Mack Trucks, Inc.

864 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Mack' Trucks, Inc. and International Union, United Automobile, Aerospace and Agricultural Imple- ment Workers of America and Local Union No. 229. Case 22-CA-15827 June 12, 1989 DECISION AND ORDER BY MEMBERS JOHANSEN, HIGGINS, AND DEVANEY On October 25, 1988, the Regional Director for Region 22 of the National Labor Relations Board issued a complaint and notice of hearing and, on December 6, 1988, an order dismissing complaint in part and approving partial withdrawal of charge, alleging that the Respondent has engaged in and is engaging in certain unfair labor practices affecting commerce within the meaning of Section 8(a)(1) and (5), Section 8(d), and Section 2(6) and (7) of the National Labor Relations Act. Subsequently, the Respondent filed an answer, admitting in part and denying in part the allegations of the complaint and requesting that the complaint be dismissed in its entirety. Thereafter, on January 3, 1989, the General Counsel, by counsel, filed with the Board in Wash- ington, D.C., a Motion for Summary Judgment and memorandum in support, with exhibits attached. The General Counsel submits that there is no genu- ine issue about any material fact and that summary judgment should be granted. The General Counsel requests that the Board find that the Respondent has violated Section 8(a)(1) and (5) of the Act and issue an order requiring the Respondent to cease and desist. On January 9, 1989, the Board issued an order transferring the proceeding to the Board and a Notice to Show Cause why the General Counsel's motion should not be granted. On January 25, 1989, the Respondent filed a memorandum of law, with exhibits attached, in opposition to the General Counsel's Motion for Summary Judgment. The National Labor Relations Board has delegat- ed its authority in this proceeding to a three- member panel. Ruling on Motion for Summary Judgment The General Counsel alleges that the Respond- ent about June 13, 1988, announced and unilaterally implemented changes in the contractual wage rates of new hires, at its Somerset, New Jersey facility, without the consent of the Unions as the exclusive bargaining representative of the Respondent's em- ployees. The Respondent admits that it announced and implemented an increase in the wage rate of new hires without the consent of the Unions. The Respondent, however, defends its action on grounds of business necessity, asserting an inability to attract new employees at the existing wage rate. For the reasons set forth below, we grant the Gen- eral Counsel's Motion for Summary Judgment. On the entire record, the Board makes the fol- lowing FINDINGS OF FACT 1. JURISDICTION The Respondent, a corporation manufacturing heavy-duty trucks with various facilities through- out the world, has its parts operation headquarters at its facility in Somerset, New Jersey, the only lo- cation involved here, where, during the 12 months preceding issuance of the complaint, it purchased and received products, goods, and materials valued in excess of $50,000 directly from points outside the State of New Jersey. The Respondent admits, and we find that it is an employer engaged in com- merce' within the meaning of Section .2(6) and (7) of the Act and that the Unions are labor organiza- tions within the meaning of Section 2(5) of the Act. II. ALLEGED UNFAIR LABOR PRACTICES A. The Unit The following employees of Respondent consti- tute a unit appropriate for the purposes of collec- tive bargaining within the meaning of Section 9(b) of the Act: All office employees at Respondent's Parts Di- vision at Somerset, New Jersey, excluding fac- tory representatives, auditors, draftsmen, per- sonnel department employees, dispensary de- partment employees, buyers, assistant buyers, methods and equipment engineers, confidential payroll clerks, confidential secretaries, supervi- sors, assistant supervisors, clerical supervisors (subject to Article 29, Section 9(c) of the Local Supplement), executives, executive as- sistants and all other supervisors with the au- thority to hire, promote, discharge, discipline or otherwise effect changes in the status of employees or effectively recommend such action. At all times material the Unions have been the recognized exclusive collective-bargaining repre- sentative of the unit. Recognition has been em- bodied in successive master and local collective- bargaining agreements, the most recent of which are effective from May 4, 1987, to November 3, 1992, and February 2, 1987, to February 1, 1993, respectively. 294 NLRB No. 71 MACK TRUCKS B. The Unilateral Changes The complaint alleges that the Respondent, about June 13, 1988, announced and implemented a change in the contractual wage rate for new hires without the consent of the Unions, during the term of the parties' collective-bargaining agreements, in violation of Section 8(a)(5) and (1) of the Act. The Respondent admits that it announced and imple- mented an increase in the wage rate of new hires without the consent of the Unions. Indeed, in its memorandum in opposition to the Motion for Sum- mary Judgment the Respondent concedes it is im- mediately apparent that "the dispute over summary judgment in this case is not whether any facts are in dispute between the parties." The Respondent defends its action on business necessity. Thus, ac- cording to an affidavit by a Human Resources As- sistant in the Somerset facility, although Mack had never experienced difficulty in obtaining qualified applicants in the past, it had "a great deal of diffi- culty obtaining a qualified person who was willing to work for the starting rate fixed by the collective bargaining agreement" in the spring of 1988. The Respondent then approached the Unions seeking approval of a wage change. The Unions in turn sought other