San Antonio Control Systems Inc.

786 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD San Antonio Control Systems Inc. and International Brotherhood of Electrical Workers, AFL-CIO, Local Union No. 60 and South Texas Chapter, National Electrical Contractors Association, Party to the Contract. Cases 23-CA-10434 and 23-CA-10453 July 29, 1988 DECISION AND ORDER BY CHAIRMAN STEPHENS AND MEMBERS JOHANSEN AND BABSON On June 8, 1987, Administrative Law Judge Richard J. Linton issued the attached decision. The General Counsel filed exceptions and a supporting brief, and the Respondent filed an answering 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 briefs and has decided to affirm the judge's rulings, findings, and conclusions 1 and to adopt the recommended Order.2 ORDER The National Labor Relations Board adopts the recommended Order of the administrative law judge and orders that the Respondent, San Antonio Control Systems Inc., San Antonio, Texas, its offi- cers, agents, successors, and assigns, shall take the action set forth in the Order. ' We adopt the judge's finding that the General Counsel did not estab- lish voluntary recognition under Sec. 9(a) of the Act. In so doing, how- ever, we find it unnecessary to pass on whether there was a sufficient demand for recognition here because there is insufficient evidence con- cerning majority union support of the Respondent's employees at the time recognition-whether under Sec. 8 (f) or Sec. 9(a)-was extended. 2 The General Counsel excepts to the judge's failure to include a visita- tonal clause in the recommended Order. A visitatorial clause authorizes the Board, for compliance purposes, to obtain discovery from the Re- spondent under the Federal Rules of Civil Procedure under the supervi- sion of the United States court of appeals enforcing the Board 's Order. Under the circumstances of the case , we find it unnecessary to include such a clause. Accordingly, we deny the General Counsel 's request. See Cherokee Marine Terminal, 287 NLRB 1080 (1988). Robert S. Breaux and Guadalupe Ruiz, Esqs., for the Gen- eral Counsel. John A. Ferguson Jr., Esq. (Harris & Padgett), of San An- tonio, Texas, for the Respondent. Robert C. Moczygemba, of San Antonio, Texas, for the Charging Party. DECISION STATEMENT OF THE CASE RICHARD J. LINTON, Administrative Law Judge. The issues litigated here include allegations that the Employ- er unlawfully refused to bargain and illegally discharged two employees. In a recent decision the Board aban- doned its rules concerning the conversion of an 8(f) con- tract to a 9(a) contract. John Deklewa & Sons, 282 NLRB 1375 (1987). That decision has a substantial impact on most of the allegations here, and I dismiss all but one of the refusal to bargain allegations. Finding no prima facie case that Respondent was unlawfully motivated in dis- charging the two employees, I dismiss that allegation as well. This case was tried before me in San Antonio, Texas, on 9-12 December 1986 pursuant to the consolidated complaint (complaint) issued 2 September 1986 (as amended 1 October 1986) by the General Counsel of the National Labor Relations Board through the Regional Director for Region 23.1 The complaint is based on charges filed 8 July 1986 in Case 23-CA-10434, and I August 1986 in Case 23-CA-10453, by International Brotherhood of Electrical Workers, AFL-CIO, Local Union No. 60 (Union, IBEW Local 60, or Charging Party) against San Antonio Control Systems Inc. (Re- spondent or SACS).2 In the complaint the General Counsel alleges that the Respondent violated Section 8(a)(1) of the Act on 11 June when Ronald Rice, Respondent's president, told employees that he no longer would pay their fringe ben- efits as specified in the collective-bargaining agreement (CBA); Section 8(a)(3) by reducing wages of employees on 1 June and on 23 June by terminating employees Charles D. Stewart and Joseph R. Stout; and Section 8(a)(5) by various unilateral actions between 26 May and 1 July, culminating on 1 July, and thereafter, by refusing to furnish data requested by the Union and by refusing to bargain with the Union. By its answer, Respondent admits certain factual mat- ters, but denies violating the Act. On the entire record, including my observation of the demeanor of the witnesses, and after due consideration of the briefs filed by the General Counsels and the Re- spondent,4 I make the following FINDINGS OF FACT I. JURISDICTION A Texas corporation headquartered in San Antonio, Texas, SACS, as a subcontractor in the building and con- struction industry, installs temperature control systems in commercial buildings. During the past 12 months SACS purchased products, goods, and materials valued in excess of $50,000, which items were received from points located outside Texas. Respondent admits, and I find, ' All dates are for 1986 unless otherwise indicated. 2 I show Respondent's name without a comma after Systems because that is the way it appears in the letterhead on the firm 's stationery. 8 Counsel for the General Counsel, Guadalupe Ruiz, attached a pro- posed order and notice to his brief. By his 10 January 1987 motion for extension of time to file brief, Attorney Ruiz advised that he would be preparing and submitting the General Counsel's brief following the hospi- talization of the General Counsel' s trial attorney, Robert S. Breaux. 4 Respondent subsequently filed a motion , dated 9 March 1987, to dis- miss the complaint based on the Board's recent decision in John Deklewa & Sons, 282 NLRB 1375 (1987). The General Counsel filed a response and opposition dated 12 March 1987. 290 NLRB No. 87 SAN ANTONIO CONTROL SYSTEMS that it is an employer within the meaning of Section 2(2), (6), and (7) of the Act. Based on other commerce allegations in the complaint, Respondent admits, and I find, that the South Texas Chapter, National Electrical Contractors Association (NECA) is an employer within the meaning of Section 2(2), (6), and (7) of the Act. NECA and its member funs comprise an employer association that exists in whole or in part for the purpose of bargaining on behalf of its members with the Union concerning the rates of pay, wages, hours of employment, and other terms and condi- tions of employment of the employees of NECA's mem- bers. II. LABOR ORGANIZATION INVOLVED Respondent admits, and I find, that IBEW Local Union No. 60 is a labor organization within the meaning of Section 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES A. The Impact ofJohn Deklewa & Sons 1. Contentions of the parties-Respondent's motion to dismiss The General Counsel's case regarding the refusal-to- bargain allegations hinges on the contention (Br. at 7-9) that the bargaining unit consisted of two electricians, Joseph R. Stout and Charles D. Steward, as a craft unit separate from Respondent's three other employees. In February 1982 Respondent signed a "Letter of Assent--B" agreeing to be bound by the terms of the Union's CBA with NECA. Later that month Stout and Steward joined the Union. The most recent CBA was ef- fective from 1 June 1985 to 31 May 1986. The General Counsel alleges (complaint par. 11) and contends (Br. at 11 ; Response at 2) that at all material times the Union has been the exclusive representative of the employees in the bargaining unit by virtue of Section 9(a) of the Act. According to the General Counsel's view of the evidence, 9(a) representative status was es- tablished "from the beginning" (February 1982) when SACS voluntarily recognized the Union based on majority support within the appropriate unit (Br. at 11; Response at 2). Consequently, when the CBA expired on 31 May the usual presumptions applied: (1) majority status rebut- tably presumed, and (2) SACS could make no unilateral changes short of an impasse in bargaining or, after with- drawing recognition based on the Union's loss of majori- ty or objective indications, that the Union had lost that status. Contending that the Respondent has shown neither a valid impasse during the May-July 1986 bargaining ses- sions nor objective indications that the Union had lost its majority status, the General Counsel argues that the Re- spondent's unilateral changes after the CBA expired on 31 May are unlawful (Br. at 12-13; Response at 2). SACS analyzes this case entirely different. First, the bargaining relationship created in February 1982, based on the "Letter of Assent-B," was established under Sec- tion 8(f) of the Act-not under Section 9(a). 787 Second, the bargaining unit alleged has never been an appropriate unit under Section 9(a) because it improperly carves two employees from a total work force of five when all five do essentially the same work, using essen- tially the same skills. Although Stout and Stewart joined the Union in February 1982, the other three did not. There is no evidence or contention that the Union ever represented, or even sought to represent, these other three. Although the Respondent's argument on brief has ad- ditional ramifications, I will not summarize them because it is obvious that the brief was prepared before counsel had obtained a copy of John Deklewa & Sons, 282 NLRB 1375 (1987). After filing its brief, Respondent submitted its four-page 9 March 1987 motion (Motion) to dismiss the complaint based on Deklewa. The General Counsel filed a four-page response and opposition (Response) dated 12 March 1987. Deklewa has a dramatic impact on the analysis to be applied to this case. In that case the Board ruled that it will apply its "new 8(f) principles to this case and to all pending cases in whatever stage." Deklewa at 1389. In Deklewa the Board overruled prior case law, aban- doned its conversion doctrine, and established a new policy. System Electric Co., 283 NLRB 650 (1987). Under the new policy an 8(f) contract is enforceable under the Act, but such a contract will not bar the processing of valid petitions filed pursuant to Section 9(c) and (e). On expiration of an 8(f) agreement, the signatory union will enjoy no presumption of majority status, and either party may repudiate the 8(f) bargaining relationship. Deklewa at 1378, 1385, 1388. 