Wood River refinery. Also on January 8, Refinery Manager F. K. Webb sent separate letters to OCAW-represented employees who were at that time receiving S&D or OI&I benefit -pay- ments. These identical letters provided, in relevant part, as follows: Today the OCAWIU commenced a strike at the Wood River refinery. This has necessitated our es- tablishing a staffing program with supervisory and unrepresented personnel so that operations, may continue safely, efficiently and without, interruption. Accordingly, at this time no work has been made available to employees in the bargaining unit who might otherwise be willing to work. Until such time as the strike ends or work is made available to employees in the bargaining unit, whichever occurs sooner, your current Sickness & Disability payments are hereby suspended in ac- cordance with the terms of the Plan. 9 Letters identical to those of January 4 were again sent by the Re- spondent to all OCAW-represented employees on January 8, the day the strike began AMOCO OIL,CQ. , When the strike began, the eight Wood' River employ- ees listed below were receiving S&D or OI&I benefit payments, and were represented by OCAW and its Locals 7-15 or 7-776. On January 8, the Respondent dis- continued the S&D and OI&I benefits these employees had been receiving for days prior to that date. None of the listed employees were scheduled to work at any time during the period of the strike, from January 8 to April 1. During this period of time, each of them was a member in good standing in OCAW and, one of the Local Unions. Benefits for these employees were discon- tinued beginning January 8 even though they had not re- covered, had not been released by their physicians to return to work, or did not engage in picketing on behalf of OCAW until the dates shown below next to their re- spective names. In discontinuing S&D and OI&I benefit payments, the Respondent did not first investigate or at- tempt to investigate whether the employees were still sick or disabled or still injured due to occupational causes. The Respondent also did not first attempt to as- certain whether these employees individually supported the strike. 10 Accordingly, the General Counsel contends that these employees are entitled to receive remedial benefits from January 8 to the dates they respectively joined the picket fines, except that, as shown, three employees continued unable to work for the entire strike period and did not picket. For them, benefits are claimed to April 1, when the strike ended, as after April, S&D and OI&I benefit payments were resumed. The affected employees and their claim termination dates are as follows: Sam Biondolino January 16 Luther Diserens January 19 Jesse J. Gater January 14 James E. Gray April 1 Harley Howard March 7 John E. Metzler Jr. April 1 Harry Reneau April 1 John Rothe January 19 On January 9, Charles H. Clark, the refinery payroll and benefits supervisor, received a telephone call from employee Harry Reneau in which Reneau said that he was still sick and not participating in the strike. Reneau asked whether his benefits would continue. Clark advised him, as he had at least one other caller during the week of January 13, that such benefits were discontinued. On March 30, the Respondent entered into separate strike settlement agreements with OCAW and the two Locals, and the employees returned to work at Wood River on April 1 at 4 p.m. Each of the three settlement as The Respondent argues that no prior investigation was warranted as those employees' support for the strike had been manifested. In the ab- sence of union security, they voluntarily had retained membership in OCAW. The bylaws of OCAW and its Locals provide for the filing of disciplinary charges against a member who engages "in acts which tend to hinder the prosecution of a . . . strike," which charges may result in fine, disqualification from union office, suspension, or expulsion . The Re- spondent, therefore, contends that by not taking initiative to renounce union membership, these employees overtly supported the strike within the meaning of Emerson Electric, supra, and that the "closed gate" policy could be applied to them, as well. 923 agreements signed at Wood River contained the follow- ing provisions: Unfair Labor Charges, Court Actions, Grievances, Etc. The Union will withdraw all unfair labor practice charges, lawsuits, and/or grievances relating to ben- efits such as CMEP (Comprehensive Medical Ex- pense Plan), vacations, and sickness and disability benefits. Concurrently with the strike at Wood River, OCAW and other of its Locals also struck at eight of the Re- spondent's other refineries., The' Respondent's "closed gate" policy also was implemented at these other facili- ties, and the strike settlement agreements signed by the Respondent with OCAW and its various Locals at these facilities all contained the above provision concerning withdrawal of unfair labor charges and other claims by the Unions. Pursuant to this provision, OCAW and its Locals, when the