John Dusenbery Co., Inc.

654 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD John Dusenbery Co., Inc. and Local 945, Interna- tional Brotherhood of Teamsters , Chauffeurs, Warehousemen and • Helpers of America, AFL- CIO. Case 22-CA-13889 16 December 1987 DECISION AND ORDER BY CHAIRMAN DOTSON AND MEMBERS JOHANSEN AND CRACRAFT On 30 June 1986 Administrative Law Judge Robert T. Snyder issued the attached decision. The Respondent and the General Counsel filed excep- tions and supporting briefs, and both filed answer- ing briefs. 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 rulings, findings, I and conclusions except as stated below and to adopt the recommended Order as modified. The Respondent has excepted to the judge's find- ing that the parties had not reached agreement on the issue of a deductible for basic medical insur- ance. We find merit to the Respondent's exception and will dismiss the complaint to the extent it re- lates to the deductible issue for the following rea- sons. The parties' expiring contract provided for "basic medical" benefits, including doctor's care and hospitalization, with no "deductible" paid by employees, and "major medical" benefits that re- quired deductibles of $100 per individual and $200 for a family. Pursuant to a goal of containing health care costs, the Respondent proposed, on 12 December 1984, to require 20 percent coinsurance payments by employees on "basic medical" bene- fits, and to raise the deductible to $200/400 on "major medical" benefits. The Respondent ' also proposed a second opinion requirement on certain surgery and outpatient surgery in certain circum- stances. The Union's bargaining committee re- i The Respondent has excepted to some of the judge's credibility find- ings The Board's established policy is not to overrule an administrative law judge's credibility resolutions unless the clear preponderance of all the relevant evidence convinces us that they are incorrect Standard Dry Wall Products, 91 NLRB 544 (1950), enfd 188 F 2d 362 (3d Cir 1951) We have carefully examined the entire record and find no basis for re- versing the findings In adopting the judge's credibility findings we do not rely on his statement, in distinguishing SCA Services of Georgia, 275 NLRB 830 (1985), that the crime of conspiracy to monopolize the gar- bage industry "did not consist of fraudulent or false conduct or acts and did not involve any personal moral transgressions, turpitude or, character- istics which could help shed light on Rizzo's actions or statements in the instant proceedings " There was no exception to the judge's findings and conclusions on the issue of prorating a bonus payment in the final year of the contract sponded that it wanted to consult with its medical programs expert. Subsequently, Rizzo, who became the Union's negotiator, attempted to convince D'Ablemont, the Respondent's negotiator, that the Respondent should join the Union's medical insur- ance program. D'Ablemont declined. After a 2-month hiatus in bargaining, a strike in progress, and a negotiation session on 25 April 1985, a Federal mediator encouraged D'Ablemont to make a new proposal. It was undisputed that in a 29 April telephone conversation, D'Ablemont made a proposal to Rizzo that eliminated the coin- surance payment, but added a $100/200 deductible to the "basic medical" benefits and eliminated the proposed increase in "major medical deductibles." The 29 April proposal' would maintain the second opinion on the surgery and outpatient surgery as- pects of the Respondent's earlier proposal. Rizzo stated that the union bargaining committee would recommend the ratification of the proposal that evening if the Respondent would make the con- tract retroactive. D'Ablemont refused and Rizzo stated that the committee would not recommend ratification. The Respondent's 29 April' proposal was rejected that night. On 30 April the Respondent circulated a letter to salaried (not bargaining unit) employees that stated its position about the state of negotiations and set out its 29 April proposal, including requiring the $100/200 deductible on "basic medical" insurance., Although the letter was not sent to the Union, Union Steward Walley stated that he received a copy of this letter and passed it along to Business Agent Fusco. Fusco did not testify, and what he did with the letter was not established. Although an 8 May union leaflet was, in part, in response to the 30 April letter, the judge credited Rizzo that he did not personally review the letter. In May there were multiple telephone conversa- tions between D'Ablemont and Rizzo in which various topics of bargaining were discussed. On 29 May, at the end of a day of bargaining via the me- diator from separate rooms, the Respondent pre- pared a list of seven changes it proposed in the ex- pired contract. The third item on the list was "Medical Insurance: As proposed by company on April 29, 1985 and set forth in letter to employees dated April 30, 1985." The credited testimony indi- cates that the Union had an opportunity to read the list but that there was no explanation of the medi- cal insurance proposal before the union committee hurriedly left for a ratification meeting. The Re- spondent's proposal was rejected that evening. In a 31 May telephone conversation, D'Able- mont made changes in the attendance bonus day, pension, and back-to-work bonus payment aspects 287 NLRB No. 67 JOHN DUSENBERY CO 655 of the 29 May proposal. Rizzo said he thought they had a deal and that he would let D'Ablemont know . On 1 June new problems arose and were re- solved. On 2 June Rizzo told D'Ablemont that the em- ployees had ratified the Respondent's proposal pro- vided that they could return to work at one time, contrary to the 29 May proposal. This problem was not resolved and the picketing continued on 3 June. On 3 June Rizzo called D'Ablemont and they re- viewed what they had agreed on item by item-al- though D'Ablemont could not say at what level of specificity . Rizzo then said , "[O]kay, the strike is over." After the strikers returned to workthe Respond- ent delivered a memorandum to the Union that listed the changes in the prior contract to which it believed there had been agreement . The Union contended that it had not agreed to four of the items in the memorandum and demanded bargain- ing on those subjects. The Respondent , believing agreement had been reached , refused to bargain. The judge concluded that the Respondent was obligated to continue bargaining about medical in- surance although it was clearly part of the proposal ratified on 2 June. The judge distinguished the de- ductible issue from the two subjects on which he found the Union bound by Rizzo's conduct based on his finding that Rizzo never understood the 29 April deductible proposal. The record does not support the judge's finding. Regarding the Respondent 's 29 April proposal, union steward and bargaining committee member Walley testified: We discussed those things, what the compa- ny's offer had been with Mr. Rizzo that day, and we weren't satisfied with whatever it was. We brought it back to the membership and they weren't satisfied either . . . . I believe the Company's offer was they in- creased the wages 4, 3, 3, and they were still insistent on the insurance being changed. They were insistent on the 100 200 into it. We didn't. We were in agreement with the second opinion (and) the outpatient basis surgery. The judge found Walley credible and correctly interpreted the quoted testimony in its context to be that Walley recalled "that the Company was in- sistent on a new $100/200 deductible on the insur- ance (to which) the Union didn 't agree." A "new" deductible to that the Union did not agree clearly refers to one on "basic medical" because "major medical" already had a $100/200 deductible that the Union found acceptable. Because it was Rizzo who relayed the Respondent's proposal to the com- mittee it is clear that Rizzo also correctly under- stood the Respondent's 29 April proposal. For this reason we do not agree with the judge's conclusion that when the Union ratified the Re- spondent's 29 May proposal on medical insur- ance-which specifically referred to its 29 April proposal-there was not a "meeting of the minds." Accordingly, the Respondent did not violate Sec= tion 8(a)(5) when it refused to bargain on this sub- ject in reliance on Rizzo's unqualified statements that agreement had been reached. Moreover, the 29 May written proposal further stated that it was "as set forth in letter to employ- ees dated April 30, 1985." The Union had the 29 May proposal for 3 days before ratification . During this period there were multiple discussions with the Respondent . No one from the Union inquired about the 30 April letter. The Union was clearly on notice that the Respondent 's proposal was con- tained in the 30 April letter and thus any misunder- standing of the Respondent 's proposal cannot be considered reasonable. ORDER The • National Labor Relations Board adopts the recommended Order of the administrative law judge as modified below and orders that the Re- spondent, John Dusenbery Co., Inc., Randolph Township, New Jersey , its officers, agents, succes- sors, and assigns, shall take the action set forth in the Order as modified. 1. Substitute the following for the final para- graph of the Order. "IT IS FURTHER ORDERED that the complaint is dismissed insofar as it alleges that the Respondent violated the Act by refusing to bargain collectively as to the provisions contained in the memorandum agreement that : do not apply negotiated wage in- creases to the minimum wage rate for each job classification; establish a separate bonus day sched- ule for employees with 5 or more years seniority; or impose deductibles on "basic medical" insur- ance." Gary A. Carlson, Esq., for the General Counsel Joel S. Cohen, Esq. (Kelley, Drye & Warren, Esqs.), of New York, New York, for the Respondent. Ira Drogin, Esq. (Leaf Sternklar and Drogin, Esqs.), of New York, New York , for the Charging Party. DECISION STATEMENT OF THE CASE ROBERT T. SNYDER, Administrative Law Judge. This case was heard by me on 2 and 3 December 1985 in Newark, New Jersey. The complaint, which issued on 29 August 1985 , alleges that after rejecting a memorandum 656 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD of agreement prepared by Respondent that ^ contained four proposals that it at no time agreed to accept, Local 945, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America (Local 945 or the Union), as exclusive representative of Respondent's production and maintenance employees , demanded, and the Respondent refused, and has continued to refuse, to bargain with the Union over a successor collective-bar- gaining agreement, in violation of Section 8(a)(1) and (5) of the Act. By its answer, filed on 10 September" 1985, Respondent acknowledged that the, Union demanded bargaining over three of the four provisions described in the complaint, but denied any obligation to continue to bargain with the Union and, further, asserted as an af- firmative defense that by accepting the increased benefits of the successor agreement the Union is estopped from demanding continued bargaining over the four, items claimed to be unresolved. On the entire record, including my observation of the demeanor of the witnesses and after careful consideration of the posthearing briefs filed by the Respondent and General Counsel, I make the following FINDINGS OF FACT I. JURISDICTION AND LABOR ORGANIZATION STATUS Respondent, a domestic corporation , maintains an office and place of business in Randolph Township, New Jersey (the Randolph plant or facility), where it is en- gaged in the manufacture, assembly, and nonretail sale of paper cutting and paper processing machinery and relat- ed products. Annually, Respondent, in the course and conduct of its business operations, sells and ships from its Randolph Township, , New Jersey facility, products, goods, and materials valued in excess of $50,000 directly to points outside-the State of New Jersey. Respondent admits, and I find, that it is an employer engaged in com- merce within the meaning of Section 2(2), (6), and (7) of the Act. The complaint also alleges, Respondent admits, and I find that the Union is a labor' organization within the meaning of Section 2(5) of the Act. ' Il. THE ALLEGED UNFAIR LABOR PRACTICES A. Background In 1966, the Board certified Local 945 as the repre- sentative for the purposes of collective bargaining of all production and maintenance employees employed by Re- spondent at its plant, then located in Clifton, New Jersey Since 1966, the Respondent and the Union have maintained a collective-bargaining relationship by enter- ing into a series of successive 2- or 3-year collective-bar- gaining agreements During the term of the 1978-1981 agreement Respondent transferred its production and maintenance operation to its present - location in Ran- dolph Township, New Jersey. The parties' practice over the years has been to negoti- ate modifications and, changes in their basic agreement, which are then set forth in a written' memorandum exe- cuted by both sides, invariably including a provision noting that, other than the changes incorporated therein, all, other provisions of their prior agreement continue in effect Finally, the changes included in the memorandum 'are then incorporated in a full, successor agreement The last agreement prior to the present dispute was in effect from 25 January 1982 to 27 December 1984 It was exe- cuted on behalf of Respondent by Roger Young, vice president, and on behalf of Local 945 by its president and William Lyons, business representative and George Wally, Jr., chief steward, and also contained the signa- tures 'of a 13-member employee negotiating committee Since 1966, Respondent's chief negotiator had been Eugene D'Ablemont, its labor counsel and partner in the law firm of Kelley, Drye & Warren, attorneys for Re- spondent in the instant proceeding Over the years, and through the negotiations leading to the 1982-1984 agree- ment, Bill Lyons, union business agent, had negotiated on behalf of'Local 945. He had always been aided and assisted by an employee negotiating committee, which, invariably, also signed the agreements which emerged from the negotiations. By the time negotiations com- menced for a successor agreement in November 1984, Lyons had retired. B. The Events Comprising the Process of Collective Bargaining for a Successor to the 1982-1984 Agreement Negotiations for a successor agreement commenced with a meeting between the parties held on 20 November 1984 at the Union's office. Accompanying D'Ablemont for Respondent were Executive Vice President Roger Young, Director of Manufacturing John Porter, and Plant Superintendent Fraupaul . Representing the Union were Robert