Howard Electrical And Mechanical, Inc

472 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Howard Electrical and Mechanical, Inc and Plumb- ers Local Union No 3, United Association of Journeymen & Apprentices of the Plumbing and Pifefitting Industry of the United States and Canada and Pipefitters Local Union No 208, United Association of Journeymen & Appren- tices of the Plumbing and Pipefitting Industry of the United States and Canada Cases 27- CA-8889, 27-CA-8889-2, and 27-CA-8924 March 29, 1989 DECISION AND ORDER BY CHAIRMAN STEPHENS AND MEMBERS JOHANSEN AND CRACRAFT On April 8, 1987, Administrative Law Judge Jer rold H Shapiro issued the attached decision The General Counsel filed exceptions and a supporting brief The Respondent filed exceptions, a support- ing brief, and an answering brief to the General Counsel's exceptions i 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,2 and i The Respondent filed a motion for leave to supplement the record evidence requesting that two letters from the Charging Parties to the Respondent dated November 12 and 13 1986 be added to the record The Charging Parties opposed the motion because the documents in question were already a part of the record as Jt Exhs 37(a) and (b) On examination of the record we find the Charging Parties observation to be correct and deny the Respondents motion 2 The Respondent excepts to the judge s findings that the Regional Di rector properly set aside the informal Board settlement agreements re solving these cases After careful review of the judge s decision we adopt these findings because we agree that there was no meeting of the minds by the parties insofar as the settlements affected the Respondents right to employ plumbers and pipefitters as pre apprentices In this regard we observe that the judge found that when the Respondent read the language of the settlements it could have reasonably believed the par ties meant the Respondent was obligated to apply the December 1983 proposals to those individuals claimed as pre apprentices No exception to this finding was filed Member Cracraft agrees that the Regional Director was warranted in setting aside the October 17 1984 settlement agreements but for reasons other than those stated by the judge and adopted by her colleagues She would find instead that the Respondent breached the settlement agree ments when it classified new hires as pre apprentices and unilaterally es tablished their rates of pay and ceased to contribute to employee benefit funds established in the 1981 - 1983 contract on their behalf The settle ment agreements stated that all employees would be reimbursed for dif ferences in wage rates The agreement with Local 3 cited Al Farrell as an employee who along with other similarly situated employees should be made whole Farrell was hired on June 27 1984 as a pre apprentice and paid $12 per hour with no contribution to employee benefit funds Unless the settlement required the parties to return to the 1981 -1983 con tract conditions rather than as the Respondent contends to the condi tions set forth in the Respondent s December 1983 proposals the require ment of backpay for Farrell and those similarly situated is meaningless Thus Member Cracraft would find that the settlement agreements pro hibited the Respondent from classifying new hires as pre apprentices uni laterally establishing their rates of pay and failing to contribute to em ployee benefit funds on their behalf when it took such actions For that reason Member Cracraft would set aside the settlement agreements Al conclusions only to the extent consistent with this Decision and Order The second amended complaint is based on charges filed by Plumbers Local Union No 3 (the Plumbers) on July 23 and August 28, 1984, and a charge filed by Pipefitters Local Union No 208 (the Pipefitters) on August 22, 1984, later amended on August 25, 1984 According to the allegations in the second amended complaint , during the bargain ing sessions with the Unions held in late December 1983, the Respondent insisted on proposals that were a nonmandatory subject of bargaining be cause they constituted an attempt to alter the scope of the existing contractual units by excluding plumbers and pipefitters classified as pre appren tices The second amended complaint alleges fur ther that, inter alia, the Respondent violated Sec- tion 8(a)(5) and (1) of the Act when it implemented its December contract proposals on or after Janu ary 23, 1984, in the Plumbers unit and on or after February 22, 1984, in the Pipefitters unit in the ab- sence of a valid, good-faith bargaining impasse Ac- cording to the General Counsel, because the Unions never agreed to exclude the pre-apprentices and Board proceedings were never initiated to change the contractual units, the Respondent could not treat the pre-apprentices as nonunit employees, assign them unit work , and fail to apply unit wages and employment terms to employees in the unilat- erally established pre-apprentice classification The second amended complaint further alleges that the Respondent violated Section 8(a)(5) and (1) of the Act when it implemented its June 1984 contract though as noted by her colleagues no specific exception was taken to the judge s finding that the Respondent could have reasonably believed the language of the settlement agreements meant that it was obligated to apply the December 1983 proposals to pre apprentices Member Cracraft notes that the Respondent specifically excepted to the judge s findings that the settlement agreements should be set aside and that there was no meeting of the minds regarding the settlement agreements at the time of their execution In her view these exceptions squarely place the issue of the parties intent when the settlement agreements were entered into before the Board The complaint alleges that the Respondent violated Sec 8 (a)(5) and (1) by unilaterally changing the unit employees benefits when it implement ed its August 15 1984 proposal without affording the Unions an opportu nity to bargain about the matter The judge dismissed this allegation be cause there was insufficient evidence to establish that the Respondent in fact had implemented its August proposal The General Counsel excepts to this dismissal In agreeing with the judge we note that the General Counsel does not dispute that the evidence did not show actual imple mentation but rather she incorrectly relies on the Respondents an pounced intent to implement the proposal as establishing the unilateral implementation See Swift Independent Corp 289 NLRB 423 fn 11 (1988) (limitations period commenced at closing of plant rather than at time of the announcement of the closing) Cf Ciba Geigy Pharmaceuticals 264 NLRB 1013 1018 (1982) enfd 722 F 2d 1120 (3d Cir 1983) (announce ment of new working conditions to employees constitutes implementation of policy) The judge dismissed the 8(a)(5) complaint allegation pertaining to the Respondents bargaining conduct in July 1985 In the absence of excep tions we adopt this dismissal 293 NLRB No 51 HOWARD ELECTRICAL & MECHANICAL proposals in both units on July 1, 1984 With re- spect to this allegation, the General Counsel con tends, inter alia, that the Unions were not afforded an opportunity to bargain over the June proposals before their implementation The judge dismissed the allegations pertaining to the December proposals on the ground that, under Machinists Local 1424 (Bryan Mfg) v NLRB, 362 U S 411 (1960),3 these allegations were barred by the limitations penod in Section 10(b) of the Act 4 He concluded that they were based on pre-10(b) conduct that would constitute an unfair labor prac- tice The judge also dismissed the allegations per- taining to the June proposals because he found that, prior to implementation, the Unions had merely rejected these proposals in their entirety and had not specifically opposed the Respondent's interjection of the alleged nonmandatory issues Given this context, the judge found that the June proposals were implemented after the Respondent had bargained with the Unions to a valid impasse For the reasons set forth below, we reverse the judge and find, based on the stipulated record, that the Respondent violated Section 8(a)(5) and (1) by unilaterally implementing its December and June proposals The Respondent is engaged in the building and construction industry as an electrical and mechani- cal contractor in the Denver, Colorado area In separate bargaining units, the Plumbers and the Pipefitters represent the journeymen and apprentice plumbers, gas fitters, pipefitters, and various fore- men employed by he Respondent 5 The Unions' 3 In Bryan supra the parties executed a collective bargaining agree ment in August 1954 The agreement contained a recognition provision and a union security provision At the time of execution the union did not represent a majority of the employers employees In June and August 1955 10 and 12 months later charges were filed alleging that the maintenance and enforcement of the agreement violated the Act The Court concluded that Sec 10(b) barred the allegations More precisely the Court held that these charges were untimely because the conduct oc curnng within the limitations period could be an unfair labor practice only through reliance on an earlier unfair labor practice that was itself time barred because it was based entirely on events occurring outside the 10(b) period 4 Sec 10(b) of the Act provides in pertinent part that no complaint shall issue based upon any unfair labor practice occurring more than six months prior to the filing of the charge with the Board b The parties stipulated that at all times material the Unions have been and are the exclusive representatives of their respective units under Sec 9(a) of the Act Although this stipulation was entered into prior to the issuance of our decision in John Deklewa & Sons 282 NLRB 1375 (1987) and therefore may simply have reflected the Respondents concession that it would be deemed to have a 9 (a) relationship under the issuance of Deklewa we nonetheless reject the Respondents attempt to rely on Deklewa here because it is untimely This claim was not raised to the judge whose decision was issued more than a month after the decision in Deklewa nor was it raised in the Respondents exceptions to the Board filed on May 26 1987 For the purposes of this case the Respondent and the Unions have a 9(a) bargaining relationship Member Johansen agrees that the reason for the stipulation is irrelevant and that the attempt to raise the nature of the bargaining relationship is untimely 473 most recent collective-bargaining agreements with the Respondent expired on May 31, 1983 The Respondent and the Unions began separate, but parallel negotiations for successor agreements in 1983 Prior to December 1983, the Respondent met with the Plumbers on March 23, April 27, May 19 and 31, and July 6 and with the Pipefitters on March 22, April 15 and 27, May 19, June 1 and 28, July 20, September 16, and November 17 As reflected by the minutes for the pre-Decem- ber bargaining sessions, the Respondent offered the Unions several proposals on different subjects, in- cluding proposals changing the contractual recog- nition clauses Both contractual recognition clauses included the following classifications journeyman plumbers and gas fitters, apprentice plumbers and gas fitters, area plumber foremen, general plumber foremen, plumber foremen, journeymen pipefitters, apprentice pipefitters, area pipefitter foremen, gen eral pipefitter foremen, and pipefitter foremen The Pipefitters contractual recognition clause also in cluded the classification of "provisional appren- tices " At the pre-December bargaining sessions with the Plumbers, the Respondent proposed that the Plumbers unit be described in the successor contract as all full time and regular part time employees employed by the Employer performing plumb- ing work in the plumbing industry within the jurisdiction of Local 3 as it exists at the time of the execution of this agreement At the pre-December bargaining sessions held with the Pipefitters, the Respondent similarly proposed that the Pipefitters unit be described in the succes- sor contract as all full time and regular part time employees employed by the Employer performing pipe fitting work in the pipe fitting industry within the jurisdiction of Local Union 208 as it exists at the time of execution of this agreement These minutes reveal in general terms that the Respondent's recognition clause proposals were re- viewed and discussed with both Unions during the pre December bargaining sessions At the July 6 bargaining session, the Plumbers, through a letter from its attorney, objected to the Respondent's proposed unit modification The Plumbers' objec- tion was that temporary part-time employees and any additional future jurisdictional territory of the Union were excluded by the Respondent's propos al With respect to the Pipefitters' negotiations, the record does not disclose what the discussions were concerning the Respondent's proposed unit modifi- cation 474 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD At the bargaining sessions held on December 29, 1983, with the Plumbers and on December 30, 1983, with the Pipefitters, the Respondent submit- ted several new proposals The Respondent pro posed, inter alia, that certain plumbers and pipefit ters be classified as pre-apprentices and be excluded from both units 6 The Respondent's proposals de- fined "pre-apprentices" as employees who "shall be primarily used for performing work which does not require all the skills of a journeyman" and "may be assigned to perform work for which they are qualified, under the direction of a journeyman " The Respondent also proposed the exclusion of pre apprentices from the coverage of the union se curity and hiring hall provisions of the contracts, a minimum hourly wage rate for pre apprentices lower than what it proposed for unit employees, and no contract fringe benefits, except profit shar ing participation and major medical insurance plan coverage, for pre-apprentices The Respondent characterized its December pro- posals as a "final" or "last" offer At the December 29 bargaining session with the Plumbers, the Re- spondent said that it "intended to implement its final offer effective January 1, 1984 " At the De- cember 30 session, the Pipefitters said that the Re- spondent's offer would be submitted to the Union's membership The record does not otherwise dis close what transpired at these bargaining sessions 7 Shortly thereafter, the Respondent's December proposals for both Unions were rejected The Respondent and the Pipefitters continued their negotiations in January 1984 On January 11, 1984, the Pipefitters requested further negotiations On January 16, 1984, the Respondent agreed to meet if the Pipefitters submitted a written proposal "substantially better than the last proposal on the table On January 20, 1984, the Pipefitters submit- ted a written contract proposal, which did not in dude the Respondent's December pre apprentice proposals In its letter of January 26, 1984, the Re- spondent rejected the Pipefitter's counteroffer, 6In this connection the Respondent proposed that it recognize the Plumbers as the sole and exclusive bargaining representative for and on behalf of all full time and regular part time employees and temporary part time employees except pre apprentices and supervisors employed by the Employer performing plumbing work in the plumbing industry within the jurisdiction of Local Union 3 as it exists at the time of execution of this agreement The Respondent proposed that it recognize the Pipefitters as the sole and exclusive bargaining representative for and on behalf of all full time regular part time employees and temporary part time employees except pre apprentices and supervisors employed by the Employer performing pipe fitting work in the pipe fitting industry The record does not demonstrate whether or to what extent any of the Respondents December proposals were discussed or considered by the Respondent and the Unions at those meetings Minutes for the De cember 29 and 30 bargaining sessions were not made a part of the stipu lated record claiming that it did not contain a single concession and included numerous changes The Respondent stated that in these circumstances there was no reason to resume negotiations with the Pipefitters The Respondent also asserted that impasse existed and it would implement its last offer The Respond ent did not specify when implementation would occur Without using the Unions' hiring halls, the Re spondent hired its first pre-apprentice plumber on May 17, 1984, and its first pre-apprentice pipefitter on April 30, 1984 During their employment, both pre-apprentices were assigned unit work, but were treated as nonunit employees and did not receive unit wages or all the unit fringe benefits s The next communication with either Union was the Respondent's contract proposals of June 19, 1984 The Respondent's June proposals differed from its December 1983 proposals in that, inter alia, the June proposals excluded apprentices from the bargaining unit and the hiring hall contractual requirement, omitted the union-security clause for all unit employees, and eliminated the Respondent's obligation to contribute to the apprentice and jour- neymen training fund for all unit employees 9 The Respondent informed the Unions that its June pro- posals "must be accepted in total, prior to July 1, 1984" On June 27, 1984, the Plumbers notified the Re spondent that it had rejected the June proposals, but offered to meet in the future to discuss a con- tract The Plumbers' request was not honored and negotiations on the June proposals were not held On July 3, 1984, the Pipefitters notified the Re- spondent that it had rejected