Hyatt Regency Memphis

HYATT REGENCY MEMPHIS 289 Hyatt Hotels Corporation d/b/a Hyatt Regency Memphis and Highway and Local Motor Freight Employees Local Union No. 667, affili- ated with International Brotherhood of Team- sters, Chauffeurs, Warehousemen and Helpers of America, AFL-CIO.' Cases 26-CA-10117 and 26-CA-10143 August 25, 1989 DECISION AND ORDER BY CHAIRMAN STEPHENS AND MEMBERS CRACRAFT AND HIGGINS On December 4, 1984, Administrative Law Judge Thomas R. Wilks issued the attached deci- sion. The General Counsel filed exceptions, a sup- porting brief, and a motion to consolidate cases.2 The Respondent filed a reply to the General Coun- sel's exceptions. The National Labor Relations Board has delegat- ed its authority in this proceeding to a three- member panel. The Board has considered the decision and the record in light of the exceptions and brief and has decided to affirm the judge's rulings, findings,3 and conclusions4 only to the extent consistent with this Decision and Order. The judge found that the Re- spondent violated Section 8(a)(1) of the Act when its supervisors, Dial and Pologruto, told employees on several occasions that, in the event of a strike, the striking employees "could" or "would" be re- placed and if they were reinstated it would be as new employees. Dial and Pologruto also stated that the striking employees "would" or "could" lose their accumulated seniority and pension benefits. Although the judge found the Respondent's statements were coercive and made to employees who were about to engage in "protected union ac- ' The name of the Teamsters in the caption has been amended to re- flect its affiliation with the AFL-CIO 2 We deny the General Counsel' s motion to consolidate this case with Cases 26-CA-9352- 1 & 2 and 26-CA-9648 et al. a The General Counsel has excepted to some of the judge's credibility findings The Board's established policy is not to overrule an administra- tive law judge's credibility resolutions unless the clear preponderance of all the relevant evidence convinces us that they are incorrect Standard Dry Wall Products, 91 NLRB 544 (1950), enfd. 188 F 2d 362 (3d Cir. 1951) We have carefully examined the record and find no basis for re- versing the findings 4 In view of our adoption of the judge's finding that the Respondent's February 1983 wage increase was reasonably comprehended within its preimpasse proposal , we find it unnecessary to pass on what the Re- spondent's past practice with regard to wage increases was or whether the February 1983 increase was consistent with that practice We further find it unnecessary to rely on the judge's discussion of any purported in- consistency of the General Counsel in alleging that the Respondent vio- lated Sec. 8(a)(5) in Hyatt Regency Memphis, 296 NLRB 259 (Hyatt /), issued today, by refusing to grant a wage increase, and then in this later proceeding alleging that the Respondent violated Sec 8(a)(5) by granting a wage increase No exceptions were taken to the judge's dismissal of an 8(a)(3) allega- tion concerning the discharge of employee Wiseman. tivities, i.e., a strike," he concluded that a remedial Order was unnecessary because of the existence of the remedial Order issued by Administrative Law Judge Robertson in Cases 26-CA-9352-1 & 2, et al. (adopted by the Board in 296 NLRB 259) that gave sufficient notice to the Respondent's employ- ees of their Section 7 rights under the Act. Fur- ther, the judge reasoned that even if Judge Robert- son's Order was not adopted by the Board, "[T]he infractions in this case [would] constitute isolated, insignificant incidents . . .." The General Counsel excepts, contending that a remedial Order is necessary and that it is the Board's responsibility to ensure that employees are fully informed of their rights by posting of a notice, especially where, as here, the judge found that the employer had interfered with the rights of its employees to engage in concerted activities. The General Counsel also contends that the judge was in error in relying on the Order in Hyatt Regency Memphis, supra, because that Order did not include any reference to threats of loss of benefits in the event of a strike. The General Counsel also asserts that the judge erred in determining that the Re- spondent's unlawful statements were "isolated" and "insignificant" because it is irrelevant to the issu- ance of an appropriate remedy that the statements were directed to only a few employees, that in any event, and contrary to the judge, the record shows that these statements were widely disseminated throughout the Respondent's hotel. We find merit to the General Counsel's excep- tions. To begin with, we note that that the particu- lar unlawful threats found in this case were not al- leged or addressed in the proceeding reported at 296 NLRB 259, nor are they covered by the Order issued in that case. Furthermore, the record shows that these threats were widely disseminated among the Respondent's employees and, therefore, they were not "isolated" or "insignificant," as the judge stated. We have consistently found that remarks such as these violate the Act because they have a tendency to interfere with the free exercise of em- ployee rights under the Act; and it is immaterial whether the remarks had a successful effect on the employees. 5 Accordingly, we find that a remedial Order is appropriate. CONCLUSIONS OF LAW 1. By unlawfully telling employees that in the event of a strike, striking employees "could or would" be replaced and that if they were reinstat- 8 See American Freightways Co, 124 NLRB 146, 147 ( 1959), cited with approval in Armstrong Rubber Co., 273 NLRB 233 (1984) See also B & P Trucking, 279 NLRB 693, 698 (1986) 296 NLRB No. 37 290 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD ed, they would be treated as new employees and "would or could" lose their seniority and pension benefits, the Respondent has violated Section 8(a)(1) of the Act. 2. The foregoing unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. 3. The Respondent has not violated Section 8(a)(1), (3), and (5) of the Act as alleged except as set forth above. IT IS FURTHER ORDERED that the complaint, as amended, is dismissed insofar as it alleges violations of the Act not specifically found herein. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government THE REMEDY Having found that the Respondent has engaged in certain unfair labor practices , we shall order it to cease and desist therefrom and to take certain af- firmative action designed to effectuate the policies of the Act. ORDER The National Labor Relations Board orders that the Respondent, Hyatt Hotels Corporation d/b/a Hyatt Regency Memphis, Memphis, Tennessee, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Threatening employees that in the event of a strike, striking employees would be replaced and if the strikers are reinstated , they would be treated as new employees and would lose all of their accumu- lated seniority and pension benefits. (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) Post at its Memphis, Tennessee location copies of the attached notice marked "Appendix."6 Copies of the notice, on forms provided by the Re- gional Director for Region 26, 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. (b) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Respondent has taken to comply. 9 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." The National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post and abide by this notice. Section 7 of the Act gives employees these rights. To organize To form, join, or assist any union To bargain collectively through representa- tives of their own choice To act together for other mutual aid or pro- tection To choose not to engage in any of these protected concerted activities. WE WILL NOT threaten our employees with re- placement if they engage in a strike , or that if rein- stated after striking they will be treated as new em- ployees and lose their seniority and pension bene- fits. 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. HYATT HOTELS CORPORATION D/B/A HYATT REGENCY MEMPHIS W. Paul Tuberville, Esq., for the General Counsel. William K Carmichael and Arch Stokes Esqs., of Atlanta, Georgia, for the Respondent. Howard R. Paul, Esq. and Duria Jones, of Memphis, Ten- nessee, for the Charging Party. DECISION STATEMENT OF THE CASE THOMAS R. WILKS, Administrative Law Judge. The original charges in this matter were filed by Highway and Local Motor Freight Employees Local Union No. 667 affiliated with International Brotherhood of Team- sters, Chauffeurs, Warehousemen and Helpers of Amer- ica (Union), on March 7 and 24, 1983. After amended charges, and the issuance of individual complaints, the consolidated complaint issued on April 21, 1983 . Answers denying unfair labor practices were filed. After the filing and disposition of a variety of mo- tions, the trial in this matter commenced before me in HYATT REGENCY MEMPHIS Memphis, Tennessee, on August 8, 1983, and continued thereafter on various dates in August, October, and No- vember 1983. Briefs were submitted to me in mid-Febru- ary 1984. On October 24, 1984, Respondent filed a sup- plemental brief with attached affidavit, to which the General Counsel objected. In view of the nonprovision in the Board's Rules for supplemental briefs, it is hereby rejected. The complaint alleges that Respondent and the Charg- ing Party Union had engaged in collective bargaining after the Union's certification as bargaining agent on No- vember 27, 1981, and that such bargaining commenced in January 1982, and that during that period of time Re- spondent made regressive proposals regarding wages, benefits and timeclocks, and failed to meet or communi- cate with the Union "between January and March 1983." The complaint alleged also that Respondent "attempted to undermine employee support for the Union during the course of collective-bargaining negotiations by unilateral- ly implementing wage increases for its employees on or about February 1, 1983, in excess of the latest proposal made by Respondent at that time, without prior notice to the Union and without having reached an impasse in col- lective bargaining." The complaint alleged that Respond- ent, by its "overall acts and conduct, including [the fore- going] refusal to bargain in good faith with the Union was in violation of Section 8(a)(5) of