Royal Sound Co., Inc.

ROYAL SOUND CO. 989 Royal Sound Company, Inc. and United Food and Commercial Workers Union, Local 21, AFL- CIO, CLC. Cases 22-CA-14580 and 22-CA- 14613 6 January 1988 DECISION AND ORDER BY MEMBERS JOHANSON, STEPHENS, AND CRACRAFT On 18 August 1987 Administrative Law Judge Howard Edelman issued the attached decision. The Respondent filed exceptions and a supporting brief. 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 brief and has decided to affirm the judge's rulings, findings, I and conclusions,2 to modify his remedy,3 and to adopt the recommended Order as modified.4 ORDER The National Labor Relations Board adopts the recommended Order of the administrative law judge as modified below and orders that the Re- spondent, Royal Sound Company, Inc., Eaton- town, New Jersey, its officers, agents, successors, and assigns, shall take the action set forth in the Order as modified. 1. Insert the following as paragraph 1(a) and re- letter the subsequent paragraphs. "(a) Interrogating employees coercively about their union activities." 2. Substitute the following for original para- graphs 1(d), 1(e), and 1(f). "(d) Granting its employees wage increases to induce them to cease their union activities; provid- ed, however, that nothing herein shall be construed ' 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 record and find no basis for reversing the findings 2 We adopt the judge's conclusion that the Respondent violated Sec 8(a)(l) by its rule prohibiting solicitation and distribution since the rule prohibits solicitation during nonworking time Our Way, Inc, 268 NLRB 394 (1983) We do not adopt his further finding that the prohibition against distribution of written material in working areas is unlawful J In accordance with our decision in New Horizons for the Retarded, 283 NLRB 1173 (1987), interest on and after 1 January 1987 shall be computed at the "short-term Federal rate" for the underpayment of taxes as set out in the 1986 amendment to 26 US C § 6621 Interest on amounts accrued prior to I January 1987 (the effective date of the 1986 amendment to 26 U S C § 6621) shall be computed in accordance with Florida Steel Corp, 231 NLRB 651 (1977) 4 We have modified the judge's recommended Order and notice to re- flect his recommended finding that the Respondent violated Sec 8(a)(1) by engaging in unlawful interrogation as requiring the Respondent to vary or abandon any benefits heretofore established. "(e) Granting its employees sick day benefits to induce them to cease their union activities; provid- ed, however, that nothing herein shall be construed as requiring the Respondent to vary or abandon any benefits heretofore established. "(f) Promulgating a no-solicitation rule prohibit- ing solicitation during the employees' working hours." 3. Substitute the attached notice for that of the administrative law judge. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post and abide by this notice. Section 7 of the Act gives employees these rights. To organize To form, join, or assist any union To bargain collectively through representa- tives of their own choice To act together for other mutual aid or pro- tection To choose not to engage in any of these protected concerted activities. WE WILL NOT interrogate employees coercively about their union activities. WE WILL NOT threaten to discharge our employ- ees because of their activities on behalf of United Food and Commercial Workers Union, Local 21, AFL-CIO, CLC. WE WILL NOT threaten employees to close our shop because of their union activities WE WILL NOT create the impression among our employees that their union activities are under sur- veillance. WE WILL NOT grant our employees wage in- creases to induce them to cease their union activi- ties. WE WILL NOT grant our employees sick day ben- efits to induce them to cease their union activities. WE WILL NOT promulgate a no-solicitation rule prohibiting solicitation during the employees' working hours. WE WILL NOT discriminatorily terminate the em- ployment of, or refuse to reinstate our employees because of, their union activities. 287 NLRB No. 99 990 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exer- cise of the rights guaranteed you by Section 7 of the Act. WE WILL offer Wanda Soto, Joseph Herbert, Clarace McCloud, and Pedro Gonzales immediate and full reinstatement to their former jobs or, if those jobs no longer exist, to substantially equiva- lent positions, without prejudice to their seniority or any other rights or privileges previously en- joyed and WE WILL make them whole for any loss of earnings and other benefits resulting from their discharge, less any net interim earnings, plus inter- est. WE WILL notify each of them that we have re- moved from our files any reference to his or her discharge and that the discharge will not be used against him or her in any way. ROYAL SOUND COMPANY, INC. William F. Grant, Esq., for the General Counsel. John E. Tate, Esq. (Tate & Alden), for the Respondent. DECISION STATEMENT OF THE CASE HOWARD EDELMAN, Administrative Law Judge. This case was