employees had returned to work, asked to withdraw the substantially similar charges filed with nine Board Regional Offices stemming from the strikes.' The Union also attempted to withdraw the charges underly- ing this proceeding. While all other requests to withdraw charges were approved, the Regional Director of Region 14 refused to approve withdrawal of the charges and proceeded to hearing. The Respondent argues that in signing the strike settlement agreements containing pro- visions for withdrawal of these charges, and by seeking withdrawal in compliance therewith, the Unions have waived claims for S&D and OI&I benefits arising from the strike on their own behalf and on behalf of their members. The Respondent also asserts that in refusing to approve withdrawal, contrary to the general course, the Regional Director abused his decision. 2. The Sickness and Disability and the Occupational Illness and Injury Benefit Plans The S&D and OI&I benefit plans, in effect at all the Respondent's facilities, including the Wood River refin- ery, are wage continuation programs for employees unable to work because of illness or'injury. As titles indi- cate, the S&D plan makes provisions for employees whose illness or disabilities are not job-related, while OI&I applies to occupationally caused or related disabil- ities. Employees become covered by the S&D plan after 1 year of employment with the Respondent, when they become eligible for full pay for the first 2 weeks of dis- ability and half pay for the following 4 weeks. These benefits increase yearly until, with 6 years of service, the maximum benefit is reached for 12 weeks of full pay and 40 weeks of half pay. Eligibility under OI&I, however, begins immediately on employment. Benefits, which do not increase with ad- ditional service, provide full pay for the first 12 weeks of disability and half pay for the next 40 weeks. The S&D and OI&I plans are in effect at all the Re- spondent's facilities, including the Wood River refinery, and are applicable to all personnel, whether managerial, 924 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD supervisory, or rank and file. Employees are included in these plans without regard to whether they are repre- sented by OCAW,1 1 other labor organizations, or are unrepresented . Both plans are fully paid by the Respond- ent without contribution by the Unions or employees. Neither plan is funded and costs are paid by the Re- spondent from current earnings. To become eligible to receive benefits under either plan, employees must be scheduled to work and be unable to do so because of illness or disability. Mere physical inability to work without actually having been scheduled would not qualify an employee to collect, as, unless scheduled to work, there would be no disability- related loss of compensation . Accordingly, employees are advised in the company-distributed booklet summa- rizing available job benefits that they are not eligible to receive S&D and OI&I benefits while they are on vaca- tion, leave of absence, suspension, or layoff, but will become eligible for these benefits when they are other-, wise due to return to work. Accordingly, these benefits would be suspended for an employee who had been re- ceiving them when placed on layoff as of the time the employee immediately below him on the seniority list is laid off. Benefits would be resumed, in the event of con- tinued disability, when the employee just below in se- niority is recalled. Similarly, an ill employee placed on suspension would lose his eligibility for these ' benefits while the suspension continues. In explaining these plans, the Respondent emphasizes the dual eligibility require- ments-an employee must be ill and he must be sched- uled to work. The Respondent contends that unlike certain other benefits, employees do not obtain vested interest in these plans. The only way in which a benefit can be received is by- meeting the above two prerequisites. Employees who, as noted, do not contribute toward the costs, re- ceive nothing from the S&D and OI&I programs when they die or retire, and unused benefits cannot be trans- ferred, accumulated, or otherwise claimed. The Respondent asserts that when its "closed gate" policy was applied at the Wood River refinery during the January-April strike, OCAW-represented employees who then were receiving S&D OI&I benefits, lost their entitlement because they no longer were scheduled to work. 3. The, Respondent's "closed gate" policy In applying its "closed gate" policy at Wood River to employees represented by the striking OCAW Unions, the Respondent has continued a practice, applied to all its facilities since 1959, of not providing work for em- ployees represented by striking unions during the term of the strike, even though they may wish to work . In 1980, this practice was followed not only at Wood River, but also at the eight other refineries concurrently struck by OCAW and its Locals. The Respondent's witnesses testified that this policy was adopted solely to avoid