2. Discussion and conclusions As mentioned, the General Counsel contends (Br. at 11; Response at 2) that Respondent voluntarily recog- nized the Union, and specifically relies on the Board's language at footnote 53 in Deklewa. We do not mean to suggest that the normal pre- sumptions would not flow from voluntary recogni- tion accorded to a union by the employer of a stable work force where that recognition is based on a clear showing of majority support among the unit employees, e.g., a valid card majority. Island Construction Co., 135 NLRB 13 (1962). That is, nothing in this opinion is meant to suggest that unions have less favored status with respect to con- struction industry employers than they possess with respect to those outside the construction industry. Since Deklewa, the General Counsel cannot rely on the conversion doctrine (stable work force plus majority status converts an 8(f) relationship into one protected by 9(a)) to argue that a 9(a) relationship was established and that the usual presumptions apply following expiration of the CBA. Under Deklewa, therefore, a showing that SACS voluntarily recognized the Union at the inception of the bargaining relationship is absolutely crucial to the General Counsel's case. Otherwise, the relationship was 8(f) rather than 9(a), the CBA expired on 31 May, and Respondent's subsequent repudiation (in effect) of the 788 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD bargaining relationship was lawful-as were the unilater- al changes, the refusal to furnish requested data, and the refusal to bargain. "In light of the legislative history and the traditional prevailing practice in the construction industry, we will require the party asserting the existence of a 9( a) rela- tionship to prove it." Deklewa at fn. 41. The General Counsel's theory of proof is voluntary recognition. Al- though the General Counsel asserts that theory, unfortu- nately the General Counsel fails to list, describe, or dis- cuss the factors giving rise to that conclusion. There was no card check in February 1982, or at any time. I agree with SACS that the bargaining relationship established here arose under Section 8(f)-not Section 9(a). Because the conversion doctrine, now abandoned by the Board,5 is not available to the General Counsel, and because there was no voluntary recognition, as occurs outside the construction industry, discussion of a stable work force and the appropriate bargaining unit be- comes academic. I will not undertake that irrelevant ex- ercise. However, I will discuss the background events. To sum up, I find that the bargaining relationship here was established under Section 8(f) of the Act, and that the General Counsel failed to prove that SACS ever vol- untarily recognized the Union so as to create a 9(a) bar- gaining relationship. Consequently, I will grant Respond- ent's motion to dismiss the following complaint allega- tions (along with the appropriate conclusionary para- graphs): 1. Paragraphs 16 and 17, which allege the 1 June 1986 unilateral reduction of wages (of Stout and Stewart) and the simultaneous elimination of pay- ments to the benefit trust funds. 2. Paragraph 18, which alleges Rice's 11 June 1986 telling of Stout and Stewart that SACS would no longer make the fringe benefit contributions called for by the CBA which expired 31 May. 3. Paragraphs 21, 22, and 23, which allege Re- spondent's refusal to furnish the Union with the data requested by the Union's letter of 1 July 1986. 4. Paragraph 24, which alleges that Respondent has failed and refused to bargain with the Union since 1 July 1986. That leaves three issues to be decided. One is a refusal- to-bargain allegation, paragraph 15, describing a 26 May bypassing and direct dealing. As we will see, I dismiss all allegations except paragraph 15. The second, paragraph 20, is an 8(a)(3) allegation that the 1 June unilateral changes were unlawfully motivated. The final issue is the 25 June 1986 termination of Stout and Stewart. Regarding Stout and Stewart, the complaint appears to allege both a constructive discharge and an actual dis- charge as alternative theories of events. Regarding the former, the complaint (par. 19) alleges that Respondent "caused the termination of" Stout and Stewart by the unilateral changes (par. 16) and by Rice telling (par. 18) Stout and Stewart on 11 June of the unilateral changes. 5 Deklewa at 1377-1378, 1385. As for the actual discharge theory the complaint, in effect, alleges (par. 20, as amended) that Respondent was unlawfully motivated in terminating Stout and Stewart. The General Counsel, on brief, appears to rely exclusive- ly on a constructive discharge theory (Br. at 15-16).6 When Respondent argued (Motion at 3) that the General Counsel offered no evidence that Stout and Stewart were "discriminatorily discharged," the General Counsel replied (Response at 3-4) by (1) listing five factors re- flecting improper motivation and (2) arguing that the Re- spondent failed to demonstrate that it would have taken the same action even in the absence of the protected conduct of Stout and Stewart. Deklewa, of course, nullifies the basis for the construc- tive discharge theory. Because the unilateral changes were lawful, they could not have unlawfully caused a termination. The constructive discharge theory, then, is out. To the extent that paragraph 19 alleges a construc- tive discharge, I shall dismiss it. We are left with the mo- tivation issue. For its part, the Respondent argues that it fired Stout and Stewart on 25 June because they willfully failed to call in on Monday, 23 June, and because they engaged in a slowdown after being told on 11 June about the lawful unilateral changes (wage reduction; discontinuation of contributions of union benefit funds) (Br. at 28-29; motion at 3). These remaining three issues require the usual summa- ry of the facts plus discussion. B. Background 1. Nature of Respondent's business Ronald E. Rice is president and owner of SACS (2:385).' The former president, James Lee, hired Rice in August 1977 to assist with management of the Company and to oversee a large project SACS was starting in Temple, Texas (2:386). Including his 2-year study in elec- trical engineering in Virginia, Rice's training and work experience since 1961 have been in the electrical field. In 1972 Rice received a master electrician's license from the city of San Antonio, and he keeps that master's license current (2:387-388; 3:584-587). Since 1968, when he worked for Honeywell, Inc. in San Antonio, Rice's expe- rience has included temperature control installation (2:386). In 1981 Lee and Rice bought out a partner's interest in SACS, and Rice became vice president and half owner of Respondent (2:390). Rice became president of SACS in October 1982 (2:386). Respondent's business is to install and service tempera- ture control systems (devices that control temperature and humidity) in commercial buildings (2:391). Ordinari- ly Respondent submits a bid for such work to whoever is the designated mechanical contractor (2:391, 412, 414). This appears to be a consequence of the fact that in job specifications in the construction industry the paragraphs 6 The General Counsel cites constructive discharge cases such as Mar- quis Elevator Co., 217 NLRB 461 (1975). 7 References to the 4-volume transcript of testimony are by volume and page. SAN ANTONIO CONTROL SYSTEMS for automatic (temperature) control systems are set forth in section 15. That section, or division, is for the me- chanical contractor, whereas section (or division) 16 is for the electrical contractor (1:178 ; 2:408-409, 414; 4:805). The reason that is so, as Business Manager Moc- zygemba testified, is that the mechanical contractor fur- nishes or designs the chillers and a lot of the equipment. It is easier for the architect or engineer to include that work in the mechanical section of the specifications (4:806). The mechanical contractors then subcontract the temperature control work either to firms such as SACS (2:414; 3:629-631, Rice) or to electrical subcontractors (4:806, Moczygemba). There is some dispute concerning which group gets more of the work, but it is not impor- tant that I resolve that matter. The physical structure of the temperature control sys- tems is described extensively in the testimony. Although the description bears on appropriate unit and majority status questions, it also has some relevance to the termi- nation issue. One of the major components of the system is the con- trol valve. Water runs through the valve . The mechani- cal contractor sets the valve in place and attaches the plumbing to the valve. From that point SACS takes over and attaches either electric wire or pneumatic tubes to the control valve (2:393, 395, 3:591). Pneumatic tubes, or lines, are of two types: copper and polyethylene. The latter is referred to as plastic or poly (2:393). The pneumatic lines are filled with pressurized air supplied by an air compressor . When the air pressure is varied other components are activated and the system performs its temperature control function (2:394, 397, 407, 432-433; 3:592). Rice testified that several years ago pneumatic jobs consisted completely of copper tubing , and that a lot of skill was required to install such a system (2:397). Moc- zygemba agrees, and states that the pneumatic work was done principally by pipefitters (1:121 ). Indeed, among labor organizations, the Plumbers and Pipefitters Unions takes jurisdiction over such fitters, or technicians, and has a classification for them, Moczygemba testified, but the IBEW does not (1 :26-27). But copper tubing is being phased out as the industry shifts to the fire-rated polyethylene tubing (1:121 ; 2:397- 398, 404). The poly tubing can be installed exposed (not necessarily in open view) or pulled through electric me- tallic tubing (EMT), metal conduit, if there is danger the poly could be damaged or cut if exposed (2:398-399). Today, Rice testified, 95 percent of Respondent's pneu- matic work uses the poly tubing , with only 5 percent being copper. Copper is used only when the item is to be exposed. To avoid the risk of damage to the tubing in the situation, copper tubing is used (2:404). For about the last 4 years, Rice testified, roughly 50 percent of Respondent's jobs have been a combination of pneumatic and electric, about 40 percent have been total- ly electric, and some 10 percent have been totally pneu- matic (2:406, 3:590, 592). • United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada, AFL-CIO. NLRB Style Manual (1983) at 58. 789 Regarding the electrical wiring jobs, the witnesses dis- tinguish low voltage wiring from power wiring. The former carries the limited energy for the signal or con- trol wiring and, as Rice testified, that is its function (2:439). The power wiring carries the higher current, or "line" voltage, of 120 volts and above. Although the wit- nesses all seem to rely on the National Electric Code (NEC) for a description of the classes of wiring and the authorized volts a class, they differ in their descriptions. The differences are not material for our purposes. The witnesses generally agree that Class 1, or A, is the higher voltage or power wiring of 120 volts and above, with Class 2, or B, being the low voltage . They agree that Class 2 is authorized for either 24 volts (2:999, Stewart), 30 volts or less (2:438, Rice), or 50 volts or less (1:173, 219, Stout). It is unclear what class they would assign a current of between 50 and 120 volts, or whether there is such a current. Clearly the bulk of Respondent's electrical work in- volves low voltage wiring (class 2 or class B). There is a dispute concerning how much of Respondent's electrical work is power wiring. Rice puts the figure at no more than 2 to 3 percent (2:413; 3:682, 694). He testified that he designs his work so that it does not have to carry over 120 volts (2:401). Rice concedes there may be times when his employees hook up the power line to a control panel (2:413). He could recall only two such jobs in the last 18 months (2:435). Joseph "Ronnie" Stout (one of the dischargees in this case) testified that at least half the jobs he has worked for Respondent involved some power wiring with some of the current being 480 volts and some of the jobs being 100 percent high voltage (1:173, 182-183). Charles Doug- las Stewart (the other dischargee) did not estimate an overall percentage of work on jobs that involved "line" or power wiring other than to say it involved "a lot" of them (2:297). He testified that the work involved both classes of wiring and he listed several jobs where the "line" voltage ran as high as 480 (2:278-279, 282, 288, 296-299, 304-305). I credit Stout and Stewart in the descriptions they gave. They did not specify a percentage of the total work, and their testimony does not necessarily conflict with Rice's figure of no more than 3 percent of the total electrical work being devoted to power wiring . Howev- er, Rice appeared to me to be limiting his estimate in order to enhance his prospects in this case. I make