tried before me on February 19 and 20, 1987, at Newark, New Jersey On July 31, 1986, a charge in Case 22-CA-14580 was filed by United Food and Commercial Workers Union, Local 21, AFL-CIO, CLC (the Union) against Royal Sound Company, Inc. (Respondent ). On August 6 and September 30, 1986, amended charges were filed. On August 21, 1986, a charge in Case 22-CA-14613 was filed by the Union against Respondent On October 30, 1986, a consolidated complaint issued alleging violations of Section 8(a)(1) and (3) of the Act. Briefs were filed by the General Counsel and by Re- spondent . On my consideration of the entire record, the brief, and my observation of the demeanor of the wit- nesses, I make the following FINDINGS OF FACT Respondent is a New Jersey corporation engaged in the wholesale sale and distribution of automobile stereo equipment Its primary office and facility is located in Eatontown, New Jersey However, it also has facilities located in Farmingdale and Wall Township, New Jersey. These three facilities are located within a few miles of each other. Respondent, annually during the course of its business operation, sells and ships from its New Jersey facilities goods, products, and materials valued in excess of $50,000, directly to points located outside the State of New Jersey I find Respondent is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act It is admitted, and I find the Union is a labor organiza- tion within the meaning of Section 2(5) of the Act. Respondent, as of June 1986, employed about 74 pro- duction and warehouse employees at its three facilities. Approximately 30 or so employees worked at the Eaton- town and Wall facilities and 15 or so at the Farmingdale facility. All employees reported to work at the Eaton- town facility where they clocked in They were then transported by various employees to the facility where they were assigned to work and transported in the same manner back to Eatontown to clock out Jack Diner, vice president of Respondent, maintained his office at Eatontown The Eatontown facility was su- pervised by Dennis Gannon and Robert Colas The Wall facility was supervised by J J Johnson and John Holman As of June 1986, Respondent's production employees were not represented by any labor organization. Some- time in late June 1986 Pedro Gonzalez, a technician em- ployed by Respondent, contacted a representative of the Union seeking union representation. On July 1, two union representatives met with Gonzales and explained the benefits of union representation and the, method of union organization Thereafter Gonzales and interested employees Joseph Herbert and Wanda Soto distributed authorization cards to employees. In addition there were several meetings up to July 17. On July 17 there was a union meeting held at a local firehouse attended by about 17 employees Gonzales, Soto, Herbert, and employee Clarace McCloud spoke at this meeting in favor of the Union Vice President Jack Diner was on vacation from July 8 to 24. Sometime during the last week in July, following Diner's return, Wanda Soto and employee Javier Medina were assigned to work at the Wall facility During a lunchbreak together Supervisor J. J. Johnson sat down with them and asked if they were "still messing with the Union . . . ." Soto asked him how he knew about the Union Johnson said it was not important how he knew, what was important was that Diner knew her and he knew everyone who had gone to the union meetings, and there were going to be changes. He then said Diner knew the employees who spoke at the last meeting (on July 17) and he was going to fire them.' Jack Diner testified that on July 29 he received a tele- phone call from one of the supervisors at Wall who in- formed him that an employee, Rene Lebron, was holding up a whole production line by making a speech to the employees.2 Diner immediately drove over to Wall and observed Lebron talking to a line of five or'six people including Soto. Production was being held up as a result.3 Diner immediately summoned Lebron to come ' These findings are based on the credible testimony of Javier Medina I was impressed with Medina's credibility His testimony on direct and cross-examination was forthright and responsive and his recollection con- cerning relevant details was adequate enough to be believable I make this credibility resolution notwithstanding various minor inconsistencies and a certain inability to recall certain less important details like when he started work and when his employment terminated Respondent was unable to produce Johnson, and the General Counsel was unable to produce Soto 2 It is not alleged that Lebron's speech was related to the Union or that Lebron was active in the Union 3 As set forth below, I do not find Diner to be a credible witness ROYAL SOUND CO 991 with him. He took him back to Eatontown and fired him He said nothing at this time to Soto. Diner testified on cross-examination that he did not fire Soto at the same time as Lebron because he wanted to talk to Gannon first . Diner testified that when he re- turned to Eatontown , after he discharged