Fusco, business agent, and eight or nine members of the then current employee negotiating com- mittee, including at least three, among them Chief Stew- art George Wally, who had served on the committee in past negotiations. The Union presented a written set of bargaining demands and D'Ablemont spent most of the time talking about the poor state of the Company's busi- ness He noted that the bargaining unit was down one- third between 1981 and 1984, from 154 to 106 employ- ees, had lost business to foreign competition, and had suf- fered substantial losses in the fiscal year ending 1984. As a consequence bargaining at this time was going to have to be very conservative. D'Ablemont said the Company would have, at the next meeting, a proposal to outline the cost containment program they would have regard-' ing medical costs. The next bargaining session was held on 12 December 1984 D'Ablemont was accompanied by Vice President in charge` of Finance James Olwell, Porter, and Frau- paul. The Union was again represented by Fusco and the members of the employee negotiating committee. Virtu- ally all of the meeting was taken up with D'Ablemont's presentation of the Company's health care containment program. A copy of the proposal was given to every union representative present. Under an existing self-insured health benefit plan ad- ministered by the Connecticut General Life Insurance Company, covered under article XII, health and welfare, of the 1982-1984 agreement, the Company had been pro- JOHN DUSENBERY CO viding both basic medical care benefits, including hospi- talization, surgical, and doctor's care and related benefits, as well as major medical benefits, for which the Compa- ny was obligated to pay the entire cost up to certain maximum amounts depending on the kind and nature of health care, with the exceptions that a 20-percent coin- surance factor paid by employees up to the first $10,000 of covered expenses and a deductible capped at $200 per family applied to the major medical coverage Now, the Company's December 1984 proposal sought, among other changes, to apply a 20-percent coinsurance factor payable by employers up to $5000 for basic medi- cal benefits, as well as making mandatory a second surgi- cal opinion for nonemergency related surgery with pen- alties for failure to comply and outpatient surgery when determined appropriate by the insurance company On the major medical coverage, the Company now sought a $200 deductible per person, an increase in the family de- ductible amount from $200 to $400, a maximum lifetime benefit of $1000, and coinsurance of 20 percent to be paid by employees on the first $5000 of covered ex- penses. After D'Ablemont's presentation, the Union side cau- cused, returned, and advised they wanted to consult the Union's expert on medical programs. The balance of the meeting was taken up with the Company's presentation of its wage proposal D'Ablemont said the Company's wage increases would not be added to the minimum wage rates set forth in the collective-bargaining agree- ment. Porter noted that there would be better synchroni- zation between the minimums and maximums by exclud- ing the minimums from increases. Further, it would not impact on anyone in the bargaining unit since no em- ployees were at the minimum.' On this D'Ablemont ac- knowledged that the Union was noncommittal, but he also added that in his experience this was a "non-issue " In addition, the Company advised it would no longer pay time and a half or double time over 10, or double time over 50 hours because neither was required by the contract. Further, the Company would no longer pay employees injured on the job for seeing a doctor when the contract only required payment for the day they were injured. D'Ablemont also explained that Respond- ent maximums were above its competitors and noted that "all of our people were at the maximum of some of the wage rates" and some were above the maximums At the conclusion of the 12 December meeting, Fusco handed over to D'Ablemont a copy of a special union notice, also posted on the union bulletin board at the plant, addressed to all members of John Dusenbery Com- pany, Inc. and signed by Fusco. It announced that at a full membership meeting on 6 December 1984, a vote was taken by the majority of the members present with a count of 43 yes to 7 no to give to their 9-member com- mittee full power to ratify a new contract or to call a full strike. On 19 December 1984, at Fusco's telephoned sugges- tion, D'Ablemont met with Anthony Rizzo, secretary treasurer of Local 945, at the Union's office. Rizzo at- tempted to convince D'Ablemont to have the Company ' A conclusion disputed by a chief union witness, see infra 657 go into the Union's medical insurance program Rizzo sought to convince D'Ablemont that the health cost per employee under the Union's plan would be less than the Company was then incurring under its own plan and thus provide moneys to increase its wage proposal. On this occasion D'Ablemont met briefly with the Union's health and welfare expert Abbote who provided D'Able- mont with copies of the Union's plans. D'Ablemont also took the time to acquaint Rizzo with the presentation re- garding wages he had made at the bargaining table on 12 December. As to changing the medical plan, D'Able- mont noted that the Company plan not only covered the bargaining unit but all of the Company's employees so that there would be an impact in removing half of them from the plan. The Company would also be reluctant to relinquish control by going into a plan with many other employees and administered by the Union The next bargaining meeting was held on 27 Decem- ber 1984, the date the existing agreement terminated. This was the first joint meeting attended by Rizzo. He was accompanied by the employee committee and, ap- parently, Union Attorney Ira Drogin. D'Ablemont, Olwell, Porter, and Young attended for the Company. A Federal mediator, Bellow, invited by the Union without the assent of the Company, was also present for the first time. As testified to by Rizzo, he said he would be the chief negotiator and his powers limited him to representing the rank and file in the bargaining unit and he was only there to negotiate the contract and not to decide their fate at any time during the negotiations Everything and anything will be brought back to the committee and eventually to the rank and file for approval. Rizzo fur- ther explained that the policy of the local should not be taken as his predecessor negotiated, that he had his own methods of negotiating and anything he would say or do would be from the committee via him. Rizzo noted that he knew his predecessor, Bill Lyons, to be a person who would take charge and not necessarily consult with the committee on every item, and he assured the manage- ment team that this is not the case, this was different. As Rizzo later explained it, he was seeking to assure the Company that the committee would speak through him, he would go back to them each time, he would convey their demands, and the committee would make the deci- sions via him. If the committee members were in dis- agreement with him, the Union side would call a caucus and discuss their differences in private But Rizzo also testified under cross-examination that his authority not only extended to speaking on behalf of the committee and conveying proposals on their behalf, but also, when agreeing to proposals he acted on their behalf. (Tr 391.) Rizzo also said at the table that if the Company sought to maintain the status quo or obtain "give backs" and pleaded financial duress, the Union would require an ex- amination of company books and records. At the mediator's suggestion, the parties made presen- tations Rizzo criticized the Company for its poor offer. D'Ablemont reviewed his prior presentation of Respond- ent's poor competitive position in detail Rizzo then reit- erated his contention that the Company would save 658 . DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD money by joining Local 945's medical insurance plan and that those savings could be translated into increased wages. The Company caucused and Olwell informed D'Ablemont that the Union 's claim of higher insurance costs per employee under the company plan was in error. On returning to the bargaining table D'Ablemont informed the Union of this error and that there were no savings to be obtained on joining the union plan that could be translated into wages. At this point, Drogin asked to see the Company's books and records to be able to substantiate to the Union 's membership that the Com- pany's economic proposal was 'justified by its losses and competitive disadvantage. D'Ablemont suggested Drogin forward a letter to this effect and he would respond: Discussion then turned ' to the fact that the contract was expiring that evening. A question was raised by the Union about extending the agreement, but D'Ablemont said he did not want to do so pending the Company's substantiation of its bargaining position , but that the Company would honor all the terms and conditions of the expiring contract. D'Ablemont acknowledged that during the meeting he learned through the mediator that the Union had revised its offer and was now willing to settle for a wage in- crease of 6 percent per year each year of a new 3-year agreement, a pension benefit increase of $1 each year, $10,000 worth of life insurance, and no change in the Company's existing health insurance program , restric- tions on contracting out work and paid sick days. D'Ab- lemont explained that in 1972 the Company bargained out existing paid sick days for an attendance bonus system. That system provides employees with a bonus at year's end for limiting or eliminating days of absence from work . Thus, the expiring 1982-1984 agreement 'pro- vided that since 1979 an employee with no unpaid days of absence at the end of the calendar year during a regu- larly scheduled workweek would receive a year-end at- tendance bonus of 4 days' pay at his regular straight time hourly rate of pay. For each day's unpaid absence from work, the employee received one less day's bonus pay, up to three such absences , with no bonus for employees with 4 or more days absences. D'Ablemont subsequently received a letter from Union Attorney Drogin , dated 28 December 1984, referring to the Company 's wage offer of 3 5, 3, and 3 percent in each year of a 3-year contract , in reliance on substantial- ly diminished gross sales and net losses, and requesting to inspect books and records dealing with its ability to pay wages and welfare benefits and profits and losses over. ,the past 3 years. By letter dated 3 January 1985, D'Able- mont replied, detailing the increased benefits provided since 1981, the` Company's economic reverses over the last contract period , noting a July 1984 grant of a 3.6- percent increase in salaries to its more than 100 nonbar- gaining unit employees, and concluding that its wage offer was fair. D'Ablemont went on to highlight a trend among employers to hold down 'escalating costs of health care benefits consistent with the Company 's position, reaffirmed its findings that health care costs were not as claimed by the Union and thus did not warrant the Com- pany considering going into the Union's plan, and advis- ing that the Company was not pleading an inability to pay, but was only seeking terms to make it competitive over the next 3 years. D'Ablemont did offer to substanti- ate through its outside firm of accountants the answers to six questions he posed , among them questions relating to a claim of a 3-year pattern of shrinkage in sales, sub- stantial losses in fiscal 1984 ; company prices exceeding its competition; and 18 "bench mark" jobs exceeding by a substantial percentage those of companies in closely re- lated industries. In D'Ablemont's letter, he acknowledged the authority of the employee negotiating committee to approve the results of the negotiations . At page nine, he began a paragraph as follows: "However, in an effort to convince the Union and the eight man Employee ' Negotiating Committee (who have the authority to make a contract without further ratification) to accept the Company's final , proposal, I agreed , in response to the Union's re- quest, that the Company would be willing to substantiate in an appropriate manner the numbers I referred to in my bargaining presentation." The Union did not reply to this limited offer of disclo- sure and the matter did not come up again in the negoti- ations. Over the next 2 months, into March 1985, there was no contact between the parties . Then in March, me- diator, Bellow contacted D'Ablemont to arrange a meet- ing in early April . Since D'Ablemont had planned a va- cation away from 3 to 14 April, a date was fixed for 16 April . A later attempt by the mediator , apparently at the Union's request, to move up the date to a time earlier in April, was rejected by D'Ablemont because of his travel plans. In the interim, the Union called a strike for 9 April. On D'Ablemont's return he rearranged the meeting date from the 16 to 25 April because of dissatisfaction that the strike commenced without notice while he was away. 