no finding regarding a percentage, but I find that it is some- thing more than the 3 percent Rice estimates. It would seem that the more relevant information is not how much of the total work is devoted to power wiring, but how critical is the power wiring, whatever the percentage, to the job. Indeed, the total work con- cept seems irrelevant since much of the work is the physical labor installing metal conduit and pulling wire or tubing through the conduit. Some of the jobs have several hundred feet of conduit, and frequently the con- duit must be installed in crawl spaces or in other cramped quarters. Since it is self-evident that power wiring is critical (otherwise there is no line current), the real question is 790 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD whether a licensed electrician is required to connect or install whatever power wiring is to be used in the tem- perature control work. There is no dispute that the elec- trical contractor's job electricians install the bulk of the power wiring on the jobs. Rice testified that this includes connecting the line voltage wire to the air compressor (2:407-408). The city of San Antonio, Rice testified, has never re- quired him (or any such contractor) to secure an electri- cal permit covering any of his temperature control instal- lation projects (2:418; 3:632). Rice appears to say that al- though the city's electrical inspector does not specifically inspect Respondent's (division 15) temperature control work (3:694),9 if the electrical inspector observes EMT lines improperly installed (sagging, for example), the in- spector can require that such work be corrected so that it conforms to the standards specified in division 16, the electrical section (2:418-419). Rice seems to attribute this to the admitted fact that under the NEC, class 2 (low voltage) wiring must be installed in a neat and workman- like manner (2:419; 3:589). By contrast, Harry F. Katz, chairman of the city of San Antonio's Electrical Board, testified that in his opin- ion installation of low voltage temperature control sys- tems is work covered by San Antonio's electrical code and work for which a permit should be obtained (4:774- 777, 785-787). Katz explains that although the Electrical Board does not perform the daily tasks of issuing permits and making inspections, it does set the city's policy. From a policy standpoint, Katz testified, temperature control wiring requires an electrical permit (issued to someone with a master electrician's license) and inspec- tions by the city (4:793-795, 799-800, 803). In addition to the job needing a permit issued to some- one with a master electrician's license, Katz also testified that the actual work must be performed (if not by the master electrician) by a licensed journeyman electrician or by an apprentice working for such a journeyman (4:785). Rice testified that in his opinion a person need to be a licensed journeyman electrician to perform tempera- ture control installations either regarding ability (2:415- 416; 3:629) or the requirements of the city's electrical code (2:417-418). Because the matters pertaining to coverage by the electrical codes are merely tangentially related to the material issues of this case, I need not resolve any of the disputed aspects. To the extent that credibility of the witnesses becomes relevant, I observed Katz to be a highly credible witness, and I would credit him over Rice on any disputed point. 2. Overview of Respondent's relationship with IBEW Local 60 As of early 1982 Respondent's work force consisted of five employees: Joseph Ronnie Stout, Charles Douglas Stewart, Martin H. Broekers III, and two brothers, John and James C. Heil. Both Stout and Stewart are licensed by the city of San Antonio as journeymen electricians, 9 A fact Rice attributes to possible oversight by San Antonio and other cities in addressing coverage of temperature control work in their local codes (2:418; 3:694). Stout since about 1972 (1:131-132) and Stewart since 1976 (2:234). Stout was hired by Respondent in either July 1977 (1:130) or possibly March 1979 (1:170). Stew- art possibly was hired in March 1978 (2:232), but the more likely date appears to be May 1980 since he recalls that James C. Heil was hired about 3 months later (2:286). James Heil was hired in September 1980 (3:723). Broekers' background experience was in electronics before James Lee hired him in May 1977. Lee trained Broekers on the pneumatics of the work (3:699-700). In 1980 Broekers registered as an apprentice electrician with the city of San Antonio, but he has not taken the test for the journeyman's license (3:707, 717). Lee hired John Heil in about June 1980. His back- ground experience is fitter work, including some pneu- matics, plus some electrical work. At SACS he acquired the additional skills he needed to do Respondent's tem- perature-control installation work. James C. Heil, John Heil's brother, was hired by Re- spondent in September 1980. His experience before coming to work at Respondent was as a pipefitter and welder plus some minor electrical work (3:723, 732-733). Until 1982 Respondent operated nonunion. In early 1982 Respondent was a successful bidder on a job to a mechanical contractor who held a contractual bargaining relationship with Plumbers and Pipefitters Local 142. The mechanical contractor informed Respondent that SACS had to use a union pipefitter on the job in order to avoid conflict with the union plumbers and fitters the mechanical contractor was hiring to do the plumbing work (2:440, 452). Rice and Lee could see a boom in the construction of commercial buildings in the San Antonio area. To par- ticipate more in that boom, Rice and Lee decided to obtain contracts with the pneumatic union (Plumbers and Pipefitters Local 142) and the electrical union (IBEW Local 60) so that the mechanical contractors would sub- contract the temperature control work to SACS (2:441, 452). Rice contacted IBEW Local 60 and Lee contacted Plumbers and Pipe Fitters Local 142 (2:441). From mid- January to early February 1982, Moczygemba discussed the matter with Rice at Respondent's ofice (2:447, 451; 3:637-638).10 At some early point in these developments Respondent alerted its five employees to its plans. The employees were advised they could choose to join a union if they so desired (2:441-442). Stout and Stewart elected to join IBEW Local 60. Each was given a test, passed it, and was classified by the Union as a journeyman inside wire- man (1:137-138; 2:239). After Stout and Stewart joined IBEW Local 60, Broekers testified an official of Plumbers and Pipe Fitters Local 142 invited Broekers and the two Heil brothers to join Local 142. They declined because, Broekers testi- 10 Moczygemba testified that he discussed the matter with both Rice and Lee when he visited Respondent's office (1:24-28). This is a minor point and I find no conflict in any event. Although Moczygemba does not describe a second or third visit, I find, he discussed the matter with both Rice and Lee. On his next visit or two it is unclear whether Lee was present. SAN ANTONIO CONTROL SYSTEMS feed, there would have been no financial benefit to join." As Broekers explained, he and the Heil brothers were (and are) paid an hourly base rate of $12 plus a profit-sharing bonus (paid annually) amounting to the dif- ference between the (labor cost) figure Rice bids a job for and the actual (labor cost) figure on nonscale jobs. On Government jobs covered by the Davis-Bacon Act, all workers are paid the prevailing (union) scale rate. Thus, those jobs fall outside Respondent's incentive pay plan. Broekers testified that in an average year Respond- ent's incentive pay brings his earnings up to the equiva- lent of Government (union) scale (3:718-721). Rice and Moczygemba describe their conversations a bit differently as it bears on the work force . According to Rice, he simply told Moczygemba that SACS did temperature control installation, that it was not an elec- trical contractor, and that only Stout and Stewart of his work force wanted to join Local 60. The names of the other three were not mentioned, and their work was not described (2:441-446, 449, 451; 3 :638-639). Moczygemba, whom I credit, testified that his discus- sion with Rice and Lee centered on the contract and the employees to be covered. Stout and Stewart were named as the only electricians employed by SACS . Moczy- gemba understood from the conversation that there were two or three other employees, but Rice and Lee assured him that those others were not electricians, that they were fitters and pneumatic employees who did not do electrical work. Rice and Lee informed Moczygemba that SACS had a bargaining relationship with Plumbers and Pipe Fitters Local 142 . Moczygemba was aware the Pipe Fitters Union has a classification for pneumatic technicians, whereas the IBEW does not. He was further aware that both unions represent their respective classifi- cations of employees with two other companies, Honey- well and Johnson Control Systems, engaged in tempera- ture control installation work in the San Antonio area (1:25-28, 122). As a result of their conferences, Moczygemba and Rice signed a "Letter of Assent--B" with an effective date of 22 February 1982 (G.C. Exh. 2). The form re- flects that Moczygemba signed on 5 February and Rice on 19 February 1982. Rice confirms that they signed on separate dates (3:637). Under the Letter of Assent--B SACS agreed to comply with the terms and conditions of employment contained in the inside labor agreement (and any amendments) between NECA and IBEW Local 60 until the termination date of 30 June 1982 . A provi- sion states that if SACS does not intend to renew the agreement, it "shall so notify the Labor Union in writing at least sixty (60) days prior to the termination date." In contrast to Respondent's written agreement with the Union, its contractual arrangement with Plumbers and Pipe Fitters Local 142 was nebulous in nature. Nei- ther James Lee, who contacted Local 142, nor any offi- cial of Local 142 testified. There is no dispute that as a result of the contract between Respondent and Local 142, a pipefitter, Darrel Mullins, began working with, or for, SACS. The record does not reflect a precise date for " James C. Heil confirms that he declined an invitation to join Local 142 in 1982 (3:735). 