repetition of what had been experienced in 1959 at the Respondent's refineries at 11 The collective-bargaining agreements between the Respondent, OCAW, and its Locals include the S&D and OI&1 plans by reference Texas City; Texas, and Sugar Creek, Missouri. In that year, the Texas City and Sugar Creek refineries were two of several refineries operated by the Respondent that were involved in strike by operating and mainte- nance employees. Herbert H. Medsger12 testified that at the time of the 1959 strike at the Texas City refinery, he,was employed as a process operator within the represented bargaining unit, was a union member , and participated in the strike, picketing in his turn. 13 Initially, no work was made available to hourly em- ployees who were represented by the Union. After the strike had been in progress at Texas 'City for about 2 or 3 months, a policy was announced to hourly employees represented by -the Union, that the Respondent would allow them to return to work . Following this announce- ment, about 56 of the 1300-1400 unit employees crossed OCAW's picket line to work.14 During the strike, Medsger saw returning employees subjected to jeers and name-calling by those on the picket line as they traveled to and from work in con- voys. Returnees also occasionally were followed by pick- eting employees as they left the refinery. The Union pub- licized the names of returning employees on a 6-by-8 foot sign erected near the union hall and facing the road- way. The sign bore the heading "American Oil Compa- ny Scabs" and the names of all employees who had re- turned to work were printed in large letters below. A represented employee was severely beaten on the union hall lawn when he went to explain his need to go back to work, and two other employees were terminated by the Respondent for having fired shotgun blasts through the bedroom window and automobile of a returnee' in the early morning hours. Two employees were terminated for their roles in this incident . The Union expelled from membership all returning employees who were members. Medsger recalled that when the strike ended,- tensions and hostilities continued between those who had support- ed the strike and those who had returned to work. All who had returned were ostracized and subjected to name-calling. Certain individuals still employed there as of the hearing date continue to receive this treatment. 15 Floyd Thomas Jr.16 described difficulties experienced at the Sugar Creek refinery during the 1959 strike. When the strike began on July 8, as at Texas City, represented employees were not permitted to work. However, em- ployees thereafter also were notified that those who wished to come back to work could do so. On and after 12 Medsger, labor relations supervisor at the Texas City refinery at the time of hearing, has been continuously employed at that facility since 1947 He held bargaining unit positions until 1965 13 The strike at Texas City began in late June 1959 and continued to early January 1960 14 Medsger was not among those who returned to work during the strike 15 Medsger related that he was compelled , to disassociate himself from the returnees although he would have preferred to end the matter, having been by others told that if he continued attempts to speak with them, he would be given the same treatment 16 Thomas, safety coordinator at the Sugar Creek refinery at the time of the hearing, has been employed at that facility since 1951 At the time of the strike at Sugar Creek, from early July 1959 to March 1960, he was a staff engineer, a nonbargaming unit position AMOCO OIL, CO, August 20, slightly more than 100 employees of the ap- proximately 1000 striking operating and maintenance em- ployees at Sugar Creek did go back while the strike con- tinued. Thomas testified that one returned employee had de- scribed being shot at while driving to work , and Thomas had seen the car. Although the bullet had missed the em- ployee, it had gone through the car window on the driv- er's side. On another morning during the strike, an auto convoy of returnees were stopped while going to work by a group of about 20 men, who knocked out car win- dows using baseball bats and overturned two vehicles. Two persons were dragged from their automobiles and beaten, resulting in overnight hospitalization. 