the June proposals and indicated that it was willing to continue nego tiations After receiving the Unions' notices, the Respondent thereafter implemented the June pro- posals for both units With regard to the implementation of the Re spondent's December and June proposals, the judge determined that the limitations period for the unilateral changes occurring on April 30 and May 17, 1984, was triggered not by their implementation dates, but by the Respondent's earlier announced intent to implement its December proposals and by a purported "unprivileged and invalid" impasse 8 Thereafter the Respondent hired other plumbers and pipefitters who were classified as pre apprentices and were similarly treated as nonumt employees 8 In particular the June proposals included a clause recognizing each Union as the sole and exclusive bargaining representative for and on behalf of all full time regular part time employees and temporary part time employees except apprentices pre apprentices and supervisors em ployed by the Employer and performing plumbing work at the jobsite in the plumbing industry for the Plumbers unit and performing pipe fit ting work at the jobsite in the pipe fitting industry for the Pipefitters unit HOWARD ELECTRICAL & MECHANICAL reached on December 29 and 30, 1983 The judge additionally based his conclusion that the complaint was time barred on his interpretation of the com- plaint allegations as requiring a finding that the im- passe that occurred in December, outside the 10(b) period, was unlawful The judge thus concluded that the finding of a violation would run afoul of the dictates of Bryan, supra We find that the judge's analysis rests on at least two erroneous premises First, the judge erroneously assumed that a de- termination of whether a valid impasse occurred is essential to a determination of whether implementa- tion of the Respondent's December proposals vio- lated the Act As we explain below, however, when a party unilaterally changes the scope of the unit, it is irrelevant whether impasse has been reached The only question is whether the other party has consented to the change Thus, we need not scrutinize the December events for evidence of impasse to determine that the Respondent violated the Act when it unilaterally implemented the pro- posals in April and May Second, the judge erroneously dated the actual implementation from the Respondent's announce- ment of an intent to implement Notice of an intent to commit an unlawful unilateral implementation, however, does not trigger the 10(b) period with re spect to the unlawful act itself American Distribut- ing Co v NLRB, 715 F 2d 446, 452 (9th Cir 1983), enfg 264 NLRB 1413 (1982) 10 The judge ac- knowledged that the first indication that the Re spondent was implementing terms of its December proposals came when the Respondent began the hiring of pre apprentices in April and May In fact, had other terms which the Respondent proposed in December been implemented, such as the manner in which benefit contributions were made the Unions might have been on notice that the imple- mentation had occurred Accordingly, we find that the actionable, alleged unfair labor practice oc curred here when the pre apprentice proposals were implemented in April and May and that the 10(b) period did not start running until that time 11 10 Thus even if the existence of a prior valid impasse were relevant to a determination of the unilateral implementation violation involved here the 10(b) period for the implementation allegation would start running at the time the unilateral changes were implemented rather than from the date of the alleged impasse Of course it is arguable that the Respondent violated Sec 8(a)(5) in January 1984 when it refused to engage in further bargaining with the Pipefitters unless the latter consented to changes in unit scope But that violation (conditioning further bargaining on concessions as to nonman datory subjects) would be entirely independent of the later implementa tion which as we find below was unlawful because it was done without the Unions consent Notice of one type of violation would not start the 10(b) period running as to the other i i See American Distributing Co supra Swift Independent Corp supra at fn I1 and Teamsters Local 42 (Daly Co) v NLRB 825 F 2d 608 615 475 Accordingly, we turn our attention to the merits of the case 12 With its pre apprentice proposals, the Respondent was, in effect, attempting to gain the Unions' permission to create a new classifica- tion of workers who would perform traditional bargaining unit work, but would be specifically ex- cluded from the unit While the record does not in- dicate the substance or length of the parties' De- cember discussions concerning the pre apprentice concept, it is undisputed that the Unions did not agree to this concept The Plumbers, aside from rejecting the pre-ap prentice proposals as part of a final offer package after the December sessions, took the position that, starting with the July 6, 1983 session, it wanted to continue to represent all employees performing plumbing work for the Respondent Similarly, the Pipefitters' counteroffer of January 1984 does not indicate that it is final and also suggests that the Pipefitters did not want the pre apprentice propos- als The Pipefitters' counteroffer, submitted at a time when the Respondent was looking for a "sub- stantially better" offer from that Union, did not in elude the Respondent's pre apprentice proposals As noted above, the crucial question in the case is whether the Unions consented to the proposed changes in the scope of the unit, changes over which, because of their nonmandatory nature, the Unions were not even required to bargain In these circumstances, we find that the Respondent unlaw fully implemented its December pre-apprentice proposals because they concerned subjects which the Unions were not required to bargain about and the implementation was done without the consent of the Unions 13 We also reverse the judge's findings with respect to the complaint allegations relating to the imple- mentation of the Respondent's June package pro- posals On receipt of the June proposals, which dif- fered from the Respondent's December package proposals, the Unions notified the Respondent that (1st Cir 1987) The Respondent relies inter alia on Postal Service Marina Center 271 NLRB 397 (1984) We note however that in that case which involved a discriminatory discharge the Board expressly stated that it was not considering what implication if any the holding there would have in other contexts Id at 401 12 The General Counsel by raising the question of whether a valid im passe existed here seemingly implies that the Respondent would have es caped liability by the existence of a valid impasse Although the record does not demonstrate either that the parties were deadlocked on the pre apprentice proposals which modified the existing units or that the Re spondent had insisted on these proposals (a subject the Unions were not required to bargain about) as a precondition to reaching successor con tracts a focus on impasse is misplaced here Given the character of the pre apprentice proposals the Respondent would not escape liability by the existence of an impasse Rather as found infra the Respondent vio lated the Act because it implemented its unit scope proposals without the consent of the Unions is See e g Boise Cascade Corp 283 NLRB 462 (1987) enfd 860 F 2d 471 (D C Cir 1988) 476 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD they were willing to continue negotiations The Respondent ignored the Unions' requests and de- clared an impasse prior to any further negotiations This demonstrates that the Respondent had a fixed determination to implement its June package pro- posals regardless of the status of its negotiations with the Unions and without the Unions' consent Accordingly, we find that the implementation of the Respondent's June package proposals violated Section 8(a)(5) and (1) See Excavation-Construc- tion Inc, 248 NLRB 649 (1980) CONCLUSIONS OF LAW 1 By refusing to bargain in good faith with Plumbers Local Union No 3 and Pipefitters Local Union No 208 as the exclusive bargaining repre sentatives of the employees in the contractual bar- gaining units when it unilaterally implemented its December 1983 and June 1984 contract proposals, thereby changing the wages, benefits, and other terms and conditions of employment for bargaining unit employees, the Respondent violated Section 8(a)(5) and (1) of the Act 2 The above unfair labor practices affect com- merce within the meaning of Section 2(6) and (7) of the Act REMEDY Having found that the Respondent has engaged in and is engaging in certain unfair labor practices, we shall order that it cease and desist and take cer tarn affirmative action designed to effectuate the policies of the Act Specifically, we shall order that, on request, the Respondent bargain with the Unions and, if an un- derstanding is reached, to embody the understand- ing in a signed agreement We shall also order that, on request, the Respondent restore the status quo and rescind the unilateral changes made in the re- spective units commencing April 30 and May 17, 1984, and make all affected employees whole for losses they incurred by virtue of its unilateral changes from April 30 and May 17, 1984, until it negotiates in good faith with the Unions to agree ment or to a valid impasse If the Unions elect to have previous conditions restored, calculations of the sums and payments necessary to make employ ees whole, with interest, shall be computed in ac- cordance with normal Board policy See Ogle Pro- tection Service, 183 NLRB 682 (1970), New Horizons for the Retarded,14 283 NLRB 1173 (1987), 1* Interest on or after January 1 1987 shall be computed at the short term Federal rate for the underpayment of taxes as set out in the 1986 amendment to 26 US C § 6621 Interest on amounts accrued prior to January 1 1987 (the effective date of the 1986 amendment to 26 U S C § 6621) shall be computed in accordance with Florida Steel Corp 231 NLRB 651 (1977) Merryweather Optical Co, 240 NLRB 1213, 1216 fn 7 (1979) ORDER The National Labor Relations Board orders that the Respondent, Howard Electrical and Mechani cal, Inc, Denver, Colorado, its officers, agents, successors, and assigns, shall 1 Cease and desist from (a) Refusing to bargain in good faith with Plumbers Local Union No 3 and Pipefitters Local Union No 208 as the exclusive bargaining repre- sentatives of the employees in the bargaining units described below as Unit A and Unit B by unilater ally implementing its December 1983 and June 1984 contract proposals that changed the wages, benefits, and other terms and conditions of employ- ment for bargaining unit employees (b) In any like or related manner interfering with, restraining, or coercing employees in the ex- ercise of the rights guaranteed them by Section 7 of the Act 2 Take the following affirmative action neces sary to effectuate the policies of the Act (a) On request, bargain with Plumbers Local Union No 3 as the exclusive representative of the employees in the following appropriate unit con- cerning terms and conditions of employment and, if an understanding is reached, embody the under- standing in a signed agreement Unit A All journeymen plumbers and gas fitters, ap- prentice plumbers and gas fitters, area plumber foremen, general plumber foremen, plumber foremen journeymen pipefitters apprentice pipefitters, area pipefitter foremen, general pipefitter foremen, and pipefitter foremen who are employed by the Respondent, excluding all other employees, office clerical employees, guards and supervisors as defined in the Act (b) On request, bargain with Pipefitters Local Union No 208 as the exclusive representative of the employees in the following appropriate unit concerning terms and conditions of employment and, if an understanding is reached, embody the understanding in a signed agreement Unit B All journeymen plumbers and gas fitters, ap- prentice plumbers and gas fitters, area plumber foremen, general plumber foremen, plumber foremen, journeymen pipefitters, apprentice pipefitters, area pipefitter foremen, general pipefitter foremen, pipefitter foremen, and pro visional apprentices employed by the Respond- HOWARD ELECTRICAL & MECHANICAL 477 ent, excluding all other employees, office cleri cal employees, guards and supervisors as de fined by the Act (c) On request of the Unions, rescind the unilat eral changes in the unit employees' wages, benefits, and other terms and conditions of employment that were made commencing April 30, 1984, in Unit B and May 17, 1984, in Unit A and make all those employees whole, with interest, for losses they in- curred by virtue of its unilateral changes to their wages, benefits, and other terms and conditions of employment from April 30 and May 17, 1984, re- spectively, until it negotiates in good faith with the Unions to agreement or to a valid impasse in the manner set forth in the remedy section of this deci- sion (d) Preserve and, on request, make available to the Board or its agents for examination and copy- ing, all payroll records, social security payment records, timecards, personnel records and reports, and all other records necessary to analyze the amount of backpay due under the terms of this Order (e) Post at its Denver, Colorado office copies of the attached notice marked "Appendix "15 Copies of the notice, on forms provided by the Regional Director for Region 27, after being signed by the Respondent's authorized representative, shall be posted by the Respondent immediately upon re- ceipt and maintained for 60 consecutive days in conspicuous places including all places where no- tices to employees are customarily posted Reason- able steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material (f) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Respondent has taken to comply 's 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 FMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post and abide by this notice WE WILL NOT refuse to bargain in good faith with Plumbers Local Union No 3 and Pipefitters Local Union No 208 as the exclusive bargaining representatives of the employees in the bargaining units described below as Unit A and Unit B, re spectively, by unilaterally implementing our De cember 1983 and June 1984 contract proposals, that changed the wages, benefits, and other terms and conditions of employment for bargaining unit em ployees WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exer cise of the rights guaranteed you by Section 7 of the Act WE WILL, on request, bargain with Plumbers Local Union No 3 as the exclusive representative of the employees in the following appropriate unit concerning terms and conditions of employment and, if an understanding is reached, embody the understanding in a signed agreement Unit A All journeymen plumbers and gas fitters, ap- prentice plumbers and gas fitters, area plumber foremen, general plumber foremen, plumber foremen, journeymen pipefitters, apprentice pipefitters, area pipefitter foremen, general pipefitter foremen, and pipefitter foremen who are employed by the Employer, excluding all other employees, office clerical employees, guards and supervisors as defined in the Act WE WILL, on request, bargain with Pipefitters Local Union No 208 as the exclusive representa- tive of the employees in the following appropriate unit concerning terms and conditions of employ ment and, if an understanding is reached, embody the understanding in a signed agreement Unit B All journeymen plumbers and gas fitters, ap- prentice plumbers and gas fitters, area plumber foremen, general plumber foremen, plumber foremen, journeymen pipefitters, apprentice pipefitters, area pipefitter foremen, general pipefitter foremen, pipefitter foremen, and pro- visional apprentices employed by the Employ- er, excluding all other employees, office clen- cal employees, guards and supervisors as de- fined by the Act WE WILL, on request of the Unions, rescind the unilateral changes in the unit employees' wages, benefits, and other terms and conditions of employ ment that were made on or after April 30, 1984, in Unit B and May 17, 1984, in Unit A and WE WILL make all those employees whole, with interest, for losses they incurred by virtue of our unilateral 478 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD changes to their wages, benefits, and other terms and conditions of employment from April 30 and May 17, 1984, respectively, until we negotiate in good faith with the Unions to agreement or to a valid impasse HOWARD ELECTRICAL AND MECHAN- ICAL, INC Barbara E Young, for the General Counsel James P Hendricks (Kapland Jacobowitz Byrnes Roster & Hendricks), for the Respondent James C Fattor (Hornbein MacDonald & Fattor), for the Charging Parties DECISION STATEMENT OF THE CASE JERROLD H SHAPIRO, Administrative Law Judge This proceeding, in which a hearing was held January 21, 1987, is based on the following Charges filed in Cases 27-CA-8889 and 27-CA-8889-2 by Plumbers Local Union No 3 against Howard Electrical and Me chanical, Inc (Respondent) on July 23 and August 28, 1984, respectively, a charge filed in Case 27-CA-8924 and an amended charge filed in that case by Pipefitters Local Union No 208 against Respondent on August 22, 1984, and August 25, 1984 respectively a second amend ed complaint issued in these cases November 26, 1986 on behalf of the General Counsel of the National Labor Relations Board (Board) by the Board s Regional Direc tor for Region 27 alleging Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(1) and (5) of the National Labor Relations Act (Act) the Regional Directors November 26, 1986 order setting aside and vacating the settlement agreements en tered into in