the Act." At the trial, the General Counsel withdrew the com- plaint allegation in reference to the timeclocks. The par- ties understood the complaint to allege that Respondent had refused to bargain by engaging in surface bargaining, i.e., bargaining with a fixed intent not to reach agree- ment. However, at the October 18 session of the trial (Tr. 925), General Counsel explicitly amended the Com- plaint to allege surface bargaining throughout the course of bargaining, despite the General Counsel's stated posi- tion at the trial and in its brief that such bad faith did not "manifest" itself until late in 1982 and early 1983 when the first evidence of such conduct emerged . Specifically, counsel for the General Counsel alleged that after a long period of hard bargaining, the first manifestation of bad faith occurred in November 1982 when Respondent began to engage in regressive bargaining concerning wages, holidays, and insurance, i.e., from a 20-cent wage offer to 18 cents, from 6 holidays to 5, from total insur- ance cost contributions to a majority contribution. During the course of the trial, the General Counsel also stated as part of the theory of prosecution, that the Feb- ruary wage increases were also contrary to Respondent's past practice of granting wage increases (Tr. 491). The consolidated complaint also alleges that certain of Respondent's lower echelon supervisors in violation of Section 8(a)(1) made coercive statements to employees concerning their prospective engagement in a strike that occurred shortly thereafter on March 17, 1983, and which is alleged to be an unfair labor practice strike. That strike is ongoing, and as of the trial there was no issue concerning a refusal to reinstate former strikers. Fi- nally, the consolidated complaint alleges that Respond- ent's agents in September 1982 threatened an employee with loss of employment if he refused to testify in sup- port of Respondent in a related unfair labor practice 291 case, and thereafter discharged Christopher Wiseman on October 15, 1982, because of his union and concerted ac- tivities. At the trial the General Counsel explained that the theory of Wiseman's unlawful discharge is premised upon his refusal to testify on behalf of Respondent in the related unfair labor practice case. That other case referred to above involves more than a casual connection to the issues herein . That matter in- volved a consolidated complaint that issued on May 28, 1982, and was heard by Administrative Law Judge J. Pargen Robertson during July, September, and October 1982. Judge Robertson issued his decision on March 17, 1983 (Cases 26-CA-9352-1; 9352-2, 9648; JD-(ATL)- 18-83.) As of this writing, the Board has not disposed of exceptions filed to Judge Robertson's findings and rec- ommended remedial Order. That case involved allega- tions of discrimination and coercion violative of Section 8(a)(3) and (1) of the Act. Also involved in that case was the allegation and finding that Respondent violated Sec- tion 8(a)(1), (3), and (5) of the Act by bad-faith bargain- ing consisting of unilaterally discontinuing its wage ad- justment plan by refusing to grant bargaining unit em- ployees longevity increases due to eligible employees in January and July 1982 and every 6 months thereafter pursuant to its preunion certification policy and practice. Judge Robertson also found similar unlawful deprivation of semiannual merit increases and unlawful abandonment of the annual wage plan revision, both of which were due under the preunion certification wage policy. During the litigation before Judge Robertson, counsel for the General Counsel explicitly stated that the General Coun- sel was not alleging bad-faith surface bargaining by Re- spondent in the contract negotiations . During the instant trial, counsel for the General Counsel explained that prior to the close of the case before Judge Robertson, Respondent's bad faith had not manifested itself, but that subsequently that manifestation revealed that Respondent had all along really never intended to reach agreement. Thus he argues that subsequent conduct had a retroac- tive revelation whereby previously characterized "hard bargaining" was really surface bargaining. During the instant trial, counsel for the General Coun- sel objected to Respondent's attempt to elicit testimony in support of its alternative defense, that the February 1983 wage increases were in accord with past practice.' At first, counsel for the General Counsel contended that the issue of Respondent's past wage practices was rele- vant to the February issues but was "basically res judica- ta" (Tr. 480-483). Thereafter, counsel for the General Counsel conceded that as the issue was still pending before the Board, it was not res judicata. He nevertheless objected to receipt of any additional evidence as to em- ployer past wage practice and policy on the grounds that it had been previously litigated and was now pending before the Board and futile to relitigate the issue. The General Counsel , however, did not see fit to move to consolidate this matter with the first litigation by motion to reopen the first case and he objected to any suspen- ' The other defense is that bargaining impasse had been reached prior to the February raises. 292 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD sion of this hearing pending the Board 's resolution of the issue, and thereupon suddenly and inexplicably refused to concede that evidence of past wage practice was rele- vant. He then contended that the General Counsel's theory of violation was premised upon the unilateral granting of a wage increase in absence of impasse, and that the Respondent had the burden of raising and prov- ing past practice as a defense but he argued that I should preclude the receipt of any such evidence and restrict my findings to administrative notice of Judge Robert- son's findings (Tr. 798-827). However, I placed no re- striction upon any attempt by Respondent to adduce evi- dence of past wage increase practice. I warned the par- ties, that, it was possible that my decision in this case might await disposition by the Board of the past wage increase practice and policy issue (Tr. 1650). Analysis of the facts herein and Board precedent regarding the issue of impasse lead me to conclude that further delay of this decision is not warranted. On the entire record in this case, including my obser- vations of the demeanor of the witnesses, I make the fol- lowing2 FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT Respondent, a corporation , maintains an office and place of business in Memphis, Tennessee, where it is en- gaged in the operation of a hotel where food and lodging are provided for guests . At its Memphis place of busi- ness, Respondent has attained an annual gross revenue in excess of $500,000, and annually purchases goods and materials valued in excess of $50,000 directly from points located outside the State of Tennessee. Respondent is now, and has been at all times material herein, an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. Ii. LABOR ORGANIZATION The Union is now, and has been at all times material herein, a labor organization within the meaning of Sec- tion 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES A. Background Bargaining January 1982- January 1983 Pursuant to a Board-conducted secret-ballot election, the Union was certified as bargaining agent for an appro- priate unit of employees on November 27, 1981. Allega- tions of Respondent's alleged antiunion coercion of em- ployees were encompassed in the above-mentioned case now pending before the Board. Negotiations toward reaching agreement on a collective-bargaining agreement commenced in January 1982. There is no allegation or 2 Respondent 's unopposed postbrief motion of June 7, 1984, to incorpo- rate into the record its July 7, 1983 subpoena duces tecum upon the Union, the Union's motion to revoke same is hereby granted My ruling granting the motion to revoke is part of the record (Tr 2077-2081) Re- spondent's subpoena and the motion to revoke will be marked as R. Exh. 55 and incorporated into Respondent's exhibits evidence as to any reluctance by Respondent to meet with and negotiate with the Union during the negotia- tions which spanned that entire year . Testimony as to the 1982 and 1983 negotiations , as well as exhaustive docu- mentation by way of correspondence containing summa- rizations of negotiations , reveals a surprisingly large area of factual agreement. During the phase of negotiations from January 20 to June 1982, Respondent's chief negoti- ator was attorney Arch Stokes . In subsequent negotia- tions, Respondent's chief negotiator was Stokes' associ- ate, Attorney William Carmichael , with Stokes playing a subordinate role. During the entire 1982-1983 negotiations the Union's chief negotiator was its Business Agent C. R. Boyd. Representing the Union also was Duria Jones , an orga- nizer and business agent. Jones described himself as Boyd's "back up" in negotiations. Boyd was present during the General Counsel's presentation of the case-in- chief, and during a substantial portion of Respondent's defense. Boyd was not called to testify as to the negotia- tions. The General Counsel therefore relied on the testi- mony of the Union's backup negotiator which was un- corroborated by the chief negotiator. The Respondent relied on the testimony of Stokes and Carmichael which was extremely detailed, spontaneous, responsive and cer- tain. Where there is a conflict in testimony between Re- spondent's negotiators and Jones, I must credit the former. Jones' testimony was more generalized, vague, evasive, inconsistent and far less certain. Prior to the advent of the Union , Respondent provid- ed certain fringe benefits to its employees, including health care, dental care, group term life insurance, acci- dental death and dismemberment insurance, group travel benefits and disability insurance . At the outset of negotia- tions Respondent provided the Union with information as to the level of benefits that it had been providing the employees. Stokes, however , warned that the Respond- ent, despite outward signs of affluence , was undergoing an economic adversity at the Memphis operation. Stokes explained Respondent's bargaining technique of offering at some point a "final offer" which constituted "the max- imum amount of money