'On 25 April the parties only met separately in caucus with the mediator . D'Ablemont learned that the strike had been called because of the Union's effort to change the contract expiration date from 27 December to some time later in the following year . This matter of the Union's interest in a change in expiration date had come up from time to time in past bargaining but had always been rebuffed by the Company. At the last prior meet- ing, on 27 December 1984, when D'Ablemont stated the Company would continue to honor the terms of the ex- pired agreement while bargaining continued, he also had made ' clear that the Company would not permit the delay in concluding a new agreement beyond the expira- tion of the old agreement to be used by the Union as a basis for a change in the expiration date, a matter on which the Company remained firmly opposed. As a result of this disclosure, the meeting broke up without any progress toward settlement Before leaving , D'Able- mont told Rizzo and Fusco that he intended to send a letter to the membership explaining the Company's eco- nomic position and criticizing the Union's reliance on the contract expiration issue as the basis for the strike and continuing dispute. In the letter sent at D 'Ablemont's suggestion, dated 26 April 1985, addressed to dear fellow employee, Compa- ny President John Dusenbery reviewed the Company's JOHN DUSENBERY CO economic losses and competitive disadvantages, decried the Union's raising the issue of the contract expiration date, and advised that unless the strike was over by 30 April, he was declaring an impasse in bargaining and would put into effect the Company's first-year offer. He also suggested the Company would begin hiring perma- nent replacements. D'Ablemont told the Company to send a copy of the letter to the union hall to Rizzo's at- tention. On 29 April D'Ablemont received a call from the me- diator who stated his belief that the contract expiration issue would no longer stand in the way of agreement and to urge his client to come up with its best offer. On an intercom hook up D'Ablemont spoke with John Dusen- bery, Young, Olwell, and Porter and they agreed to in- crease the Company's proposal to attempt to end the strike and reach an agreement. The wage proposal was increased to 4, 3, and 3 percent in each of 3 years, an increase of one-half percent in the first year. On health and welfare, as to basic benefits, the coinsurance provi- sion was eliminated but deductibles of $100 for the indi- vidual and $200 for the family were added. The Compa- ny retained the mandatory second surgical opinion on nonemergency related surgery and outpatient surgery .when determined appropriate. As to major medical bene- fits, the Company dropped its demands that a $200 de- ductible be imposed per person to replace the existing $100 figure and that the family deductible be increased from $200 to $400 The major medical benefits would also otherwise remain without change. A night- or second-shift differential, already in existence for all hours actually worked, was to be expanded to now include holiday pay, but not vacations. Contract expiration date would remain the same. In response to the renewal of a union demand for paid sick leave, which had been made at the 27 December session, the Company also decided to add 1 day to the attendance bonus schedule already in place This propos- al would be effective on the employees' return to work. After reviewing this proposal by telephone with the mediator, D'Ablemont telephoned Rizzo late in the after- noon and presented the Company's latest proposal to him. D'Ablemont testified that he and Rizzo went through the proposal line item by line item The Union had a membership meeting scheduled for that evening, and, according to D'Ablemont, who was not disputed by Rizzo, Rizzo said this committee and this Union will rec- ommend to the membership tonight that this be ratified provided the Company gives in on retroactivity. D'Able- mont said he did not think he could get it, excused him- self, called the company executives and confirmed this was so, and then called Rizzo back to tell him there would be no retroactivity because the Company felt it had been blindsighted by the strike. Rizzo concluded by saying we will not recommend ratification at the meet- ing. The Union rejected the proposal that evening at its meeting and Porter learned about it that night The next day, the Company, in consultation with D'Ablemont, de- cided to notify the salaried employees of the latest devel- opments. The Company had apparently held out hopes to these employees of an early resolution of the dispute 659 by its 29 April offer, and the failure to achieve that had left them confused about the result and the issues still in contention. They had been crossing a picket line to go to work every day since the commencement of the strike in early April By letter dated 20 April, addressed to dear salaried employees, President John Dusenbery sought to bring them up to date on yesterday's strike developments. Du- senbery referred to a major concession in the Company's medical insurance proposal made at the mediator's urging. He then itemized the Company's proposal. Item V was the proposal on medical insurance As to A, medi- cal care benefits (Basic), it listed the three changes from the existing plan. The first was a one-time deductible each calendar year of $100 for the individual with a max- imum of $200 for the family. The second and third were the mandatory second surgery opinion and outpatient surgery, when appropriate On B, major medical benefits, the letter noted no change from the existing company plan and described what changes it had previously pro- posed and now dropped. The letter went on to refer to the Union's rejection of the proposal, the Company's in- tention to explore operating with replacements, and a promise to keep the employees informed. In D'Ablemont's view, the Company had also con- cluded that a mailing to the salaried employees was the fastest way of getting it to all employees, including the pickets with whom the salaried people came in contact. The fact remains that the only writing in which the Company listed its last revised medical insurance propos- al was not mailed or forwarded to the union negotiator or its employee negotiating committee. That proposal had been described orally over the telephone to Rizzo on 29 April and would later be referred to in writing as having been set forth in a letter to employees dated 30 April 1985 but was never described with particularity to the employee committee, which D'Ablemont acknowl- edged had full authority to approve a successor contract. On approximately 1 May, Dusenbery received a telex from the Union stating that it had voted to reject the Company's offer and to continue to strike, and that de- mands will follow. On 6 May the Company received a set of revised demands from the Union. It included 10 items, relating to wages, night-shift differential, pension, subcontracting, equal treatment on the job, dental and optical plans, sick days, vacation, and date of contract. No change was proposed in the existing medical health plan provisions. All the 10 items were either modifica- tions of the Company's 29 April proposal or were new demands not encompassed in that proposal For all D'Ablemont knew, these demands could have been com- piled by Rizzo or by the negotiating committee or both. On 7 May, D'Ablemont and Rizzo spoke by phone. Under examination by the General Counsel, D'Ablemont agreed they did not discuss whether the wage increase would apply to the minimum wage rate, the medical in- surance proposal, or the schedule of bonus days. Later, on direct examination by Respondent's counsel, D'Able- mont testified that Rizzo explained there were three issues that now separated them. They were wages, which Rizzo believed would have to be 5 percent each year; 660 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD pension, which surfaced at the 29 April union meeting, with Rizzo seeking an increase from $12 per month (mul- tiplied by years of credited service) to $18; and retroac- tivity, which was the real strong issue. Among the other items, D'Ablemont rejected the pension increase as making that benefit completely noncompetitive. D'Ablemont and Rizzo again spoke by telephone on 13 May. D'Ablemont began by noting the Company was willing to try to end the strike on the gut issues separat- ing them. First, in lieu of retroactivity, the Company was willing to make a major move and give a back-to-work bonus of $200, payable to people after they were back to work for 60 days Second, on wages the Company was now at 4, 3, and 3 percent for a 3-year contract. In the second and third year, the Company was willing to add a year-end bonus of $100 each year. Contract expiration would remain the same. The Company's insurance pro- posal of 29' April, as set forth in the 30 April writing, would be part of this proposal. D'Ablemont did not recall dealing with any specifics of this proposal Re- garding night-shift differential, the Company would not only build it into holidays, but also into vacations. But the Company would take back the 1 bonus day previous- ly proposed to be added on to the attendance bonus. And there would be no increase in either the pension benefit or vacations. D'Ablemont added that his notes re- flect he also said as you may not know, but Bobby Fusco should know, our wage increases do not go into mini- mums. Also, as we indicated in an earlier session you did not attend, there will no longer be any double time over 10 hours per day, or over 50 hours per- week. D'Ablemont continued, and Rizzo 'did not later dis- pute, that Rizzo responded, you know, this is a major move and I want to meet with the committee. I want to review this. When confronted with his 16 August 1985 pretrial affi- davit immediately following this testimony, D'Ablemont was compelled to agree that in paragraph 18, which re- ferred to the 13 May conversation with Rizzo, he swore that "we did not discuss medical insurance, bonus days or whether the wage increases would apply to a mini- mum wage rate." This variation appears to be an im- peachable conflict, which is not cured by D'Ablemont's 21 August 1985 letter to counsel for the General Counsel Gary Carlson, who had taken the affidavit and ques- tioned D'Ablemont about it at trial. In that letter, D'Ab- lemont stated that in reviewing his notes of his 13 May telephone proposal to Rizzo, a copy of which he at- tached, it would appear he did remind Rizzo that the wage increases would not go in the minimums, but he had no independent recollection of this since he viewed this as a nonissue between the parties Although this page of notes stated and underlined at the top, above notes on the wage proposal, "Not in Minimums" and contained at a lower point on the page, "No Added Day For Bonus (Pay Back)," it is odd indeed that such a careful and experienced labor attorney as D'Ablemont had not reviewed this material prior to providing the Region with a sworn and detailed affidavit, even one in support of the Respondent's then pending charge alleg- ing the Union's refusal to bargain. Nonetheless, I will not rely alone on this contradiction in evaluating D'Able- mont's testimony. In any event, the notes were not of- fered in evidence as a past recollection recorded, and D'Ablemont's only testimonial recollections of the 13 May discussion does not include any reference to wheth- er the salary increases proposed apply to the minimums. Until D'Ablemont ultimately prepared a memorandum' purporting to set forth the parties' agreement on the new terms to be included in a renewal agreement, there was no writing at any stage of the negotiations that refers to the exclusion of minimums from wage increases. According to D'Ablemont, he and Rizzo next con- ferred by telephone on 16 May. Rizzo informed him that he had met with the employee committee for about 3-1/2 hours that day and he had a complete contract proposal to make that he thought would end the strike. On wages, the Union sought 4 percent each year. On pensions, the union demand was for a $1 increase in benefit each year. On contract expiration, the Union now had no problem with the company proposal. On insurance, the Compa- ny's proposal was O.K. Night-shift differential was fine. And the Company could take back its one attendance bonus day. On the back to work bonus, Rizzo wanted $250 instead of $200, and payable within 5 days of the employees' return, not after 60 days. Rizzo also repeated the same vacation schedule demanded from the begin- ning of negotiations and which was later repeated in the Union's 6 May demands. In conflict with D'Ablemont's characterization of Rizzo's 16 May agreement to the Company's revised in- surance proposal is a letter dated 17 May 1985 from Rizzo to the Company In it Rizzo sets forth five condi- tions (proposals) which, if met, could result in a contract. The first provides that "Insurance remain same, with the exceptions: A. Second opinion on Surgery B. Outpatient treatment when applicable. The third branch of the Company's cost containment program, a one-time $100 deductible for individual and $200 for family on basic medical care, is pointedly not included in the Union's first condition for settling the contract. While the Union's letter is silent also on wages, it is otherwise con- sistent with D'Ablemont's report of Rizzo's other 16 May contract proposal Rizzo describes these conditions as "the bottom line of our Rank and File members " D'Ablemont explains away this apparent conflict by testifying that on 21 May, at Mediator Bellow's sugges- tion, he called Rizzo. In the course of that conversation, he said, "Tony, by the way, with respect to the Compa- ny insurance proposal, you told me that was agreed to." He said, "It is." I said, `Well you have it on a piece of paper which left out the most important part, $100 and $200."' Rizzo said, "No, you get it My notes reflect that I wrote down `Insurance $100-$200, you get it."' Those particular notes, if any, reflecting this conversation, were neither produced, identified, or referred to in any further examination of D'Ablemont. Whether Rizzo's letter of 17 May represented the true union position on health bene- fits or inadvertently excluded the deductibles as claimed by D'Ablemont will be dealt with when credibility find- ings are made. The parties next met on 29 May 1985, after lunch, about 1 p.m. The Union had scheduled a ratification vote JOHN DUSENBERY CO 661 for early that evening . The parties had been called into session by the Mediator Bellow The principals remained in separate rooms as the mediator went back and forth between them . During the caucusing, although there was discussion back and forth via the mediator on such sub- jects as wages, back-to-work bonus, pension benefits, paid sick time, and vacation , D'Ablemont acknowledged that the subject of adding wages to the minimum rates, the schedule of bonus days , and themedical insurance plan were not so discussed According to D'Ablemont , when the mediation session as conducted did not produce an agreement by around 4 or 4.30 p .m, the mediator suggested the Company make its very best final shot, and do it in writing . D'Ablemont, with Young, Olwell , and Porter present, then wrote out "Company Final Proposal To End The Strike," and gave it to Bellow . Bellow took it to the Union and then called the parties into joint session D'Ablemont testified that there was a long joint session where we reviewed the specific proposals He went over them one by one, item by item, as did Rizzo , with the committee. This was the first face-to-face meeting of the parties since 27 Decem- ber 1984, since at the 25 April meeting , the parties only met separately with the mediator The Company 's final proposal had seven numbered items The first covered wages Four percent was to be effective with the end of the strike A one time return to work bonus of $228 was to be payable one-eighth for each week a returning employee works . In the second contract year, 2 percent was to be effective 28 December 1985 and 2 percent effective 28 June 1985 In the third contract year 2 percent was to be effective 28 December 1986 and 2 percent was to be paid as a one time bonus, not part of the wage rate, on 23 December 1987 "to each employee then on the payroll in the amount of $228 " The second item was Pensions, and provided $1 to be added in the third