these cases by the parties which had been approved on October 17 1984, by the Regional Director and Respondents answer to the second amended com plaint denying the commission of the alleged unfair labor practices 1 On the entire record2 and having considered the par ties posthearing briefs,3 I make the following ' In its answer Respondent admits it is an employer engaged in com merce within the meaning of Sec 2 (6) and (7) of the Act and meets the Board s applicable discretionary jurisdictional standard Also in its answer Respondent admits that the Charging Parties Plumbers Local Union No 3 and Pipefitters Local Union No 208 each are labor orgam zations within the meaning of Sec 2(5) of the Act 2 The record consists of the formal papers the parties stipulation of facts as amended at the hearing the parties supplemental joint stipulation of facts the parties oral arguments and their postheanng briefs 3 Respondents motion to strike certain parts of the briefs filed by the General Counsel and the Charging Parties on the ground that they raise legal issues outside the scope of the issues they indicated were in ques tion during the on the record colloquy with the Administrative Law Judge is denied I have considered all the arguments raised by the par ties which are encompassed by the allegations of the second amended complaint FINDINGS OF FACT I THE ALLEGED UNFAIR LABOR PRACTICES A The Facts 1 The setting Respondent, a corporation with its principal office and place of business in Denver, Colorado, is an electrical and mechanical contractor in the building and construc tion industry The Charging Parties, Plumbers Local Union No 3 (Local 3) and Pipefitters Local Union No 208 (Local 208), who are affiliated with the United Asso ciation of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada, AFL-CIO represent separate appropriate bargaining units of Respondents employees Local 3, at all times material, has been and is the exclusive collective bargain ing representative of the following appropriate unit of Respondent s employees All journeymen, plumbers and gas fitters, apprentice plumbers and gas fitters, area plumber foremen, general plumber foremen, plumber foremen, jour neymen pipefitters, apprentice pipefitters, area pipe fitter foremen, general pipefitter foremen, and pipe fitting foremen who are employed by the Employ er, excluding all other employees, office clerical em ployees guards and supervisors as defined by the Act Local 208 at all times material has been and is the exclu sive collective bargaining representative of the following appropriate unit of Respondents employees All journeymen plumbers and gas fitters, apprentice plumbers and gas fitters, area plumber foremen, general plumber foremen plumber foremen, jour neymen pipefitters, apprentice pipefitters, area pipe fitter foremen general pipefitter foremen pipefitter foremen and provisional apprentices employed by the Employer, excluding all other employees, office clerical employees guards and supervisors as de fined by the Act The Charging Parties and Respondent have been par ties to a series of successive collective bargaining con tracts The most recent was effective May 1, 1981, through May 31, 1983 (the 1981-1983 contract) This contract is between the Charging Parties and the Con tract Administration Fund of Northeastern Colorado (the Association) on behalf of those employees including Re spondent for whom the Association was authorized to bargain The recognition clause in the 1981-1983 con tract reads as follows The Employers recognize the Unions as the sole and exclusive bargaining representatives, as certified by the National Labor Relations Board, Cases No 30-RC-701 dated July 30 1952 and 30-RC-710 dated July 29 1952, for all journeymen plumbers and gas fitters apprentice plumbers and gas fitters, area plumber foremen, general plumber foremen HOWARD ELECTRICAL & MECHANICAL plumber foremen, journeymen pipefitters, appren tice pipefitters, area pipefitter foremen, general pipefitter foremen, pipefitter foremen who are em ployed by any Employer who is a party to this Agreement or has accepted its provisions Prior to the expiration date of the 1981-1983 contract the Charging Parties and Respondent gave timely notice they intended to open the about to expire contract and engage in collective bargaining for a new contract Re spondent also gave timely notice to the Charging Parties it was withdrawing the Associations authority to repre sent it for purposes of collective bargaining and it intend ed to negotiate with the Charging Parties on an individ ual basis 2 The March 23-December 29, 1983 negotiations between Respondent and Local 3 and the December 22, 1983-January 6 1984 negotiations between Respondent and Local 208 Commencing March 23, 1983, negotiators for Re spondent and Local 3 met to negotiate a collective bar gaining contract to succeed the 1981-1983 contract to cover Respondents employees represented by Local 3 During 1983 the parties held six collective bargaining sessions March 23, April 27, May 19 and 31 July 6 and December 29 During this period Respondent offered a series of proposed contracts that modified the 1981-1983 contract in many significant respects There was no evi dence of Local 3 offering a proposed contract As of the July 6, 1983 bargaining session Respondent was proposing a contract effective from the date of its execution to May 31, 1984 Some of its relevant provi sions follow The "recognition clause provides for Respondent to recognize Local 3 as the representative of all full time and regular part time employees employed by [Respond ent] performing plumbing work in the plumbing industry within the jurisdiction of Local 3 " The `hiring of em ployees" provision gives Local 3 the opportunity to refer all journeymen and apprentice applicants for employ ment, with Respondent having the right to reject any of the referrals and to hire from other sources if Local 3 failed to fill Respondents request for applicants after a certain period of time, and further provides that helpers will not be selected or referred out by Local 3 The wage provision gives Respondent the power to unilater ally increase the employees minimum hourly rates of pay, and to establish minimum gross hourly rates for three classifications journeymen apprentices,' and helpers The minimum gross hourly rates" include Respondent's contributions on behalf of the employees to the several contract benefit funds such as health and wel fare, pension, and vacations 4 * The health and welfare pension and vacation benefit provisions in the July 6 1983 contract offer obligate Respondent to deduct from the employees gross hourly rate of pay the amounts agreed to by Local 3 and Respondent for distribution to the several contract employee benefit funds 479 Effective June 1, 1983, the minimum gross hourly rate of pay set for journeymen plumbers by the July 6 pro posal was $21 20 and $8 55 for apprentices just starting their apprenticeship 8 Effective December 31, 1983, the minimum gross hourly rate of pay for journeymen plumbers was $21 70 and $8 72 for apprentices just start ing their apprenticeship Effective June 1, 1983, the mini mum gross hourly rate of pay for employees classified as helpers was $5 44 Regarding the helpers, the wage pro posal provides that `the ratio of helpers shall be two helpers to each plumber, and there shall be no restriction on the work assignments designated by the Employer " The aforesaid wage and fringe benefit package for journeymen and apprentices contained in Respondent s July 6, 1983 contract proposal which was effective June 1 1983, is the same as the wage and benefit package called for under the terms of the 1981-1983 contract when it expired May 31, 1983 6 During the July 6, 1983 bargaining session Local 3 s negotiators wrote a letter prepared by their attorney which was critical of virtually all the provisions con tained in Respondent's July 6, 1983 contract proposal 7 It was at the July 6 session that Respondent submitted a new bargaining proposal, the above described July 6 contract proposal, which in all significant respects was no different from the May 31 contract proposal The July 6 session ended with the parties agreeing to hold an other bargaining session after Local 3 reviewed Re spondent's July 6 contract proposal It was not until De cember 29, 1983, however, that the next bargaining ses sion was held It was called by Respondent On December 29, 1983 during the bargaining session held that day, Respondent submitted a new contract pro posal Respondent's negotiators characterized this pro posal as Respondent's final offer and told Local 3 s ne gotiators Respondent intended to implement its final offer effective January 1, 1984 " The next time the parties communicated with one an other concerning contract negotiations was June 19, 1984, when, as described in detail infra, Respondent sub mitted a new contract proposal to Local 3 Commencing on March 22 1983, negotiators for Re spondent and Local 208 met to negotiate a collective bargaining contract to succeed the 1981-1983 contract to cover Respondents employees represented by Local 208 During 1983 the parties held 10 collective bargaining ses sions March 22, April 15 and 27, May 19 June 1 and 28 July 20, September 16 November 17, and December 30 During the first bargaining session held on March 22, 1983 Respondent submitted a proposed collective bar gaining contract to succeed the 1981-1983 contract This proposal contained many provisions which in significant 5 Under the terms of the 1981 - 1983 contract and under the terms of each of the contract proposals involved in this case apprentices are paid a certain percentage of the contract hourly rate of pay for journeymen which percentage is increased every 6 months during the apprentices employment until they finish their term of apprenticeship 6 The 1981-1983 contract however did not have a helper classifica tion just journeymen and apprentice classifications r The criticism did not extend to the wage and fringe benefit proposals because Local 3 apparently did not submit those parts of the proposal to its attorney for review 480 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD respects differed from the 1981-1983 contracts prove sions The proposal was effective from date of execution to May 31, 1984 The provisions of the March 22, 1983 contract proposal dealing with recognition, hiring of em ployees, wages and benefits, in pertinent in part, read as follows Respondent proposed in the contract recognition clause to recognize Local 208 as the collective bargain ing representative of all fuil time and regular part time employees employed by the Employer performing pipe fitting work in the p pefittmg industry The hiring of employees provision gave Local 208 the opportunity to refer all covered employees, with Respondent having the unqualified right to reject any referrals and the right to hire from other sources if, after a certain period of time, Local 208 did not fill Respondents request for ap plicants, and further provides that apprentices trainees and helpers will not be selected or referred out by Local 208 The Employer will make selections and these names will be transmitted to Local Union No 208 ' The wage provisions of the proposal establish minimum wages for the covered employees, granting Respondent the authority to unilaterally increase those minimum wages and grant incentive increases based on employees productivity and performance, and sets out 84 classifica tions for pipefitters (classifications 16 through 100 ) whose minimum hourly rates of pay range from $4 (clas sification 16') to $25 (classification 100 ), and further provides Respondent could unilaterally designate which of the 84 classifications the pipefitters would be assigned to The proposed benefit provision provided for Re spondent to deduct from employees earnings an amount agreed to by the parties for distribution to the employee contract benefit funds such as health and welfare pen sion, and vacation During the period of negotiations from March 22-No vember 17, 1983, the parties discussed in detail Respond ent s March 22 1983 contract proposal It was apparent ly revised by Respondent more than once, in ways not revealed in the record during this series of negotiation sessions Local 208 did not counter with a contract pro posal of its own and on at least one or two occasions Local 208 s membership rejected Respondent s contract proposals This was the state of the negotiations when the parties met December 30 for the 10th negotiation ses sion On December 30, during the negotiation session, Re spondent submitted a new contract offer which it charac terized as its last offer Local 208 s negotiators told Respondents negotiators that the offer would be submit ted to the Union s membership On January 3, 1984 Local 208 notified Respondent that the negotiation committee of pipefitters Local Union 208 has not approved or accepted [Respondent s] latest contract proposal but will submit the proposal to [Local 208 s] membership for their consideration at a meeting on January 10 1984 ' Thereafter on January 11 1984 Local 208 notified Respondent that its membership unanimously rejected Respondents latest contract pro posal at a January 10, 1984 special meeting and that Local 208 was willing to continue negotiations at your earliest convenience Respondent replied by telegram dated January 16 1984 in which it stated Please be informed that the unaerstanding that we reached at the table on December 30, 1983 was our last offer We are willing to meet with you if you submit to us in writing a proposal that is substantial ly better than the proposal we agreed upon at the table Absence [sic] our receiving a new written proposal from you by January 22, 1984 we will im plement the understanding reached at the table on January 23 1984 On January 20, 1984, Local 208 hand delivered a con tract proposal to Respondent There were no collective bargaining sessions held between the parties concerning Local 208 s proposal There is no evidence the parties discussed this proposal On January 26, 1984, by letter, Respondent informed Local 208 it had reviewed Local 208 s January 20 1984 contract proposal and discovered it did not contain a single concession and that there were numerous changes made in the agreement reached by the parties on Decem ber 30, including a significant economic increase 8 The letter ended In the light of the above we see no reason to resume negotitions [sic] Since our last offer was re jetted by the membership we are, of course, at im passe and will implement our last offer The next time the parties communicated with one an other concerning contract negotiations was June 19, 1984 when as described in detail, infra Respondent sub mitted a new contract proposal to Local 208 a Respondent s December 29 1983 contract proposal and Respondent's December 30 1983 contract proposal The duration of Respondents December 29, 1983 con tract proposal for the unit represented by Local 3 and the duration of its December 30, 1983 contract proposal for the unit represented by Local 208 was from the date of their execution until May 31 1984 Each proposal is identical in all significant respects The proposals which for the sake of convenience will be collectively referred to as Respondents December 1983 contract proposal differ in several significant repects from Respondent s last contract proposals its March 22 1983 proposal for the unit represented by Local 208 and its July 6 1983 proposal for the unit represented by Local 3 The contract recognition clause in Respondents previ ous contract proposals included within the contract bar gaining unit all employees who performed plumbing work in the plumbing industry within Local 3 s jurisdic tion and all employees who perform pipefitting work in the pipefitting industry w ithin Local 208 s jurisdiction 8 There is no evidence of an understanding or agreement between Local 208 and Respondent during the December 30 1983 negotiation ses sion as claimed by Respondent in its above described January 16 1984 telegram and January 26 1984 letter HOWARD ELECTRICAL & MECHANICAL 481 whereas the December 1983 contract proposals recogni tion clause specifically excludes plumbers and pipefitters classified as pre apprentices from the bargaining unit Consistent with the exclusion of pre apprentices from the unit in the contract recognition provision the union security and hiring hall provisions of the December 1983 contract proposal also specifically exclude pre appren tices from their coverage The December 1983 contract proposal describes the plumbers and pipefitters classified as pre apprentices in these terms Pre apprentices shall be primarily used for perform mg work which does not require all the skills of a journeyman However, pre apprentices may be as signed to perform work for which they are quali feed under the direction of a journeyman The ratio of pre apprentices shall be at the direction of the employer There shall be no restriction on the work assignments designated by the employer The December 1983 contract proposal, unlike Re spondent s previous contract proposals, divides the em ployees into two separate categories for purposes of wages and employee benefits, current employees, new hires, and recalled employees The December 1983 contract proposals wage and ben efit package9 for the pipefitters and plumbers classified as journeymen and apprentices who were currently em ployed was less than had been provided for under the wage and benefit package in Respondents March 22 1983 and July 6, 1983 contract proposals and was less than what was being paid to the Respondents journey men and apprentice pipefitters and plumbers under the terms of the 1981-1983 contract Regarding new hires or recalled employees classified