'Thirteen members of the attacking group were jailed for contempt of court, having violated an outstanding injunction. These persons also were discharged. Following the strike, as in Texas City, the employees who had stayed with the strike ostracized employees who had gone back to work. The two groups did not speak or willingly work together, remaining in separate groups. This friction continued for years after the strike ended, and divided at least one family . One of two brothers employed in the represented unit when the strike began returned to work while the other remained out. From the end of the strike until they retired in the midseventies, the two brothers did not talk to each other. As a result of these experiences at the Texas City and Sugar Creek refineries during and since the 1959 strikes, by the testimony of John F. Horner, the Respondent's vice president of refining and engineering, 17 manage- ment made a decision that in the event of a strike at any refinery operations it would continue with supervisory and technical personnel and work would not be sched- uled for employees within the represented units. Since 1959, strikes have affected certain of the Respondent's refineries in 1969, 1974, and 1980. The Respondent has applied its "closed gate" policy at all struck facilities on those occasions. Horner, in consultation with other mem- bers of management, made the decision to again invoke the "closed gate" policy at the nine refineries affected by the 1980 strike. Horner testified that as the "closed gate" policy was adopted solely to avoid a repetition of the 1959- experi- ences at Texas City and Sugar Creek, there was no intent to use this practice to retaliate against employees because they had gone on strike, were supporting the strike, were OCAW members , or were engaging in any other union activities. Is 17 Horner, who exercised general supervisory responsibility over the Respondent's 10 refineries, was assigned to the research branch at the Texas City refinery in 1959, and observed the situation there during the strike, 18' Horner's testimony is generally corroborated by that of Medsger and Thomas Although neither of these men had participated in manage- ment's decision to invoke the "closed gate" policy, Medsger had seen it applied at the Texas City refinery during the 1969, 1974, and 1980 strikes Thomas related that there were no strikes at the Sugar Creek refinery from 1959 until 1980, but that the "closed gate" was effectuated there on the latter occasion Both men testified as to the benign intent of this doc- trine. 925 C. Discussion and Concluding Findings In Emerson Electric, supra, on similar facts, the Board found that the Respondent had violated Section 8(a)(1) and (3) of the Act by discontinuing during a strike sick- ness and accident benefits for employees who had been receiving them when the strike began. This was done before the Respondent was aware that any of the em- ployees, all of whom were then unable to work, had rati- fied or actively supported the strike. In finding violation, the Board noted that, earlier, with the strike impending, the Respondent had served notice that these benefits would not be paid to such employees, although a union representative had protested that the individuals who were unable to work were not participants in any strike. The 'Board majority affirmed that employees have a Section 7 right to refrain from declaring their positions on a strike while medically excused, and held that: [A]n employer may no longer require its disabled employees to disavow strike action during their sick leave in order to receive disability benefits. To allow the termination of such benefits to certain em- ployees as a result solely of the strike activities of others is to penalize the employees who have not yet acted in support of the strike. To the extent that Southwestern Electric Power Company" is inconsist- erkt with out decision herein, it is hereby overruled. [W]e now hold that for an employer to be justified in terminating any disability benefits to employees who are unable to work at the start of a strike it must show that it has acquired information which indicates that the employee whose benefits are to be terminated has affirmatively acted to show public support for the strike. Barring such affirmative action . . . we agree . . . that the disabled employ- ees found herein to have been discriminated against are entitled to (sickness and accident) benefits for the full length of their sickness or disability, [Foot- note omitted.] No merit is found to the Respondent's arguments that the present case is distinguishable from Emerson Electric in that here there was no discriminatory intent in discon- tinuing benefit payments; that these employees merely could not meet the work scheduling prerequisite to the S&D and OI&I benefit plans because of the lawful "closed gate" policy, imposed for proper motive. Nor do I agree that as these plans were noncontributory and nontransferrable, these employees did not have an enti- tlement to continue to receive them as benefits previous- ly earned. 