791 either the arrangement with Local 142 or Mullins' first day on the job. The evidence is that Mullins began work shortly after Rice signed the Letter of Assent--B with IBEW Local 60. On his first day of testimony Rice asserted that Mul- lins has always (since February 1982) worked as a sub- contractor for Respondent and that, apparently, Re- spondent has never had a contract with Local 142 (2:463-464). The following day Rice testified that Re- spondent, through James Lee, did enter into a collective- bargaining relationship with Local 142 (3:618), asserted that he did not know whether SACS had a signed docu- ment at Respondent's office, stated that the relationship with Local 142 may be based on a handshake, and con- cluded by testifying he at least believes there was some kind of contractual arrangement between Respondent and Local 142 from February 1982 to 1985 (3:631-622). At some point in 1985, Rice testified, Rice met with officials of Local 142 and explained that Respondent did not have enough (union) work to keep Mullins busy. The parties orally agreed to terminate whatever arrangement they had. At the same time they decided (apparently so that Respondent could use Mullins at least some of the time) Mullins should form his own company so he could contract with others (3:619-620). From that date in 1985 to the present, Respondent has used Mullins strictly on an independent contractor basis (he works primarily for Respondent), and it pays him a rate higher than the pre- vailing scale in order to compensate him for some of his overhead expenses (2:463-464; 3:620-621, 627-628, 693). When Respondent, in February 1982, made its con- tractual arrangement with Local 142, and signed with IBEW Local 60 to be bound by the NECA contract, Rice admittedly split his work force of five employees (plus Mullins) into two crews, one union and the other nonunion, and told them they would work on separate projects (2:447-448). At times previously they had worked together on some jobs . Except for finishing work they currently were on, Respondent's work force after February 1982 worked as a union crew and a nonunion crew (2:453-454). The union crew consisted of electricians Stout and Stewart and fitter Mullins. Broekers, John Heil, and Jim Heil formed the nonunion crew (2:448). On the union crew, Rice testified, Stout and Stewart did the electrical work, the "control wiring," and Mullins the pneumatic or fitter work. The nonunion crew did both the pneu- matics and electrical work on their jobs (2:450-451, Rice). Broekers testified that after February 1982 he did strictly pneumatics (3:716). James C. Heil testified that he did both pneumatics and control wiring after Febru- ary 1982 (3:727-728, 731). At different times, and for brief periods, from 1 June to the end of October 1982, the Union (IBEW Local 60) referred a total of four electricians to assist on Respond- ent's union crew. There is no evidence of referrals after October 1982. The union and nonunion crews enjoyed different pay systems. Stout and Stewart were paid the rate called for in the prevailing NECA contract and Respondent made the mandated contributions to the contractual trust 792 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD funds. The basis of payment to Mullins between 1982 and 1985 is unclear, but presumably it was the scale for Local 142. Respondent paid in to trust funds on behalf of Mullins until the 1985 conversion of his status (3:626). From 1985 forward Respondent paid Mullins a rate higher than union scale, and Respondent paid Mullins the equivalent of the contributions it had been making on his behalf to union trust funds (3:626-627). By contrast, the nonunion crew was paid $12 an hour plus an incentive bonus equal to the difference between the sum Rice had bid regarding labor cost and the amount of actual labor cost (3:500, 505, 719). Broekers testified that Respondent's incentive bonuses bring the annual pay of the nonunion crew up to about the level of the Davis-Bacon scale (3:720-721). This incentive pay system applies to nonscale jobs; for on Government jobs covered by the Davis-Bacon Act, the prevailing scale rate is paid to the nonunion crew (2:461-463; 3:505) as well as to the union crew (3:575, 678, 680). In early 1982 Rice and Lee thought they saw a boom in construction of commercial buildings. What they really saw, as all are now painfully aware, was the last spurt before the boom went bust. The only year in which Respondent obtained jobs from unionized mechan- ical contractors was 1982. Toward the close of 1982 Respondent began running out of jobs that required a union pipefitter. This resulted, at least in part, not only from the general downturn in the economy leaving less work for the union contractors, but from an influx of nonunion mechanical contractors from Houston and Dallas grabbing some of the available work (3:600-602). To keep Stout and Stewart working after 1982, Re- spondent occasionally had to assign them to some of its nonunion jobs, yet SACS continued to pay them to the contractual scale (2:452). Even on these occasional non- union jobs, however, Respondent admittedly kept its two crews separate. Although there were jobs on which at some point each crew worked, after February 1982 Re- spondent's union and nonunion crews never worked on the same job at the same time (2:453-454, 456). For some reason Respondent failed in 1983 to notify the Union that it wanted to cancel (did not wish to renew) the Letter of Assent--B. Nor did it do so in 1984 or 1985. Thus, each year the agreement was automatical- ly renewed and SACS was covered by the NECA con- tracts over that period (1:94;2:468). The last NECA con- tract to which Respondent became bound had an effec- tive term of 1 June 1985 to 31 July 1986 (G.C. Exh. 3). Notwithstanding Respondent's failure to give the ap- propriate notice that would have canceled any further renewals of the NECA contract, at an early point Rice began seeking relief from the Union from the financial burden created by his having to bid against nonunion competitors based on his own union scale labor costs. By letter dated 23 August 1983 to Moczygemba, Rice re- quested a $12-an-hour rate for "my journeyman and elec- tricians" when they work on (1) small service jobs, (2) any job not covered by the Davis-Bacon Act, and (3) jobs in which the electrical installation contract is for less than $20,000 (R. Exh. 2). Moczygemba admittedly received the letter (1:92), but he never answered it (2:469). The $12 rate, it will be recalled, was the base rate SACS was paying its nonunion crew (3:505, Rice; 3:719, Broekers). The $12 figure, standing alone, is mis- leading as to Respondent's nonunion employees. As Broekers explained, the nonunion crew enjoys an incen- tive bonus plan which, on average, brings their annua- lized wages up to a level equivalent to the Davis-Bacon scale (3:719-721). The Davis-Bacon scale is the prevail- ing scale or, in effect, the union scale. Over a year and a half passed before Rice, by letter dated 5 April 1985, again wrote IBEW Local 60 request- ing relief (R. Exh. 3). Again Rice received no reply (2:469). Apparently deciding that he had had enough, Rice sent Moczygemba the following letter of 15 No- vember 1985 (G.C. Exh. 7; 1:35): Dear Bob: I wish to, with regrets, terminate the agreement between San Antonio Control Systems, Inc. and IBEW Local Union #60 as soon as possible, pursu- ant to Article I sections 1.02 and 1.03. Two requests for targeted wage rates were sub- mitted in writing, on August 23, 1983 and April 5, 1985, both were denied. Many of our installations are unique pertaining to the electrical requirements. I must be more cost effective in our current market- place, to first keep my company profitable, and sec- ondly to open up as much work as possible for my employees. I want to express my respect for Local Union #60 and their continued success in the future. Sincerely, Is/ Ronald E. Rice Ronald E. Rice President Although Respondent received no written reply from the Union (468-469), Moczygemba possibly telephoned Rice (1:35). Rice concedes his awareness that around this time the Union offered a market recovery rate (MRA) of $14.25 an hour to its signatory contractors who agreed to sign a 2-year NECA CBA. The MRA is also referred to as the target rate (3:640). The wage rate for journey- men under the March 1985 to May 1986 CBA was scheduled to increase on 2 December 1985 from $15.62 to $15.75 (G.C. Exh. 3 at 10). Rice elected not to accept the MRA deal because, he felt, it still would not make him competitive with the nonunion contractors (2:467-568; 3:506, 639-640). For some time, Rice testified, Respondent had been losing money on the jobs on which SACS employed its union crew (2:470-471; 3:493, 514). As the May termination date of the NECA CBA ap- proached, Rice wrote Moczygemba a reminder letter, dated 3 April 1986, as follows (G.C. Exh. 8; 1:35):"As I stated in my letter dated November 15, 1986, I wish to terminate my letter of assent. I understood we are bound to the current agreement until May 31, 1986." Responding by letter dated 17 April, Moczygemba re- quested a meeting to negotiate a renewal agreement and asked Rice to contact him concerning a date compatible SAN ANTONIO CONTROL SYSTEMS with their schedules (G.C. Exh. 9; 1:36). Rice apparently never applied, and Moczygemba wrote again on 8 May reminding Rice that the CBA would expire 31 May and suggesting a meeting date of 19 May at 10 a.m. at Moc- zygemba's office (G.C. Exh. 10; 1:36). The parties did meet on that date. C. The Bargaining Sessions of May-July 1986 1. Introduction In order to understand the background events as they bear on the two allegations of unlawful motivation, I will summarize the bargaining sessions. Of course, Respond- ent's pre-Deklewa position that the parties reached an im- passe on 5 June is no longer an ultimate issue to be de- cided. The parties met four times during May-July 1986: 19 and 29 May, 5 June, and 1 July. The first three meetings, the parties agree, were bargaining sessions. Because Re- spondent contends (and the General Counsel disputes) that an impasse was reached at the third session, 5 June, it objected at one point to the General Counsel's refer- ence to it as a bargaining session (1:126), and Respondent describes the 1 July meeting as "an attempt to resolve the parties' impasse." (Br. at 26-27.) Whether Respond- ent makes a valid distinction is questionable . For conven- ience purposes, I shall refer to all four as bargaining ses- sions. The first, second, and fourth sessions were short, with the meeting of 5 June being relatively long, lasting at least 2 hours. 2. The session of 19 May 1986 On 19 May the parties met at the Union's office for about an hour. Present were Moczygemba, his assistant Thomas Huckelba, and Rice. They first talked about ground rules and some minor matters. One of these was the fact that Respondent had been underpaying Stout and Stewart by 13 cents an hour, plus failing to make full payments to these benefit funds (2:473). As Rice credibly explained , the shortage arose from Respondent's failure to increase payments based on the higher wage schedule (from $15.62 to $15.75; G.C. Exh. 3 at 10) that went into effect 2 De- cember 1985. Rice said that if the Union would advise him of the exact amount due he would pay it. The Union did so the following day, by letter of 20 May (R. Exh. 18), and Rice paid the balance due. Rice testified that the shortage flowed from his idea that his 15 November 1985 letter (giving notice that Re- spondent would not renew the CBA in May 1986) froze the pay and benefit rates at the current levels. Later in the spring, Huckelba advised him that was incorrect. "I didn't think it was fair" to have to pay the difference, ex- plained Rice (since the other contractors , who had signed the 2-year MRA agreement, were paying only $14.25), "but I wanted to get out from under this con- tract in the correct manner" so he said, "I will pay it." (2:465-467; 3:518-519.) Moczygemba testified that Rice said he did not want to be a union contractor because he was not competitive, not making enough money, and did not see how he could survive as a union contractor (1:37-38, 95). In Rice's words, "I explained the reasons 793 why I expressed a desire to get out from under the union contract." (2:472.) Moczygemba handed Rice a complete written propos- al for a new CBA (G.C. Exh. 11). Rice said he would take it back to his office and review it. Moczygemba asked Rice to come back with a response. They agreed to meet again on 29 May. Before passing to the second bargaining session I will briefly mention a chronological development occurring on 20 May, the day after the first bargaining session. On 20 May Rice issued a memorandum in which he summa- rized the terms and conditions of employment for his nonunion employees (2:474-477). As this memo of 20 May figures in the allegation of direct dealing (complaint par. 15), I will defer further discussion until I reach that topic. 