as journeymen and apprentices, the December 1983 con tract proposal provides for the same amount of employee benefit contributions as for current employees employed in those classifications but provides for an hourly rate of pay of $10 for journeymen, which is substantially less than the rate called for in the 1981-1983 contract for journeymen and at least $6 71 an hour less than the hourly rate called for in Respondents March 22 1983 and July 6 1983 contract proposals for journeymen Be cause apprentices are paid a percentage of a journey man s hourly rate of pay the hourly rate for newly hired or recalled apprentices in the December 1983 contract proposal was reduced by the same percentage as the journeymen s Regarding the new classification of employees desig nated as pre apprentices ' the December 1983 contract proposal provides that plumbers and pipefitters employed in this classification be paid a minimum hourly rate of $5 if currently employed and a minimum hourly rate of $4 if they are new hires or recalled workers It also pro vides that, unlike the journeymen and apprentices the pre apprentices are ineligible to receive the contract e As did Respondents March 22 1983 and July 6 1983 contract pro posals the December 1983 contract proposal gave Respondent the right to unilaterally raise the employees contract minimum hourly rates of pay fringe benefits, but are eligible to participate in Respond ent s profit sharing and major medical insurance plans Lastly, the December 1983 contract proposal contains a non severability provision which in substance pro vides that the parties understood that the December 1983 contract proposal is called a package agreement and that no provision is severable that is each provision herein is in consideration for the entire Agreement and to benefit from any provision a party must assume the benefits and obligations of the entire Agreement b Local 208 s January 20 1984 contract proposal Local 208 s January 20, 1984 contract proposal is of fective by its terms from the date of execution until May 31 1985 rather than May 31, 1984, as provided for by Respondents December 1983 contract proposal The recognition clause in Local 208 s proposal in cludes all employees who performed pipefitting work in the pipefitting industry within the jurisdiction of Local 208 Respondents contributions on behalf of the journey men and apprentices to the several contract benefit funds were the same through May 31, 1984 under Local 208 s proposal as under Respondents proposal but effective June 1, 1984 Local 208 s proposal calls for an increase of $1 50 an hour to be divided among wages and fringes Regarding wages, Local 208 s proposal does not, as did Respondent s divide the journeymen and apprentices into presently employed employees and new hires Local 208 proposed that journeymen and apprentices be paid $1 30 an hour more than Respondent had proposed and also proposed that effective June 1, 1984 they be grant ed an increase of $1 50 an hour to be broken down be tween wages and fringes In its January 20 1984 proposal Local 208 also includ ed an agreement dealing with the creation of a new clas sification of workers, known as special journeyman This agreement provided Special journeyman shall be primarily used for performing work which does not require all of the skills of a journeyman However the special jour neyman may be assigned to perform any work for which he is qualified under the direction of a jour neyman The ratio of special journeyman shall be two spe cial journeymen to each journeyman pipefitter not to exceed 30 percent of the total pipefitters em ployed by [Respondent] Special journeyman shall only be employed on those contracts that the total of plumbing heating air conditioning and piping contracts does not exceed two and one half million dollars Local 208 proposed that the special journeyman be paid an hourly rate of pay ranging from a minimum of $5 03 to a maximum of $10 06 It also proposed that Re spondent contribute on their behalf to the contract health insurance fund as they did for the journeymen and ap prentices but would not have to contribute on behalf of the special journeyman to the other contract benefit funds Also Local 208 proposed that the above agree 482 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD ment concerning the special journeyman remain in effect for 6 months from the date of execution and from year to year thereafter unless terminated by both parties 3 The implementation of Respondents December 29 and 30, 1983 contract proposals and Respondents employment of pre apprentices As I have found supra, during the December 29 1983 negotiations session, Respondent informed Local 3 it in tended to implement its final offer [the December 29 pro posal] effective January 1, 1984, and on January 26, 1984, informed Local 208, We are at impasse and will implement our last offer [the December 30 propos all " The evidence presented on the issue of whether Re spondent implemented either of these contract offers fol lows Respondent did not implement the terms of its Decem ber 1983 contract proposal in two respects the payments made by Respondent on behalf of its journeymen plumb ers and pipefitters to the several contract benefit funds were mailed directly to the pipe industry insurance fund (fund), whereas the December 1983 contract proposal provided the payments be mailed directly to the offices of Local 3 and Local 208 which would transmit them to the fund, and the December 1983 contract proposal omits Respondents contribution to the contract adminis tration fund, whereas Respondent continued to pay con tributions of 12 cents an hour to this fund as agreed on under the 1981-1983 contract In hiring plumbers and pipefitters Respondent did not use the Unions hiring halls It was not required howev er, under the December 1983 contract proposal to give the Unions an opportunity to refer these job applicants because as all the plumbers and pipefitters hired by Re spondent were classified as pre apprentices, all of whom were exempt from the hiring hall provisions of the December 1983 contract proposal Likewise the pre apprentices" were specifically excluded from the December 1983 contract proposal's union security provi sion thus Respondents failure to enforce the union secu rity provision as to those workers was not inconsistent with the terms of the proposal and in any event the Unions never requested Respondent to enforce the union security provision Finally the fact the Respond ent continued to permit the journeymen in its employ to take the two 10 minute break periods provided for under the terms of the 1981-1983 contract, does not conflict with the terms of the Respondents December 1983 con tract proposal because as there is nothing in that propos al which precluded its employees from taking two 10 minute breaks in addition to their lunchbreak The sole evidence showing Respondent implemented the December 1983 contract proposal is that pursuant to the terms of that proposal Respondent employed plumb ers and pipefitters who were classified as pre apprentices As a matter of fact all the plumbers and pipefitters hired by Respondent subsequent to January 1 1984, were clas sified by Respondent as pre apprentices The first plumb er pre apprentice was hired May 17, 1984 and the first pipefitter pre apprentice was hired April 30 1984 Be tween May 17, 1984 and October 7, 1985, Respondent hired 41 plumbers all of whom it classified as pre ap prentices' and between April 30, 1984, and October 25 1985 hired 24 pipefitters all of whom it classified as pre apprentices 10 Consistent with its December 1983 con tract proposal, Respondent did not contribute to the con tract benefit funds on behalf of the pre apprentices and did not pay any of them less than the proposed $4 mini mum hourly rate of pay for this classification The record reveals that the hourly rates paid to the 41 plumber pre apprentices range from a minimum of $4 an hour paid to one and a high of $18 an hour paid to one, with the minority at the low end of the scale and the ma jority toward the middle Regarding the 24 pre appren tice pipefitters, their hourly rates of pay range from a minimum of $8 paid to three and a high of $17 paid to one, with the rest of the pre apprentices being paid be tween $10 and $15 an hour 4 The events of June-August 1984 Following Respondents communication to Local 3 and Local 208 on December 29, 1983, and January 26, 1984, respectively, stating it intended to implement the December 1983 contract proposal, there was no further communication between the parties until June 20 1984, when Local 3 and Local 208 received copies of a pro posed contract from Respondent with an accompanying letter dated June 19 1984, stating Please find enclosed a package for your approval which must be accepted in total prior to July 1, 1984 We are prepared to discuss this enclosure with you at your request This proposal will be implemented in its entirety July 1, 1984 On June 27, 1984 and July 3, 1984, respectively, Local 3 and Local 208 each wrote Respondent it had reviewed and rejected the June 19 1984 contract proposal and in formed Respondent they wanted to meet with Respond ent to discuss the terms of a new contract On or about July 1 1984 Respondent declared an im passe and implemented its June 19 1984 contract propos al Local 3 and Respondent did not have any negotia tions about Respondents June 19, 1984 contract proposal prior to its implementation No meetings were held between Local 208 and Re spondent concerning the June 19 1984 contract proposal The parties did not stipulate whether Respondent in fact implemented this proposal in the unit represented by Local 208 It is a fair inference, however that Respond ent implemented the proposal in that unit, inasmuch as the parties stipulated that it implemented the proposal in the unit represented by Local 3 Also in its August 15, 10 Following its hire of a plumber pre apprentice on May 17 1984 Re spondent hired three in June 1984 three in July two in September two in October two in November and two in December three in January 1985 three in February five in March three in April two in June one in July eight in August and one in October Following its hire of a pipe fitter pre apprentice on April 30 1984 Respondent hired one in May 1984 two in June one in July three in August six in September two in October and one in December two in April 1985 one in August one in September and three in October HOWARD ELECTRICAL & MECHANICAL 1984 letter to Local 208, infra, Respondent by telling Local 208, If you do not accept this change in our im plemented proposal [referring to the June 19, 1984 con tract proposal], in effect admitted it had implemented the June 19, 1984 contract proposal in the unit represent ed by Local 208 Respondents June 19 1984 contract proposals made to Local 3 and Local 208 were identical in substance and will be referred as Respondent's June 1984 contract pro posal It was effective from the date of execution until May 31, 1985 The proposal differs from Respondents December 1983 contract proposal in a number of signifi cant respects, as follows Besides excluding pre apprentices, as did the Decem ber 1983 contract proposal, the June 1984 contract pro posal s recognition provision excludes apprentices from the bargaining unit The hiring of employees" (hiring hall) provision also excludes apprentices, as well as pre apprentices, from its coverage and does not obligate Re spondent to give the Unions an opportunity to refer ap plicants for employment, but gives Respondent the right to hire any particular person without going through the hiring hall The June 1984 contract propos al omits the union security provision contained in the December 1983 contract proposal The wage provision in the June 1984 contract proposal omits the two tier system of wage rates for current employees and new hires, contained in the December 1983 contract proposal and, unlike the December 1983 contract proposal, con tains only a single employee classification, that of jour neyman and proposes that journeymen plumbers and pipefitters receive a minimum hourly rate of pay includ ing vacation pay, of between $7 50 and $20 "1 The `Health, Welfare, Vacation and Other Funds provision in the June 1984 contract proposal eliminates Respond ent s contribution to the Apprentice and Journeymen Training Fund contained in the December 1983 con tract proposal and also unlike the December 1983 con tract proposal imposes the following condition The Employer shall continue to provide benefits pursuant to the above listed funds until such time that pursuant to the Internal Revenue Code s anti discrimination provisions it becomes necessary to alter the employers benefit program in order to maintain the qualified nature of such programs In such case, all employees shall be eligible to partici pate in all employer group benefit plans such as profit sharing and major medical, as specified in each plan and the Employer shall then cease making contributions pursuant to the above listed facts On July 23 1984, Local 3 filed its charge in Case 27- CA-8889 alleging Local 3 was a collective bargaining representative of an appropriate unit of all journeymen and apprentice plumbers employed by Respondent and, " The December 1983 contract proposal provides that current em ployed journeymen would receive a minimum hourly rate of pay includ mg vacation pay of $1677 and tnat new hires would receive $10 Under each proposal Respondent maintained the right to unilaterally increase those minimum wages 483 in violation of Section 8(a)(1) and (5) of the Act, Re spondent on or about July 1, 1984, and continuing to date, failed and refused to bargain with Local 3 by uni laterally changing the wage rates working conditions, and terms of employment of the employees in the appro prate unit On August 15, 1984 Respondent sent Local 3 and Local 208 a new proposal which changed the benefit fund portion of Respondents June 1984 contract propos al More specifically , by identical letters dated August 15, 1984 Respondent notified the Unions that with re spect to the Health Welfare, Vacation and Other Funds provision of its June 1984 contract proposal, that Respondent was now proposing to add the following language Each employee covered by this agreement shall be given the option to participate in the above Plans [referring to the contract employee benefit plans] subject to the approval of the trustees of the various funds, or to participate in the Company s profit sharing plan and major medical plan subject to the rules for eligibility provided for in said plans In this letter Respondent also stated If you do not accept this change in our implemented proposal by August 20, 1984 we will presume that you have rejected the change and we will implement it immediately Local 3 and Local 208 responded to Respondent s August 15, 1984 proposal by identical letters dated August 16, 1984 and August 20 1984 respectively in which they rejected the proposal and informed Respond ent that Respondents August 15 letter contains propos als which have never been discussed or negotiated We are prepared to meet with you to negotiate a new con tract On August 22 1984 in Case 27-CA-8924 and on August 28 1984 in Case 27-CA-8889-2, Local 208 and Local 3, respectively filed identical charges which allege that Local 208 and Local 3 are the collective bargaining representatives of an appropriate unit of all journeymen and apprentices employed by Respondent , and further allege that, in violation of Section 8(a)(5) and (1) of the Act, Respondent on or about August 15 1984 failed and refused to bargain with Local 208 and Local 3, in that [Respondent] without discussion or bargaining with [Local 3/Local 208], has threatened to and has unilater ally altered the compensation and terms of employment of bargaining unit employees by revising the provisions of the employee pension medical insurance and vacation programs On September 25 1984 , Local 208 in Case 27-CA- 8924 filed an amended charge The amendment added to the initial charge the allegation that commencing on or about February 22, 1984 and continuing to date Re spondent had violated Section 8(a)(1) and (5) of the Act by unilaterally changing the wage rates working condi tions, and terms of employment of the unit employees 5 The October 17, 1984 settlement agreements On October 17 1984 the Board s Regional Director for Region 27 approved an informal settlement entered 484 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD into by Respondent and Local 3 in Cases 27-CA-8889 and 27-CA-8889-2 and by Respondent and Local 208 in Case 27-CA-8924 The settlement agreement in Cases 27-CA-8889 and 27-CA-8889-2 provides in pertinent part that Respondent would do the following WE WILL NOT fail or refuse to bargain in good faith with Plumbers Local Union No 3 concerning wages, hours, and other terms and conditions of em ployment for employees in the following appropn ate bargaining unit All journeymen plumbers and gas fitters, appren tice plumbers and gas fitters, area plumber fore men, general plumber foremen, plumber foremen, Journeymen pipefitters apprentice pipefitters, area pipe fitter foremen general pipefitter fore men, and pipe fitter foremen who are employed by the Employer excluding all other employees office clerical employees, guards and supervisors as defined by the Act WE WILL NOT refuse to bargain in good faith by bargaining to impasse about provisions excluding employees from the appropriate unit described above WE WILL revoke and rescind retroactive to Janu ary 23, 1984 all unilateral reductions in pay and benefits affecting our employees in the appropriate unit described above and will make whole employ ees for all losses they sustained as a result of any such change