changes. The parties did not reach agreement, the Unions withheld consent to the change, and the Respondent implemented the new wage unilaterally. As a defense to the complaint, the Respondent asserts that the Supreme Court and the Board have recognized "the possibility that ex- tenuating circumstances might justify unilateral mid-term modification of the terms of a collective bargaining agreement." From this, the Respondent argues that summary judgment is inappropriate, and "a hearing is necessary so that the company can fully present this defense." The General Counsel contends that the Respond- ent's answer obviates the need for a hearing, that the Respondent has admitted unilaterally imple- menting a wage change during the term of the col- lective-bargaining agreement without the bargain- ing representatives' consent and that the proffered business justification is essentially irrelevant. We agree with the General Counsel. As the Board stated in Oak Cliff-Golman Baking Co., 207 NLRB 1063 at 1064 (1973): The unambiguous language of Section 8(d) of the Act explicitly: (1) forbade Respondent's midterm modification of the contract's wage provisions without the Union's consent; and (2) granted the Union the privilege it exercised to refuse to grant consent. The proscribed action is not excused by the prof- fered economic need, or by the fact that it may 865 serve what may appear to the Board to be a desira- ble objective. Ibid. The fact that the Unions agreed to discuss the Respondent's proposed modification and offered counterproposals does not signify that the Unions agreed to reopen the contract, nor is there any such contention by the parties. Accord- ingly, these discussions do not affect the result here. Herman Bros., 273 NLRB 124 fn. 1 (1984); Connecticut Light & Power, 271 NLRB 766 (1984). Accordingly, the General Counsel's Motion for Summary Judgment is granted. . CONCLUSIONS OF LAW 1. The Respondent, Mack Trucks, Inc., is an em- ployer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. The Unions are labor organizations within the meaning of Section 2(5) of the Act. 3. By announcing and implementing changes in the contractual wage rates of new hires during the term of collective-bargaining agreements without the consent of the'collective-bargaining representa- tive, the Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(1) and (5), Section 8(d), and Section 2(6) and (7) of the Act. REMEDY Having found that the Respondent has violated Section 8(a)(5) and (1) of the Act, we shall order it to cease and desist and to take certain affirmative action designed to effectuate the policies of the Act. Thus, we shall require that the Respondent revoke the unilateral wage increase if the Unions, as the exclusive collective-bargaining representa- tive, so requests. ORDER The National Labor Relations Board orders that the Respondent, Mack Trucks, Inc., Somerset, New Jersey, its officers, agents, successors, and as- signs, shall 1. Cease and desist from (a) Refusing to bargain with International Union, United Automobile, Aerospace and Agricultural Implement Workers of America and Local Union No. 229 by unilaterally announcing and implement- ing wage raises during the term of collective-bar- gaining contracts without the consent of the bar- gaining representative. (b) In any like or related manner interfering with, restraining, or coercing employees in the ex- ercise of the rights them guaranteed by Section 7 of the Act. 2. Take the following affirmative action neces- sary to effectuate the policies of the Act. 866 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD (a) On request by the designated bargaining rep- resentative, rescind the unilateral increases in wage rates of new hires at its Somerset, New Jersey fa- cility. (b) Post at its facility in Somerset, New Jersey, copies of the attached notice marked "Appendix."' Copies of the notice, on forms provided by the Re- gional Director for Region 22, after being signed by the Respondent's authorized representative, shall be posted by the Respondent immediately upon receipt and maintained for 60 consecutive days in conspicuous places including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. (c) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Respondent has taken to comply. ' If this Order is enforced by a judgment of a United States court of appeals, the words in the notice reading "Posted by Order of the Nation- al Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board " APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post and abide by this notice. WE WILL NOT refuse to bargain with Internation- al Union, United Automobile, Aerospace and Agri- cultural Implement Workers of America and Local Union No. 229 by unilaterally granting wage in- creases during the term of collective-bargaining agreements without the consent of the employees' designated representative. 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 by the designated bargain- ing representative, rescind the wage increase for new hires we unilaterally implemented for unit em- ployees during the term of our collective-bargain- ing agreements. The appropriate unit is: All office employees at Mack Truck, Inc.'s Parts Division at Somerset, New Jersey, ex- cluding factory representatives, auditors, draftsmen, personnel department employees, dispensary department employees, buyers, as- sistant buyers, methods and equipment engi- neers, confidential payroll clerks, confidential secretaries, supervisors, assistant supervisors, clerical supervisors (subject to Article 29, Sec- tion 9(c) of the Local Supplement), executives, executive assistants and all other supervisors with the authority to hire, promote, discharge, discipline or otherwise effect changes in the status of employees or effectively recommend such action. MACK TRUCKS, INC.