contract year for a pension of $13 per month for each year of credited service The third item was medical insurance , "as proposed by Company on April 29, 1985 and set forth in letter to Employees dated April 30, 1985." The fourth item was contract expiration: 27 December 1987 The fifth item was night-shift differ- ential included in pay received for holidays and for va- cations. The sixth covered all other terms : Remain as set forth in the collective-bargaining agreement that has ex- pired . The seventh item related to bonus days- 1 more day added to the schedule . It was signed by Roger Young, senior vice president and at its foot had a note reading, "Employees will be called to work on an as needed basis." Reporting pay provisions shall not apply. It was D'Ablemont's testimony that when the union side came into the room , Rizzo sat up front at the table with himself and other company officials, and the media- tor and the eight- or nine-member employee committee sat in back of Rizzo Rizzo read off the items as best he could, they were in D'Ablemont 's handwriting, and D'Ablemont helped and embellished items to make sure they understood them. After reading each one, Rizzo would turn to the committee and ask if they understood, do you agree, and the committee would say yes, or nod. D'Ablemont recalled some saying yes , some nodding as he and Rizzo went through each item He could not, however, recall who, among the committee members, nodded or who said yes. This process took 20 minutes to a half hour. In direct conflict with this testimony is a portion of D'Ablemont's affidavit, which he acknowledged, in which D'Ablemont swore "when Rizzo and I went through the other items on the proposal, he would look over at the committee members after each item to see if there was any comments and none of them made any comments " In his testimony, D'Ablemont continued, after review- ing the writing, Rizzo said this committee has authority, here and now, to accept this proposal and we do not need to go back to that ratification meeting. We accept it except for two items We need a pension benefit increase of 50 cents in the second year and 3 paid sick days. D'Ablemont was stunned a bit and responded that the Company was not going to give any paid sick time The parties were then separated again by Bellow to try to work out the two open items but without success. While the parties were apart, the company people were focus- ing on some way of making the attendance bonus system more attractive so as to satisfy the employees' apparent desire to avoid penalties for absences that may have been involuntary, but without the Company paying for such absences. Excluding absences caused by work-connected injuries was one idea. As the time elapsed, without agreement being reached, the union delegates advised they had to leave for the meeting At this point, says D'Ablemont, the call back to work on as needed basis was added to the two-page proposal, copies were made and given to Rizzo, telephone numbers were exchanged and the union people left around 6.30 p.m for the mem- bership ratification meeting. Later that night D'Ablemont learned that the union membership had rejected the Company's proposal by an overwhelming vote In a mailgram received by the Com- pany the next day, 30 May, Rizzo advised that the offer was rejected 55 not to accept, 10 to accept, 5 abstained, which he characterized as a rejection representing a vast majority of the people. By late in the day on 30 May, D'Ablemont and com- pany officials had again revised the bonus day schedule. In its offer in writing of 29 May, the Company had added one day to the schedule Under that proposal, em- ployees with no unpaid absences at the end of the year were to receive 5 attendance bonus days pay, instead of 4, and with each additional absence up to a total of four, employees would receive one less bonus day until finally, an employee with five or more absences in a year re- ceived no bonus days at all Now, the Company decided to add one more day to the attendance bonus schedule as follows Unpaid Absences Bonus 0 5 days 1 4 days 2 3 days 4 2 days 5 2 days 6 or more 0 662 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Thus, the employee with four or five unpaid absences, would receive 2 bonus days, whereas under the 29 May proposal the employee with four absences was to receive I day, and the employee with five absences was .to re- ceive no days. The conditions the Company attached to this last schedule was that it would apply only for em- ployees with 5 or more years of service and only in the third year of the contract. Whether these conditions, in particular the former (since the latter condition was almost immediately dropped) were made clear to the Union remains in dispute. According to D'Ablemont, in a telephone conversa- tion with Rizzo on Friday, 31 May, in which they dis- cussed the pension and back-to-work bonus, after propos- ing the new attendance bonus schedule with the two conditions, he removed one, that it would not go into effect until the third year, but made clear it would apply to employees with 5 or more years of service. In that conversation, D'Ablemont later testified on direct exami- nation that before talking with Rizzo he had discussed with the mediator by telephone the fact that over 90 per- cent of the unit employees had 5 or more years of serv- ice and he had reviewed company records on employee attendance history, but nonetheless, in order to maintain their bargaining position vis-a-vis the Union, the Compa- ny would propose the last attendance bonus schedule only for those with 5 or more years of service It was when Mediator Bellow suggested he contact Rizzo to review with him the attendance records of the commit- tee and why paid sick days would only add on to the abuse at a time when the Company needed more produc- tivity with a reduced bargaining unit, that D'Ablemont called Rizzo late in the afternoon. D'Ablemont related that after describing the newly revised attendance bonus system and expressing willingness to put it into effect in the first year for those with 5 years' seniority, if he would acccept that, the Company would add 50 cents to the pension in the second year and if he needed it, they would accelerate the back-to-work bonus of $225, now paying it in full after 10 days of work rather than 8 weeks. Rizzo said, "That's fine, that should do it, I think we have a deal, we'll let you know " On Saturday, 1 June, Rizzo told D'Ablemont by phone that he had some real problems. His first was that the stewards must come back to work first. Another was whether the employees on strike would receive their full vacation pay, normally due in'July. A third was whether employees who had committed themselves for summer homes or vacations could still take them in July., An- other was a strong feeling on the part of the group to return to work together. Through a series of calls back and forth with Porter and Rizzo, D'Ablemont was able to resolve most of these questions to Rizzo's satisfaction, but on the return to work, the best D'Ablemont could offer was to bring the workers back as rapidly as the availability of materials and supplies would permit The last word from Rizzo was that there still might be a problem on the return to work matter, but the Union had a ratification meeting scheduled for Sunday morning and he would be in touch. On Sunday, 2 June, Rizzo telephoned D'Ablemont and told him that the employees had ratified the Company's i proposal that morning D'Ablemont acknowledged that Rizzo did not review the items that had been ratified However, one stumbling block to final agreement re- mained, the Union's insistence on all employees being called back to work together, preferably by 5 June. This problem was not then resolved and the strike and picket- ing continued on Monday, 3 June. Then, as related by D'Ablemont, during the afternoon of 3 June, after learning from Porter that he had referred Rizzo to him, Rizzo called D'Ablemont and said, "I just want to review where we're at, make sure we all under- stand what we're talking about." D'Ablemont said, "Fine." Rizzo then reviewed what they had agreed to, item by item. D'Ablemont testified:, "I don't know the specifics, but what he said to me was my understanding of everything that we had said on May 31 " In response to a specific question by the General Counsel, D'Able- mont acknowledged that he did not recall the degree of specificity with which he and Rizzo discussed the items At that point Rizzo then said, "Okay, the strike is over." He then explained the Union was withdrawing its demand to let everybody come back by 5 June D'Able- mont then said he would prepare a memorandum as he normally did and get it to Rizzo within a day or two, which he did. While preparing the memorandum D'Ablemont had occasion to call Rizzo to seek his agreement on adding language regarding mutual withdrawal of outstanding unfair labor practice charges, no reprisals by either side against employees for conduct related to the strike and labor dispute, and agreement that an outstanding criminal charge pending against a salaried employee for conduct in driving a car through the picket-line would be with- drawn Rizzo agreed to the first but would not agree to the latter two items and so they were not added to the memorandum. After preparing the memorandum, D'Ablemont ini- tialed it, as attorney, sent it by hand to the Company, where it was reviewed with him by telephone, signed by Young, Olwell, and Porter, and then delivered personal- ly to Rizzo early in the morning on 6 June 1985. In its first paragraph the memorandum agreement pro- vides, inter alia, that the parties agree to a new labor contract, dated and effective as of 4 June 1985, the first workday following termination of the strike. The second paragraph provides that the contract shall continue in force until midnight, 27 December 1987, and shall be identical to the prior labor contract except for some changes . There were seven Roman numeral and num- bered changes that constitute the heart of the agreement: Item (i) grants a 4-percent hourly increase effective 4 June 1985 and a one-time $225 return to work bonus to returning employees who complete 10 working days; item (ii) grants a 2-percent hourly increase effective 28 December 1986, and another 2 percent effective 28 June 1986; item (iii) adds another 2-percent increase effective 28 December 1986 and also grants, on 23 , December 1987, a one-time lump sum bonus of $228. "To each em- ployee then on the active payroll who worked or received pay for the complete six month period prior to December 23, 1987'" Those employees who did not work or receive pay for JOHN DUSENBERY CO. the full 6-month period, are to receive the bonus on a pro rata basis As to each of the percentage wage increases built into the wage rate, in (i), (n), and (iii) the language appears, "Said percentage increase shall not be added to the minimum wage rates of the classification. " Item (iv) provides for employees who retire in calen- dar year 1986, a 50-cent increase a month in the pension benefits, to $12.50 a month, and another $1 increase to those employees who retire in calendar year 1987, bring- ing the benefit to $13 50 a month. Item (v) dealing with medical insurance, in subpart A makes three changes in medical care benefits (basic), (1) adding a one-time deducti- ble each calendar year of $100 for the individual with a maximum of $200 for the family; (2) making mandatory a second surgical opinion on nonemergency related sur- gery; and (3) making mandatory outpatient surgical facil- ity when determined appropriate by the insurance com- pany. Subparts (2) and (3) are referenced as per company typewritten proposal of 12/12/84. Under item (v), major medical benefits under subpart B are noted as remaining the same. In item (vi) the second (night) shift differential is included in eligible employees' pay for holidays and vacation. Item (vii) contains two new schedules govern- ing attendance bonus days. The first provides 5 bonus days for employees with 0 unpaid absences down to 0 bonus days for employees with 5 or more days unpaid absences. The second schedule, applicable only for "an employee with five (5) or more years of service with the Company, who has unpaid absences of more than three (3) days but less then six (6) days in a calendar year shall re- ceive two (2) bonus days that year." Thus, under that schedule, an employee with 5 years' service, who has 4 or 5 days unpaid absences in a year receives 2 bonus days instead of 1 and 0, respectively, for all other em- ployees. The third paragraph of the memorandum first provides that the foregoing is the full and complete agreement be- tween the parties for a new labor contract. The remain- ing provisions cover the agreements arrived at on 1 July relating to certain benefits on return to work of striking employees, the manner of return and working shifts, and the further agreement to mutually withdraw the out- standing charges. A next to last paragraph provides that "Both the Union and the Employee Negotiating Committee, indi- vidually and collectively, have represented to the Com- pany that the foregoing Agreement is binding on the par- ties without need for further ratification by the member- ship-a representation the Company has relied on in re- turning employees to work beginning June 4 1985 and such representation is of the essence of this Agreement." The final paragraph provides that no agreement exists not expressly contained in this agreement and the basic labor contract, which constitute an integrated binding contract D'Ablemont testified that within a short period of time following union receipt of the agreement, the Union de- manded that the Company continue to bargain on four claimed open items and the Company refused. On the issues that the Union claimed were open, the Company claimed they were not open and had, in fact, been re- solved during the course of bargaining. 