All other unilateral changes affecting unit employees will be revocable at the request of Plumbers Local Union No 3 WE WILL, upon request, bargain in good faith with Plumbers Local Union No 3 as the exclusive representative of all employees in the appropriate unit with respect to rates of pay wages hours of employment and other terms and conditions of em ployment WE WILL reimburse all employees retroactive to January 23, 1984, in an amount equal to the differ ence between the wages and benefits which they would have received if the wage rates and all other terms and conditions of their employment, had been continued without change as they existed on Janu ary 23 1984, and we will make remittance to all employee benefit trust funds to which we were obli gated to make contributions under terms and condi tions of employment as they existed on January 23 1984 of the full amount of such contributions less the sum of any contributions which we have made to each respective fund since said date The settlement agreement also provided that Al Farrell and all similarly situated employees, to be made whole by payment to each of them in the amount of backpay and benefits plus interest to be computed by the Region al Director in accordance with existing Board formula The record reveals that Al Farrell was hired by Re spondent as a plumber on June 27, 1984, and was termi nated on July 25 1984 (Jt Exh 28(1) and Tr 7) and was classified as a pre apprentice and paid $ 12 an hour and that like all the other plumbers in Respondents employ classified as pre apprentices, Respondent did not contrib ute on his behalf into the contract benefit funds In entering into the settlement agreement with Local 208 in Case 27-CA-8924, Respondent agreed to abide by provisions which were identical to the above described provisions in the agreement in Cases 27-CA-8889 and 27-CA-8889-2 between Local 3 and Respondent, with three modifications (1) the appropriate unit in Local 208 s settlement agreement included the classification provisional apprentices as being within the appropriate unit, (2) the two paragraphs contained in the Local 3 set tlement agreement in which Respondent agrees to revoke and rescind the unilateral reductions in pay and benefits retroactively to January 23 1984, and to reim burse the employees for their lost wages and benefits ret roactively to January 23, 1984 had been changed in the Local 208 settlement agreement to read February 22, 1984 rather than January 23, 1984 and (3) the Local 208 settlement agreement provides that [Respondent] will make whole all affected employees by payment to each of them for backpay and benefits plus interest to be com puted by the Regional Director in accordance with exist ing Board formula, and unlike the settlement agreement in the Local 3 case makes no mention of any particular employee or similarly situated employees 6 The 1985 negotiations On February 28, 1985, the Unions and Respondent re sumed collective bargaining negotiations and with the agreement of all parties Respondent bargained jointly with representatives of Local 3 and Local 208 Subse quently in 1985 five bargaining sessions were held March 22, July 11, July 17, July 31 and August 7 During the March 22, 1985 bargaining session the Unions submitted contract proposals for their respective bargaining units These two proposals were identical in virtually all significant respects and for the sake of con venience are referred to as the Union March 22 1985 contract proposal The Union March 22, 1985 contract proposal is effec tive from the date of execution until May 31, 1989 Its recognition provision provides for Respondent to recog nize Local 3 as the exclusive bargaining agent of all em ployees employed by Respondent performing plumbing work in the plumbing industry within Local 3 s jurisdic tion and provides for Respondent to recognize Local 208 as the exclusive bargaining agent of all employees em ployed by Respondent performing pipefitting work in the pipefitting industry within Local 208 s jurisdiction The proposal also includes a hiring hall provision giving Local 3 and Local 208 the first opportunity to refer job applicants to Respondent Regarding wages the Union March 22 1985 contract proposal does not include the special journeymen clas sification included in the January 20 1984 Local 208 contract proposal and does not provide for a change in the existing hourly rates of pay for journeymen or ap prentices It provides however, that effective November 5 1986 the minimum hourly rate of pay for journeymen HOWARD ELECTRICAL & MECHANICAL 485 plumbers and pipefitters would be increased to $19 07 and that apprentice plumbers would be paid the hourly rate set forth in Respondents December 1983 contract proposal and that the apprentice pipefitters would be paid between $1 70 and $2 16 an hour more than the ap prentice plumbers The provision in the Union March 22, 1985 contract proposal entitled `Health, Welfare, Vacation and Other Funds" is identical to Respondents December 1983 con tract proposal insofar as the amount of the Respondent s employee benefit contributions are concerned During the next bargaining session held July 11, 1985, Respondent submitted to the Unions contract proposals for their respective units These proposals, although in separate documents, are identical in content and for the sake of convenience are referred to as the Respondent s July 11, 1985 contract proposal The duration of the July 11, 1985 contract proposal is from the date of its execu tion until May 31, 1986 In substance it is identical to Re spondent s December 1983 contract proposal During the next bargaining session on July 17, 1985, Respondent asked the Unions negotiators to identify the parts of the July 11, 1985 proposal which were "a prob lem to them and asked the Unions negotiators to list the problem items in order of priority and explain to Re pondent's negotiators how they thought these items could be resolved The Unions negotiators complied with this request as follows The Unions negotiators requested an individual wage rate for each employee classification and the same rate of pay for current employees new hires, and recalled former employees rather than the two tier wage system proposed by Respondent The Unions negotiators requested that pre appren tices who were excluded from the contract bargaining unit under Respondents contract proposal, be covered under the contract provisions dealing with recognition, union security hiring of employees, and wages and benefits The Unions negotiators objected to Respondents pro posed "working provisions clause which obligated em ployees to make corrections at the minimum wage for work that had to be redone because it did not meet re quired specifications and obligated the Unions if re quired by an arbitrator to furnish the required materials to make these corrections and to reimburse Respondent 10 percent for extra overhead costs incurred because the work had to be redone The Unions' negotiators objected to the provision in Respondents contract proposal entitled Performance Appraisals which, in substance, provided that wages ne gotiated in the contract were minimum wages and gave Respondent the right to unilaterally increase employees wages and to grant employees incentive bonuses based on productivity and performance The Unions' negotiators objected to the portion of Re spondent s contractual no strike no lockouts provision which provided that although employees covered by the contract would not be disciplined for refusing to cross an authorized AFL-CIO picket line, the employees would be expected to come to work if furnished a separate gate from the gate used by the picketing union The Unions negotiators objected to the proviso in Re spondent s proposed grievance and arbitration proposal which provided, [t]he grievance and arbitration process in this Agreement shall be the only recourse the employ ees shall use against his or her Employer The negotiators discussed the section of Respondent s contractual hiring hall proposal which dealt with the right of Respondent to call for someone by name The negotiators discussed the duration of Respondent s proposed contract Regarding the proposed contract provision entitled Health, Welfare, Vacation and Other Funds the Unions negotiators indicated that they wanted a penalty provision included for late employee benefit fund contri butions The Unions negotiators asked for certain unspecified changes in the contract management rights clause pro posed by Respondent Lastly the parties discussed the provision in Respond ent s proposal entitled Supervision and the Unions ne gotiators agreed that the matters contained there were not negotiable At the next bargaining session held July 31 1985, the parties discussed the wage rates presently being paid by nonunion contractors in the area and agreed nonunion contractors pay their employees between $10 and $12 an hour Respondent submitted a revised contract proposal, which by its terms was effective on the date of execution until May 31, 1986 Respondents negotiators informed the Unions negotiators that the revised proposal incor porated some of the changes requested by the Unions negotiators at the last negotiation session The Unions negotiators stated they would review the Company s new proposal and submit their contract proposal to Re spondent at the next negotiation session Respondents July 31 1985 proposal differed from its July 11, 1985 proposal in the following respects The contract recognition, union security ' and hiring of employees provisions included the pre apprentice classi fication which had been excluded from these provisions in the July 11 proposal 12 the part of the contract gnev ance arbitration procedure proposed by Respondent stat ing the grievance arbitration procedure was the only re course the employee could use against Respondent, was qualified by the proviso This does not prevent an em ployee from filing a charge with the National Labor Re lations Board or with the EEO after arbitrators decision is rendered , the no strike no lockouts provision stat ing employees were expected to come to work if they were furnished a separate gate was supplemented in the July 31 proposal by the following language, And the Employer is notified by the owner or owner's represent ative to man the project or the Employer will be in breach of contract and will be assessed all costs because of this action taken by the employees , the provision dealing with the employees and Unions obligations when employees work failed to meet required specifica 12 The July 31 proposal however still gave Respondent the right to assign pre apprentices to perform any work for which they were quah fled and also provided as did the July 11 proposal that the ratio of pre apprentices shall be at the discretion of the Employer 486 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD tions, was modified by Respondents July 31 contract proposal but still required the employee to redo the work on his own time, the July 31 proposal omitted the performance appraisals provision that in substance gave Respondent the right to unilaterally increase the employees wages, also in response to the Unions re quest the July 31 proposal eliminated from the contract management rights clause the provision giving Respond ent the exclusive right to grant merit increases and in centive bonuses', the section of Respondents hiring hall proposal which reads, If the employer desires to hire any particular person by name, was changed to read If the employer desires to hire one particular person by name, per job , also in response to the Unions concerns, the July 31 proposal added a penalty clause to the prove Sion dealing with Respondents obligation to contribute to the employee benefit funds, the July 31 proposal, which still retained the July 11 proposal s two tier system of wages, proposed that current employees classi feed as journeymen would be paid a minimum hourly wage of $18 10 as contrasted to the hourly rate of $16 77 for this classification in the July 11 proposal likewise under the July 31 proposal, when compared with the July 11 proposal, current employees classified as ap prentices' received an hourly increase of between 53 cents and $1 14 per hour depending on the stage of their apprenticeship the July 31 contract proposal provided for new hires and recalled employees classified as jour neymen to receive a minimum hourly rate of $12, whereas the July 11 proposal set a minimum hourly rate of $10 for this classification likewise under the July 31 proposal, when compared with the July 11 proposal, new hires and recalled unit employees classified as ap prentices received an hourly increase of between 70 cents and $140 depending on the stage of their appren ticeship finally, while employees classified as pre ap prentices were not eligible under the July I1 contract proposal to receive benefits under the contract benefit plans the July 31 proposal provides that pre apprentices were eligible to receive health and welfare benefits under the contracts health and welfare plan At the next negotiation session held August 7 1985, Respondent asked for the Unions contract proposal The Unions negotiators replied by stating they did not intend to submit a contract proposal and handed Respondent s negotiators identical letters which read as follows Plumbers Local Union No 3's negotiating com mittee has reviewed the contract proposal you sub matted on July 31, 1985 Your latest contract pro posal is less favorable than previous offers in many respects For example, it contains no provisions for payment of overtime, nothing about work periods, and no schedule of hours Furthermore, your proposal fails to address the many items of concern to the Union that have been the subject of negotiations for the past two years Your proposal still would allow you free reign to assign bargaining unit work to supervisors, includ ing foremen who have been covered by all of our previous agreements with Howard Mechanical Yet you would exclude foremen from the recognition and union security clauses while retaining the right to designate foremen in unlimited numbers at your discretion You also propose to be able to hire pre apprentices" in unlimited numbers and to assign them work without any restriction Under your pro posal, a job could be manned entirely by so called supervisors and pre apprentices, and thereby deny any work to journeymen and apprentice members of the Union And since no Pension contributions would be paid on supervisors or pre apprentices, your proposal would provide a means for you to evade your obligations to the Pension Fund We have repeatedly objected to your various proposals for these reasons, just as you have repeat edly rejected our proposals that address these con cerns For example you have adamantly [sic] re fused to consider our proposal that would allow you to utilize helpers under existing ratios and for certain work We have also informed you on several occasions of our objection to your proposal for a one year contract, the two tier wage structure (under which all members of the Union would be treated as new or rehired employees at the low wage rate), to your call by name proposal, to the no strike clause, to your proposal that employees must correct alleged ly defective work on their own time without pay and to numerous other regressive proposals Your latest offer includes all of these previously rejected proposals, or worse It has been obvious to us for a long time that you do not truly want to reach agreement with this Local Union You have repeatedly advanced pro posals which would strip your employees of all the rights they have achieved over many years of col lective bargaining Your proposal to pay journey men licensed plumbers $12 00 an hour or one third less than what Union Journeymen nresently make is but one example of your total lack of good faith You have gone through the motions of bargain ing for over two years since our last agreement ex pired [sic] in May, 1983 We are no closer today in reaching an agreement than we were when negotia tions commenced We are convinced that this is what you intended all along We will not continue to engage in this futile exer cise We reject your latest proposal and we will de cline to make any further counter proposals until and unless you substantially change your position on items which we are presently deadlocked on As far as we are concerned the parties are at impasse and have been for sometime Accordingly, we intend to advise the Trustees of the Pension Fund of the situation and request them to proceed to col lect your withdrawal liability Respondents negotiators denied the negotiations were at an impasse and pointed out that at the last negotiation session on July 31 1985 Respondent as requested by the Unions, submitted a new contract proposal which had revised its previous proposal in several respects The Re spondent's negotiators stated Respondent had been pre HOWARD ELECTRICAL & MECHANICAL pared to make additional changes in its contract proposal in an effort to satisfy the Unions' complaints The Unions negotiators replied they were not interested in further negotiations and would notify the trustees of the pension fund that negotiations had reached an impasse On August 27, 1985, Respondent, by identical letters to the Unions, replied to the Unions' above described August 7 letters, as follows We were shocked to have your letter hand deliv ered to us at the early stages of our meeting August 7, 1985, because we were prepared to present a pro posal to you that contained a number of concessions as requested by you during our meeting of July 31, 1985 We were also shocked to read in your letter statements which contradict those you have made in recent bargaining sessions, including some