Lebron, he then asked Gannon his opinion of Soto, and Gannon told him that during the period of time Diner was on vaca- tion (July 8-24) Soto had gotten into disputes with other employees and that, based on Gannon's assessment of Soto, he had decided to terminate her He notified her of her termination at the end of the day when she returned to Eatontown to clock out. I do not credit Diner's explanation about his reason for Soto's termination During the period Diner was on va- cation Soto was not working at Eatontown under Gan- non's supervision There is no reason to believe Gannon would be in a position to give the evaluation alleged by Diner. Moreover , Gannon, who was called as a witness by Respondent, was not questioned about this alleged conversation with Diner. There is no evidence that Soto had received prior warnings from Respondent concerning her work Clarace McCloud, an employee employed at Eaton- town, testified that on July 29, during her workday, Diner told her she was being laid off because work was slow. McCloud told him this was not the reason for her layoff Diner said nothing. Diner testified he assigned McCloud certain work to perform and that 20 minutes later he observed her per- forming other work . He told her to perform the work he assigned her but she refused Diner left and then dis- cussed the matter with Gannon . Diner then decided to terminate her at the end of the day. Diner initially testi- fied that it was he who notified McCloud of her termina- tion, but then later testified it was Gannon. Gannon, although called as a witness by Respondent, did not corroborate Diner's testimony. Respondent does not contend that work was slow re- quiring any economic layoffs. Indeed , there is no evi- dence that any employee was laid off at this time I credit the testimony of McCloud . I was generally im- pressed with her demeanor. She testified in a forthright and responsive manner on both direct and cross-examina- tion, and displayed a reasonable recollection of the rele- vant facts. I found Diner a totally incredible witness. His entire testimony on both direct and cross -examination was ram- bling. He frequently editorialized . He was vague and in- consistent concerning the facts surrounding all four dis- charges. As set forth above in footnote 1, concerning Soto's discharge, he first testified that the whole assem- bly had stopped work and was listening to Lebron's speech, then testified it was only Soto who had stopped work. Concerning McCloud's discharge he first testified that he fired her . He then testified that Gannon fired her. Moreover he testified he discussed the facts surrounding both Soto and McCloud's discharge with Gannon, yet Gannon, although called as a witness by Respondent, failed to corroborate this. Further, much of Diner's testi- mony does not make sense For example, Diner testified he discussed Soto's work with Gannon before he fired her and Gannon told him she got into arguments with other employees However, Soto did not work under Gannon's supervision or even at the Eatontown facility where Gannon was a supervisor Diner did not explain why he spoke to Gannon about Soto or why Gannon would know about the conduct of an employee he did not supervise. Another example is Diner's testimony con- cerning Gonzales' discharge, which is set forth below. Diner testified that Gonzales was hired as a janitor. His work was so poor, however, that he was going to fire him. Instead , he promoted him with a raise in pay to the position of technician Diner, although pressed on cross- examination, failed to explain such a contradictory action Diner is simply not a credible witness. Joseph Herbert was employed by Respondent as a warehouseman at the Eatontown facility. His supervisor was Gannon Part of his duties included driving employ- ees from Eatontown to Wall and Farmingdale in the morning and picking them up in the afternoon so they could clock out. Four or five other employees also per- formed this function In late June or early July Diner told him he would be getting a merit raise Herbert testified that on July 29 about 4 p in., Diner called him over and told him they did not need him any- more. Herbert asked why and Diner replied, "it is just not working out " Herbert responded that it was not working out because of what was going on, and Diner replied he did not know what was going on. Diner testified that he fired Herbert because he took too long to shuttle the employees to and from Eaton- town and because he used the office telephone for per- sonal calls. Diner testified that Herbert had received re- peated warnings about both of these problems, presum- ably by Gannon, his supervisor. Diner testified he saw him using the office telephone on July 29 and fired him on the spot without discussing the discharge with Gannon. Gannon testified contrary to Diner that he discussed Herbert's termination with Diner before Herbert was fired and he told Diner he saw Herbert using the office telephone that day. He also testified they discussed Her- bert's production. Gannon was not questioned and