Respondent would be willing to propose," at a time in negotiations when it could be made with a view towards "wrapping the entire contract and putting it to bed." He warned that subsequent offers would be modified by changes in the economic condi- tions of the hotel for the better or the worse , i.e., a higher economic offer or a lower offer . In early negotia- tions, substantial time was spent by Stokes in explaining the hospitality industry bargaining peculiarities to Boyd and Jones, e.g., the fact of a wage differential between tipped and nontipped employees. Stokes provided the union negotiators with a variety of contracts he had ne- gotiated on behalf of other Respondent hotels and hotel industry labor unions . During the first phase of negotia- tion, Stokes discussed at length the "quantification" of labor costs in the hospitality industry. He explained in depth the cost effect of a variety of benefits. On February 3, Stokes by letter suggested a schedule of meetings for February 3, 4, 17, and 18 and March 4 and 5, and confirmed his offer made at negotiations to HYATT REGENCY MEMPHIS provide the Union with any relevant information it needed for bargaining . That schedule was met. By February 4, 1982, the parties had met three times and exchanged contract proposals and agreed to first ne- gotiate contract language rather than economic issues. The course of bargaining reveals no evidence of Re- spondent's opposition to the Union's representational status. Thus, for example, a dues-checkoff system was readily agreed on. The eighth and ninth sessions were held on March 18 and 19. By letter dated March 12, 1982, the Union de- manded that employees be granted pay raises allegedly due pursuant to past practice and policy. Stokes declined that request by letter of March 18. In the meantime Stokes had been provided with the Union's second pro- posed contract dated March 11, containing certain eco- nomic proposals, and the eighth and ninth bargaining ses- sions occurred on March 18 and 19 , 1982. Stokes again discussed the "quantification" of labor costs. By March 25, he obtained a summarization by the hotel' s fiscal of- ficer of 1980 and 1981 comparative economic data for 156 nontipped and 67 tipped unit employees, including labor costs per occupied room, labor costs percentage of gross sales, room occupancy percent, average room rate, average employee hourly rate ($4.02 nontipped and $2.37 tipped); compensable hours and labor costs, nonproduc- tive compensable hours and costs, and additional costs. The analysis evaluated the economic impact of the Union's second proposed contract but it did not encom- pass the cost of wage increases or other economics not yet proposed by the Union. It also reflected that employ- ees had not received any wage increase since the Board conducted the election of September 11, 1981. Stokes as- certained from this report that labor costs increased 10.8 percent in 1981 from 1980, whereas the average room rate only increased 6 percent. Further, the percentage of labor costs to gross sales increased from 30.2 percent to 35.7 percent. Stokes conveyed this data to the Union in negotiations and indicated that the hotel's economic problems were greater than he had anticipated and its profitability was in jeopardy. Stokes explained to the union negotiators that the traditional manner of coping, i.e., increasing room rates, was not plausible. He ex- plained that the hotel industry depression of 1981, 1982, and 1983, and the increased competition in the luxury hotel business in Memphis precluded the increase in room rates. He pointed out the recent other hotel con- tracts he had negotiated, in 1982 and 1983, involved modest increases of less than 5 percent. In fact, the Memphis operation , he explained, had made virtually no profit for the owners since it opened in 1975. The thrust of Stokes' position as he expressed it to the Union was that the Memphis operation's objective was to contain or reduce the labor cost factor in its operation in order to assure its viability as a profitable organization. He de- vised various forms of presentations to the Union, includ- ing graphs and charts, wherein he analyzed the cost impact of the total package of benefits then enjoyed by the employees and compared the cost increase of the Union's March 11 proposals, which he estimated would double the nonproductive compensable hour cost. 293 Subsequently Respondent calculated its "absolute max- imum amount of money" that it concluded that it would pay. Respondent advised the union negotiators that it was in the process of reevaluating its attitude toward em- ployee benefits, including the practice of paying the to- tality of the insurance premium in order to contain fur- ther calculated cost escalation . Stokes warned the union negotiators that Respondent may take a position, which in fact it later did, that it would be willing to pay only a part of the employee insurance costs and cited to the Union a similar position he took in negotiating a contract at another area calling for Respondent 's contribution of only a majority of the premium costs as opposed to its past practice there of paying 70-90 percent of that pre- mium. During the protracted discussions of Respondent's economic projections and calculations of the impact of labor costs, it suggested that the Union hire its own ac- countant to analyze its financial records if the Union did not believe its representations. Stokes insisted in negotia- tions that Respondent could not increase labor costs with no expectation of an increase in room occupancy. Stokes' economic arguments and analysis were never disputed, challenged, or argued by the union negotiators. Stokes explained throughout negotiations that Respondent's eco- nomic offers were substantially similar to increases agreed to by other similar situated employees engaged in the hospitality industry. His assertion was never chal- lenged . In April 1982, Respondent calculated that its "absolute maximum amount of money" that it deemed able to offer encompassed a 20-cents-per-hour wage raise for nontipped employees as well as certain benefits. Respondent's third contract proposal was presented to the Union on March 30, 1982. Negotiations occurred on April 15 and 22 and May 10. On May 10, the Union sub- mitted a wage demand proposal providing for an 85-cent raise for all employees the first year and 65 cents per hour for each of the next 2 years of the contract. On May 19, Respondent's fourth contract proposal was sub- mitted which called for a 20-cent raise for nontipped em- ployees and 5 cents for tipped employees. At a June 3, 1982 meeting the Union submitted a second proposal "for wages and benefits" which sought a wage raise of 65 cents per hour for all employees the first year and 45 cents for the second and third year of a 3-year contract, employer payment of all health and dental insurance costs, increases in life insurance coverage, retirement plan contribution proposals and a variety of economics and other proposals . The parties were disagreed as to the Union's request for a timeclock system , Respondent's re- quest for a 5-year contract, the wage and economic pro- posals and a variety of other issues. The Union soon moderated its wage demand to seek a 20-cent raise for tipped employees. Respondent had taken the initial position that tipped employees were al- ready overcompensated and were due no wage increase because they had been effectively raised in wages as a natural result of the inflationary rising sales cost of meals, etc., from which their tips formed a percentage. On June 14, Stokes wrote to Boyd and set forth his quantification of the Union's second proposal on wages and other cost items wherein he asserted that the wage 294 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD increases above would increase costs over $440,000 from 1982 to 1984, and would be historically unprecedented and excessive . He asserted that the Union's total econom- ic proposal would cost an additional $2,298,600 over that 3-year period and that the wage increase sought of 184.5 percent over 3 years would be higher than any in the in- dustry. Stokes reminded the Union that its total labor cost in 1981 were over $2.9 million. Several more bargaining sessions occurred through June 1982 . By June 17, 1982, the Union had reduced its wage rate demand to 55 cents for nontipped employees in the first year, and 40 cents each for the second and third year of the contract and 20 cents for all 3 years for tipped employees. By June 17, 1982, after a total of 64 hours of bargaining from January 20, Respondent sub- mitted its seventh contract and wage proposal at the 15th bargaining session . In that proposal it offered a 5-cent raise to tipped employees, 20 cents to nontipped employ- ees, proposed 5 cents per hour incentive pay to senior employees, made concessions in a variety of areas, in- cluding the "grandfathering" of banquet employees with respect to continuing senior banquet employees at their old rate of pay while reducing the wage rate of less senior banquet employees. Respondent also made conces- sions regarding disciplinary proposals, checkoff of union dues, job classifications, definition of employee status, recognition clause language, a shop steward position, compensation of shop steward , management rights clause, e.g., subcontracting, overtime pay language, em- ployee rest breaks, meal break, report in pay, seniority clause and other language, disciplinary procedure, and incentive pay as an attendance reward . Stokes explained to the union negotiators that the seventh proposal con- tained its maximum offer on labor costs and warned that the proposal would not remain on the table indefinitely but might be withdrawn and modified according to eco- nomic changes. The union negotiators rejected that offer and threatened to strike. The Union did submit its fourth proposal on June 17, which it indicated : "This is our last proposal." The parties met again on June 18. Respondent's nego- tiators were augmented by its fiscal officer, James Bar- nish, who was presented to the Union for any question- ing they desired on Respondent 's economic position. Barnish explained Respondent's economic situation and the charts which reflected the labor costs impact upon its operations. The Union rejected Respondent's proposal. On June 23, Stokes, by letter to Boyd , summarized the respective position of the parties and asserted that the Union's economic demands were double that offered by Respondent, and excessive, but requested that he be con- tacted "at any time you are ready to discuss this matter further." In addition to the wage rates, disagreement re- mained, inter alia, in the following critical areas: merit raises, service charges for banquet employees, insurance benefits, holidays, maintenance of standards, timeclock, and duration of agreement. With respect to merit raises, Respondent's contract proposals, up to the seventh proposal , contained in arti- cle 6, section 9, the following: Incentive Increase. The wage scale set forth in the schedule of wages in the appendix of this agreement reflects minimum rates and does not prohibit an em- ployee from receiving a higher wage , based upon incentive increases for outstanding attendance records. Page 2, paragraph (d), of Stokes' June 23 summarization letter states: Hyatt and the Union agree that Hyatt has the dis- cretion to grant merit increases. The testimonial evidence and positions of both parties suggest that the Union had consistently opposed such discretion. Banquet employees had been receiving as of June 1982 a service charge in addition to the base wage. Respond- ent had proposed a reduction of that charge whereas the Union had proposed an increase . Respondent then reof- fered somewhat less of a reduction with a grandfather clause for the six most senior banquet employees. The Union insisted on an increase of the old rate but at slight- ly less than originally asked. The entire package of fringe benefits including, inter alia, health care, dental care, and life insurance had been provided by the employer. As of June 23, the Respond- ent agreed only "to maintain a majority of contribution costs of the existing health & welfare [insurance] benefits program for the existing Hyatt programs throughout the life of this Agreement." Article 15 of Respondent's pro- posal provided that Respondent retain discretion to de- termine any prospective change of insurance carrier and "terms, costs, component parts of said insurance policy, rates of contributions consistent with business needs." Further, it provided that the insurance program was to be nonnegotiable and to be provided by Respondent "upon its sole discretion." The Union had proposed ex- panded coverage, and participation in the Southern States Savings and Retirement Plan. By June 17, the Union dropped the retirement plan re- quest, and on June 18 agreed upon the current programs except that the "Company pays fifty percent (50%)" of dental charges but insisted upon health coverage for de- pendents and upon its original life insurance demands. The employees had been entitled to 6 paid holidays in the past. Respondent offered to retain those paid holi- days. The Union originally demanded 11 paid holidays but by June 23 proposed 6 paid holidays for the first year of the contract and an additional holiday added each year for the next 2 years. The Union demanded that the Respondent maintain conditions of employment at the highest level as of the time of the execution of the contract . Respondent agreed to maintain certain programs and benefits , e.g., locker rooms, educational assistance programs, recreational ac- tivities, pay advances, employee cafeteria, but insisted upon "discretion to maintain or modify the programs throughout the length of this contract." The parties remained apart on the Union's demand for timeclocks and Respondent's rejection of a 3-year term contract and insistence upon a 5-year term. HYATT REGENCY MEMPHIS On June 8, 1982, the union negotiators received Inter- national union authorization for a strike. On some date between June 23 and July 1, 1982, Boyd and Jones con- ducted a meeting of employees where a vote was taken and strike authorization granted to the negotiators. Jones testified that he reviewed the varying positions of the parties with the employees and stated to them that nego- tiations would continue. He conceded that nonagreement on a contract up to that time was a motivating factor for the vote, but insisted that the strike vote at that stage of negotiations was merely routine and in accord with standard union practice. He insisted that no impasse had been reached in bargaining. On July 1, the Union by letter notified Respondent that the employees rejected the June 23 proposal and voted to strike. On July 14, 1982, Stokes wrote Boyd a letter wherein he pointed out that the Union had as yet failed to offer a counterproposal to Respondent's last proposal, nor had he received any union request to negotiate . He then warned that Respondent 's last offer would remain "on the table for a period of 30 days," at which later point Respondent would "reassess" its "situation." In the meantime, the unfair labor practice charges in Cases 26-C-9352( l) and (2) and 26-CA-9648 had pro- ceeded to trial before Judge Robertson in July 1982. During the August sessions of that trial , the parties ar- rived at a settlement agreement which impacted directly upon collective-bargaining negotiations . As part of the resolution of those unfair labor practices , the Respondent on August 5 modified its seventh bargaining proposal by agreeing upon timeclocks, disciplinary language, the grandfathering of all banquet employees under the old service charge rate and finally agreed upon a reduced service charge rate for future banquet employees. It was agreed that the parties would resume bargaining to re- solve all remaining issues . Respondent reiterated that its seventh wage proposal remained the maximum that it in- tended to offer. The settlement of the unfair labor prac- tice charges in Judge Robertson's case was aborted due to the nonapproval of the agreement by certain discri- minatees whose waivers were necessary . That settlement was not approved by Judge Robertson . The Respondent therefore withdrew its modifications to the seventh pro- posal, as those modifications were in part a quid pro quo for settlement. Stokes withdrew as chief negotiator for the Respondent and was replaced by his colleague, Car- michael. During the litigation of the case before Judge Robert- son, which involved an 8(a)(5) bad-faith bargaining alle- gation based on alleged refusal to grant wage increases pursuant to past practice and policy , counsel for the General Counsel stated explicitly that it was not the po- sition of the General Counsel that Respondent had en- gaged in bad faith in contract bargaining . That trial con- cluded in October 1982. On August 10, Carmichael forwarded a letter to Boyd summarizing the August 5 meeting , the aborted settle- ment efforts, etc., and recited therein, inter alia: During our meeting on August 5, I asked you and Duria Jones, Jr., what the union wanted from Hyatt Regency Memphis in terms of wage increases and 295 in terms of Paragraph 16 of the Third Amended Complaint pending before the National Labor Rela- tions Board. You stated the union did not want Hyatt and would not authorize Hyatt to grant wage increases pursuant to its past practices and Employ- er Handbook, based upon Hyatt's discretion and other factors. Copies of that letter were forwarded to Judge Robert- son, the Regional Director, counsel for the General Counsel, Union Negotiator Jones and the union presi- dent, John Raney. The correspondence between the par- ties was stipulated into evidence , and stipulated and/or testified to as accurate except where explicitly contra- dicted. There is no credible, probative contradiction of the assertions in that letter. On August 13, Carmichael informed Boyd by letter that Respondent's seventh proposal was withdrawn and that a new proposal would be presented as soon as possi- ble. On August 17, Carmichael forwarded to Boyd, Re- spondent's eighth total contract and wage proposal and notification of the withdrawal of the agreements that were contingent upon settlement of the unfair labor prac- tices. An invitation to negotiate was extended to the Union. The eighth proposal eventually constituted a reit- er'tion of the original seventh proposal. However, with respect to article 6, section 19, Re- spondent modified its merit increase proposal by adding the following language, of "merit, outstanding perform- ance, or other factors," to be included in addition to at- tendance as a basis for incentive wage increases. Union Negotiator Jones responded by letter dated September 3, 1982, wherein he took note of Carmichael's August 17 letter and informed that the Union was "willing to bar- gain" the ensuing week, and asked why Respondent had not made a new proposal on wages . By letter dated Sep- tember 14, Carmichael responded with a suggested date for resumed negotiation and recited therein: Also Hyatt continues to inquire of the Union whether it will allow Hyatt to grant wage increases. Please advise if the Union's position has changed. The next event, however, was a negotiation meeting held on September 28. At that meeting, Boyd reduced the wage demand of the Union to 25 cents for all nontipped employees and 10 cents for tipped employees. He also, inter alia, offered terms of the contract as had been agreed upon by Respondent contingent upon unfair labor practice charge settlement. He offered in consideration for contract agreement the Union's consideration of withdrawing "paragraph 16 charge at the labor Board." Boyd confirmed the Union's position by letter to Re- spondent on September 29. Stokes responded by letter of October 7, wherein he stated that Respondent was "ana- lyzing and quantifying the costs embodied in this counter proposal," and promised an answer at that time when Barnish, the fiscal officer, had "thoroughly costed this proposal." He indicated that he planned to be in attend- ance at the unfair labor practice proceedings before Judge Robertson in Memphis on October 25 and would have a response ready on that date. 296 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD For reasons unexplained there was a hiatus in contacts between the parties until a meeting was held on Novem- ber 29 between Jones, and the Respondent negotiators headed by Carmichael.3 Carmichael had mailed to Boyd Respondent's ninth total contract and wage proposal on November 24. He also hand-delivered a copy to Jones at the November 29 meeting . That proposal reiterated the eighth proposal with two