3. The session of 29 May 1986 The same representatives met again , also for about an hour, at the Union's office on 29 May. Again Rice said he could not make it as a union contractor because his union employees were not competitive and Respondent was not making enough money (1:141). Before the meeting Rice read the Union's contract proposal, and in response he prepared a letter, dated 29 May, which he submitted at the meeting to Moczygemba (2:480-481). In the letter Rice lists several cost increases, a restriction on his ability to offer profit sharing to his employees, a restriction on his ability to own or operate another company (without the terms of the CBA attach- ing), and concludes with the following (R. Exh. 4): "Considering the increases, restrictions, and labor out- look for the San Antonio area I cannot sign the 1986 agreement." Rice asked for a reduction in wages, and Moczygemba proposed the MRA rate of $14.25. They could not agree (2:481-482; 3:488). The next meeting was set for 5 June at 10 a.m. in Respondent's office. 4. The session of 5 June 1986 The same three representatives met in Rice's office on 5 June for about 2 hours and went through the Union's contract proposal item by item (1:42, 46-47, 62, 100; 2:482-483; 3:487). Making significant progress, the parties reached agreement on many provisions of a new CBA, but they ended the meeting with minor differences on a few items and substantially apart on two major issues. Clearly the parties were in serious disagreement re- garding two major issues : wage rates and contract dura- tion. Respondent argues that the parties reached impasse on 5 June regarding these two issues (Br. at 25). I agree that if an impasse was reached, it was regarding one or both of these issues. Respondent additionally contends that the parties seri- ously disagreed regarding two other issues, arbitration and subcontracting (Br. at 10). That tends to overstate the matter somewhat, for the parties had done little more than exchange their positions regarding those two issues, and the 5 June meeting ended with the understanding that the Union (on these two plus some other issues) was to submit (at the next meeting) revised language in an at- 794 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD tempt to meet Rice's objections. I need not summarize the evidence regarding the arbitration and subcontracting provisions. As I have described, since August 1983 Rice had been requesting an hourly wage rate of $12. Rice brought with him to this third meeting a letter, dated 5 June (G.C. Exh. 12), which he gave to Moczygemba (1:47). In the letter Rice expressed his concerns about three topics, including wages. On wages he wrote that he wanted a wage rate of $12 plus $2.24 for Respondent's contribu- tions to the benefit funds (3:582). He ended his letter by stating: My main concern is greeting the jobs my union em- ployees are installing to show a profit. To date they are not. Two things need to be done, get more pro- duction from my employees and get their wage rate down to a more competitive level. Moczygemba reminded Rice that at the last meeting he had offered Respondent the MRA, and he offered it again. He reviewed for Rice the details of the MRA. These included a wage rate of $14.25, plus benefit contri- butions, with an extension of the CBA to May 1988. Rice persisted at his $12 an hour (1:50, 101-102, 124; 3:681). Moczygemba estimated the benefit contributions under the MRA at no more than $1.80, or a total outlay by an employer of $16.05 (1:124-125). The total cash ex- pense under Respondent's offer, $12 plus $2.24, would be $14.24. Rice said he was paying his nonunion employees $12 an hour, 12 and that it was important he obtain that rate on any CBA because work was scarce and he had to be as competitive as possible (1:127-128; 3:506).13 Rice "in- dicated" that the MRA was not acceptable. Even so, in Moczygemba's opinion, they were not at loggerheads over the wage rate because Rice simply objected to the term (1:102-103). When the parties reached article X, section 5(a), "wages for all classifications shall be presented at a later date," the Union submitting no written wage proposal. Rice testified that it was "just understood" the rate was the target wage of $14.25 an hour (3:504). Moczygemba testified, without contradiction, that the parties agreed to defer on that item until they made more progress on agreements regarding other topics (1:107). The duration clause (art. 1, sec. 1) provided for a 1- year term beginning 1 June 1986. Rice said he was not interested in either a 1-year or 2-year CBA, but might consider one with a term of 6 months. Because of the 12 It is not entirely clear in the record that Rice referred to his non- union employees at the bargaining session as distinguished from his testi- fying at the hearing what he was thinking at the bargaining session. It seems clear, however, that he at least mentioned the $12 rate, and a read- ing of his testimony suggests that he referred to that as the rate he was paying his nonunion employees. Iz The $12 is a bit misleading. As we know, Respondent's nonunion employees are eligible for incentive bonuses, which bring their average pay to the equivalent of union scale. Rice advised the Union, however, of the incentive plan when they subsequently reached a provision of the proposed CBA restricting profit sharing (art. II, sec. 16). Rice explained that he had a profit-sharing program with his other employees that worked well. Moczygemba withdrew that provision (1:57-58, 105; 3:499- 500). hardships the current CBA was imposing on him, Rice said he did not think he could survive under the present CBA (3:488).14 He said it was important that he hold any new CBA to a term of 6 months. Moczygemba said he wanted a term of 1 year. They moved to the next topic (1:51, 103; 3:486-487). Although it is not entirely clear, the integrated posi- tions seem to have been as follows. Respondent: $12 an hour with a 1-year CBA or $14.25 for a CBA of 6 months. Union: $14.25 an hour if the CBA was for 2 years, and on a 1-year CBA a wage rate not yet pro- posed by the Union. Respondent suggests that the Union's proposed wage rate for a 1-year CBA was $15.75 (Br. at 25). That is not so. As Moczygemba testi- fied, the Union deferred presenting its wage rate propos- al sending progress on other issues (1:107). The $15.75 rate was the current rate of the CBA, which expired at the end of May 1986 (G.C. Exh. 3 at 10). The 5 June meeting ended with the parties agreeing to meet again on either 16 or 17 June. However, that date was postponed when Rice could not make it, and a second date was postponed for similar reasons (1:63; 3:508-509). They finally met for the fourth and last time on 1 July. To keep events in chronological perspective, I shall mention here Respondent's admission that effective with the pay period beginning Sunday, 1 June 1986, it (unilat- erally) reduced the hourly pay of Stout and Stewart to $14.25 and discontinued all payments to union benefit funds on nonscale jobs (jobs not covered by the Davis- Bacon Act). On scale jobs it paid direct to them the scale base rate of $15.75, plus benefits of $1.47, for a total of $17.22 (1:9; 3:574-575, 677-680). He did so with- out consulting an attorney (3:681). Rice testified that he made the wage-reduction deci- sion on Wednesday, 11 June (3:511). That is Respond- ent's payday. On their paychecks they received that 11 June, Stout (1:157-159) and Stewart (2:263-265) ob- served that their checks were for lesser amounts. Stewart called Rice who said that the new nonscale rate was $14.25 and that they were to pay for their own benefits out of that sum (1:159; 2:265, 326; 3:574, 677). Stout (1:159) and Stewart (2:265) promptly reported the matter to Moczygemba. Rice did not apply his decision prospectively. He made it retroactive to the pay period beginning 1 June as reflected in the amendment to Respondent's answer at the opening of the hearing (1:9). Rice's subsequent testi- mony on the effective date is a bit ambiguous. At one point he suggests it was effective on 6 or 7 June (2:480). Later he put the effective date as the pay period ending 7 June (3:679). The latter would be the same pay period that began 1 June. The paychecks themselves covered the period beginning 1 June and were for the reduced 14 Frequently, as here, Rice's testimony lapsed into a description of the reason he expressed a position . On the surface it is unclear whether he stated that reason to Moczygemba . At various points (such as 3:494 and 3:506), however, when asked if he so told the Union, Rice answered yes. I find that the reasons he testimonially described were also the reasons he stated to the Union at the bargaining sessions. SAN ANTONIO CONTROL SYSTEMS 795 amount. In any event, Respondent's amended answer re- mains unchanged and controls its positions. Rice testified that, without consulting an attorney, he reduced the wages of Stout and Stewart because (3:680- 681): I considered that an unfair contract to me; I figured I had bargained in good faith, as long and as hard as I could on June 5 . So I thought this was a fair settlement, and a fair way to operate, because I didn't want to live under that unfair contract, as, and me being the only one in town having to live under that unfair contract. Apparently it was not until he learned of the termina- tion of Stout and Stewart on 25 June that Moczygemba drafted a letter on 26 June to Rice regarding the unilat- eral changes. Assistant Business Manager Thomas Huck- elba and International Representative Henry Villareal hand-carried the letter to Rice that day (1:78-79, 109- 110; 3:511-512). In his letter of 26 June to Rice , Moczy- gemba observes that, notwithstanding its desire to termi- nate the CBA, Respondent still has an obligation to comply with the terms of the "current agreement" until such time as the parties may bargain to impasse. He warns Rice that current wages, benefits, hours, and working conditions "may not be unilaterally altered by you." Moczygemba concludes his letter by asking Rice, "Please advise as to your intent in this regard." (G.C. Exh. 18.) The record does not show whether Rice re- plied. 