of which amount to your withdrawing previously granted concessions We strenuously disagree with your statement in your August 7, 1985 letter that you believe that the parties are at impasse Rather, it is our position that substantial concessions have been made in recent meetings by both parties and we were prepared during our August meeting to present even more concessions Jack Howard is presently out of town and will not be back until September 16, 1985 Based on what we have already indicated to you we were prepared to do during our August 7 1985 meeting, we accept your challenge to sit down and sub stantially change our position on a number of im portant items We would request, therefore, that you contact us so that we may schedule the next couple of meetings to take place after Mr Howard returns In closing, we wish to reiterate it is the compa ny s position that the parties are not at impasse and that further negotiations will be most fruitful We think it is unfortunate that you took the position ex pressed in your letter at the beginning of the August 7 1985 meeting in light of the company being prepared to make some substantial conces sions On September 10, 1985 the Respondent, by letter no tified the Unions it intended to file unfair labor practice charges if the Unions did not set a date for the resump tion of negotiations On September 18 1985 Local 3 and on September 20 1985 Local 208, wrote identical letters to Respondent in response to its above described August 7 letter In their response, the Unions, in pertinent part, stated If you do in fact have a new proposal which you would like for us to consider, we suggest that you send it to us at your earliest opportunity After we have had a chance to review your new proposal, we will contact you about scheduling another meet mg Meanwhile it remains our position that the par ties are at impasse for the reasons stated in our letter of August 7 487 On August 11, 1985, Respondent submitted to the Unions, by mail, separate but identical contract propos als Respondent s October 11, 1985 contract proposal dif fers from its July 31, 1985 contract proposal in these re spects The provision in the July 31, 1985 proposal pro viding for the correction of work by employees was de leted in its entirety, the language concerning Respond ent's late payment penalty for being late in making its contributions to the various contract benefit funds was revised to obligate Respondent to make these payments 5 days earlier, if it wanted to avoid incurring a penalty, the two tier system of wages which divided employees into current and new or recalled employees was in effect abolished under the October 11, 1985 proposal In this last respect, the minimum hourly wage rate for currently employed journeymen was reduced from the July 31 proposed hourly rate of $18 10 to $16 80 and the mini mum wage rate for new hires or recalled journeymen was increased from the July 31, 1985 rate of $12 to $16 80 Consistent with the above changes the October 11, 1985 proposal proposed that the rates for currently employed apprentices be reduced and that the rates be increased for newly hired or recalled apprentices, so that both groups would be paid the same minimum hourly rate Lastly, the minimum hourly rate proposed by the October 11, 1985 proposal for the newly hired or re called pre apprentices was increased from $4 to $5 which was the rate being proposed for the currently employed pre apprentices Respondent's October 11, 1985 contract proposal failed to bring the Unions back to the bargaining table and there was no further contact between the parties about negotiations until June 24, 1986 when Respondent wrote the Unions that if they did not contact Respond ent for a bargaining session by July 1, 1986 Respondent would file unfair labor practice charges with the Nation al Labor Relations Board alleging they were refusing to bargain in violation of the Act Prior to Respondents June 24, 1986 demand that the Unions resume bargaining Respondent on or about May 29 1986 had received a letter from the fund administra tor of the board of trustees of the Colorado pipe industry pension fund, the fund Respondent had been obligated to contribute to during the term of the 1981-1983 contract on behalf of the unit employees' pension benefits The letter informed Respondent that because the fund s records indicated Respondent had not contributed to the fund since December 31, 1984 and because the fund had been advised that negotiations for a new contract be tween Respondent and the Unions had reached im passe,' the fund s trustees concluded Respondent had withdrawn from the Plan and, accordingly was sub ject to the withdrawal liability provisions of the Multi Employer Pension Plan Amendments Act of 1980, a Federal enactment amending the Employee Retirement Income Security Act of 1974 (ERISA) The fund ad ministrator advised Respondent its withdrawal liability totaled $555,852 and demanded payment On July 17, 1986, Respondent wrote the fund contest ing its conclusion that Respondent had withdrawn from the plan and specifically challenged the assertion that ne 488 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD gotiations between Respondent and the Unions were at an impasse On July 17, 1986, in Cases 27-CB-2373 and 27-CB- 2374 Respondent filed charges against the Unions alleg mg that, in violation of Section 8(b)(3) of the Act, since about July 1, 1986, the Unions had failed and refused to meet and confer with Respondent in good faith at rea sonable times and places As of the date of the hearing in this case-January 21, 1987-the Board s Regional Di rector for Region 27 had not made a determination on the merits of these charges On November 5, 1986 Respondent wrote the Unions separate but identical letters informing them that Re spondent accepted their March 22, 1985 contract propos al in its entirety In November 1986 shortly after receiving Respond ent s November 5, 1986 letter, the Unions wrote separate but identical letters to Respondent stating that their March 22, 1985 bargaining proposal was no longer open for acceptance due to the lapse of time and changed cir cumstances The Unions informed Respondent they were treating Respondents letter of November 5, 1986, as an adoption by Respondent of the Unions March 22, 1985 contract proposal which Respondent was now propos ing for the Unions acceptance In order to properly evaluate the proposal the Unions asked Respondent to furnish them certain information On November 26 1986, Respondent renewed its demand to the Unions that they accept and execute the agreement embodied in their March 22 1985 contract proposal On December 2, 1986, the Unions reiterated their refusal to do this On December 8, 1986, Respondent filed charges against the Unions in Cases 27-CB-2425 and 27-CB- 2425-2 alleging that since on or about December 2 1986 the Unions had violated Section 8(b)(3) of the Act by re fusing to meet with Respondent in good faith and by re fusing to execute a collective bargaining agreement agreed to by the parties As of the date of the hearing in this case, the Regional Director for Region 27 had not made a determination on the merits of these charges B Discussion and Conclusions 1 The settlement agreements On July 23 1984 in Case 27-CA-8889 Local 3 filed a charge alleging in substance Respondent violated Section 8(a)(5) and (1) of the Act on or about July 1 1984 by unilaterally changing the wage rates, working conditions, and terms of employment of the employees represented by Local 3 On August 22 , 1985, in Case 27-CA-8924, Local 208 filed a charge and on August 28 1984 Local 3 filed an identical charge in Case 27-CA-8889-2 alleg ing that on or about August 15, 1984, Respondent violat ed Section 8(a)(5) and (1) of the Act by threatening to change and by unilaterally changing the provisions of the pension, medical insurance, and vacation programs of the employees represented by the Unions Lastly on September 25 1984 Local 208 filed an amendment to its charge in Case 27-CA-8924 which alleged that com mencing on or about February 22 1984 and continuing to date, Respondent violated Section 8(a)(5) and (1) of the Act by unilaterally changing the wage rates , working conditions and terms of employment of the employees represented by Local 208 On October 17, 1984, the Board s Regional Director for Region 27 approved the settlement agreements en tered into by and between the Unions , Respondent and counsel for the General Counsel in the aforesaid cases The appropriate bargaining unit described in each of the settlement agreements includes within the unit the classifications of journeymen and apprentice plumbers and pipefitters, however, the unit description in the agreement covenng the employees represented by Local 208 also includes the classification provisional appren tices' as being within the unit In the settlement agreement covering the unit repre sented by Local 3, Respondent promises to revoke and rescind retroactive to January 23, 1984 all unilateral re ductions in pay and benefits affecting the unit employees and to reimburse the employees retroactive to January 23, 1984 the difference between the wages and benefits they would have received if the wages and benefits had been continued as they existed on January 23, 1984 and promises to make the employees benefit trust fund contributions that it was obligated to make on January 23, 1984 Also Respondent promises, on request, to bar gain in good faith with Local 3 as the exclusive repre sentative of all the employees in the appropriate unit The language set forth in the settlement agreement covering the unit represented by Local 208 contains the identical language except that whenever the date Janu ary 23, 1984 appears in the Local 3 agreement it reads February 22 1984 in the Local 208 agreement January 23 1984 is the start of the 10(b) limitations period for the charges filed by Local 3 in Cases 27-CA- 8889 and 27-CA-8889-2 The start of the 10(b) limita tions period for the charge filed by Local 208 in Case 27-CA-8924 is February 22 1984 No evidence was presented about the negotiations be tween the parties which led up to and resulted in the set tlement agreements Nevertheless Respondent contends [t]here was an oral understanding that the agreements would be interpreted in accordance with Respondent s position Respondent, in support of this contention relies on its attorneys letter of February 28 1985 sent to the Regional Director in Cases 27-CA-8889 and 27-CA- 8889-2 This letter was sent several months after the set tlement agreements were executed , when the Regional Director was investigating the Unions claim that the agreements had not been complied with In this letter Respondent's attorney informed the Regional Director As you know, the agreement for purposes of remedy goes back to January 23 1984 It was made very clear in the discussions between myself and the Region prior to executing the settlement agreement that as to remedy the company s offer [referring to the December 1983 con tract offer], which was put in effect in January prior to the 23rd, did not have to be disturbed Respondent's contention is without merit because (1) no evidence was presented that in fact Respondents at torney before executing the settlement agreement had reached an understanding with the representatives of the HOWARD ELECTRICAL & MECHANICAL Regional Director or the General Counsel or the Unions, or even informed them, it was his understanding that the terms of the settlement agreements would not disturb Respondents December 1983 contract proposal which had been implemented , and (2) the Regional Director in response to Respondent attorney s February 28 1985 letter wrote the attorney denying that the attorney had ever communicated such an understanding to the Region prior to his February 28, 1985 letter The fact the Re gional Director failed to answer the February 28, 1985 letter from Respondents attorney for several months and the lapse of time between the execution of the settlement agreements and the start of the Regional Director's in vestigation into whether Respondent had complied with the agreements, is insufficient to establish Respondent s claimed oral understanding Subsequent to the execution on October 17, 1984, of the settlement agreements , Respondent continued to clas sify each plumber and pipefitter it hired as a pre appren tice and to unilaterally establish their hourly rates of pay, and did not contribute on their behalf to the employee benefit funds established by the 1981 -1983 contract In or about the fall of 1985 , a representative of the Boards Regional Director advised Respondents lawyer it appeared Respondent had not complied with the terms of the settlement agreements because it was continuing to classify the plumbers and pipefitters it was hiring as pre apprentices and was in effect excluding them from the collective bargaining unit with respect to their wages and other employment benefits Respondents lawyer took the position that in continuing to hire plumbers and pipefitters and classifying them as pre apprentices Re spondent was acting consistent with the terms of the set tlement agreements He explained that Respondents De cember 1983 contract proposal gave it the right to classi fy all its pipefitters and plumbers as pre apprentices and to exclude them from the coverage of the proposal s fringe benefit provisions, and to unilaterally set their rates of pay, as long as they were paid at least $4 an hour Therefore, Respondents lawyer explained , because the terms of the December 1983 contract proposal had been implemented in January 1984, prior to either Janu ary 23 or February 22, 1984, there was nothing for Re spondent to rescind or revoke In short, Respondent s lawyer took the position that when Respondent pursuant to the settlement agreements , agreed to restore the status quo to January 23, 1984 , in the case of the Local 3 bar gaining unit and to February 22, 1984 in the case of the Local 208 bargaining unit it had merely agreed to abide by the terms and conditions contained in Respondent s December 1983 contract proposal The representative of the Regional Director responded by informing Respond ent s lawyer that the Regional Director had approved the settlement agreements with the understanding Re spondent's December 1983 contract proposal had not been implemented and that the only proposal of Re spondent which had been implemented was the one it had implemented July 1, 1984, and that under the terms of the settlement agreements the status quo envisioned by the Regional Director consisted of the terms and condi tions of employment set by the 1981-1983 contract not the Respondents December 1983 contract proposal 489 In the instant proceeding the General Counsel con tends the Regional Director was justified in setting aside the settlement agreements for two reasons ( 1) Respond ent failed to comply with the terms of the settlement agreements by continuing to classify its plumbers and pipefitters as pre apprentices and treating them as non unit workers whose wages and benefits were established unilaterally by Respondent, and (2) by proposing in July 1985 that it be granted the right to retain unilateral con trol over all aspects of the pre apprentices terms and conditions of employment, Respondent engaged in bad faith bargaining in violation of Section 8(a)(5) of the Act, which also violated the terms of the settlement agree ments I have serious doubts whether the General Counsel s second alleged justification for the Regional Director s decision to vacate the settlement agreements is encom passed within the scope of the pleadings Assuming it is, it is without merit The fact that in July 1985 Respond ent proposed that the Unions accept a contract which would grant Respondent the right to hire pre apprentices in unlimited numbers and to assign them to do bargain ing unit work without any restriction does not warrant the inference Respondent was not bargaining in good faith with a sincere desire to reach a collective bargain ing agreement Nor is there other evidence which, when coupled with Respondents proposal concerning the pre apprentices would warrant the inference Respondent in July 1985 was not bargaining in good faith with a sincere desire to reach an agreement Insofar as the General Counsel is contending that in July 1985 Respondent in its bargaining with the Unions insisted to impasse on a nonmandatory subject-the ex clusion of plumbers and pipefitters classified as pre ap prentices from the units-there is no evidence to support this contention In Respondents July 31 , 1985 contract proposal which was made immediately after the Unions expressed their opposition to Respondent about Respond ent s proposal to exclude pre apprentice plumbers and pipefitters from the units Respondent specifically includ ed the pre apprentices within the coverage of the con tract recognition union security and hiring hall provi sions and dropped its proposal which would have given it unilateral control over the pre apprentices wages, and agreed that the pre apprentices would be covered by the contracts health insurance provision The fact that Re spondent was still proposing that pre apprentices not be covered by the contracts pension plan and that Re spondent be given the right to hire an unlimited number of pre apprentices and to assign them to do plumbers and pipefitters work without restriction does not establish Respondent was making a contract offer which in effect excluded the pre apprentices from being represented by the Unions Regarding the General Counsels contention that Re spondent violated the terms of the settlement agreements by continuing to hire plumbers and pipefitters whom it classified and treated as pre apprentices, I am of the opinion there was no meeting of