critical changes. The wage offer was now reduced to 18 cents from 20 cents for nontipped employees and the holiday offer was reduced from 6 paid holidays to 5, i .e., a reduction from the 6 paid holidays then afforded to employees. Carmichael as- serted in that meeting that the wage and holiday propos- al was now the maximum that Respondent would offer. Carmichael explained to the negotiators that the reduc- tion in Respondent's offer was based on recent economic information he had received from his client concerning the Memphis hotel operation. He argued that on the na- tional scene, unions were negotiating lower wage settle- ments in 1982 in deference to benefits . He urged the Union not to underestimate the cost value of the benefits. He cited and proffered to the union certain news articles on the subject of national wage settlement and the cost value of fringe benefits. He further offered to the Union "any financial information that they wanted us to share with them in justification of our economic position at that time." He explained that the offer was determined by a deteriorating "performance and business" at the hotel at that time. Carmichael offered to bring Barnish to the meetings to explain Respondent's calculation and of- fered the Union "whatever" financial information they desired. Jones merely responded that it could not accept the lesser offer. Jones did not question, challenge, or debate the Respondent's argument of deteriorating eco- nomic situation as the determinant for a reduction in its wage and holiday offer. Jones asked for no economic data. Carmichael stated that the wage offer it had made was the maximum that it would make and that its posi- tion was firm. At the November 29 meeting the parties reviewed and discussed the other areas of disagreement. Carmichael's testimony concentrated on the wage and holiday offer discussion . Jones was asked whether there was any dis- cussion concerning the issue of "discretionary raises," and answered cryptically only that Carmichael "felt very strong" on the issue, i.e., the right to grant merit raises for "attendance, good job production" and other factors, and that Jones merely responded, "We felt like every- thing should be across the board ." Jones gave no testi- mony of prior negotiation with respect to Respondent's merit raise proposal, nor with respect to Carmichael's past suggestion in the August 10 letter that , on August 5, the Union objected in negotiations to the granting of dis- cretionary merit raises to the employees. With respect to the issue of Respondent's insurance proposal, Jones testified that the conversation consisted of a few words exchanged wherein Carmichael stated that "they still would have to insert at our [discretion]" in the insurance proposal . The testimony is too cryptic to 3 Boyd was absent from this meeting. enable any meaningful conclusions as to negotiations of the discretionary element proposal by Respondent. As to the other issues, Respondent remained firm on a 5-year contract term despite the Union's offer of a 5-year contract with a wage reopener clause in the third, fourth, and fifth year. Disagreement still remained as to the Union's timeclock demand . Disagreement also con- tinued as to the probation period and number of banquet employees to be grandfathered under the Respondent's proposed service charge reduction for banquet employ- ees. Some agreement was reached with respect to the contractual language relating to guaranteed work hours with respect to senior employees and the determination of seniority between competing employees who com- menced work simultaneously. On December 6, Carmichael wrote Jones a letter wherein he summarized the November 29 meeting and a telephone conversation between himself and Jones wherein Jones promised to forward to him a written pro- posal. Carmichael indicated a willingness to meet with Jones during the week of December 6, in Atlanta as of- fered by Jones, or in Memphis on December 15 or 16. On December 15, Carmichael wrote again to Jones stat- ing he had received no response to his December 6 letter and offering to meet in Memphis "at any time." Jones, however, had prepared a counterproposal and mailed it on December 8 to an incorrect mailing address. Some correspondence issued over that postal misadventure. On January 3, Jones mailed again to Carmichael the Union's written proposal. The Union's written proposal included a 5-year con- tract with a reopener in the fourth and fifth years, a 23- cent wage increase for nontipped employees for each of 3 years with a reopener in the final 2 years, 7 paid holi- days, retention of the current insurance program at no less than the "present standard in effect" at contract exe- cution, timeclocks, a probationary language proviso and the grandfathering of all banquet employees at the cur- rent rate of service charge. The union proposal rejected ..any provision allowing for incentive or discretionary in- creases in wages." On January 12, Jones met again with Respondent ne- gotiator Carmichael who, as in prior meetings was aug- mented by Lynn Taggert, director of personnel at Mem- phis from April 1981 through June 1983. At that meet- ing, Respondent insisted upon a 5-year duration contract, the discretionary wage raise proviso, 5 paid holidays, grandfathering of banquet employees at their old rate to the six most senior banquet employees and the wage pro- posals of its eighth contract proposal . Respondent again rejected the timeclock proposal . Respondent submitted a written version of article 15, section 57, of its prior offers which now set forth: [Section] 57. Insurance. Employees who have com- pleted their probationary period shall be eligible for HYATT's health insurance program . The Union agrees that HYATT's health insurance program is non-negotiable and that the insurance program is provided by HYATT based upon its sole discretion. HYATT reserves the right during the term of this Agreement, consistent with its business needs, to HYATT REGENCY MEMPHIS change the insurance carrier, terms, costs, compo- nent parts, coverage, rates of contribution and any other insurance provision, subject or matter. HYATT agrees to pay a majority of the total insur- ance costs of the health insurance program. The prior proposals read as follows: [Section] 57. Insurance. HYATT agrees to provide each employee covered by this Agreement who has completed his/her probationary period , group insur- ance coverage with life insurance, hospitalization, surgical, major medical, and maternity benefits in accordance with the terms and conditions of the group insurance policy now in force, furnished to TEAMSTERS LOCAL NO. 667 and agreed to by TEAMSTERS LOCAL NO. 667. HYATT reserves the right during this Agreement to change the in- surance carrier, terms, costs, component parts of said group insurance policy, rates of contributions consistent with business needs. This insurance pro- gram is agreed by the union to be non-negotiable, and is provided by HYATT based upon its sole dis- cretion. Jones rejected Respondent's demand for discretion to change the terms of the insurance coverage and the car- rier. Carmichael explained to Jones and assured him that the second language was merely a repetition of Respond- ent's prior position with the exception that Respondent wished to clearly set forth that it was willing to assume at least a majority of the costs of insurance . Jones testi- fied that he accused Respondent of being "regressive." However, from his testimony on direct examination, it is not clear that he was referring to regression from prior proposals. Rather, from his testimony it appears that he meant regression from the Respondent 's past policy of providing cost-free insurance to its employees.4 There- fore, the credible and probative evidence in the record indicates that the Respondent did not regress from its original insurance cost contribution proposal , but rather was consistent. Similarly the testimony is too skeletal to support the General Counsel's argument, advanced for the first time in the brief, that the language of the revised insurance proposal was a regression in bargaining posi- tion in that it eliminated an obligation by Respondent to provide insurance. There is no evidence that either party interpreted the language in that manner, or that such issue arose in discussions.5 At the January 12 meeting, Carmichael asked whether Respondent would be "permitted by the Union to grant merit increases" pursuant to what Respondent believed was its past practice. Jones answered "no way." With re- spect to the wage rate issue Jones stated, "Well, you 4 On cross-examination he testified that he first became aware on Janu- ary 12 that Respondent's position was limited to a majority contribution to insurance costs However, the June 23, 1982 letter from Stokes to Boyd clearly reflects that such was Respondent's position at least on that date, if not earlier. I credit Respondent's testimonial evidence that Re- spondent consistently advocated only a majority employer contribution The "miscellaneous article" of the ninth Respondent proposal set forth an assurance that , inter alia, presently enjoyed "benefits" will be maintained but with retained discretion to maintain or modify same. 297 know the employees [severely castigated me] for offering 23 cents, Mr. Carmichael. Therefore you know, I can't go any further than this."6 Carmichael then asserted that the 18-cent offer was Respondent's final offer and "as far as [Respondent] can go." He further stated "evidently the stalemate which has been existing now for several months still exists today." Carmichael also insisted that Respondent was adamant upon the 5-day holiday propos- al. The only agreement during the course of the meeting came upon minor issues involving the guaranteed work hours provision, the probation period, seniority and dues checkoff. In view of the Union's rejection of the critical elements of Respondent's ninth proposal , it was with- drawn by Carmichael as the meeting ended. That with- drawal upon the Union 's rejection of it was summarized by Carmichael in his letter to Jones dated January 17 and stated "we are in the process of assessing our posi- tion and will contact you as soon as possible." Thereafter, a hiatus in negotiations occurred wherein unilateral wage increases were granted employees, and wherein it is alleged