did not corroborate Diner's contention that Herbert had re- ceived prior warnings about the excessive length of time he was taking to shuttle employees or of his use of the' office telephone. I credit the testimony of Herbert I was generally im- pressed with Herbert's demeanor He was responsive and forthright to questions put to him on both direct and cross-examination and displayed a reasonably good recol- lection of the relevant details As set forth above, Diner was not a credible witness. Moreover, his testimony that he fired Herbert on the spot was contradicted by that of Gannon, and his testi- mony that Herbert received prior warnings concerning his work differences was not corroborated by Gannon Gonzales was initially hired by Respondent as a janitor in 1985 About 6 months after his hire he was promoted to the position of technician. He worked out of the Ea- tontown facility and was supervised by Robert Colas. 992 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Gonzales testified that on July 31 Diner summoned him to his office. Diner told him he could not believe the employees were trying to organize a Union . He took Gonzales' timecard that he had on his desk and ripped it up He told Gonzales he was gone. He then told Gon- zales that he knew which employees had signed authori- zation cards and that they would be fired . He also stated he knew about a scheduled union meeting to take place that night at the local firehouse. Diner testified that on July 31 Gonzalez stormed into his office and angrily accused him of firing Soto, McCloud , and Herbert because of their union activities Diner testified he felt Gonzales , by his statements, was accusing him of being a "very bad person " Diner then told him he could no longer work there anymore be- cause he could no longer trust him and feared he might sabotage his products. I credit Gonzales. I was very impressed with Gon- zales' demeanor. He was most responsive and forthright to questions put to him on both direct and cross-exami- nation and had an excellent recollection about the rele- vant details. As set forth above, Diner was not a credible witness. Respondent attempted to corroborate Diner's testimo- ny with the testimony of Robert Colas, who testified that sometime after his discharge Gonzales telephoned him and said he "blew it" with Diner . "He went in to start talking to Jack, and a few words were exchanged and Jack [Diner] fired him " Gonzales denied this conversa- tion. He admitted a telephone conversation with Colas after his discharge but testified it related to real estate matters. I credit Gonzales. Moreover, I find Colas' testimony too vague and insufficient to corroborate Diner even if credited. Diner admitted that on August 1 following the 'dis- charge of Gonzales on July 31 he assembled the employ- ees to speak to them The reason for this speech, accord- ing to Diner, was the union organization and the dis- charges of the above four employees Javier Medina cre- dibly testified that Diner told the employees about the Union's campaign referring to it as a "Union problem." He told the employees if the Union came in he would lose control and he did not know if he could utilize his work force effectively, and if not he might have to sub- contract his work overseas. He then discussed the four employees who had been discharged, and stated that he was not going to allow "a few rotten apples" to spoil the Company. Diner admitted he told the employees he was upset about the Union's organization campaign and that he was now faced with "a Union problem." He denies he threat- ened to subcontract unit work because of the Union. He testified he was merely expressing his uncertainty if the Union were voted in and explained that union demands might require such subcontracting. He did not specifical- ly deny the statement about discharging the "rotten apples" attributed to him by Medina - For the reasons set forth above I credit Medina 's testi- mony. Respondent produced three employees, Lina Albert, Claire Castellitto, and Barbara Fincher, who testified that at no time during Diner's speech did he even bring up the subject of the Union or the Union's campaign In view of Medina's credible testimony, and Diner's admis- sion that the "Union problem" was discussed, I discredit their testimony. Medina credibly testified that sometime in late Septem- ber Diner questioned him about whether he was a member of the Union. The evidence established that prior to the instant case Respondent did not issue across-the-board wage in- creases. In June Respondent informed the Wall township employees that they would be getting a raise by July 1. It appears the raise was intended for the Wall employees only This was because in March 1986 there was a layoff of all the Wall employees when Respondent's videotape business floundered. Some employees were eventually re- called but were apprehensive about their job security. In June they were promised a raise to ease their apprehen- sion. On July 1, or thereafter, prior to the Union's cam- paign, this raise was never implemented In