5. The session of 1 July 1986 Moczygemba, Huckelba, and Rice met for the fourth time on 1 July in Rice's office (1:63-64; 110). The meet- ing lasted 45 minutes to an hour (3:514). The highlights relevant for our needs are as follows. One of the first topics raised was the termination of Stout and Stewart. Moczygemba asked whether Rice would consider taking them back . "Never," replied Rice. Moczygemba asked Rice about the cutting of wages and cessation of payments to the benefit funds. Rice admitted such, saying he was not about to pay any more fringes because he was no longer bound to the (expired) CBA. Moczygemba said he did not think Rice could do that (1:65, 112). Because of Rice's references at the 5 June meeting to his union employees, Moczygemba formed the impres- sion that Rice perhaps was operating a double -breasted operation (1:66, 114). Moczygemba therefore prepared a letter requesting data (a listing of 12 items) that would disclose this and also verify whether Rice's claims of "poverty" were true. He presented the letter to Rice at the 1 July meeting (1:66-67, 114; 3:513-514). Because the request for data is no longer relevant, I will omit any summary or reproduction of it. As the parties reviewed Moczygemba 's letter the sub- ject of economics arose . Rice said his nonunion employ- ees were doing the work cheaper than Stout and Stewart could do it (1:66, 72-73, 113). Rice said that the jobs Stout and Stewart did were not profitable, and that his books were open to Moczygemba right then . Moczy- gemba said he did not have time to examine the books at that visit (3:514). Moczygemba testified that at the 5 June meeting Rice said he had the data on job costs and the Union was welcome to look at it to see how "produc- tive" his union employees were but that Rice did not offer to make the books available on 5 June (1:128). D. The Direct Dealing Allegation 1. The 20 May 1986 memorandum Rice testified that on 20 May, the day after the initial bargaining session, he prepared a three-page memoran- dum (G.C. Exh. 17) setting forth company policies appli- cable to his nonunion employees . Hesitating at first to give copies of the memo to Stout and Stewart , he decid- ed to do so on the thought they might withdraw from the Union at some future date and, therefore , it would be fair to them to know what policies apply to nonunion employees. Beginning that day he distributed copies of his 20 May memo to all employees . Rice concedes that the policies in the memo differ in many respects from the terms of the CBA (2:474-475). Stout testified that Rice handed him a copy of the 20 May memo. Uncertain of the date Rice gave him the memo, Stout was under the impression it was on -Monday (19 May) when he turned in his timesheet. He concedes, however, that on occasion he turned in time- sheets on Tuesdays, and that in fact he does not recall which day it was (1:155-156, 186). Although an early Monday time would not necessarily conflict with the 10 a.m. bargaining session Rice attended at the Union's office on 19 May, I find it more likely that Stout re- ceived the memo from Rice on 21 May as Rice testified (2:475). According to Stout, Rice said the memo reflected company policy and the way things were going to be done in the future. He suggested that Rice read the memo, think about it, and see if he could live with the policies, which would be effective "immediately in the future." He asked Stout to take Stewart's copy to him at the jobsite. Stout said he would think about the new policies. He delivered Stewart's copy (1:154-156, 186- 187). Not specifically denying Stout's testimony, Rice testi- fied that he and Stout did not sit down and go over the memorandum, which he handed to Stout on 21 May, and that Stout asked no questions regarding it (2:475 -476). In noting that Rice's version is not inconsistent with Stout's, I credit Stout. Stewart testified that he received two copies of the memo on either Monday or Wednesday of that week. The first copy was one he found in his box at the office, and the other copy was given to him on the job by Stout. Stewart assumes he picked up the first copy on Wednesday, 21 May. Rice was not there at the time. After talking with Stout about it on the job , Stewart telephoned and spoke to Rice (2:260, 319-320). Rice agrees that Stewart did telephone him about the memo on Wednesday, 21 May. According to Rice, he explained to Stewart his thought that it would be a good idea to put company policies in writing, and that it 796 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD would be fair to him and Stout to let them know what the policies would be should they elect to withdraw from the Union at some future date (2:476). Stewart, whom I credit, testified that when he asked Rice about the memo in the telephone conversation, Rice said it was the new policy of the Company. Stewart asked Rice to confirm that the policy did not apply to Stout and Stewart because they were in the Union. Rice said it did not apply to them until the contract expired, that he would bargain with the Union in good faith, that he wanted to keep everything on the "up and up," and that Stewart and Stout would continue to receive all contractual wages and benefits "until we reach impasse or until I resign."15 Stewart asked what an impasse was, and Rice explained that it meant "until we agree or can't agree on the contract." (2:261, 320, 323, 326). As Rice's version is not inconsistent with Stewart's I accept it as a supplement to the other remarks I find that he made. Moreover, Rice's reference to a possible future withdrawal from union membership by Stewart and Stout aids in interpreting the ambiguous "until I resign" testimony of Stewart. I find no contradiction between the accounts of Stout and Stewart. Rice's comments to Stout appear to have been rather brief. His telephone conversation with Stew- art was longer and he described his intentions more spe- cifically. Although Stout at one point recalled Rice as saying the new policy would be effective "immediately in the future," the balance of his testimony is in line with Stewart's that Rice said the policies would apply in the future regarding the union employees. The differences between the policies in Rice's memo- randum of 20 May and those contained in the CBA are several, and they are significant, as Moczygemba de- scribed at the hearing (1:123-124). For example, item 3 of the first page asserts that work on nonscale jobs (work not covered by the Davis-Bacon Act) will be paid "as determined by management." Vacation would be 1 week rather than the 2 weeks union members take. Under the CBA the employer pays full costs of the medical insur- ance, but under the 20 May policies, SACS pays only half. And additional family members would be covered at the employee's cost, whereas under the CBA, Moczy- gemba testified, without contradiction, all family mem- bers are covered at no additional cost. There is no dispute that before 1 June Respondent ap- plied none of the new policies to its union employees, Stout and Stewart. Rice concedes that in early June he did apply the new pay-rate policy to them (2:479-480). We also know that with the paychecks distributed 11 June, for the pay period effective 1 June, Respondent also ceased making contributions to the benefit funds. Did Rice's conduct constitute the direct dealing and bypassing of the Union alleged in complaint paragraph 15? Arguing that the answer is an affirmative, the Gener- ' The "until I resign" is ambiguous. Rice could have used the "I" as a way of saying until he ceased dealing with the Union after the CBA ex- pired . Another possibility is that Rice said "until you resign" but the wit- ness, converting the reference to himself to the first person pronoun, in- serted the word "I" in midsentence . The matter was not clarified , and the parties do not address it in their briefs . I find the second possibility to be the more likely explanation. al Counsel points to the testimony of Stout and Stewart that in the fall of 1985 Rice told each of them that he wanted to get out of the Union (Br. at 10). To Stewart, in a casual conversation, Rice said that unions are be- coming a thing of the past, that they cost too much money, and that business was too competitive. He told Stewart to think about it, and Stewart said he would. Rice mentioned this on one or two subsequent occasions, but Stewart ignored the subject (2:258-259). Rice's comments to Stout were a bit more pointed. In addition to telling Stout he was going to get out of the Union, Rice also said that Stout and Stewart were being paid too much and that everyone was going to earn the same pay rate. Rice said he was writing a letter to the Union expressing his desire to get out once the CBA ex- pired. Stout testified that Rice repeated his comments (other than the letter writing) on other occasions into 1986 and up to June 1986 (1:144-145, 148). Rice did not testify concerning these assertions, no complaint allegation specifically addressed them, t 6 and Respondent does not discuss this evidence in its brief. I credit Stout and Stewart. In so crediting them, I consid- er the evidence as to Rice's comments about wanting to leave the Union relevant (regarding the allegation of par. 15) only as they bear on credibility, for the direct dealing allegation does not turn on Respondent's motivation if Rice in fact bypassed the Union. 2. Conclusion The evidence shows that Respondent did bypass the Union and deal directly with Stout and Stewart on this subject, including telling Stout to "think about" Re- spondent's new policies. Even though Respondent's new policies were not to be effective (regarding Stout and Stewart) until after an impasse or unless Stout and Stew- art withdrew from union membership, the conduct and remarks of Rice violate Section 8(a)(5) and (1) of the Act as alleged. This is so because even after an impasse an employer cannot implement policies not reasonably com- prehended within its preimpasse proposals. Taft Broad- casting Co., 163 NLRB 475, 478 (1967). As of 21 May Respondent had not presented its 20 May memorandum to the Union, and the only item contained there that Re- spondent had discussed with the Union was the reduc- tion of wages. Thus, Respondent bypassed the Union. As for the resignation from union membership, even if it occurred, it would not necessarily mean that Stout or Stewart was no longer a member of the bargaining unit-even if Respondent assigned him to the nonunion crew. By commenting on this topic to Stout and Stewart on 21 May Respondent bypassed the Union and dealt di- rectly with employees represented exclusively by the Union. For the reasons I have stated, I find that Respondent violated Section 8(a)(5) and (1) of the Act as alleged in complaint paragraph 15. 16 Of course, anything in 1985 would be outside the 6-month limita- tions period set forth in Sec. 10(b) of the Act. SAN ANTONIO CONTROL SYSTEMS E. The Unlawful Motive Allegations 1. Introduction As previously discussed, there are two unlawful motive allegations. one is the unilateral reduction in wage rates and elimination of payments to the union trust funds (complaint pars. 16, 20). The second is the termination of Stout and Stewart (complaint pars. 19, 20). To some extent these allegations may be treated to- gether. Earlier I summarized the evidence showing Rice's desire and efforts to persuade the Union to accept a $12 wage rate, and also his comments to Stout and Stewart that he wanted to go nonunion. Rice had developed something of an antiunion attitude . Even so, it was based on economic costs and restrictions, and not on any per- sonal dislike of the union representatives. More to the point, it did not translate into any dislike of Stout and Stewart. Thus, even as Stout described Rice's comments in the spring of 1986 about a desire to get out of the Union and pay everyone the same rate , Stout conceded that Rice assured Stout that he had a home there as long as he wanted it (1:145). On some of the occasions of Rice's comments about getting out of the Union, according to Stout, Rice spoke crudely, saying "Fuck the godamn union." (1:215, 221.) One such occasion was in May 1985 when Stout came to pick up his paycheck at lunchtime rather than after work for the day. When Rice asked why Stout came at lunch Stout explained that, under the CBA, SACS was to de- liver the paychecks by quitting time , that if Rice wanted to deliver his paycheck Stout would not come to get it, and that Stout was doing this as a service to Rice since Stout did not eat lunch. In the presence of office secre- tary Barbara Will, Rice said, "Fuck the motherfucking union; pardon my French." (1:221-222.) Will recalls no such remark (2:376) and Rice did not address the matter during his own testimony. Even if Stout is credited, Rice's angry and crude ex- pression was directed more toward the Union than toward Stout. That seems to be a distinction with a dif- ference, for as mentioned above, as late as the spring of 1986 Rice told Stout he had a home at SACS as long as he wanted one. 2. Material facts The immediate occasion of the termination of Stout and Stewart centers on their failure to call the office on Monday, 23 June. One of the jobs they had been work- ing on for several days was the U.S. Post Office in downtown San Antonio. The job involved replacing two large water chillers for the building's air conditioning (1:217-218; 2:316; 3:547). Stout testified that for the pre- vious week he and Stewart worked 36 hours each at the post office disconnecting (demoing) some pneumatic lines, tracing the wiring, pulling, tugging, researching, and "just digging into everything that needed digging into." (1:150, 196-198, 217, 220, 223-228.) Stewart gave similar testimony (2:315-319). 