that Respondent unlawfully refused to meet and bargain with the Union, and when on March 17 certain of the employees engaged in a strike which is alleged to have been caused by Respondent 's bad-faith bargaining. Prior to discussing those factual events, con- sideration shall be given at this point to the alleged re- gressive bargaining of Respondent which , with the uni- lateral wage increase and refusal to meet, is contended to be that manifestation of bad faith which clearly revealed that previously otherwise apparently hard but progres- sive bargaining was in reality surface or sham bargaining. It is the General Counsel 's position that the reduction in its wage offer was so timed when it became apparent that the Union's reduction of wage demands had brought the parties close to agreement which Respondent sought to avoid.7 B. Respondent 's Economic Position and the Wage Offer Reduction The General Counsel concedes that Respondent's Memphis facility faced a period of significant economic attrition in 1982 . This was due to a variety of factors, in- cluding general economic recession, and depressed local business conditions, including increased competition in an area of receding hotel room demand. The 1982 economic decline was a continuation of a downward cycle that commenced in 1980 . It is conceded that Respondent's economic predictions made in November 1981 for 1982 had been grossly overestimated. For example, its gross operating profit through June 1982 was only 79.5 percent of that projected . The General Counsel contends that Respondent's poor economic situation got no worse in November of 1982 and its projections for 1983 were no worse and therefore the reduction of its offer by a few cents had no substantial impact on its economic situation 6 Obscenity actually used to mean "severely castigated" has been sub- stituted , but the meaning is clear. I In his brief the counsel for the General Counsel argues also that Re- spondent's bargaining position from the beginning reveals bad faith, i.e., insistence on "regressing " from benefits previously enjoyed , and insist- ence on discretion as to its wages and benefits. 298 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD and must therefore have been motivated by a desire to frustrate contract agreement. Cody Plott, the hotel resident manager, testified that after the June 1982 best offer which was made to "put to bed" the contract quickly, the economic experience pro- gressively deteriorated from the expectation in June, thus forcing a reevaluation of Respondent's bargaining posi- tion. For example, the occupancy projection which was forecast to be 76 percent actually ran about 68 .7 percent. Total sales and income were down $711 ,800 from that forecast . Gross operating profit was $477,300 lower than the forecast. Thus testimony and other evidence in the record reveals that as of October 31, 1982, Respondent's total sales, gross operating profit, and occupancy de- creased substantially while the average room rate de- clined rather than increased as predicted . The actual sav- ings achieved by a reduction of 2 cents in the wage offer and reduction of one holiday amounts to $12,000 annual- ly, which is the amount achieved by $50,000 in sales, i.e., 2 full business operating days . As of June 23, 1982, ac- cording to Respondent 's "quantification" of labor costs, the Union's total proposal over a 3-year period would have cost $325,000 more than that which Respondent of- fered at that time, exclusive of insurance benefits, breaks, meal breaks, vacations, sick pay, bereavement pay, jury duty pay, and "changing time." The General Counsel contends that the rate of decline at the end of October was the same rate as that Respond- ent had been experiencing in June and therefore there was no progression in the decline of sales, gross operat- ing profit and room occupancy . The evidence reveals that a 30-percent gross operating profit, i .e., g.o.p., is the objective in order to attain a "good year" with respect to a satisfactory return of investment. The progression of the monthly g.o.p. in 1982 was as follows: Actual Quarterly 1981 forecast February 28 21.8% 24.3% 22.5% April 30 23.2 28.0 27.1 May 31 24.7 28.6 26.2 June 30 25.6 28.6 27.1 August 31 248 27.9 25.2 September 30 24.8 27.8 25.0 October 31 24.9 28.2 26.2 November 30 25.0 28.3 26.0 On May 31, 1982, the annual forecast of the g .o.p. was 28.9 percent and remained close to that level throughout the year. However, on October 31, the annual forecast was 28 .7 percent whereas the actual g.o.p. did not reach that level but in fact remained close to the same disap- pointing level as in April. Thus, although the rate of g.o.p. did not decline precipitously , it continued through- out the year to fall substantially short of what was pre- dicted in May to be the ultimate g.o.p. for the year of 1982. To suggest that the economic situation did not therefore deteriorate or become progressively worse is to ignore the fact that Respondent was faced in October with an economic situation that clearly failed to live up to projections that had been made in June when it had made its best offer. Thus, on May 31, the sales and income level was $396,000 less than predicted for the year. That figure, literally, in absolute terms, became progressively worse so that by October 31, Respondent's total sales were $711,800 less than predicted for the year. Total sales on October 31, 1982, were slightly in excess of $7 million dollars, over $269,000 less than the same period in 1981 . However, there is no single dramatic eco- nomic event that occurred between the Union's offer of 23 cents and Respondent's reduction of its offer from 20 cents to 18 cents other than a review of the economic experience of Respondent up through October 1982, which was prompted by the Union's most recent offer. Thereafter, the operation of the hotel continued its poor performance for the balance of 1982 in that sales were $800,000 less than predicted in November 1981 when Re- spondent made its annual forecast for 1982. The total profit was $344,315 (before deduction of capital ex- penses). Respondent, however, was unable to meet its goal of paying $281,000 on a $1.5 million capital invest- ment loan. Instead, it paid $15,000 which is far short of the annual interest. The difference was paid by the owners from other sources of income . Respondent ana- lyzed monthly trade reports and concluded that there was an industrywide depression in the hotel business which affected all hotels in the Memphis area wherein occupancies were down and rates were flat or down through August, September, October, and November. In terms of total final profit since 1975, the owners had faced an "out of pocket" loss of $913,215. The owner's profits from 1980, 1981, and 1982 were $472,268; $54,090, and $12,824, respectively. Respondent 's yearly g.o.p. declined progressively from 29 percent in 1980 to 24.6 percent in 1982 . Its expenses rose progressively from $5,804, 144 in 1980 to $6,651,913 in 1982 . Its percentage of occupancy declined progres- sively from 71.3 percent in 1980 to 68 .7 percent in 1982. Respondent's annual forecasts are made in the month of November at which time it estimates and projects forthcoming business based upon bookings and other fac- tors. The Respondent had made no forecasts for 1984 or 1985 or later at the time of its reduced wage offer cou- pled with a 5-year contract. Plott testified that as of No- vember 1983 it was his goal to enhance the g.o.p. and bring it back to or near the 30-percent level as was possi- ble, and that his motivating factor in arriving at a 5-year wage and benefit offer was economic . The profit (before capital expense deduction) projected and targeted was set at $361 ,300. The profit to the owner was targeted at $340,200 which would have been second in amount to the best year of 1980. The 1983 forecast included an in- crease of income of $425,000 over 1982 and an increase of $275,000 in g.o.p., or 26. 5 percent and an occupancy rate of 70.5 percent. C. The February 1983 Wage Increase One of the issues litigated before Judge Robertson was whether Respondent violated Section 8(a)(5) and bar- gained in bad faith by unilaterally discontinuing a wage HYATT REGENCY MEMPHIS adjustment policy and withholding semiannual wage re- views and wage increases to employees due pursuant to longevity and merit. The Respondent's prior wage prac- tice and policy were litigated . The General Counsel there took the position that withholding discretionary wage increases constituted a breach of prior practice and/or policy. On February 1, 1983, without prior specific notice to the Union, the Respondent implemented wage increases, i.e., the first wage increases in about 19 months. The raises generally varied from 5 cents to 15 cents. A few ranged from 20 cents to 50 cents per hour . Plott testified that he implemented the raises because of the great lapse of time since the last raises, the acknowledged rising cost of living, and the fact that the employees' wage levels were close to the minimum wage required by law. Plott concluded that raises were necessary to maintain morale and to prevent the loss of capable persons to competitor employers and were in accord with Respondent's past policies. He concluded that since the union had objected to merit raises each time Respondent asked for approval to grant merit raises, that after the lapse of extensive ne- gotiations, an impasse had been reached . Therefore he decided to implement raises based upon individual em- ployee merit for the preceding 19-month period of time. Plott testified that during the 19-month interim an addi- tional major luxury hotel had entered the market. Plott testified that he had surveyed the market in January and concluded that wage adjustments were necessary to remain comparable to competitors' wages. The total amount of the cost of the 1983 merit raise increase was less than the cost of Respondent's most recent wage offer made in negotiations. About 34 employees of over 200 employees received raises in excess of 18 cents per hour. Only 100 employees received less than an 18-cents- per-hour raise. Respondent's Employee Handbook in effect prior to the Union's Certification states: PAY INCREASES Wage and salary reviews will be made on a semi- annual basis in May and November, coincidental with the semi-annual performance evaluations. All hourly employees who have completed their proba- tionary period will be considered for a wage in- crease at those times. However, increases are not automatic, but are dependent upon successful oper- ation of the hotel and the employee 's demonstrated merit and actual job performance. Plott testified without contradiction that he announced the raise at a meeting of the employees, where he ex- plained to the employees that the raise was based on merit and was unrelated to the contract negotiations. D. The Alleged Refusal to Meet and Bargain January 1983-March 1983 On January 19, Carmichael corresponded with Jones where, in a letter, he rebutted assertions made in corre- spondence by Jones with respect to failure to meet with the Union on earlier occasions . The General Counsel does not allege that Respondent did in fact fail to meet on earlier occasions and there is no such evidence. 