19 216 NLRB 522 (1975)' In Southwestern Electric Power, the Board concluded that the employer had acted lawfully by terminating sick leave benefits for employees on sick leave before a strike prior to any showing that they supported the strike The majority there reasoned that an em- ployer may reasonably believe employees so situated supported the strike solely because the strike was effective and the employees were union members This rationale, again here urged by this Respondent , was re- jected in Emerson Electric as too speculative to warrant termination of earned existing disability benefits 926 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Even accepting, for argument's sake, that "closed gate" policy is intended to avoid repetition of the vio- lence and abiding friction experienced in connection with the 1959 strikes at Texas City and Sugar Creek, its appli- cation to employees unable to work at Wood River during the 1980 strike, in terms of Stated purposes, is` ir- relevant. The claimers in this matter, all unable to work when the strike began, were not on January 8 capable of antagonizing strikers by crossing picket lines to perform duties in opposition to the strike. The Respondent does not state a concern that active strikers would object to a situation where sick, unit members might continue to re- ceive previously earned disability benefits while unable to work.20 In short, although it is clear that discontinuation of S&D and OI&I benefits to the eight sick employees during the strike saved the Respondent money, it is not clear that their continuation would have fomented in- creased tensions within the unit. The Respondent's contention that the sick employees became ineligible under the plans as, pursuant to the "closed gate," they were not scheduled to work also is not dispositive. These individuals were not removed from the work schedule because of situations arising in the normal course of employment as referred to in the above-mentioned booklet summarizing job benefits, i.e., vacations, layoff, suspension, and approved leaves of ab- sence. Rather, they were deliberately removed by the Respondent as a response to a strike by other employees. This had the effect, found violative in Emerson Electric of imposing a sanction against certain unit employees be- cause others had gone out on strike. The Respondent contends that its "closed gate" doc- trine has not been applied now or historically as' an an- tiunion measure. However, in Allied Industrial Workers v. NLRB,21 the court in weighing whether there was an antiunion motive in certain discriminatory conduct, held, after considering NLRB it. Great Dane Trailers'22 that under the facts presented there was no necessity of deter- mining whether the employer's conduct there was "in- herently destructive" of important employee rights, or a "comparatively slight" discrimination because the Com- pany failed to prove a substantial business justification for its relevant conduct.23 Here, as in the Allied Industri- 20 The S&D benefits here, as were the sickness and accident payments in Emerson Electric, are deferred payments for past work performed as benefits increase with seniority No coverage is afforded under the S&D plan in the present case until the employee has completed 1 year of em- ployment, and 1P years' service are required to achieve maximum bene- fits Although coverage under OI&I attaches immediately on employment and benefits do not escalate with increased seniority, as an employee must suffer a job related injury to become eligible, benefits under OI&1 are not less earned This equity apparently also was recognized by the Respondent in making full OI&I coverage immediately available 23 476 F 2d 868, 877-878 (D C Cir 1973) 22 388 U S 26, 33-34 (1967) 22 In Great Dane Trailers, the Supreme Court held that when the em- ployer's conduct was "inherently destructive" of important employee rights, no proof of antiunion motivation is needed and an unfair labor practice can be found even if the employer introduces evidence that the conduct was motivated by business considerations. On the other hand, if the adverse effect on employee rights is 'comparatively slight," an an- tiunion motivation must be proved to sustain the charge if the employer comes forward with evidence of legitimate and substantial, business justifi- cations for the conduct al Workers case, no such similar determination is neces- sary as it has been found above that the Company's stated reason for applying its "closed gate" policy to the eight employees as justification for discontinuing their benefits during the -strike, was irrelevant. As important rights of these employees were thereby compromised, an unlawful motivation is inferred.24 The Respondent further argues that as the eight em- ployees had voluntarily kept their membership in OCAW and its Locals, even absent union-security provi- sions, and had not subjected, themselves to the disciplines provided in the Union's bylaws by acting to hinder the strike, they had openly and affirmatively supported the strike so as to lose benefit eligibility under Emerson Elec- tric. This reasoning, however, was specifically rejected there in overruling Southwestern Electric Power Co. Finally, the Respondent contends that the Unions, among other things, waived all pending S&D and OI&I benefit claims on behalf of themselves and their members by agreeing as part of the three strike settlement agree- ments to withdraw all unfair labor practice charges, law- suits, and/or grievances relating thereto and by, thereaf- ter, requesting withdrawal of the charges. This point also was addressed in Emerson Electric by Administrative Law