797 On Friday, 20 June, Rice was in Fairfax, Virginia (3:544, 643, 647). 17 Office secretary Barbara' Will tele- phoned Rice either around 11:30 a.m. or that afternoon to report that Edward Talley , project manager for Cold Temp Air Conditioning Co., the mechanical contractor on the post office job, had called to say he did not see Stout and Stewart on the job and Cold Temp wanted the two chillers on line (installed and operating) by the first part of the following week . Will told Rice she had tried to reach the two men but was unsuccessful . Rice told her that if they called in, to tell them it was critical that they be on the job Monday morning (3:543-544, 551, 646-648). Rice then telephoned the post office and reached the building engineer who informed him that he thought he had seen Respondent's employees (Stout and Stewart) there earlier, but they were not there then. Rice called Will back and repeated his direction to her that she tell Stout and Stewart to be at the post office job on Monday (23 June) because the job was very critical. He told Will that he would arrive in San Antonio about 11:30 a.m. on Monday (3:544-546). This possibly was all in Rice's first conversation with Barbara Will, for on cross-examination he testified that he does not remember calling her back (3:648). Rice made no effort himself to contact Stout and Stewart that weekend. He did not have Stout's number, and he did not think of leaving a message for Stewart's pager (3:648-649). About 7 a.m. on Monday morning, 23 June, Stout ar- rived at the Taco Cabana, a "centrally" located cafe where Stout and Stewart would meet, park one vehicle, and ride together to the jobsites . 18 Stewar did not appear. A few minutes after 8 a.m. Stout telephoned the office but, he testified, the number was busy. About 9 a.m. he left for home without again telephoning the office. He did not go to the office that day. He did not call from his home because that would have incurred a long distance charge (1:160-161, 185, 230). When giving his address at the hearing, Stout gave a San Antonio address (1:130). Stewart testified that Stout lives close to Leon Springs on the opposite side of San Antonio from him (2 :329-330). Leon Springs, as a map reflects, is a community a few miles north of San Anto- nio on Interstate Highway 10. Stout testified to a mixture of reasons why he made no further attempts to call the office or, apparently, to go there. First, he had tried once unsuccessfully . Second, it was a long distance call from his home . Third, there were occasions when they (he and Stewart) would go straight to a job on Mondays and they would not call the office all day. Fourth, Rice had instructed him simply to make sure their timesheets reflected whether they were working. Fifth, Stout apparently concedes that he was not eager to call because he was unhappy with Rice. He was unhappy with Rice because of his sar- castic remarks about both the Union and Stout (1:185). 17 Rice had told Stewart he would be out of town (2:326-327). 16 Stout testified that the "centrally" located Taco Cabana is located at Wurzbach and Bandera Highway (1:160). As a map reflects, that intersec- tion is on the northwest side of San Antonio near loop 410. 798 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Stout concedes that he was unhappy over his pay cut (1:215). Indeed, in his pretrial affidavit of 10 July Stout states (1:203-204): Both Stewart and I were fed up with Rice cutting our wages, refusing to pay fringes, and his com- ments that the Union was no good. Stout denies that "what really happened" was that he was so fed up with Rice's cutting the wages that he did no work his last 2 weeks at SACS (1:204). Stewart testified that he did not go to meet Stout for work on Monday, 23 June, because that day he had to attend to some "personal" business (2:328-329). He con- cedes, however, that he really did not go to work that day because he was "fed up" with Rice for cutting his wages even though the personal business was an addi- tional reason (2:330-331, 346-347). Finally, on cross-ex- amination Stewart confirmed that in his pretrial affidavit of 31 July (2:284, 320) the reasons he gave were (2:384): "On June 23rd 1986 I was so frustrated and angry at having my wages and fringes cut that I didn't report to work." Stewart testified that neither the secretary (Bar- bara Will) nor anyone paged him that day (2:267-268). Barbara Will met Rice at the San Antonio airport on Monday, 23 June, and informed him that Stout and Stewart had not reported to work that morning at the post office job. Rice went immediately to the post office (3:546, 650). At the post office Rice discovered that some copper lines had been capped, but no other work had been done. In particular there was no conduit installed from the chillers to the remote control panels, and there should have been 35 or 40 feet of conduit to each chiller. More- over, the capping work he found was work Stout and Stewart had done earlier, in February (3:546-548, 651-- 652). At the post office Rice spoke with Jerry (surname not identified in the record) of Cold Temp who advised Rice that he had not seen Stout or Stewart at the post office the previous week (3:549-550). Rice drove to another job at the Collins Gardens Li- brary where Stout and Stewart were to have run about 50 feet of conduit from a control panel to a remote con- densing unit on the roof and pull in three wires and ter- minate. Rice found no evidence of any work (3:550-551, 654-655). Rice telephoned Cold Temp and requested patience re- garding the post office job. He then contacted his non- union crew and arranged for Broekers and John Heil to meet him at the post office the following morning. He was unable to reach Stewart about 4 p.m. on both the pager and by calling Stewart's home in Big Foot, Texas. Stout recently had moved and Rice did not have his number (3:552-553, 650). Stewart testified that his Big Foot home is about 45 to 50 miles south of downtown San Antonio (2:327-328). That Monday night Stewart telephoned Stout at home and explained that he had taken care of personal business that day. They agreed to meet the following morning (1:161; 2:329). On Tuesday morning Stout and Stewart met at the Taco Cabana around 7 a.m. From there they drove to a jobsite at a credit union about three blocks away. Find- ing the walls there not ready for their work, the two drove (in one vehicle) to the Sequin Library in Sequin, Texas (about 35 miles east of San Antonio), where they arrived about l I a.m. As that job, too, was not ready for them, they returned to the Taco Cabana around 2 p.m. and from there each went home (1:162-163, Stout; 2:269- 270, Stewart). There is no evidence that they attempted to call or go by the office. That Tuesday, 24 June, Rice spent about an hour with his nonunion crew at the post office lining them up on the work to be done (3:552). They did the job in about 3 to 4 days. The work included installing about 100 feet of conduit to each chiller from a control center on the back wall of the basement (3:710, Broekers; 4:743-748, 758- 760, Heil). On Tuesday Rice decided Stout and Stewart should be terminated (3:562). That evening he finally reached Stewart.19 Rice asked him where they had been on Monday and Tuesday. Stewart said he had been occu- pied with his personal business on Monday. Rice said the post office jobs was critical and he asked if they knew to be there. Stewart replied simply that he had personal business on Monday. Rice said he needed to see him and Stout in the office the next morning. Stewart asked whether he should remove his hand tools, and Rice said yes (3:566-567). Stewart contacted Stout and relayed the message to him (1:164; 2:331). They both understood that removal of their tools and personal items from the com- pany pickups meant they were fired (1:164; 2:271). On Wednesday, 25 June, Stewart and Stout met at the Taco Cabana between 7 and 8 a.m. and discussed the sit- uation. Stewart concedes (2:272), as Rice testified (3:567), that he and Stout did not reach the office until about 11:30 a.m. At the office, Stout testified, Rice told them he was letting them go for not calling in on Monday and that such complaint was the only reason he gave (1:165-166). Stout concedes, however, that over the last couple of weeks Rice had complained that he was losing money on their jobs, but he contends Rice always made that com- plaint (1:167, 226). In addition to telling them they were being discharged for not calling in, Stewart testified (2:272, 276), Rice "implied" that they had not been producing for Rice the previous 2 weeks (2:332). The termination slip Rice gave to each reflects that each was being discharged because he "Did not contact this office Monday 6-23-86."(G.C. Exh. 20.) Rice testified that he asked them why they did not show up for work on Monday. Stewart replied that he had personal business; Rice does not recall whether Stout responded (3:567). Rice asked them where they had worked the previous week and the number of hours (1:201-202, 216, Stout; 3:567, Rice). They named two 19 Stewart testified that he telephoned Rice about 9 p.m. to ask why Rice was not paying him (and Stout) the union scale of $15.75. Supposed- ly he also asked whether Rice had "resigned" from his contract with the Union and Rice said no (2:270, 331). As Stewart had not bothered to call Rice that day, I find it far more likely that the call that night was initiat- ed by Rice. I credit Rice. SAN ANTONIO CONTROL SYSTEMS 799 jobs, the Sequin Library and the post office. On a yellow sheet of paper (G.C. Exh. 22) Rice recorded their re- sponses as follows regarding 16-20 June (3:567-570): Stewart M T W T F Totals Sequin Library 4 4 Post Office 8 5 8 8 29 33 Sequin Library Stout 4 4 Post Office 8 8 8 8 32 36 Rice told them that he was at the (post office) jobsite on Monday, that they knew how critical the job was to get completed, yet when Rice went there on Monday he did not see a "damn thing" either one of them had done other than the small amount of work they had done in February. Stout's only response was that they had been on Rice's payroll working for him. Stout did not say he had installed so many feet of conduit or pulled so much wire, but simply that they had been on his payroll work- ing for him. Rice did not ask them about other jobs be- cause this (post office) job was reason enough to termi- nate them. Rice told the two that they had not been working in June, and what they had done to him the past month was pretty bad. He said he thought they were lying to him about the hours for the previous week , but he did not want to argue about it and would pay them for all the hours they were claiming (3:567-572). From there they went outside to check in the trucks. Rice found that the 1986 truck Stewart had been using was filthy from having been used for hunting, with 40 to 50 shotgun cases in the bed, empty beers cans in the cab, and brush marks on the sides (3:572-573). Stout and Stewart apparently submitted no claim for hours on Monday or Tuesday, 23-24 June, and Stewart so testified (2:274, 347). 