663 These four items were included in the agreement pre- pared by D'Ablemont at the conclusion of negotiations and were each underlined in the preceding paragraphs of this Decision describing, summarizing, and quoting the contents of the changes in substantive terms to be incor- porated in a new, successor collective-bargaining agree- ment. One changed the basic medical coverage portion of the Company's health benefit plan by applying a $100 deductible per individual and a maximum $200 deducti- ble per family each calendar year before medical charges are reimbursed or paid. A second excluded the minimum wage rates for each job classification within the bargain- ing unit from the percentage wage increases to be re- ceived by employees in each classification over the life of the new agreement . A third limited the receipt of 2 additional attendance bonus days for employees with four or five unpaid absences in a calendar year, under a revised bonus day schedule, and with 5 or more years of service with the Company. A fourth limited full receipt of a third year one time lump sum bonus of $228 to em- ployees who worked or received pay for the 6-month period preceding the date fixed for its receipt, 23 De- cember 1987, and mandated pro rata payment for all other employees. In each case, the Union disputes that the terms to which they agreed that settled the strike and the contract dispute included these four provisions. Since there has been no meeting of the minds regarding terms of an agreement, it demands that the Company meet with it to resolve all outstanding differences necessary to settling terms of a successor agreement During the General Counsel's examination, D'Able- mont agreed that he did not know if the agreement he prepared contained items to which the employee negoti- ating committee never agreed. He did not know what conversations took place between Rizzo and the commit- tee. As D'Ablemont noted, the conversations near the end, after the 29 May meeting, were all between John Bellow, himself, and Rizzo As D'Ablemont noted, we were trying to get the people back to work, we were conducting negotiations by telephone because of the dis- tance. One by one, the General Counsel took up in turn each of the four items in dispute, and D'Ablemont agreed that regarding three of them, excluding the de- ductibles added to the basic medical care benefits, he never discussed their subject matter with the committee. As to the deductibles applicable to basic medical bene- fit-, it was D'Ablemont's position, as earlier noted, that in his presence they nodded agreement at the session on 29 May 1985, when Rizzo went down the line items, one by one, including that item. Aside from D'Ablemont, the sole witness called by Respondent in the case, who was also first examined at length by the General Counsel under Rule 611(c) of the Federal Rules of Evidence, and whose testimony, along with quotes, references, and excerpts from various docu- ments comprise the chronology of events in the bargain- ing process related this far, the General Counsel called two witnesses, Rizzo and Chief Stewart George Wally. The explanation Rizzo provided to Respondent at the 27 December 1984 meeting of his role as chief negotiator and the function of the employee committee in deciding 664 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD the terms of the contract , has been described. While Rizzo erroneously placed the date of his meeting with D'Ablemont at the union hall to discuss the_ hospitaliza- tion plan and cost factors in January , some weeks later than it probably took place, his summary of it does not differ basicly from D'Ablemont's recital . Rizzo frankly acknowledged his inability to recall in detail the specifics of several telephone conversations he held with D'Able- mont, starting in May 1985, in an attempt by them to close the gap and resolve the differences between the parties. Rizzo could not recall whether he ever saw during ne- gotiations the 30 April 1985 Company's letter to salaried employees which , inter alia, spelled out the Company's revised proposal on medical insurance , including the change mandating a deductible for the first time in basic medical care benefits . Regarding medical benefits, it was Rizzo's recollection that at the first meeting he attended at the last contract's expiration in December, he was brought up to date by D'Ablemont , learning that the Company had proposed a deductible of $100 and $200, and "we responded that we presently had a deductible of $100 and $200 and if that's what you're talking about I have no problem with that." Rizzo testified he made this point several , times across the table and on the phone with D'Ablemont. Rizzo's testimony about the timing of his discussions of medical deductibles with D'Ablemont is clearly in error and is symptomatic of a confusion about certain dates and events that characterized his testimony. Thus, for ex- ample, according to Rizzo, at the 29 May meeting he told D'Ablemont the Union did not want a strike and D'Ablemont responded that according to his sources Rizzo could not get a strike vote anyway . Later in his testimony, Rizzo stated both that the strike did not begin until April and that there was no strike on 29 May and it was in the best interests of the men not to have one then. In fact, the strike had already been in progress a month and a half at this point. In spite of his confusion about the timing of the raising of certain issues and the commencement of the strike, Rizzo was firm in his recollection that D'Ablemont had never discussed with him not adding wage increases to the minimum wage rates, and had never proposed a bonus day schedule for employees with 5 or more years of seniority, and had never proposed prorating the bonus schedule in the third contract year so that the bonus pro= vision in the third year of the contract would be "in synch" (synchronization) with provisions of the expired agreement. Rizzo testified that in a caucus meeting with Mediator Bellow on 29 May he stated several times in front of the committee that regarding the Company's hospitalization program , the Union was definitely agreeable, as he had mentioned to D'Ablemont at a prior meeting , the deduc- tibles they have would be the same, we would recom- mend our committee ratify a second opinion (on surgery) as well as outpatient (surgery) when applicable. Rizzo added that we made sure that under no circumstances would it change in any other manner because it would certainly be a give back in a severest way. This testimony suggests that Rizzo as well as the com- mittee were unalterably opposed to anything that smacked of a give back in benefits and that they viewed the inclusion of new deductibles in the medical plan as just such a give back. At the same time, Rizzo at least appeared to be acting under the mistaken belief that hos- pitalization was not part of the basic medical plan of ben- efits, but was part of major medical benefits . This misap- prehension appeared to be confirmed when at a later point while undergoing cross-examination Rizzo stated that under the expired contract the Company already had $100/$200 deductible for hospitalization , they sought to raise it to $200/$400 but then reduced it, in, effect withdrawing their proposal in this regard. It was at this point that Rizzo stated hospitalization was part of the major medical benefit and not part of the basic medical care, a clear misconception on his part . (Tr. 429.) There is some indication on, the record that Rizzo did not have substantial experience as a labor negotiator at the time he took over these duties on Bill Lyon 's retirement. He had negotiated several contracts at the time of the 1984 nego- tiations. When questioned whether he viewed himself as experienced, Rizzo at first responded , "Presently, yes" as of December 1985 before adding that he also believed himself experienced at the time. Rizzo also was then, in- volved concurrently in negotiating two contracts in the public sector, which may have left him with divided at- tention and concentration on the instant matter. Under cross-examination , Rizzo first denied , and then, when confronted with his pretrial affidavit , confirmed that at the 29 May session, the parties met to discuss the Company's written proposal before he and the commit- tee left hurriedly -for the membership ratification meet- ing. Rizzo continued to deny that he had his own copy until shortly before he left when copies were run off so he could take one to present to the membership. It was Rizzo's testimony that at no time did he go over a line- by-line item review of the written proposal with the committee or the mediator. Rizzo explained that he had learned from several calls made to the Union's hall, where the session was held , that the members were al- ready waiting impatiently at the meeting place for the negotiation committee to arrive, it was getting a little rowdy there, and both he and the employee committee felt pressure to leave. It was in this setting of some strain and anxiety that Bellow prevailed on D'Ablemont to draft a final proposal and for Rizzo and the committee to review it, however briefly Nonetheless , Rizzo acknowl- edged that the writing was read to him. In all likelihood, Rizzo was able to hold and review the original writing handed him by Bellow since he recalled raising with Bellow and shortly afterward directly with D'Ablemont the 2-percent bonus the Company was now prepared to pay to employees on the payroll as of 23 December 1987. Rizzo asked D'Ablemont if he added the 2-percent bonus to save 2 percent in the next contract , to which D'Ablemont just shrugged. In any event, the proposal D'Ablemont read did not contain any of the four provisions later incorporated in the poststrike agreement that both Rizzo and the com- mittee, independently, raised objection to on their receipt JOHN DUSENBERY CO of it. The 29 May writing did make reference to the letter to (salaried) employees dated 30 April 1985 in de- scribing the Company's proposal on medical insurance. On their way to the membership meeting with the com- mittee, as they traveled by van, one committee member asked Rizzo what the 30 April reference was in D'Able- mont's handwritten proposal Rizzo testified he respond- ed, "It won't matter, its whats agreed upon, that we agreed on $100 and $200 deductible." It was too late to turn around and go back, apparently, although Rizzo did not complete the thought, to seek clarification. Yet, Rizzo never thereafter sought to determine what D'Ab- lemont meant by that reference because, in his words, we had an agreement. Respondent introduced into evidence notes Rizzo made of a telephone conversation he held with D'Able- mont on 31 May 1985. In them Rizzo wrote down two attendance bonus day schedules, as they appear in the Company's poststrike agreement, and added below them the words "5 or more-3 days less 6 =" apparently refer- ring to the Company's offer to add an extra attendance bonus day for employees with 5 years or more who have more than 3 and less than 6 days unpaid absences. Rizzo finally reluctantly agreed that the notes reflected the schedules as offered by D'Ablemont (and later included in the agreement D'Ablemont submitted for execution by the Union) (Tr. 476.) Thus, Rizzo contradicted here his earlier testimony that he and D'Ablemont never dis- cussed the bonus day schedule for employees with 5 years' service Wally also confirmed that at the 29 April union mem- bership meeting, after Rizzo and D'Ablemont had talked by phone earlier that day, the bargaining committee first rejected, and then brought to the membership, which also rejected, the Company's latest proposals to end the strike and settle the contract. Wally recalled, among other items, that the Company was insistent on a new $100/$200 deductible on the insurance, the Union did not agree, but was in agreement on the second opinion and outpatient basis on surgery demanded by the Company. Wally further testified that he did not see a copy of the Company's final proposal to end the strike until the end of the 29 May session and then it did not contain item 7, the bonus day add on, or the call back language below Young's signature at its foot. Wally's testimony under questioning by the General Counsel is as follows: Q. When did you first see that? A. At the end of the bargaining session on May 29. We had come to a point where it seemed we could go no further. We had a meeting, we had people waiting at the Knights of Columbus in Dover. We had come to a point where we felt we couldn't reach agreement and so we were going to go to the meeting. We had broken up in preparation to go and we all wanted to see this Mr Bellows had this He had this in his possession until then. He brought it in and out. We didn't see it until then. Copies were made for each of us, just as these copies were com- pleted, Mr. Bellows was inside with Mr D'Able- mont and the company's representatives and he said 665 that there was further movement on the company's part, could we wait? We waited a moment and Mr. Bellows went back in and he came out once again A few minutes he came out and there was a change to this second page of the paper. There was a 7th item on it This only has 6. Q How do you know there was a 7th item? A Because we made copies there again, we waited again once we got that. So that we could take them with us to the meeting to present the company's proposals to the membership Q. Who waited? A. Tony Rizzo, Bob Fusco, Gary Holley, Joe Michelli, myself and most of the committee One or 2 had left to let them know that we were in route. They had called several times, they were concerned with how long it was taking because I believe it was well after 5:30-there had been a communica- tion with me, they were concerned with where we were and how long would it be before we got there and I told them to remain patient There were other people going around the floor making offers to them. I told them we'll talk about that when we get there. Q At that meeting with the company, when if ever did Mr D'Ablemont go through items 1 by P A. I don't recall Mr D'Ablemont going through these. I only recall seeing it was yellow sheets of paper, larger than what I have now. I recall Mr. Bellows running back and forth between both loca- tions with the piece of paper in his possession Q. When if ever did you see Mr. D'Ablemont? A He came in a few times during the attempts by Mr. Bellows to have us reach agreement by him- self. Never with the rest of the company representa- tives, although we had requested that they be present too I believe he said it wasn't necessary He came in himself, responded to whatever question we had- Q. Who said it wasn't necessary? A. Mr. D'Ablemont He was the only one there. (Tr. 491, L 15-493, L 15) At the meeting in Dover, Rizzo presented the package to the membership and they rejected it. No one on the committee was in favor of it and each in turn stood up and addressed the membership on their feelings. There was not another vote until Sunday, 2 June on the side lawn of Local 945's office. All the committee- men including Wally, Rizzo, Fusco, and many members were there. Wally testified that prior to the meeting, Rizzo reviewed the Company's proposal with the com- mittee. Regarding the wages, there would be 2 percent in June, 2 percent on 27 or 28 December, 2 percent the following June, 2 percent the following December,2 2 percent in June of the third year, and they were going to get a one-time 2-percent bonus not to be considered as part of the wage increase. The insurance was to remain 2 The agreement actually called for 4 percent as of 4 