299 Jones testified that after the January 17 letter from Carmichael he made "several" efforts to communicate with the Atlanta office of the law firm of which Stokes and Carmichael are members but on one occasion he was put on hold and later told that the attorney was at lunch and on another occasion was told that he was in court. He then left his name with a receptionist named Barbara but otherwise left no other message. He testified uncer- tainly that he made one or two other attempts to contact Stokes and succeeded on one occasion to awaken Stokes by telephone contact with his hotel room on the West Coast, and again in New York. Jones testified that he told Stokes that he desired to meet in negotiations but Stokes referred him to Carmichael who was now the chief Respondent negotiator, as in fact he had been since August 1982. Jones did not specify the dates of these contacts. His testimony as to exactly what Stokes said is unclear, imprecise and uncertain . He testified: uncertainly when asked if he contacted Stokes "a second time" be- tween mid-January and mid-March : "as far as I can recollect, I don't think I contacted him more. I may have. I tried several times to contact Carmichael." Thereupon counsel for the General Counsel asked: "I was referring to Mr. Stokes. The second time-?" After a colloquy over Respondent's objection, Jones thereupon recalled a similar "second" conversation on an unspecified date wherein "that same thing" was dis- cussed. Why Jones called Stokes again after Stokes had withdrawn as chief negotiator back in August, and had referred Jones to Carmichael in a West Coast and/or New York telephone contact, is unclear. Jones testified that Carmichael did not respond to his calls. Stokes' recollection of his conversation with Jones is far more clear, consistent, spontaneous, detailed and cer- tain. I credit Stokes wherever there is a conflict . Stokes testified that the practice of his law firm is to maintain 24 hour availability through a message retention and for- warding system ; and that he responded to all messages from Jones, and did advise Jones that Carmichael was the chief Respondent negotiator and that he should con- tact him. Even Jones conceded that he contacted Stokes at a hotel . Stokes testified that he received a telephone call at his residence from Union President John Raney on or about February 5. Jones confirmed that Raney had told him that he had made telephone contact with Stokes at his home at that time. Stokes had provided the Union with his residence telephone number at the outset of ne- gotiations. Stokes testified that during the February 5 conversa- tion, he reminded Raney that Carmichael was the chief Respondent negotiator and to contact him if the Union "wants to move in any way." Stokes testified that Raney responded that he did not desire to meet "unless [Re- spondent] would agree to a contract." Stokes responded that the parties were at "loggerheads" since the rejection of the recent proposal . Raney professed to Stokes only little knowledge of the the details of negotiations but stated that he wanted to "put the contract to bed" and that the AFL-CIO convention scheduled for the Mem- phis facility for March 1983, would be cancelled if there were no contract as of that date because the Union 300 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD would picket the hotel . Stokes testified that between Jan- uary 17 and March 14 he had several telephone conver- sations with union agents wherein he was asked to influ- ence Carmichael to make bargaining concessions and wherein strike threats were made . He testified that he had two such conversations with Jones, two with Raney in February and one with Boyd . The conversations with Jones were all similar as described above. Additionally, Stokes suggested that Jones send Carmichael a proposal and resolve economic concessions but that Jones replied, "I can't concede the economic points" and he repeated that the union members were upset with him for reduc- ing the wage demand to 23 cents for nontipped employ- ees. With respect to the Boyd conversation he testified without contradiction that Boyd asked , "Is there any- thing we can do to get off dead center?" Stokes replied that the Respondent's offer had been withdrawn in Janu- ary after it had been "on the table" for a long time but that he would "consider anything you want to submit to us." Boyd replied, "I understand," and terminated the conversation . Raney's vague, uncertain testimony does not effectively contradict Stokes . Raney could not deny stating that he did not care to negotiate unless Respond- ent would guarantee contractual execution in advance of resumed negotiation. On February 2, Carmichael forwarded a letter to Jones wherein he acknowledged receipt of telephone messages to the effect that Jones had telephoned him on that date. He asserted therein , as he testified at the trial, that he returned the calls but Jones ' office telephone was busy each time. Carmichael asserted that he had been out of the office to a larger extent and invited Jones to write him. On February 4, Jones wrote a letter to Carmichael asserting, as he also testified at trial , that he had been telephoning Carmichael's office "daily" without receiv- ing a reply. He demanded a resumption of negotiations during the week of February 7 through 11, at which Boyd or himself would be available. The next written communication was a letter from Jones to Carmichael dated March 4, when he asserted that the Union had re- quested meetings "several times" by certified letter and daily telephone calls. He ended, "Please advise us of your intentions on future negotiations." Stokes, in the early February telephone conversation, advised Raney to call Carmichael. Raney testified that he called Carmichael but Carmichael was absent and did not return his call . Towards the end of February, Raney again telephoned Stokes, again asked to "put the con- tract to bed," and again threatened a walkout at the scheduled March 19 AFL-CIO convention. Stokes testi- fied that he told Raney that the bargaining positions were reached after many hours of negotiations and stated, it is difficult for us to move unless you move some- place. So you can send us a proposal if you want to. Mr. Raney responded : "there will be no contract unless we [Respondent] conceded on the remaining issues." Raney conceded that he had several telephone conversa- tions with Stokes during this period . Raney did not ef- fectively contradict Stokes. For this and the above stated reason, I credit Stokes. Telephone company billing records reveal that from February 1 to March 2, the following telephone calls were made to Stokes' law firm from the union office: a 1-minute call on February 1, three calls of at most 2 min- utes on February 2, a 1-minute call on March 1, five calls of 1 or 2 minutes on March 2. Also there is re- vealed a 15-minute call to Stokes' resident on February 4. Carmichael testified that he did not respond to Jones' February 4 letter because his letter of February 2 was contemporaneous with it and he had been informed by Stokes that Raney could telephone him. Carmichael testi- fied that he attempted unsuccessfully to respond to the Union's calls in February by person-to-person calls. He also testified that he traveled frequently during that time period and made these attempts from his office and other locations such as airports . The General Counsel adduced the telephone billing records of Respondent for the criti- cal period July 1 through March 1982. He argues that they fail to demonstrate that any calls placed to the union office from the Respondent law firm were "person to person" but rather all calls billed to Respondent's office were encoded as station-to-station calls. It is there- fore argued that it is highly unlikely that the unsuccess- ful efforts to call the Union just happened to be the oc- casions when Carmichael utilized the person -to-person call which would not be reflected on a telephone bill. Of course these records are not dispositive of Carmichael's testimony that he made attempts to call the Union from places other than his office. The record is silent as to Carmichael's method of billing his calls from out-of- office locations, e.g, credit card . General Counsel's ex- hibit reveals no encoded credit card calls, and he ad- duced no evidence that Carmichael's past practice has been to utilize credit card, station-to-station calls from out-of-office locations. With respect to Respondent's nonuse of person-to-person calls as a general practice, the General Counsel adduced no evidence . His documen- tary evidence of past practice is limited to billing records for 13 station-to-station calls to the Union's office billed to the Respondent law firm for the period July 1 through March 1982. It is not clear that Respondent made telephone contact with the Union from and to other locations other than that revealed in the billing records adduced into evidence. Thus the documentary evidence falls short of conclusively impeaching Carmi- chael, as is argued by counsel for the General Counsel. In cross-examination , Jones testified that between Jan- uary through March 4, he was aware of only one union request to bargain despite his affidavit testimony that there had been "numerous" requests to bargain in that time period. Jones conceded in cross-examination that between February 4 and March 1, the Union made only one telephone call to Respondent 's law