3. Discussion As earlier noted, the General Counsel lists several fac- tors as showing a prima facie case . Aside from denying the existence of a prima facie case , Respondent argues that it demonstrated, by "clear and convincing" evidence (Br. at 28), that Stout and Stewart would have been dis- charged notwithstanding their union membership because of their slowdown in work. I fmd that the General Counsel failed to establish a prima facie case . First, Rice's announced intention to go nonunion never reflected an animus toward Stout or Stewart. Indeed, until June, at least, Stout concedes that Rice told him he had a home at SACS as long as he wanted one. There is nothing to suggest Rice felt any different toward Stewart. Second, the timing factor (discharges occurring after expiration of the CBA) shows nothing but a chronologi- cal sequence of events without any cause -effect relation- ship. If anything, the timing factor lends support to Re- spondent's slowdown argument, which I discuss next. Third, the unilateral reduction of wages lends far more support to Respondent's slowdown (or no work) defense than it does to the complaint's allegations of unlawful motivation. Indeed, the evidence demonstrates, and I fmd, that the resentment of Stout and Stewart against Rice and the unilateral cuts was the overriding reason Stewart did not show up for work on Monday , 23 June, and for Stout's going home without persisting in tele- phoning the office from the Taco Cabana . That same re- sentment, I fmd, resulted in this halfhearted effort to fmd work on Tuesday, 24 June, all the while declining to call Respondent's office or to answer the pager Stewart car- ried. Fourth, contrary to the General Counsel's contention, in fact there was no established practice about not call- ing in on Mondays and Stewart admits that he usually called in whenever he missed work (2:266). Moreover, Mondays are when they were either to come to the office to report their time for the previous week or they were to call it in on Mondays (1:184, 190, 195 , Stout; 2:311, Stewart). Fifth, the "shifting" reasons. In the absence of explana- tion, I presume the General Counsel means that Re- spondent shifted from the reason stated on the discharge slip and from, to some extent, the testimony of Stout and Stewart that Rice gave no other reasons besides not call- ing in. In considering only the General Counsel's evi- dence,20 however, there is no evidence of shifting. Even when we consider Respondent's evidence we have not shifting, but additional grounds . If I were to reach those grounds, I would credit Rice. Sixth, the General Counsel argues (Br. at 15): Having received complaints from Stout and Stewart regarding their reduced wages, Rice realized that he would have to bring their employment to an imme- diate conclusion. Accordingly, he seized upon their failure to report to work on June 23 , as a reason to terminate them on June 25. That is a fine theory. Unfortunately, the General Counsel fails to cite the evidentiary underpinnings. What com- plaints, for example? Stewart telephoned on 11 June and inquired about the difference in the pay rates, but he did not complain. On Tuesday night, 24 June, Stewart testi- fied that he telephoned Rice for the apparent purpose of complaining about the pay reduction . But Stewart never testified that he so complained or what Rice said (2:270, 330). All that Stewart said, so far as the record shows, was to ask Rice whether he had "resigned his contract." Rice supposedly said no, then told Stewart that he and Stout should remove their personal items from the trucks, come to the office (the next day), and talk to Rice (2:270). Even if I were to credit Stewart (which I do not), it is clear that in his version Rice had already decided to fire both employees. I find this sixth ground to be without merit. 20 Hillside Bus Corp., 262 NLRB 1254 (1982). 800 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Overall I find that the General Counsel's evidence does not rise to a prima facie case of unlawful motivation regarding either the unilateral changes or the discharge of Stout and Stewart. If I were to reach Respondent's evidence regarding Rice's motivation, I would credit Rice and the other evidence presented by Respondent. Even if I were to find, prima facie, that Respondent was unlawfully motivated in reducing wages and eliminating benefits after the 8(f) contract expired, I still would dis- miss the 8(a)(3) allegation because I find that Respondent would have taken that action in any event for economic reasons. I shall dismiss complaint paragraphs 16, 19, and 20. CONCLUSIONS OF LAW 1. Respondent San Antonio Control Systems Inc. (SACS) is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. The South Texas Chapter, National Electrical Con- tractors Association (NECA) is an employer within the meaning of Section 2(2), (6), and (7) of the Act. 3. International Brotherhood of Electrical Workers, AFL-CIO, Local Union No. 60 is a labor organization within the meaning of Section 2(5) of the Act. 4. The bargaining relationship created in February 1982 between SACS and IBEW Local 60 was estab- lished under Section 8(1) of the Act. 5. After the 8(f) relationship was established between SACS and IBEW Local 60 in February 1982, SACS never voluntarily recognized the Union as the exclusive bargaining representative of its employees in an appropri- ate unit and, thus, never established a bargaining rela- tionship under Section 9(a) of the Act. 6. When the latest collective-bargaining agreement (CBA) between SACS and the Union (the NECA con- tract) expired on 31 May 1986, SACS was free to repudi- ate its 8(f) relationship with the Union and to make uni- lateral changes in wages, hours, and working conditions regarding its employees previously covered by the NECA contract. 7. Respondent violated Section 8(a)(5) and (1) of the Act on or about 21 May 1986 when it distributed copies of a memorandum dated 20 May 1986 outlining company policies and procedures ostensibly applicable to SACS' unrepresented employees, to its employees represented by IBEW Local 60 and telling them to think about such policies because they would apply to them if they elect- ed, at some future date, to resign their union member- ship. 8. Respondent SACS did not violate Section 8(a)(5) of the Act in June 1986 when, following expiration of the 8(f) NECA contract on 31 May 1986, it made unilateral changes in wages and benefits for employees previously covered by the NECA CBA. 9. Respondent did not violate Section 8(a)(1) of the Act on 11 June 1986 when it told its employees repre- sented by the Union that SACS was reducing wage rates effective retroactively to 1 June 1986 and would no longer make the fringe benefit contributions called for in the recently expired NECA contract. 10. Respondent did not violate Section 8(a)(5) of the Act by refusing, on and after 1 July 1986, to furnish the Union with data the Union had requested by letter of 1 July 1986. 11. Respondent has not violated Section 8(a)(5) of the Act by failing and refusing to bargain with the Union as the exclusive collective-bargaining representative of cer- tain of its employees. 12. Respondent did not violate Section 8(a)(3) of the Act on 11 June 1986 by unilaterally reducing wage rates of the employees covered by the recently expired 8(f) NECA contract, nor by simultaneously discontinuing fringe benefit payments called for in such expired CBA. 13. The General Counsel failed to establish a prima facie case that Respondent violated Section 8(a)(3) of the Act on 25 June 1986 by discharging employees Joseph Ronnie Stout and Charles Douglas Stewart. 14. The unfair labor practice described in Conclusion of Law 7 affects commerce within the meaning of Sec- tion 2(6) and (7) of the Act. THE REMEDY Having found that Respondent has engaged in certain unfair labor practices, I find it necessary to order it to cease and desist and to take certain affirmative action de- signed to effectuate the policies of the Act. Although Respondent no longer has a collective-bar- gaining relationship with IBEW Local 60, I shall order it to notify the Union, and Respondent's employees, that if ever in the future SACS again has a collective-bargain- ing relationship with IBEW Local 60, or any labor orga- nization, it will not bypass such representative and deal directly with the represented employees. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- edzr ORDER The Respondent, San Antonio Control Systems Inc., San Antonio, Texas, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Bypassing the collective-bargaining representative and dealing directly with any of its employees who may in the future be represented by IBEW Local 60 or any other labor organization concerning wages, hours, or other terms and conditions of employment. (b) In any like or related manner interfering with, re- straining, or coercing employees in the exercise of the rights guaranteed them by Section 7 of the Act. 2. Take the following affirmative action necessary to effectuate the policies of the Act. (a) Notify IBEW Local 60 in writing that should that union, or any other labor organization, in the future become the exclusive collective-bargaining representative of any of its employees in an appropriate unit, that SACS will not bypass IBEW Local 60, or any such 21 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. SAN ANTONIO CONTROL SYSTEMS labor organization, and deal directly with such represent- ed employees on wages, hours, or terms and conditions of employment. (b) Post at its Houston, Texas office copies of the at- tached notice marked "Appendix."22 Copies of the notice, on forms provided by the Regional Director for Region 23, after being signed by the Respondent's au- thorized representative, shall be posted by the Respond- ent immediately upon receipt and maintained for 60 con- secutive days in conspicuous places including all places where notices to employees are customarily posted. Rea- sonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, 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 violations of the Act not specifically found. nf 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 NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government 801 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 bypass IBEW Local 60 or any other labor organization which in the future may represent any of you in an appropriate unit and, in such bypassing, deal directly with you concerning wages, hours, or other terms and conditions of employment. WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exercise of the rights guaranteed you by Section 7 of the Act. WE WILL notify IBEW Local 60 in writing that should that union or any other labor organization in the future represent any of our employees in an appropriate unit, we shall not bypass IBEW Local 60 or such other labor organization and deal directly with you concerning wages, hours, or other terms and conditions of employ- ment. SAN ANTONIO CONTROL SYSTEMS INC.