June 1985, with the next increase of 2 percent on 28 December 1985 666 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD the same with the exception that we agreed to the second opinion and outpatient treatment on surgery. The bonus days had been revised to 5 and you could miss up to 2 days in the schedule and still not be penalized. There would also be a one time return to work, bonus. Wally, -without prompting, noted that there was no mention of any proration or anything in the third year with reference to the one time bonus' they got. Neither, according to Wally, did Rizzo report or make any men- tion that there would be a $100/$200 deductible There was no mention that there would be two schedules on the attendance bonus days, one for those of us that were over 5 years and another for those of us that were under 5 years. In Wally's words: "We had negotiated a con- tract for everyone, not just those that were in the top of the scale, but everyone." (Tr. 496.) When the proposal was presented to the membership at large, Wally was taking attendance and so did not hear everything that Rizzo presented to them. It would appear unlikely, however, that Rizzo's presentation dif- fered in any material respect from that which he and the committee received before the membership also ap- proved the terms. The men at the union meeting told Rizzo they all wanted to return to work at the same time. Rizzo tele- phoned Porter, who advised he would have to check with D'Ablemont. D'Ablemont called back, told Rizzo only he had the power to make offers, and hung up. The men then dispersed and continued picket duty the next day. Several days after returning to work, Fusco came to the plant with the 3 June agreement, and, with the Com- pany's permission, the committee members assembled to review it Wally reviewed it before the others arrived. Wally found several discrepancies. They included the 6- month proration on the $228 bonus at the end of the third year. On medical care, the change involving deduc- tibles was added to the two they had agreed to With the bonus day schedule, there were two schedules, and one made mention of the 5-year requirement, which they had not agreed to. "We negotiated for everyone on an even keel not the upper crust gets all the meat and potato and the little guy gets nothing " (Tr. 500.) A fourth discrep- ancy was with the wage increases not being applied to the minimum classification. In particular, the deductible on basic medical care stood out like a sore thumb be- cause that was a hard core issue all through the negotia- tions. While D'Ablemont in his presence had proposed the deductibles and perhaps not applying any wage increases to the minimum wage rates, both of which the Union op- posed, he had not raised the issue of a separate bonus day schedule for 5-year senior employees at any session, and Rizzo never told him as a member of the committee that he had held discussions with D'Ablemont about any of these three items. As to the fourth item, prorating the last year bonus or requiring 6 months prior employment as a condition for its receipt, D'Ablemont admitted he had never discussed this with Rizzo or the committee prior to inserting it in the 3- June agreement. It was D'Ablemont's rationale for this provision that it was con- sistent with and part of the collective-bargaining agree- ment. As D'Ablemont explained, other provisions of the contract incorporated by reference, by analogy have benefits that either require a full period of work, or, if not so worked, provide the benefit on a pro rata basis. The yearend attendance bonus was one. Vacation was another. Thus the preexisting vacation provision provid- ed that if an employee, during the year prior to 30 June when eligibility is determined, is on layoff or authorized leave of absence of more than 60 calendar days he will receive paid vacation on a pro rata basis In sum, the terms for receipt of the 2-percent bonus' were put in to be in synchronization with this collective-bargaining phi- losophy. After the committee and Rizzo refused to ap- prove the agreement he prepared, D'Ablemont proposed that this language, on prorating the 1987 bonus, remain in the contract and if an actual dispute arose at the time it was due to be paid, let it be arbitrated. This offer was rejected by the Union, which sought, instead,'to negoti- ate to agreement on the item. As the other committee members arrived, they individ- ually read the document and all agreed on the same four discrepancies. Fusco informed Porter, who said he would investigate it and check with D'Ablemont; he did not think there was any problem. In fact, Wally testified, all employees, including those at the minimum, had received the 4-percent increase. Three people worked at the minimum in Wally's own work area. As a result, the union employees believed that the Company had now applied the wage increase across the board including to those at the minimum. It turned out, however, after Porter spoke to those at the minimum a few weeks later, that-it was only coincidence that they had received 4 percent, which represented not a contractual wage increase, but a merit increase to the top of the classification after a periodic review. Wally noted that,not only does a new (inexperienced) employee start at the minimum wage rate of his classifi- cation but also when an employee successfully bids into a new job classification, after 60 days he receives the minimum rate of the new classification (unless he is al- ready earning more, in which case he receives the next higher rate). These two groups of employees, the newly hired and successful bidders, would be • affected by not applying the 10-percent total 3-year wage increase to the minimums of the job classification Wally also acknowledged that some grievances had been filed during the period the employees believed they had a contract but that, thereafter, although a written record was made of the problem and presented to Porter, there was no formal procedure and grievants were so informed, but they were also advised to call Carlson of the Regional Office of the NLRB to report the matter. Dues have continued to be checked off by the Compa- ny and remitted to the Union, pursuant to the individual checkoff authorization on file. On cross-examination, Wally acknowledged that he had been given the Company's 30 April letter by a sala- ried employee shortly after 30 April and he had given it to Fusco. Further, he also agreed that a union leaflet dated 8 May had been distributed partly in response to JOHN DUSENBERY CO 667 the 30 April letter in which the Company, in the course of informing salaried employees of its position in the continuing labor dispute, listed its latest proposals, in- cluding the one-time deductibles for the basic medical care benefits portion of the company plan-the only time this item was put in writing In that union leaflet, signed by Rizzo and distributed to the nonunion and salaried employees, the Union took issue with the information contained in several letters and memos passed out by the Company among the office and nonbargaining unit per- sonnel . In terms of specific bargaining subjects, the leaf- let referred only to the Company's insufficient wage offer and its refusal to agree to retroactive pay even if the Union dropped its demand for a changed contract date. No mention was made of the Company's new medi- cal benefit proposal, and the record is devoid of any evi- dence that 3 to 4 weeks later, anyone on the Union's team had still in his possession or recalled the proposals the Company had made on 29 April, documented in the 30 April letter As Fusco never took the stand, it is un- clear whether he ever gave, or acquainted Rizzo with, its particular contents Rizzo conceded that he heard from Fusco that certain propaganda was being circulated by the Company throughout the white collar or salary force stating facts that were not true and conditions that did not happen. He immediately responded with the 8 May notice In fact, in addition to the 30 April letter, the Company also sent a mailing to all office employees on 16 April and followed the Union's 8 May leaflet with a mailing directed to all employees In the 16 April mail- ing, the Company characterized the way in which the Union voted to strike and was acting on the picket line as irresponsible and implicitly criticized the Union for its failure to seek to substantiate the Company' s numbers and statistics. The 30 April letter was also referred to by Union Lawyer Drogin in a 13 June letter to D'Ablemont pointing out three differences that had still to be re- solved in order to arrive at an agreement Drogin wrote: "Although the Company's April 30th proposal with regard to medical insurance mentioned basic medical care benefits, no deductible was agreed to except with regard to major medical." Rizzo testified that he asked Fusco to gather all memos and writings from the negoti- ations for the lawyer's use when he became aware there was a continuing difference about the terms of an agree- ment and he wanted to prepare material to aid in the dis- pute and Fusco may have forwarded a copy of the 30 April letter to Drogin, but he was not sure. Wally also asked Rizzo about the 30 April letter when he reviewed the Company's proposal to end the strike at the 29 May session but could not recall his response. He did make clear on the witness stand that the insurance remain the same and that there be no $100/$200 deducti- ble on the basic coverage It also developed toward the close of the hearing that when the 3 June agreement was first delivered to the Union it was signed by Fusco; however, it was never signed by Rizzo or the committee men or delivered to the Company, and was destroyed prior to the time the Company served a subpoena on the Union calling for the production of any signed or executed copies. The credibility of both D'Ablemont and Rizzo is sus- pect on a number of crucial factual disputes that arose in the course of this proceeding Each of them was im- peached by virtue of testimony they gave on relevant matters, indeed, testimony on the substantive discussions held between them, which differed and conflicted in sig- nificant respects from either pretrial statements or prior testimony they each gave here. Furthermore, on occa- sion D'Ablemont showed a tendency to avoid direct an- swers to question posed by the General Counsel, creating the strong impression of evading and avoiding dealing with lines of inquiry on which Respondent's position was not particularly strong. Thus, when asked to agree that he never presented the Company's 29 April proposal di- rectly to the negotiating committee, D'Ablemont first re- sponded that he presented it directly to Rizzo, then when asked to agree that response did not answer the question, answered that we were negotiating by tele- phone, and then finally, asked to agree that answer still did not answer the question, answered no. (Tr 44, L. 20-Tr 45, L. 1) Rizzo demonstrated a vagueness, poor recollection, and haziness about the timing of discussions, events and, in particular, the period and genesis of the strike, which detracted from his believability even when his statements were otherwise responsive and germane The most credible witness was Wally, who was gener- ally straightforward, concise, and relatively clear in his responses. He made a sound witness whose clarity of presentation is probably best exemplified in the extract of his testimony that has been earlier reproduced, describ- ing the events near the close of the bargaining session held on 29 May 1985. I have determined to credit Wally's recital when a conflict in testimony arises. I have made no credibility findings based on the fact, admitted on the record by Rizzo, that in 1982, in his ca- pacity as an owner of a company engaged in the garbage hauling industry, he pleaded guilty to a criminal charge of a conspiracy to monopolize the garbage industry for which he received a 2-year prison sentence, of which a year and a half was suspended, and was fined $65,000. Although I ruled over the union counsel's objection that the probative value of the evidence of the conviction outweighed its prejudicial effect to the defendent and thus was admissible under Rule 609 of the Federal Rules of Evidence, I am not convinced that it warrants being given weight in independently determining Rizzo's credi- bility. Unlike the situation in SCA Services of Georgia, 275 NLRB 830 (1985), cited by Respondent counsel in sup- port of its argument that the conviction be given control- ling or serious weight in determining Rizzo's credibility, the crime involved here was engaged in a different ca- pacity, did not consist of fraudulent or false conduct or acts, and did not involve any personal moral transgres- sions, turpitude, or characteristics that could help shed light on Rizzo's actions or statements in the instant pro- ceeding Faced with the hazard of determining credibility when conflicts have arisen in light of the poor choices, made evident by the foregoing summary and the testimony previously detailed, I conclude as follows 668 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Regarding those recitals by D'Ablemont of the presen- tations made by the parties at the first December meet- ing, which Rizzo did not attend, I find this testimony generally sound, including the point that he made known the Company's intention to exclude the minimum rates in each classification from the wage increases proposed and that Porter provided an explanation for this, position. Wally did not deny that this proposal may have been made in his presence. Rizzo could,not recall if it was dis- cussed I conclude that it was made by the Company on 12 December, and was never thereafter withdrawn, al- though, admittedly, it was not specified at any time in writing, not even in the 29 May strike settlement propos- al. I also find that along the way, when D'Ablemont sought to bring Rizzo up to date on the Company's posi- tions, or later, when after 29 May, they reviewed by telephone the various proposals for resolving their differ-' ences, Rizzo became personally acquainted with the Company's proposal on minimums. I am also prepared to conclude that Rizzo learned of the Company's proposal in this regard and did not object to it during his telephone negotiations with D'Ablemont during May into very early June 1985, particularly on I June. It is noted in this regard that Rizzo acknowledged having suggested to D'Ablemont a two-tier wage system, with a lower rate for new employees, whether experi- enced or not, to aid the Company's economic predica- ment, and a minimum rate that did not receive the pro- posed wage increases was, at least, consistent with this position. I come to this finding also because of Rizzo having been impeached with respect to