the minds by the parties insofar as the settlement agreements affected Respond 490 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD ent's right to employ plumbers and pipefitters and classi fy them as pre apprentices In its December 1983 contract proposal Respondent proposed it be given the right to hire an unlimited number of pre apprentices who would be excluded from the contracts recognition, union security and hiring hall provisions, and to assign them to do unit work without restriction and to pay them whatever wage rates it de sired so long as it paid them a minimum wage of $4 an hour On December 29 1983 Respondent told Local 3 it intended to implement the December 1983 contract pro posal in the Local 3 unit effective January 1, 1984 and on January 26, 1984 told Local 208 it intended to imple ment the December 1983 contract proposal in the Local 208 unit because the parties were at an impasse Subse quently in April and May 1984, the first time Respond ent s manpower requirements necessitated the employ ment of additional plumbers or pipefitters Respondent hired plumbers and pipefitters, and classified all of them as pre apprentices and unilaterally set their rates of pay and excluded them from the coverage of the expired contracts fringe benefit provisions The October 17, 1984 settlement agreements obligated Respondent to re store the status quo to things as they existed on January 23, 1984 in the Local 3 bargaining unit and to things as they existed on February 22, 1984, in the Local 208 bar gaining unit The above described circumstances per suade me that when Respondent read the above de scribed language of the settlement agreements it could have reasonably believed they meant Respondent was obligated to live up to the terms of its December 1983 contract proposal insofar as the employment of pre ap prentices was concerned On the other hand it was perfectly reasonable for the Unions and the General Counsel to believe that by exe cuting the settlement agreements Respondent had agreed to restore the status quo as it existed before January 1 1984, when the 1981-1983 contract governed the terms and conditions of employment of employees represented by the Unions Thus the dates of January 23 and Febru ary 22 1984 are not tied timewise to the start of any of the unilateral acts of conduct involved in this case Rather these dates are specifically tied to the 6 month limitation period set forth in Section 10(b) of the Act The reason for this is because the Boards normal remedy for violations of the kind of unilateral conduct alleged in the Unions charges is limited to the 10(b) period See Al Bryant Inc 260 NLRB 128 fn 3 (1982) Under the circumstances, I am persuaded it was not un reasonable for the Unions and the General Counsel to believe that the intent of the settlement agreements was to restore the status quo to the terms and conditions of employment which were in place prior to Respondent s implementation of the December 1983 contract proposal and to believe that the reason January 23, 1984 and Feb ruary 22 1984 were used in the settlement agreements, as the dates on which the status quo was to be restored was that as a matter of law it was necessary to confine the agreements make whole remedy to periods com mencing on those dates Also in assessing the intent of the parties when they entered into the settlement agreement in Cases 27-CA- 8889 and 27-CA-8889-2 it is significant that included in this settlement is a provision that provides that Respond ent shall make whole Al Farrell who was hired by Re spondent as a pre apprentice plumber on June 27, 1984, and all the other plumber pre apprentices similarly situat ed, for their loss of wages and fringe benefits caused by Respondents alleged unfair labor practices The settle ment agreement makes sense only if the intent of the agreement was to make Farrell and the other similarly situated pre apprentices whole for the loss of their wages and fringe benefits incurred as a result of Respondent s implementation of its December 1983 contract proposal For, the make whole provision could not have been re ferring to either Respondents alleged July 1 1984 or August 15, 1984 unilateral changes in the employees wages and conditions inasmuch as these changes did not in any way adversely affect the pre apprentices terms and conditions of employment 13 Previously, when it im plemented the December 1983 contract proposal Re spondent had instituted the provisions dealing with the pre apprentices, which provisions were not changed in any way by the Respondents subsequent proposals of June 19 or August 15, 1984 Based on the foregoing, I am of the opinion that as suming Respondents interpretation of the settlement agreements was a reasonable one, and accurately reflects what was in its mind at the time of the settlements that the Unions and the General Counsel had markedly dif ferent ideas about what the settlements were intended to cover and that their interpretation was a reasonable one In other words, there was no meeting of the minds when the settlement agreements were executed It is for this reason that I find the Regional Director properly set aside the settlement agreements in these cases Respondent asserts that principles of contract con struction preclude me from considering the General Counsels and the Unions interpretation of the settlement agreements This argument is without merit First, even under the technical principles of contract law an exami nation of the parties different understandings of the set tlement agreements warrants the conclusion that there was no meeting of the minds See Corbin, Contracts §104 (1963) ( If the parties had materially different meanings [of the language] and neither one knew or had reason to know the meaning of the other there is no contract ) Williston Contracts 1541 (1957) Apache Powder Co 223 NLRB 191, 195 (1976) Respondents construction of the settlement agreements ignores a significant number of the relevant circumstance-, including the legal circumstances involving the limitations proviso to Section 10(b) of the Act which demonstrate that the Unions and the General Counsel could reasonably understand that the dates con tained in the settlement agreements were merely remedy al cutoff dates required by the statutes 10(b) limitations period and were not meant to legitimatize the implemen 13 It would have been very easy for the parties to have made the make whole provision dealing with Farrell and the other similarly situ ated pre apprentices retroactive to July 1 1984 if the intent of the set tlement agreements had been to simply restore the status quo as of the period of time immediately before the implementation of Respondents June 19 1984 and August 15 1984 contract proposals HOWARD ELECTRICAL & MECHANICAL tation of the contract pre apprentice provisions proposed by Respondent In any event, paraphrasing the Fourth Circuits Ian guage, "general contract principles alone [do not] govern this issue George Banta Co v NLRB, 604 F 2d 830 835 (4th Cir 1979) The disposition of unfair labor practice charges [pursuant to settlement] involves not simply an adjustment of the rights of private parties, but also a broader public interest, and it is the ultimate re sponsibility of the agency to ensure that the public interest is served by a settlement Id at 835-836 In this regard, the Board with Supreme Court approval has a longstanding policy of setting aside settlement agree ments in order to ensure that the policies of the Act are not frustrated by an ineffectual agreement Wallace Corp v NLRB, 323 US 248 (1944) Whenever a settlement fails to achieve its purpose-i e to end labor disputes, extinguish their causative elements, and restore labor peace (at 254)-the Board will set it aside E g, Stage Employees IATSE Local 659 (MPO TV), 197 NLRB 1187 (1972), enfd 477 F 2d 450 (D C Cir 1973) In determin ing whether the settlement has accomplished its objec tive, the Board does not rely on a mechanical applica tion of a rigid a priori rule, but instead utilizes the ex ercise of a sound judgment based upon all the circum stances of each case ' Ohio Calcium Co, 34 NLRB 917, 935 (1941) Where a settlement, under the circumstances, effectuates the purposes of the Act, it will not be set aside but where subsequent events have demonstrated that efforts at adjustment have failed to accomplish their purpose there is no estoppel to further Board pro ceedings Wallace Corp, supra at 254-255 In the instant case, the purposes of the Act are plainly served by the Regional Director's withdrawal of approv al from the settlement agreements, since the settlements proved insufficient to lay to rest the rights and obligation of the parties and left their labor dispute unresolved See Stage Employees, supra, in which the Board affirmed the Regional Director's withdrawal of approval from an in formal settlement agreement, concluding that this was a case where no agreement was reached and that it would be inequitable to hold the parties to the commit ments contained in the settlement In Stage Employees, approval was withdrawn from the agreement even though there was no ambiguity in the language of the agreement itself, rather, the deficiency in the agreement was that each party reasonably made widely divergent assumptions about the implementation of its terms See also City Cab Co v NLRB, 122 LRRM 2392, 2396-2397 (11th Cir 1986) 2 The December 1983 contract proposal During the negotiations covering Local 3 s unit Re spondent submitted a new contract proposal to Local 3 on December 29 1983 which it characterized as its final offer and told Local 3 it intended to implement this offer effective January 1 1984 During the negotiations covering Local 208 s unit Re spondent submitted a new contract proposal to Local 208 on December 30 1983 which it characterized as its last offer, and subsequently on January 26 1984 after Local 208 rejected the December 30 contract offer and 491 Respondent had rejected Local 208 s counteroffer Re spondent informed Local 208 that negotiations had reached an impasse and Respondent intended to imple ment its last contract proposal One of the provisions included in Respondents De cember 1983 contract proposal,14 excluded all plumbers and pipefitters classified as pre apprentices from the pro posed contracts recognition, union security, hiring hall, and benefit provisions and gave Respondent the right to hire pre apprentices in unlimited numbers and to assign them bargaining unit work without restriction and the right to unilaterally set their rates of pay as long as they were paid at least $4 an hour In 1984 it was not until April 30 that Respondent hired its first plumber or pipefitter, and when it hired that plumber it classified him as a pre apprentice and thereaf ter during 1984 and 1985 whenever Respondent em ployed plumbers or pipefitters it classified them as pre apprentices and consistent with the December 1983 con tract proposal treated them as nonunit employees On July 23, 1984 Local 3 filed its initial charge in this case and on August 22, 1984, Local 208 filed its initial charge Thus, the 6 month limitation period prescribed by Section 10(b) of the Act commenced in Local 3 s bar gaining unit January 23, 1984, and in Local 208 s bar gaining unit February 22, 1984 The complaint in this case alleges that on or about De cember 29, 1983, in the unit represented by Local 3 and on or about December 30 1983 in the unit represented by Local 208, Respondent demanded as a condition of consummating any collective bargaining agreement that the Unions agree to a provision that altered the existing appropriate bargaining units by excluding from the units plumbers and pipefitters classified as pre apprentices, and that in furtherance and in support of this demand Re spondent on those dates bargained to an unprivileged and invalid impasse (complaint par 9(a), (b) (d), and (e)) The complaint further alleges Respondent violated Section 8(a)(5) and (1) of the Act when on or about Jan uary 23 1984, in the Local 3 unit and on or about Feb ruary 22 1984 in the Local 208 unit 'at a time when no good faith impasse existed " Respondent unilaterally al tered the wages and benefits of the units employees in cluding the employees classified as pre apprentices (com plaint par 12(d) and 13(d)) In its posthearing brief in support of the complaint al legations counsel for the General Counsel argues page 9 Any impasse the Respondent [d]eclared in December over the pre apprentice[s] was invalid Therefore Respondent could not implement the changes in the bargaining unit The Respondent violated Section 8(a)(5) when it implemented the unit changes follow ing an invalid impasse [Emphasis added ] And further argues at 10 of her brief [T]he Respondent announced to the Plumbers on December 29, its intent to implement its final offer 'a As noted supra for the sake of convenience the above described December 29 1983 and December 30 1983 contract proposals are re ferred to collectively as Respondents December 1983 contract proposal 492 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD effective January 1, 1984 The Respondent an nounced to the Pipefitters on January 20 that its final offer would be implemented Since it was an in valid impasse the Respondent could not implement its final offer The Plumbers and Pipefitters hired by the Respondent following the invalid implementa tion as well as employees already employed by Re spondent in December were lawfully part of the existing bargaining unit By classifying these em ployees as nonunit pre apprentices, assigning them unit work, and failing to apply to them unit wage rates and terms of employment, the Respondent uni laterally change[d] the scope of the unit and violat ed Section 8(a)(5) [Emphasis added ] In its postheanng brief in support of the complaint s allegations, counsel for the Charging Parties asserts that, ` the first issue to be decided on the merits of the case itself is whether or not the Company bargaining [sic] to an unprivileged and invalid impasse Respondent takes the position that the complaints alle gations that pertain to the implementation of the pre ap prentice provisions contained in its December 1983 con tract proposal should be dismissed because they are time barred by the 6 month limitations proviso to Section 10(b) of the Act Respondents 10(b) defense is meritori ous A decision on how to apply Section 10(b) to the facts of this case must be made in the light of the statutes un derlying policy The Supreme Court has described the policy of the statutory time limit as to bar litigation over past events after records have been destroyed wit nesses have gone elsewhere and recollections of the events in question had become dim and confused and of course to stablize [sic] existing bargaining relation ships Machinists Local 1424 (Bryan Mfg Co) v NLRB, 362 U S 411, 419 (1960) quoting H R. Rep No 245, 80th Cong 1st Sess 40 (1947) In Bryan the Court inter preted Section 10(b) of the Act as precluding the filing of an unfair labor practice charge which was grounded on events predating the limitations period There the Court distinguished between two situations The first is one where occurrences within the six month limitations period in and of themselves may constitute, as a substantive matter unfair labor prac tices There earlier events may be utilized to shed light on the true character of matters occurring within the limitations period and for that purpose 10(b) ordinarily does not bar such evidentiary use of anterior events The second situation is that where conduct occurring within the limitations period can be charged to be an unfair labor practice only through reliance on an earlier unfair labor practice There the use of the earlier unfair labor practice is not merely evidentiary since it does not simply lay bare a putative current unfair labor practice Rather, it serves to cloak with illegality that which was otherwise lawful And where a complaint based upon that earlier event is time barred to permit the event itself to be so used in effect results in reviving a legally defunct unfair labor practice [362 U S at 416-417] In Bryan the situation fell within the second category, for the entire foundation of the unfair labor practice charged was the unions time barred lack of majority status when the original collective bargaining agreement was signed 362 U S at 417 In the instant case the charged misconduct that oc curred within the 10(b) period-Respondent s exclusion from the units of employees performing unit work by classifying them as pre apprentices-is alleged to be an unfair labor practice relying solely on Respondents earls er alleged illegal conduct which predated the start of the 10(b) period its insistence as a condition precedent to en tering into a collective bargaining agreement with the Unions, that the Unions agree to permit Respondent to exclude employees from the unit doing unit work by classifying them as pre apprentices This is the theory of the complaint, as set out specifically in the complaint and in the General Counsels and Charging Parties briefs and is the way the case in fact was litigated In other words, not only do all the operative facts essential to establishing the unfair labor practices charged in this case take place outside of the 10(b) period but the coun sel for the General Counsel as alleged in the complaint must prove that this pre 10(b) conduct constituted an unfair labor practice in order to prove as alleged in the complaint, that Respondents conduct within the 10(b) period violated the Act Thus, the entire foundation for the alleged unfair labor practices is another alleged unfair labor practice that is admittedly time barred by the 10(b) limitations period Bryan does not allow this It is for these reasons that I am persuaded the complaint