August, fol- lowing Diner's speech, all Respondent's employees re- ceived a wage increase. About August 8 Respondent issued a booklet for the first time to all employees entitled "Policies and Bene- fits." This booklet contained various Respondent rules and benefits Included in this booklet was a no-solicita- tion rule that provided- All distribution of written material or oral solici- tation for any organization or group by employees or nonemployees in work area is prohibited at any time 4 This booklet also contained an admittedly new benefit providing for sick days. John Holman, Respondent's manager testified it was decided to provide for sick day benefits in response to long-standing complaints of em- ployees 5 A second booklet was issued- to all employees in Sep- tember 1986, that was the same as the August booklet, except that it amended the wording of the no-solicitation rule to conform to the present Board law, as discussed below. The General Counsel contends that Respondent's dis- charge of four employees was discriminatorily motivat- ed The General Counsel has the burden of proving that the employees' union activities were a motivating factor in such alleged discrimination. Once such motivating factor is established, the burden of proof shifts to Re- spondent to establish the same action would have taken place in the absence of the employees' union activities. NLRB v. Transportation Management Corp., 462 U.S 393 (1983), Wright Line, 251 NLRB 1083 (1980), enfd 662 F.2d 899 (1st Cir 1981), cert. denied 455 U.S. 989 (1982) " This same rule in a prior edition was issued to Wall employees only in February 1986 5 The booklet also provided for a profit -sharing plan that was alleged in the complaint by the General Counsel as an unlawful grant of benefit The evidence, however, established that such benefit was in existence prior to the advent of the Union, and the General Counsel in his brief moved to withdraw this allegation from the complaint This motion is granted ROYAL SOUND CO 993 This rationale is like balancing weights on a scale. The greater the weight of evidence in the General Counsel's prima facie case, the greater the weight of evidence Re- spondent in his defense must place on the scale to shift the balance In the instant case, the General Counsel has presented a strong case to support its contention Respondent's knowledge of union activities is estab- lished by Johnson's interrogation of Soto and Medina during the last week in July, a few days before the dis- charges, when he asked them if they were "still messing with the Union." I conclude this interrogation is also a violation of Section 8(a)(1) because it took place during the same conversation wherein Johnson unlawfully cre- ated the impression of surveillance and threatened dis- charge Rossmore House, 269 NLRB 1176 ( 1984). During this conversation Johnson told the employees that Diner knew who attended the union meetings. I find such state- ment unlawfully creates the impression of surveillance in violation of Section 8(a)(1) Eagle Headers, 273 NLRB 1486 (1982). Respondent's animus to the extent he was willing to discharge employees in order to keep the Union out of his shop is established by Johnson 's statement to Medina and Soto that Diner was going to discharge employees who spoke up at the union meetings. I find this statement to be a threat of discharge in violation of Section 8(a)(1) A & R Transport, 237 NLRB 1084, 1088 ( 1978) It is further established by Diner's unlawful speech , described below, when he threatened to close the shop if the Union came in, and referred to the discharged employees as "rotten apples" who were never coming back Animus is further established by Respondent's unlawful grant of benefits, described below The timing of the discharges is highly significant evi- dence in support of the discriminatory motivation The discharges took place within a week of Diner's return from vacation. The identity of the employees is also highly significant . All four employees discharged had spoken in favor of the Union at the last union meeting and Johnson had told Medina that Diner intended to fire those employees who spoke at the last union meeting Moreover, Respondent had never fired more than two employees for independent reasons within such a short period of time. Further, Diner's statement to Gonzales when he fired him that he could not believe the employ- ees were trying to organize a Union, coupled with his act of ripping up Gonzales' card and telling him he was gone, is a virtual admission of a discriminatory motiva- tion Diner contends that Soto was discharged because she had stopped working and was listening to Lebron speak However, Diner initially testified Lebron had caused a work stoppage on the whole line of six employees and later testified that it was only Soto who had stopped work. Moreover, there is no evidence that Soto had ever been warned for similar misconduct , any other miscon- duct, or for poor work. Diner testified McCloud was discharged for insubordi- nation . However, his testimony was not credited McCloud's