his denial that D'Ablemont ever proposed to him a separate attendance bonus day schedule for more senior employees. Having found Rizzo to have misstated the facts in that regard, by virtue of his own handwritten notes on the subject, I infer that on the wage minimum item, which, like the at- tendance bonus schedule, did not involve a give back- anathema to the union side-D'Ablemont made' this demand clear, reiterated it, and indeed, ultimately re- ceived no objection to either proposal from Rizzo. As will be recalled, it was Rizzo's practice in these series of telephone sessions with D'Ablemont to seek some modification or additional gain in benefit-whether' a change in termination date, sick days, pension or wage increase-after D'Ablemont had outlined the proposal to date, and then hold out the promise of agreement if only the new demand or proposal was granted On these oc- casions Rizzo spoke about being in contact with the committee-he was either shortly going to meet with them or had done so-so that his assent, albeit condition- al (on company agreement to just one more demand) ap- peared to all intents and purposes to have been the result of his own consultations and discussions with the com- mittee which, after all, had ultimate authority to bind the Union to a new contract. Again, although the second attendance day bonus schedule was not memorialized prior to D'Ablemont's forwarding of the 3 June agreement, its terms grew out of the give and take of the extended and multiple discus- sions he and Rizzo had as the Company tried to satisfy the Union's demand for a paid sick day benefit The second added attendance day, was, at first, limited to the third year of the contract and those employees with 5 years service until the first condition was finally with- drawn. I credit D'Ablemont's recital of the subtle turns and twists the negotiations took as the Company arrived at its final proposal on this item Rizzo failed on the stand to deal with any of the ramifications of the Compa- ny's response to his paid sick day demand, and must be left with the only testimony that reasonably deals with the subject matter, to which, after all, only two individ- uals were privy Although Wally is likely telling the truth when he re- lates that Rizzo did not mention either the minimums ex- clusion from wage increases and the "two tier" attend- ance bonus in his 2 June meeting with the committee before the union ratification vote, I find that Rizzo was aware of both proposals, and either agreed to them in'his discussions with D'Ablemont or did not object to their inclusion in a final package of changes to the 1982-1984 contract, which he agreed to present to the membership and on' the basis of which, with'the addition of strike return housekeeping items and improvement in the timing of the back-to-work bonus resolved, he agreed to discontinue the strike and return the men to work The parties' series of, and final, positions on the de- ductibility issues presents a different kind of problem. Even Rizzo concedes that deductibility was a subject that came up in his presence and that he discussed with D'Ablemont by telephone. It was not a part of the Com- pany's comprehensive medical, cost containment propos- al distributed in December 1984, and only came to the fore, according to D'Ablemont, on 29 April, when he in- formed Rizzo the Company was dropping any change in deductibles for major medical, leaving them at $100/$200, and adding a $100/$200 to the basic medical benefit plan: I find that Rizzo's confusion on the deduct- ibility issue probably dates from this occasion. That con- fusion, if not completely understandable, is at least not beyond the realm of reason The confusion is compound- ed by Rizzo's apparent lack of understanding that hospi- tal benefits fall under the basic coverage and not the, major medical or catastrophic portion of the coverage. It is important to bear in mind on this issue that the Union was adamant in its opposition to any give back in benefits, and adding a deductible to an existing benefit was a give back Wally testified the Union expressed op- position to the Company's then insurance changes in De- cember, and, assuredly, Rizzo joined in that criticism in direct discussions with D'Ablemont Although the two surgical changes did not add to employee cost and were therefore not objectionable on that score, the deductibles would come directly out of the employee's pocket and would be strongly opposed at the table by Local leader- ship, which expressed such strong negative feelings to giving up any prior benefit gains earned over the years. My conclusion in this regard is reinforced by the evi- dence of Rizzo's 17 May 1985 demand letter to the Com- pany in which he made clear that the Union was willing to agree on a second surgical opinion and outpatient treatment but that otherwise the insurance was to remain the same. This letter comes a day after Rizzo purported- ly agreed to deductibles in the basic medical plan. See JOHN DUSENBERY CO 669 Associated Machine, 271 NLRB 367 (1984), enfd Associ- ated Machine v. NLRB, 271 NLRB 367 (1984), enfd. As- sociated Machine v. NLRB, 782 F.2d 1051(T) (9th Cir 1986) I am unwilling to find that this omission of the de- ductible item was an inadvertence, but find instead it was basic to the Union's position opposing give backs, par- ticularly in the medical plan The conditions contained in this letter were consistent with the positions Rizzo voiced in conversations with D'Ablemont as recently as the day before. See Monument Printing Co., 231 NLRB 1215 (1977). D'Ablemont's testimony regarding a follow- up phone call to Rizzo in which Rizzo acknowledged his mistake in the letter is not credited. The absence of D'Ablemont's supposed corroborative notes, conflicts be- tween D'Ablemont's testimonial assertions and sworn af- fidavit, his characterizations of items as nonissues when clearly there was union disagreement, his eagerness to tailor his narrative and evade direct responses, all lead me to this finding. It is also clear that the Company bears some responsi- bility for the ambiguity on this issue, which it never clarified in writing to the union side. The first error was on 29 May, in referencing a letter distributed to salaried employees, the only occasion on which this proposal was codified. The probabilities are strong that in subsequent telephone discussions with Rizzo, D'Ablemont continued to so reference this change in medical benefits He was not clear how detailed his discussions of specifics were when the package was thereafter discussed, and it is con- ceivable that it remained ambiguously referenced to the very end when on 2 June, Rizzo agreed to settle the con- tract and return the employees to work. D'Ablemont testified on 29 May he reviewed his writ- ten strike ending proposal in detail in front of the media-, tor, Rizzo, and the employee committee. I find that D'Ablemont overstated the nature of the discussions that took place, and I am inclined to agree with Wally's nar- rative regarding the sequence of events Wally's version substantially corroborates Rizzo's and disputes D'Able- mont's claim that he defined the items and received nods or assents from the committee. D'Ablemont could not provide any identifications of those committee members who so agreed by movement or word Under the strained circumstances under which D'Ablemont first prepared and then added to his memorandum, and given Wally's and Rizzo's more reliable recitals, I find that nei- ther Rizzo nor the committee received an explanation of the 30 April letter reference and that they did not agree to a deductible to be added to the basic health plan then or at any later date There is some suggestion that Rizzo and, indeed Wally, were aware of the meaning of the 30 April letter reference on 29 May by virtue of Wally's receipt of a copy a month earlier and his having provided Fusco with it. There is, however, insufficient evidence in this record to show that a month later, Rizzo was well ac- quainted with its contents I am inclined to credit Rizzo that he became aware of the nature of that 30 April letter and others addressed to salaried, nonunit personnel, but never reviewed it personally or in detail. Even Rizzo's 8 May leaflet response to these letters does not deal with the Company's changed medical containment proposal, but with other, more general matters such as tactics and responsibility for the strike and its continu- ance I find that until receipt of the 3 June agreement, Rizzo believed he was agreeing to retention of the old major medical deductible after the Company had first proposed its change, and two optional surgical proposals, and nothing more. No objective writing or other documenta- tion provides reasonable counterveilmg evidence that could otherwise convince me that Rizzo or the commit- tee was aware of the precise terms of D'Ablemont's pro- posed change in medical care or that either agreed to the deductible under the basic portion of the plan. Rizzo's misunderstanding prevents that agreement from being ef- fective and neither he nor the Company agreed or voted for the change. Analysis This case presents the basic question whether the par- ties reached agreement on the terms of a successor col- lective-bargaining agreement Did they achieve a "meet- ing of the minds" on the four terms and conditions of employment that since 3 July 1985, have divided them? Absent a "meeting of the minds" there is no mutually binding agreement. That coming together in agreement, that mutual assent, however, does not mean that both parties must have the same subjective understanding of the meaning of material terms in the contract. Subjective understandings or misunderstandings are irrelevant so long as the terms; themselves are unambiguous "judged by a reasonable standard " Pittsburgh-Des Moines Steel Co, 202 NLRB 880, 888 (1973); Dipolmat Envelope Corp., 263 NLRB 525, 535-536 (1982). In the labor relations context, just as with any contrac- tual dispute, the key to determining whether an agree- ment has been reached, and the substantive terms of the agreement, lie, in the conduct and words of the partici- pants during their ' negotiations Pittsburgh-Des Moines Steel Co., supra On-occasion, an issue may arise, as it has here, wheth- er the participants in the negotiations who, as agents of their. principals are claimed to have reached agreement, had the authority to approve the terms. Even if the agent lacked actual authority to consum- mate an agreement, he may nonetheless be held to have bound his principal under the doctrine of apparent au- thority "Apparent authority results when the principal does something or permits the agent to do something which reasonably leads another to believe that the agent had the authority he purported to have " Retail Clerks Union Local 1364, 240 NLRB 1127, 1131-1132 (1979) quoting Hawaiian Paradise Park Corp. v. Friendly Broad- casting Co., 414 F 2d 750, 756 (9th Cir. 1969). The Union, in its early December special notice, made clear that the employee negotiating committee had full power to ratify a new contract and Rizzo, at the 27 De- cember session, explained that he would be the main spokesman representing their views, positions, and re- sponses during the negotiations D'Ablemont, more than once, orally and in writing, acknowledged his under- standing of their respective authorities Neither Rizzo 670 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD nor the committee members in attendance on 27 Decem- ber limited that authority to face to face negotiations. Since the final series of negotiations took place by tele- phone between the main agents, D'Ablemont had every reason to believe that Rizzo's and the committee's au- thority and status continued unabated. I have previously described and analyzed the nature of Rizzo and D'Ablemont's interaction in the series of con-, versations. Consistent with that analysis I now conclude that by his conduct, Rizzo conveyed the distinct impres- sion to D'Ablemont that the precondition of higher ap- proval by the committee had been satisfied. Thus, when D'Ablemont included,the terms regarding the two items involving minimum wage classifications and a separate attendance bonus schedule for senior employees on his 3 June submission, he reasonably acted in a belief that the committee's assent had been obtained. Just as in Walnut, Hill Convalescent Center, 260 NLRB 258 (1982), Rizzo had become implicitly clothed with the authority to communicate the fact that approval had been given; al- though he did not formally announce such approval in formal language,' everything he did delivered that mes- sage. See also Electrical Workers IBEW Local 22 (Elec- tronic Sound), 268 NLRB 760 (1984), enfd. 748 F 2d 348 (8th Cir. 1984). Rizzo, in fact, indicated on the record that he could bind the committee by his actions when he testified that when,he agreed to proposals,, he was speak- ing on behalf of the committee. As I have found that Rizzo, in essence, by his words and conduct, by telephone, agreed to these two terms, he thereby bound his principal, the committee, even though the employees' earlier expressed opposition to the exclu- sion of minimums from wage increases may have, been, expressed at the bargaining table and Rizzo failed to list these two items in his review of the Company's latest proposal, before the committee on 2 June 1985. As a result of this conclusion, I will recommend that the com- plaint be dismissed in so far as paragraphs 10, 11, and 12 rely, in part, on the inclusion in the memorandum of agreement of these two subjects and allege the Union's refusal to agree to them and continued demand to bar- gain concerning them. Regarding the substantive issue involving deductibility,. I conclude that no meeting of the minds ever took place The confusion Rizzo manifested about the nature of the deductible item D'Ablemont had raised as early as their phone conversation on 29 April was never mitigated or dissipated by any clarification from D'Ablemont, particu- larly any writing that could have cleared the air about what precisely the Company was proposing on deducti- bles after it withdrew its complex and detailed early offer on multiple changes in its health insurance plan, both basic and major medical portions. By relating its subsequent change in position to a letter addressed to sal- aried employees, never directly provided the committee or Union's chief negotiator, Rizzo could reasonably com- plain, as he did on the witness stand "how was a propos- al sent to a white collar force and not the Union?" (Tr. 416) In the face of Rizzo's legitimate confusion, the evi- dence is simply lacking that shows, by reference to any writing, signed or otherwise, that agreement was reached on this issue. The limited documentation, which makes reference to