s allegations that Respondent refused to bargain within the meaning of Section 8(a)(5) of the Act by unilaterally a] tering the wages and benefits of the units employees commencing on January 23, 1984, and February 22, 1984 the start of the respective 10(b) periods are barred by the 6 month limitations proviso to Section 10(b) of the Act Catholic Medical Center, 236 NLRB 497, 500- 501 (1978) Durfee s Television Cable Co 174 NLRB 611 613-614 (1969) I therefore shall recommend the dismis sal of these allegations in their entirety Harvard Folding Box Co 273 NLRB 841, 845-847 (1984) cited by the Charging Parties is inapposite be cause, unlike the instant case, it was not litigated based on the theory that the alleged unfair labor practice was inextricably tied to another unfair labor practice which occurred outside the 10(b) period Also in Harvard Fold ing Box the Board concluded that the start of the 10(b) period was tolled because the employers announcement of its unilateral change in vacation pay policy was made to the employees and not the union, which did not learn about the new policy for several months Here as I have found infra the Unions knowledge of the disputed uni lateral changes predated the start of the 10(b) limitations period Finally insofar as Harvard Folding Box holds that the employers announcement of the unilateral change in its vacation pay policy would have been insufficient to start the 10(b) period even if it had been made to the union it relied in substantial part on California School of HOWARD ELECTRICAL & MECHANICAL Psychology, 227 NLRB 1657 (1977) which was specifical ly overruled by the Board in Postal Service Marina Center 271 NLRB 397 (1984) I also reject the Charging Parties contention it was not until Respondent began to hire employees to perform unit work and classified them as pre apprentices that the Unions first learned of this policy thereby tolling the start of the 10(b) limitations period As I have found, supra the Unions were told by Respondent, outside of the start of the 10(b) period it was implementing the De cember 1983 contract proposal which excluded all em ployees performing bargaining unit work whom Re spondent chose to classify as pre apprentices from the contract's recognition, union security, hiring hall and benefit provisions and gave Respondent the right to hire pre apprentices in unlimited numbers and to assign them to bargaining unit work without any restriction and the right to unilaterally set their rates of pay as long as they were paid $4 an hour This notification clearly placed the Unions on sufficient notice of the alleged unfair labor practices to file a charge Postal Service Marina, 271 NLRB 397 (1984), Carter Glogau Laboratories, 280 NLRB 447 (1986) The fact Respondent did not have an occasion for ap proximately 4 months to utilize its new policy of classify ing employees performing unit work as pre apprentices does not detract from the fact that the Unions were clearly and unequivocably advised, prior to the start of the 10(b) period that Respondent was implementing its December 1983 contract offer that contained this new policy As I have found, supra in 1984 it was not until April and May that Respondent hired its first unit em ployees at which time, and at all times thereafter when ever it hired unit employees Respondent classified them and treated them as pre apprentices Under these circum stances, Respondents failure to utilize its new policy concerning the pre apprentices prior to April-May 1984 could not have reasonably led the Unions to believe Re spondent did not intend to implement that portion of its December 1983 contract proposal I also reject the Charging Parties' contention that by failing to implement certain provisions of its December 1983 contract proposal Respondent lulled the unions into believing Respondent continued to abide by the ex pared contract rather than implement the December 1983 proposals, as threatened In this regard as I have found supra there is evidence Respondent did not implement the terms of its 1983 contract proposal in only two re spects mailing contract benefit payment contributions to the fund, whereas the December 1983 contract proposal provided the payments be mailed to the Unions which would transmit them to the fund 15 and, continuing to pay contributions to the contract administration fund as it had agreed to do under the terms of the 1981-1983 contract, whereas the December 1983 contract offer omitted this contribution No one from the Unions testified that because Re spondent continued to pay benefit contributions directly to the fund and continued to contribute to the contract administration fund, that this led the Unions to believe 15 The 1981-1983 contract is silent on this subject 493 Respondent had changed its mind about implementing the terms of the December 1983 contract proposal, in cluding the pre apprentice provisions, and instead was continuing to abide by the terms and conditions of the expired 1981-1983 contract Nor does Respondents fail ure to implement the December 1983 contract proposal in these two respects, on its face warrant the inference it led the Unions to believe this Thus, there is no evidence it was ever brought to the Unions attention, during the time material here, that Respondent was still contributing to the contract administration fund And mailing the ben efit fund contributions directly to the fund instead of in directly to the fund through the Unions was not the kind of conduct which would have reasonably led the Unions to believe Respondent was continuing to abide by the terms of the expired 1981-1983 contract rather than im plementing its December 1983 contract proposal 3 The June 19, 1984 contract proposal On June 19, 1984 when negotiations resumed after a hiatus of several months, Respondent made another con tract proposal to the Unions It was identical to Re spondent s last proposal of December 1983 insofar as it excluded pre apprentices from the contract bargaining unit In addition to pre apprentices it also excluded ap prentices from the contract unit, even though they had been specifically included within the unit encompassed by the 1981-1983 contract The Respondent sent its June 19, 1984 contract pro posal to the Unions by mail at which time it wrote the Unions it was prepared to discuss the proposal at the Unions request, but that the proposal must be accepted in total prior to July 1 1984 and that it will be imple mented in its entirety July 1 1984 On July 27 1984, and July 3, 1984 Local 3 and Local 208 suspectively wrote Respondent rejecting the June 19, 1984 contract proposal and advised Respondent they wanted to meet with it to discuss the terms of a new contract No meetings were held between the parties concerning the June 19, 1984 contract proposal which was ample mented July 1 1984 The General Counsel contends that the changes in the employees wages and benefits instituted as a result of Respondents July 1, 1984 implementation of its June 19 1984 contract proposal constitute unlawful unilateral changes in the employees existing terms and conditions of employment because the proposals exclusion from the bargaining units of the pre apprentices and apprentices was a nonmandatory subject of bargaining which Re spondent insisted on as a condition precedent to entering into an agreement with the Unions thereby constituting a refusal to bargain in good faith which precluded a gen time impasse on any of the terms set forth in the June 19, 1984 proposal Alternatively, the General Counsel ap pears to argue that Respondents July 1, 1984 unilateral changes in the employees' wages and benefits were un lawful because Respondent has not shown that these new wages and benefits which were a part of its June 19, 1984 contract proposal were implemented after an im passe in bargaining 494 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD It is settled that to insist to impasse on nonmandatory subjects of bargaining is an unfair labor practice in viola tion of Section 8(a)(5) NLRB v Borg Warner, 356 US 342, 349 (1958) In explaining what constitutes impasse bargaining by an employer in the context of proposing a nonmandatory subject the Board has indicated that before it will conclude an impasse has occurred, the union must have placed the employer on notice that it objects to the alleged nonmandatory bargaining proposal so that the employer will be afforded an opportunity to withdraw this proposal from his overall contract propos al Thus, in Union Carbide Corp, 165 NLRB 254, 255 (1967), the Board stated It is well settled, however, that [the statutory] obli gation to bargain does not mean that bargaining must be confined to the statutory subjects (case) Either party may lawfully propose nonmandatory bargaining items Neither party may insist, however, nor condition its bargaining or the execution of any agreement, upon acceptance of such demand by the other party [case] The Respondent, therefore, did not violate its duty to bargain when, on June 2, it initially proposed certain modifications in the cur rent pension insurance agreement Nor was it un lawful insistence for Respondent to refer to its June 2 package offer during two subsequent bargaining sessions when the union s wage and vacation de mands were discussed For, the union had not ex pressly and unequivocally rejected that offer or the nonmandatory bargaining demand contained there in After Respondent presented its final offer on June 29 the union negotiators for the first time de Glared their opposition to Respondent's injection of the nonmandatory issue into the basic contract ne gotiations In these circumstances, however it can hardly be said that Respondents insertion of the nonmandatory subject in its final offer of June 29 constituted unlawful insistence in the face of a clear and express refusal by the union to bargain about the pension insurance modifications [case] Similarly the Board in National Fresh Fruit & Vegetable Co 227 NLRB 2014, 2015 (1977), stated [T]he controlling factors in determining whether a party insisted unlawfully upon a subject in the course of bargaining are (1) whether the demand was on a mandatory or voluntary subject of bar gaining and (2) whether the insisting party persisted in demanding the nonmandatory provision in the face of continuing rejection by the other party In the instant case there is no evidence that prior to Respondent's June 19 1984 contract proposal or in re sponse to that proposal that the Unions told Respondent they were opposed to Respondents interjection of the al leged nonmandatory issues contained there into the con tract negotiations The Unions approach, insofar as this stipulated record shows, was simply to reject Respond ent's December 1983 and June 19, 1984 contract propos als in their totality without specifying which provisions it objected to or the basis for their objections the Unions did not specifically object to the inclusion of the alleged nonmandatory bargaining items in Respondents propos als There is no evidence that the Unions had reason to believe that such an objection would have been futile Quite the opposite, after the negotiations resumed in July 1985, when the Unions for the first time expressed their objection to Respondents proposal excluding pre ap prentices from the units, Respondent immediately with drew this proposal from its contract offer 16 Under the circumstances, the lack of evidence that Respondent in sisted on the alleged nonmandatory provisons in the face of the Unions' objection to those provisions I am per suaded the General Counsel has failed to prove that when Respondent on July 1, 1984 implemented the wage and benefit provisons of its June 19, 1984 contract pro posal that it did so in the context of having insisted on the alleged nonmandatory subjects as a condition prece dent to entenng into any agreement with the Unions 17 Cf Bozzuto s Inc, 277 NLRB 977 (1985) (Employer bar gained to impasse over a nonmandatory subject-the al teration of the bargaining unit-where the union made clear [to the employer] that it would not change the unit and would not recommend to its members a package containing such a change') I am also persuaded that when on July 1 1984, Re spondent changed the employees wages and benefits pursuant to the terms of its June 19, 1984 contract pro posal that the record shows the parties had bargained to an impasse 18 The last time the parties communicated with one an other about the bargaining negotiations prior to Re spondent s June 19 1984 contract proposal was Decem ber 29 1983, in the Local 3 unit and January 26, 1984 in the Local 208 unit On those dates as described in detail above the negotiations were deadlocked without any re alistic possibility that continuation of the negotiations would be fruitful This is vividly demonstrated by the fact that for the next 4 1/2 months, until Respondent transmitted its June 19, 1984 contract proposal, there were no bargaining sessions and there is no evidence that any of the parties made an effort to schedule further con tract negotiation meetings Respondents June 19 1984 contract proposal, clearly was not calculated to break the impasse in the negotiations Its provisions were sub stantially worse insofar as the Unions were concerned, thus leaving the parties even further apart 19 These cir 19 On the resumption of negotiations in July 1985 Respondent had previously withdrawn the contract provision excluding apprentices 17 [I]n evaluating whether parties have insisted to impasse on a par ticular nonmandatory subject of bargaining the Board and courts have looked to whether agreement on the mandatory subject of bargaining are conditioned on agreement on the nomandatory subject of bargaining [cases] Taft Broadcasting Co 274 NLRB 260 261 (1985) See also La trobe Steel Co Y NLRB 630 F 2d 171 179 (3d Cir 1980) ( What Borg Warner prohibits is insistence upon a non mandatory subject as a condi tion precedent to entenng an agreement ) 19 An impasse in collective bargaining negotiations exists when good faith negotiations have exhausted the prospects of concluding an agree ment or when there [is] no realistic possibility that continuation of discussion[s] would [be] fruitful Television Artists AFTRA v NLRB 395 F 2d 622 624 628 (D C Cir 1968) 19 The June 19 1984 contract proposal omitted the union security and the exclusive union hiring hall provisions and for the first time excluded Continued HOWARD ELECTRICAL & MECHANICAL cumstances have persuaded me that when Respondent implemented its June 19 1984 contract proposal that ne gotiations between the parties were still at an impasse 20 Based on the foregoing, I find that when Respondent unilaterally changed the employees wages and benefits on July 1, 1984, by implementing its June 19 1984 con tract proposal, that it did so after it had bargained with the Unions to a valid impasse I therefore shall recom mend the allegations pertaining to this conduct be dis missed in their entirety 4 The August 15, 1984 contract proposal As set forth in detail, supra, on August 15, 1984, Re spondent sent the Unions a new proposal modifying its June 19, 1984 contract proposal in one respect, it gave the employees covered by the contract an option to par ticipate in either the contract benefit plans or the Re spondent's profit sharing and major medical plans Re spondent wrote the Unions on August 15, 1984 that if they did not accept this change in Respondents proposal the apprentices from the unit and lowered the hourly wage rate for jour neymen and subjected the continuation of Respondent s benefit contnbu tions to a new condition 20 Whether Respondent s course of conduct including the nature of its bargaining proposals and the fact that it only offered the Unions I1 days to consider its June 19 1984 contract proposal before implementing it warrants the inference Respondent was bargaining in bad faith without a sincere desire to reach an agreement was not alleged in the complaint as a violation of the Act In entenng into the stipulation of facts in this case the parties did not litigate this issue Accordingly insofar as the General Counsel appears to be arguing Respondent was engaged in overall bad faith bargaining so as to preclude the existence of a valid impasse I have not considered this argument 495 by August 20, 1984 we will presume that you have re jected the change and we will implement it immediate ly By letters dated August 16, 1984 and August 20 1984 the Unions notified Respondent they rejected this proposal The record the stipulation of facts does not say whether Respondent implemented its August 15 1984 proposal The General Counsel contends Respondent violated Section 8(a)(5) and (1) of the Act by unilaterally chang ing the employees' benefits of employment when on or about August 20, 1984, it implemented its August 15, 1984 benefit proposal without affording the Unions an opportunity to bargain about the matter The General Counsels contention is without ment because there is in sufficient evidence to establish that Respondent in fact implemented this proposal I therefore shall recommend the complaint be dismissed insofar as it encompasses this allegation 5 The Respondent's July 1985 bargaining conduct Lastly, with respect to the General Counsels conten tion that in July 1985 Respondent engaged in bad faith bargaining in violation of Section 8(a)(5) of the Act by proposing in negotiations that it be given the right to retain unilateral control over all aspects of the pre ap prentices terms and conditions of employment, I am of the view that this contention is without meet for the rea sons set forth earlier in the section of the decision deal ing with the setting aside by the Regional Director of the parties settlement agreements [Recommended Order for dismissal omitted from pub lication ]