credible testimony was that Diner told her he was letting her go for lack of work. There is no evi- dence, however, that an economic layoff was necessary .or that other employees were laid off Diner testified that Herbert was fired because of his unauthorized and frequent use of the office telephone and because of his taking excessive time in shuttling em- ployees from one facility to another . However, the credi- ble evidence fails to establish prior warnings for similar conduct or other work-related inadequacies. Diner testified that Gonzales was discharged for insub- ordinate conduct However, the credible testimony estab- lished that Diner summoned Gonzales into his office, told him he could not believe the employees were trying to organize a Union, ripped up his timecard , and told him he was gone As set forth above, such conduct is a virtual admission of discriminatory motivation. I conclude that Respondent has utterly failed to meet its burden under the Transportation Management and Wright-Line considerations and that the discharges of the four employees described above was discriminatorily mo- tivated and in violation of Section 8(a)(1) and (3) of the Act. As set forth above, on August 1, 1 day after the un- lawful discharge of the above employees , Respondent met with the employees . Diner told the employees he was upset with the Union's organization and he was now faced with a "Union problem " He then stated that if the Union came in he would lose control , might not be able to utilize his work force effectively, and might have to subcontract out his production work He then character- ized the discharged employees as "rotten apples" and stated they would never be back . Whether an employer's statement concerning subcontracting is a lawful predic- tion or an unlawful threat depends on the totality of cir- cumstances . Gissel Packing Co., 395 U.S . 575, 617-619 (1969) The employer has the burden of showing such statements are based on objective facts that demonstrate probable consequences outside his control . Chester Valley, 251 NLRB 1435, 1447 ( 1980) and cases cited therein . In the instant case, the subcontracting statement was made following Diner's unlawful discharge of the leading union adherents, and following his characteriza- tion of the Union 's campaign as a "Union problem." The statement was then followed by his reference to the dis- charged employees as "rotten apples." Moreover, there were no objective facts set forth that would demonstrate the probable need to subcontract out production work that was outside his control . Cf. Chester Valley, supra at 1447 Therefore, under all the circumstances , I conclude Diner's statement about subcontracting work was an un- lawful threat in violation of Section 8(a)(1). The evidence established that prior to August 1986 Respondent did not provide its employees with sick-day benefits notwithstanding its employees longstanding com- plaints. The evidence further established that prior to August 1986 Respondent never granted its employees across-the-board raises . Although Respondent promised the Wall employees a raise in June, effective on July 1, such raise appears to have been limited to those employ- ees because of the recent layoff at that facility More- over, notwithstanding Respondent 's promise, the raise was not granted on July 1 The timing of the raise in 994 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD August 1986 and the expansion to include all employees leads me to conclude such benefits were granted for the purpose of inducing employees to cease their activities in support of the Union in violation of Section 8(a)(1) of the Act. The same reasoning applies to the granting of sick days. Here there was not even a prior promise to provide such benefits notwithstanding employee com- plaints over a long period of time. I therefore conclude the grant of sick days to be for the purpose of inducing employees to abandon their union activities and violative of Section 8(a)(1) of the Act American Model & Pattern, 269 NLRB 309, 312 (1984). There is no dispute that the employee booklet issued on August 8 during the Union's campaign contained an unlawful, no-solicitation rule, which would prohibit dis- tribution or solicitation by employees during working hours, when they may be on their own time. Our Way, Inc., 268 NLRB 394 (1983). That this rule was amended a month later to substitute an admittedly lawful rule does not absolve Respondent from the impact and effect, during the height of a union campaign, of such unlawful rule. Accordingly I conclude the institution of such rule for the August-September 1986 period violated Section 8(a)(1) of the Act. THE REMEDY 4. By threatening employees to close its shop because of their union activities, Respondent has violated Section 8(a)(1) of the Act. 5. By creating the impression among its employees that its union activities were under surveillance, Respondent violated Section 8(a)(1) of the Act. 6. By granting its employees wage increases to induce them to cease their union activities, Respondent violated Section 8(a)(1) of the Act. 7. By granting its employees sick, day benefits to induce them to cease their union activities. Respondent violated Section 8(a)(1) of the Act. 8. By promulgating an unlawful no-solicitation rule prohibiting distribution or solicitation during working hours because of their union activities Respondent violat- ed Section 8(a)(1) of the Act 9. By discriminatorily terminating the employment of and or refusing to reinstate Wanda Soto, Joseph Herbert, Clarace McCloud, and Pedro Gonzales because of their union activities, Respondent violated Section 8(a)(1) and (3j of the Act. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed6 ORDER Having found that Respondent has engaged in various unfair labor practices, I shall recommend that it cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act. Because I have found that Respondent discriminatorily discharged the employees set forth above, I shall recom- mend that Respondent be ordered to offer them immedi- ate and full reinstatement to their former jobs or, if they no longer exist, to substantially equivalent positions of employment, without prejudice to their seniority or other rights and privileges. I shall also recommend that Respondent make whole the employees set forth below for any loss of earnings they may have suffered by reason of the discrimination against them from the date of their layoff until the dates of their reinstatement or offers of reinstatement. Backpay for the above employees shall be computed in accordance with-the formula approved in New Horizons for the Retarded, 283 NLRB 1173 (1987). I shall also recommend that Respondent remove from its records any reference to their unlawful termination and to provide written notice of such expunction to those employees, and to inform them that Respondent's unlawful conduct will not be used as a basis for further personnel actions concerning them. Sterling Sugars, Inc., 261 NLRB 472 (1982). CONCLUSIONS OF LAW 1 Respondent is, and has been at all times material, an employer engaged in commerce within the meaning of the Act. 2. The Union is a labor organization within the mean- ing of Section 2(5) of the Act. 3. By threatening to discharge its employees because of their union activities, Respondent has violated Section 8(a)(1) of the Act. The Respondent, Royal Sound Company, Inc., Eaton- town, New Jersey, its officers, agents, successors, and as- signs, shall 1. Cease and desist, from (a) Threatening to discharge its employees because of their activities on behalf of United Food and Commer- cial Workers Union, Local 21, AFL-CIO-CLC (b) Threatening employees to close its shop because of their union activities (c) Creating the impression among its employees that their union activities were under surveillance. (d) Granting its employees wage increases to induce them to cease their union activities (e) Granting its employees sick-day benefits to induce them to cease their union activities (f) Promulgating a no-solicitation or distribution rule prohibiting solicitation or distribution during the employ- ees' working hours. (g) Discriminatorily terminating the employment of and/or refusing to reinstate its employees because of their union activities. (h) In any like or related manner interfering with, re- straining, or coercing its employees in the exercise of their right to self-organization, to form , join, or assist labor organizations , to bargain collectively through rep- resentatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection , to refrain from any or all such activities. 6 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 ROYAL SOUND CO 995 2. Take the following affirmative action necessary to effectuate the policies of the Act (a) Offer to the employees set forth in paragraph 9 of the conclusions of law, full and immediate reinstatement to their former or substantially equivalent positions of employment, without prejudice to their seniority or to other rights and privileges previously enjoyed. (b) Make the above employees whole for any loss of earnings they may have suffered by reason of the dis- crimination against them in the manner set forth in the remedy section (c) Preserve and, on request , make available to the Board or its agents for examination and copying , all pay- roll records, social security payment records, timecards, personnel records and reports, and all other records nec- essary or useful to analyze the amount of backpay due under the terms of this Order. (d) Post at its place of business in New Jersey, copies of the attached notice marked "Appendix."7 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 Re- spondent immediately on receipt and maintained for 60 consecutive days in conspicuous places, including all places where notices to employees are customarily posted . Reasonable steps shall be taken by the Respond- ent to ensure that the notices are not altered , defaced, or covered by any other material. (e) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Re- spondent has taken to comply. 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 "