this item, supports the conclusion that agree- ment was not reached. In his 17 May letter, Rizzo makes a full contract proposal on behalf of the Union, including agreement to two changes in the medical plan but not the third, which the Company, since 29 April, had been seeking. Given also the Union's uniform opposition to give backs; D'Ablemont had no sign or indication that Rizzo or the committee had agreed to a deductible on the,basic coverage. As I have found, D'Ablemont could not rely on any conduct or words of the committee members expressed at the 29 May bargaining session. His version of a subsequent May conversation with Rizzo has also not been credited. Neither could he rely on his subsequent conversations with ` Rizzo about which he could not swear, without some reservation, that the med- ical plan changes were itemized with precision. Rizzo's misunderstanding was never put to the test by any docu- mentation, which in haec verba, could be said to have listed each of the three changes that the Company finally proposed in its medical plan. Thus, applying the test for determining whether a mu- tually binding agreement had been achieved, I conclude that, inasmuch as Rizzo's and the committee's words and conduct, judged by a reasonable standard, lacked speci- ficity, and masked a latent ambiguity, which reference to relevant, mutually comprehended, extrinsic evidence cannot resolve, the Company's reliance on the evidence of concurrence it offered is insufficient to show that a contractual agreement was reached on applying deducti- bles to the basic portion of the medical insurance plan. See Pittsburgh-Des Moines Steel Co., cited supra, 202 NLRB at 888. See also Vallejo Retail Trade Bureau, 243 NLRB 762, 767 (1979). Accordingly, regarding this issue, agreement being lacking, the Respondent has had a continuing legal duty to meet and bargain with the Union. Having failed and refused to do so, I shall recom- mend that its conduct be found to have violated Section 8(a)(5) and (1) of the Act and shall issue an appropriate order. Regarding condition the Company placed on the grant of its 23 December 1987 2-percent bonus, I also conclude that no agreement was ever reached and its inclusion in the 3 June poststrike settlement agreement reflects no mutual assent on the matter. The Company's 29 April • final proposal to end the strike specifies regarding this bonus, that it be paid "to each employee then on the payroll in the amount of $228." At no time did D'Ablemont ever notify Rizzo or the committee that its full receipt would require an em- ployee to have worked or received pay for the complete 6-month period prior to 23 December 1987, failing which, an employee would receive it on a pro rata basis. D'Ablemont argues that it was merely a matter of con- forming this benefit to others of long standing that like- wise conditioned full payment on prior full periods of work, but that also permitted payment on a pro rata basis. What D'Ablemont fails to note is that this bonus as a one time lump sum amount does not equate with the other benefits he cited. Rather, it falls into the category of a benefit provided in lieu of a salary increase. Rizzo clearly recognized its purpose when he questioned JOHN DUSENBERY CO. 671 D'Ablemont about it at the end of the 29 May session. As such, it saved the. Company from a raise in the base permanent salary at the end of the new contract term from which base new wage increases would be negotiat- ed. The Company does not argue that the percentage salary raises built into the new contract required prior employment for their receipt, even for a new, experi- enced employee Thus, the Company in this provision seeks to have its cake and eat it too. It seeks to avoid a contract ending raise in permanent contractual rates as well as a limitation on the bonus disbursement in full to only employees who have met a minimum prior period of service, a condition not otherwise applicable to its raises in wages While a proper employer objective, D'Ablemont's failure to specify this limitation at any time prior to his preparation and ,forwarding of the final agreement after the strikers had returned to work on the' strength of an apparent agreement on all terms for a suc- cessor contract, prevents this condition from being treat- ed as an agreed on term of employment. The Respond- ent's insistence on the Union's execution of the agree- ment including this item, and its refusal to continue to negotiate to a binding agreement once this unresolved difference was made known, is a refusal to bargain in violation of the Act and I shall recommend that the Board so find. D'Ablemont's offer to arbitrate any dis- pute then arising under this language as to the parties' intent to prorate the bonus did not convert an open item into an agreed on provision, and the Union was free to reject this offer and insist on further negotiation to reach agreement. It is not the interpretation of the added con- dition that is at issue here but its inclusion in the agree- ment in the first place Respondent also argues that the Union did sign the memorandum and therefore must be bound by its act manifesting agreement to its terms. Fusco's signature does not constitute agreement. Agreement on the Union's part would have required that the employee ne- gotiating committee members sign on page seven where provision is made for their signatures. Even if Rizzo had exercised apparent authority with respect to all issues di- viding the parties, his signature was also lacking. Fusco was neither the Union's negotiator nor the Union's prin- cipal with authority to enter into the contract. In any event, the writing was destroyed when it appeared that mutual assent was lacking, and it was thus not subject to production under the Respondent's later issued subpoena. Respondent further contends that inasmuch as the Union is receiving a certain benefit of its expired agree- ment, not a term or condition of employment, to wit, re- ceipt of dues deducted from the employees' pay, it has thereby waived its right to claim that no agreement is currently in force. Apart from the checkoff provision in the contract itself, it appears that the Union has, consistent with its charge, taken the formal position that no successor con- tract exists Thus, with respect to the grievance article, it has refrained from processing any grievances beyond making an initial record of them with supervision. While Respondent took the position that all terms and condi- tions of employment under the expired agreement would continue to remain in effect while bargaining continued, that is its legal obligation, barring an impasse, and it ap- pears, based on D'Ablemont's statements, that none of the wage,increases, following the first which was effec- tive 4 June 1985 immediately on the employees' return to work, and except for the back-to-work bonus, would be implemented. Thus, neither party is acting to implement an agreed on successor contract. As for the dues remission, that is implemented pursu- ant to a dues-checkoff authorization executed by the in- dividual employee that the employee could revoke any time following expiration of the agreement on 27 De- cember 1984. Washington-Baltimore Newspaper Guild, AFL-CIO v. Washington Post Co., 101 LRRM 2123 (D.C. Cir. 1979). As a contract between an employee and his employer, Machinists Local 2045 (Eagle Signal), 268 NLRB 635, 637 (1984), no agreement between the Union and Respondent is being implemented while the Compa- ny continues to remit the dues pursuant to the checkoff, and the employee, who is free to do so, has not revoked his individual authorization. In other words, the expired agreement, while authorizing a check off, is not the in- strument pursuant to which the dues are being remitted to the Union. Rather, it is the member's individual au- thorization Finally, although the Union's initial charge did not raise the issue of the Respondent's refusal to bargain over inclusion in the 3 June memorandum of the provi- sion excluding the minimums from receipt of the wage increases, it is evident from the facts described that until some weeks after their return to work, the employees committee believed that the Company was applying the increases to employees at the minimum of their classifica- tions, at least until Porter explained otherwise. In any event, there was no legal impediment to including that fourth item in paragraph 10 of the complaint, as one of the subjects about which no agreement was reached and, about which Respondent refuses to bargain. It was clear- ly within the scope of the charge, was timely, and was closely related to the subjects alleged in the charge. Re- spondent does not contend otherwise. Finally, as I have recommended dismissal of the allegation related to that item, there is no reason for the Board to reach Respond- ent's contention regarding the charge. THE REMEDY Since I have found that Respondent did engage, and continued to engage, in certain unfair labor practices that affect commerce, I shall recommend that it be ordered to cease and desist therefrom, and to take certain affirma- tive action, including the posting of appropriate notices, designed to effectuate the polices of the Act. CONCLUSIONS OF LAW 1. Respondent John Dusenbery Co., Inc., is an em- ployer within the meaning of Section 2(2) of the Act, en- gaged in commerce and business activities that affect commerce within the meaning of Section 2(6) and (7) of the Act. 2. Local 945, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America is a labor organization within the meaning of Section 2(5) of 672 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD the Act, which admits certain employees of John Dusen- bery Co., Inc. to membership. 3 All production and maintenance employees em- ployed by John Dusenbery • Co., Inc, at its Randolph Township, New Jersey facility, excluding all office cleri- cal employees, guards, professional, and technical em- ployees,' and supervisors as defined in the Act, constitute a unit appropriate for the purpose of collective bargain- ing within the meaning of Section 9(b) of the Act 4. At all times material, complaintant union has repre- sented a majority of Respondent's employees within the bargaining unit dust described; by virtue of Section 9(a) of the Act, complaintant union has been entitled to rec- ognition as the exclusive representative of all employees within the said unit, for the purpose of collective bar- gaining regarding their rates of pay, wages, hours of em- ployment, and other terms and conditions of work. 5. By failing and refusing to bargain collectively "since on or about 14 June 1985 with complaintant union re- garding provisions the Respondent included in a memo- randum of agreement that purported to resolve all differ- ences for entry of a successor collective-bargaining agreement, that prorates a bonus payable in 1987 and that applies deductible amounts to the basic portion of the medical insurance plan, Respondent has failed to bar-' gain collectively regarding rates of pay, wages, hours of employment, and other terms and conditions of employ- ment for employees within the bargaining unit described above, and has thereby engaged in, and is engaging in, unfair labor practices affecting commerce within the meaning of Section 8(a)(1) and (5), and Section 2(6) and (7) of the Act 6. In all other respects, Respondent John Dusenbery Co., Inc., has not committed any unfair labor practices as alleged in the complaint On these findings of fact and conclusions of law and on the entire record,3 I issue the following recommend- ed4 the exclusive representative of Respondent's Randolph Township,, New Jersey facility, employees, within the unit found appropriate here for collective-bargaining pur- poses, with respect to their rates of pay, wages, hours of employment, and other terms and conditions of employ- ment, and, if an understanding is reached, embody such understanding in a signed agreement. (b) Post at Respondent Randolph Township, New Jersey facility copies of the attached notice marked "Ap- pendix."5 Copies of the notice, on forms provided by the Regional Director for Region 22, after being signed by the Respondent'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 cus- tomarily posted Reasonable steps shall be taken by the Respondent to ensure that the notices are not altered, de- faced, or covered by any other material. (c) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Re- spondent has taken to comply IT IS FURTHER RECOMMENDED that the complaint be dismissed insofar as it alleges Respondent violated the Act by refusing to bargain collectively regarding the provisions contained in the memorandum agreement that do not apply negotiated wage increases to the minimum. wage rate for each job classification and established a separate bonus day schedule for employees with 5 or more years', seniority. 5 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 " APPENDIX ORDER Respondent, John Dusenbery Co., Inc., Randolph Township, New Jersey, its officers, agents, successors, and assigns, shall 1 Cease and desist from refusing to bargain collective- ly in good faith,with Local 945, International Brother- hood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, on behalf of workers within the unit here found appropriate for collective-bargaining pur- poses, or from engaging in any like or related conduct in derogation of its statutory duty to bargain. 2. Take the following affirmative action necessary to effectuate the policies of the Act. (a) On request, bargain collectively in good faith with Local 945, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, as a In an order correcting record that I issued on 17 June 1986, 1 or- dered corrections to the record in certain limited respects 4 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 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. WE WILL NOT fail or refuse to bargain collectively in good faith with Local 945, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, as the exclusive representative of our employ- ees, within the appropriate bargaining unit described below, concerning their rates of pay, wages, hours of work, and other terms and conditions of employment. WE WILL NOT in any like or related manner interfere with, restrain, or coerce our employees regarding their exercise of the rights to bargain collectively through a representative chosen by them. WE WILL on request, bargain collectively in good faith with the Union as the exclusive collective-bargaining representative of all production and maintenance em- ployees at our Randolph Township, New Jersey facility, JOHN DUSENBERY CO 673 excluding all office clerical employees , guards, profes- sional and technical employees and supervisors as de- fined in the Act. JOHN DUSENBERY CO., INC.