Judge Ricci in his Board-approved decision:25 The Board acts 'in the public interest to enforce public, 'not private, rights. National Licorice Co. it. N.L.R.B., 309 U.S. 350 (1940); Amalgamated Utility Workers it. Consolidated Edison Co., 309 U.S. 261 (1940); Agwilines, Inc. v. N.L.R.B., 87 F.2d 146 (5th Cir. 1936). "Whenever private contracts conflict with its functions, they obviously must yield or'the Act would be reduced to a futility." J I. Case Co. v. N.L.R.B., 321 U.S. 332 (1940). Section 10(a) of the Act explicitly provides that the Board's power to prevent unfair labor practices "shall not be affected by' any other means of adjust- ment or prevention that has been or may be estab- lished by agreement, law, or otherwise ...." Ac- cordingly, the "parties cannot by contractual agree- ment divest the Board's function to operate in the public interest." Boire it. International Brotherhood of Teamsters, 476 F.2d 778 (5th Cir. 1940). Nor, can merit be found to the Respondent's conten- tion that the General Counsel abused his discretion by refusing to approve withdrawal of the charges in the matters here considered when leave to withdraw similar charges was concurrently granted in other Regional Of- fices. The charges underlying the consolidated com- plaints have been found to be meritorious, the separate rights of eight employees are involved and, in agreement with the General Counsel, it would not have been appro- priate to approve withdrawal to do so would have' left these individuals without a remedy. It is also noted that 24 It is noted that the "closed gate" doctrine has not always been in- voked to avoid violence and tension, as when implemented during the first months of the 1959 strike at both Texas City and Sugar Creek 25 246 NLRB at 1149 AMOCO OIL CO. the individual Charging Party, Gray, neither agreed to withdraw his charge nor attempted to do so. For the above reasons, it is found that the Respondent violated Section 8(a)(3) and (1) of the Act by discontinu- ing sickness and disability and occupational illness and injury benefit payments for the eight employees from January 8, 1980, to the dates set forth above. It is further found that the Respondent violated Section 8(a)(1) of the Act when, without prior investigation, it notified em- ployees in advance of and during the strike that S&D and OI&I benefits would be suspended for the duration of the strike, as the policies announced did not specifical- ly exempt employees who were receiving payments under these plans when the strike began. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES ON COMMERCE The activities of the Respondent set forth in section III, above, found to constitute unfair labor practices, oc- curring in connection with its operations described in section I, above, have a close, intimate, and substantial relationship to trade, traffic, and commerce among the several States, and tend to lead to labor disputes burden- ing and obstructing commerce and the free flow thereof. CONCLUSIONS OF LAW 1. The Respondent is an employer engaged in com- merce within the meaning of Section 2(2), (6), and (7) of the Act. 2. Oil, Chemical and Atomic Workers, International Union and its Local Unions 7-15 and 7-776 are labor or- ganizations within the meaning of - Section 2(5) of the Act. 3. The Respondent has violated Section 8(a)(3) and (1) of the Act by withholding payment of sickness and dis- ability and occupational illness and injury benefits during a strike from the eight employees named below in the 927 remedy section of this decision for periods when these employees were not participants in the strike. 4. The Respondent has violated Section 8(a)(1) of the Act by announcing to employees that during a strike by the above-named Unions sickness and disability and oc- cupational illness and injury benefit payments would be withheld from employees then receiving same who were not strike participants. 5. The aforesaid unfair labor practices are unfair labor practices within the meaning of Section 2(6) and (7) of the Act. THE REMEDY Having found that the Respondent has engaged in cer- tain unfair labor practices, it will be recommended that the Respondent be required to cease and desist therefrom and to take certain affirmative action designed to effectu- ate the policies of the Act. It having been found that the Respondent unlawfully withheld sickness and disability and occupational illness and injury benefit payments from the eight employees listed below during a strike at times when they were not strike participants, these employees should be reimbursed for benefits lost under these plans from January 8, 1980, the date the strike began when these benefit payments were discontinued, until the dates shown below next to the names of the respective employees: Sam Biondolino January 16 Luther Diserens January 19 Jesse J. Gater January 14 James E. Gray April 1 Harley Howard March 7 John E. Metzler Jr. April 1 Harry Reneau April 1 John Rothe January 19 [Recommended Order omitted from publication.]