firm office. The request to bargain was the letter of February 4 which preceded the above-described telephone conversations engaged in by Stokes . Jones testified that the union office has several incoming lines and that a message retention system is utilized but he received no messages that Car- HYATT REGENCY MEMPHIS michael had called . The testimony of Stokes as to his ob- servation of incoming calls and frequent overloaded in- coming lines during the numerous times he was at the union office where negotiations were conducted is not effectively contradicted . Jones admitted that, as in any system based on human performance, there is room for error and that on occasion messages had been misdirect- ed at the Union's office. E. Events Leading to and Including the March 17 Strike In early March, according to Stokes, he had another telephone conversation with Raney wherein Raney again asked to put the contract to bed, but stated that the Union could not concede "certain points," but agreed to meet on condition a contract would result . Stokes testi- fied that he responded that he could not guarantee con- tractual agreement, that he thought Respondent 's offers were reasonable, that he had explained the economic bases for the offer to the Union's negotiators, that Nego- tiator Boyd understood it, that Jones ought to appreciate it, but that he would be glad to meet with Raney in any event. Stokes testified that Raney answered , "Well, I won't meet with you, if you don't guarantee that we have a contract." Stokes replied "How can you say that and you don't even know the issues?" Stokes testified that Raney then said "Well, that's that," and ended the conversation. Raney did not effectively contradict Stokes. I credit Stokes. Carmichael testified, also without effective contradic- tion from Raney, that within a 3-day period prior to March 17, he engaged in a telephone conversation with Raney which arose upon Raney's telephone call to his office in Atlanta. Raney told Carmichael that he had Boyd, Jones, and a Federal mediator, Gene Garritz, in his office, and that Raney wanted to know , "what we have got to do to get a contract." Carmichael 's offer to discuss and describe the issues was declined by Raney. Carmichael's offer to go to Memphis and discuss the issues with Raney was also rejected . Raney refused to meet or discuss the issues unless Carmichael would "guarantee" a contract . Raney warned that without such guarantee the Union would call a strike which would in effect cancel the scheduled AFL-CIO convention. Raney testified that such a telephone contact was "possible." He conceded that he may have stated at one point in such a conversation that he did not know the bargaining issues, and he would not deny that he refused to meet with Car- michael when he could guarantee a contract. I credit Carmichael. Manager Plott testified that on March 14 or 15 Raney telephoned him and stated that he wanted to discover why negotiations were at an "impasse" and to apologize for the status of negotiations . Some discussion ensued as to the relative wage offers . Plott testified further that Raney proposed an across-the-board 23-cent raise for nontipped employees and 10 cents for tipped employees. According to Plott, Raney stated that he had present with him a representative of the AFL-CIO, and that the AFL-CIO convention was due to start at the Memphis facility on March 19 and that if no contract were reached he would invoke a strike which would cause the 301 convention's cancellation. Raney did not effectively con- tradict this testimony. Raney testified that "very possi- bly" he telephoned Plott or someone at some time prior to the strike and offered the 23-cent raise proposal at a time when, unknown to him, Jones had been insisting on a 25-cent raise. I credit Plott. Stokes testified that on March 16 Union Secretary- Treasurer Thornton telephoned Stokes at his residence. According to Stokes, Thornton offered a wage proposal which differed from Raney's offer to Plott whereupon Thornton hung up when Stokes accused him of igno- rance of the issues . According to Thornton, Stokes or Carmichael telephoned him, he is not sure who, and made loud and irate comments to him of which he ad- mittedly can remember "very little." Thornton testified in generalities to the effect that Stokes spoke loudly and he, Thornton, tried to say that he thought the parties were only "two or three items apart on the contract." He testified that Stokes loudly complained of inconsistent wage proposals from the Union , and that because Stokes was so loud he hung up . Because of Thornton's inability to recollect the conversation with any specificity and be- cause of no explicit contradiction of Stokes , I credit Stokes. By letter dated March 14, Carmichael responded to the March 4 letter from Jones . In that letter he stated, as he also testified at trial , that he had returned telephone calls to the Union and had left with the union reception- ist messages that were not answered . He then asserted: As you know, we have been awaiting an offer from the Union. We are still awaiting that offer. We would be happy to receive an offer from you and give it our every consideration immediately upon receipt . . . We are always available to bargain rea- sonably ... . The collective bargaining negotiations between Hyatt and the union reached an impasse on January 12, 1983. We have received no contract offer from you since that date. We ask you to forward an offer as soon as possible. On March 15 , Jones communicated by letter and tele- gram to Carmichael a response to Carmichael's March 14 letter. In that letter he set forth the Union 's proposals with respect to wages, contract duration , holidays, and timeclocks. Jones now took the position that the Union's wage proposal was a raise of 25 cents per hour for all nontipped employees and 10 cents for tipped employees because it asserted Respondent had unilaterally raised the wages of some employees by 25 cents. As to contract du- ration it demanded a 3-year contract or a 5-year contract with a wage reopener after the third year . Finally it de- manded one additional paid holiday as well as installation of timeclocks. Jones also rejected Carmichael 's claim of attempted communication and asserted that "we have documented proof we have called four and five times some days with no answer for you." On March 16, Car- michael responded by telegram , "We are considering your offer, we will contact you immediately upon our full consideration." 302 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD On March 17, Stokes telegraphed Thornton wherein he referred to their March 16 telephone conversation. He stated, inter alia: I am still awaiting a complete contract proposal from the Teamsters which intelligently reflects the issues that have been thoroughly negotiated since January 1982. It appears we are still at impasse, and we reject what you have told me your current proposal is- namely 25 cents per hour and all items in your tele- gram of March 15, 1983. When you are ready to make an offer which re- flects a unified position . . . please contact me. The strike commenced on Thursday, March 17, 1983. Jones testified that the preceding Saturday , i.e., March 12, he and Boyd conducted a meeting of between 45 to 60 employees whereat he told the employees that the Union was unsuccessful in trying to get the Respondent to the bargaining table . He testified that the reaction from the group was, "When do we strike?" and he an- swered that he was still hopeful of contract execution and that they would be notified. He testified to a similar smaller meeting of 15 employees on Sunday, March 13. Raney testified that he made the decision to strike, but he could not recall the date upon which he made that decision. He testified that he decided to call a strike be- cause, "they completely refused to sit back down, even with me offering to get involved in the negotiations." There is no evidence of any strike vote taken by employ- ees other than that which was taken the preceding June in 1982. Jones' testimony as to the weekend meetings of March 12 and 13, 1983, is too generalized to support any conclusions as to the specific interaction between the union negotiators and employees as to the purpose of the strike. In cross-examination, Jones denied that the pur- pose of the strike was employee dissatisfaction with Re- spondent's economic proposals. In an affidavit of March 28, 1983, he testified that the strike vote was taken sever- al months earlier but at a prestrike meeting the employ- ees were "updated as to the employer's cutting its offer from .20 to .18 plus the loss of one holiday" and were "upset with what the company had offered before these cuts, so there was little doubt that there would be a strike when these cuts were proposed." Some of Respondent's employees engaged in a strike and picketing commencing on March 17, 1983. The picket signs bore the legends, "Teamsters Local 667 On Strike Against Hyatt Regency . No contract," and "No Dispute With Anyone Else." On March 15, Thornton forwarded a letter to the Fed- eral Mediation and Conciliation Service wherein he gave notice of intent to strike because, "we are unable to reach a contract or tentative agreement with the Compa- ny. Several employees testified that the purpose of the strike as stated by Jones was in protest of a failure to obtain a contract and a failure of Respondent to offer ac- ceptable economic proposals. Some employees testified that Jones stated that the purpose of the strike was Re- spondent's bad-faith bargaining and refusal to meet in ne- gotiations. Respondent adduced evidence of various incidents of picket line misconduct , including blocking of entrances, one instance of a parking lot firebombing and various in- dividual threats . The strike has never ended, and there has been no unconditional offer to return to work other than as part of settlement efforts that aborted . There is no issue herein as to the discharge of any strikers be- cause of picket line misconduct . The alleged picket line misconduct is only relevant to Respondent's defense that such condition is so egregious as to preclude a bargain- ing Order under the Board's rationale in Laura Modes, 144 NLRB 1592 (1963), and Allou Distributors, 201 NLRB 47 ( 1973). Discussion of this alleged misconduct will therefore be deferred to an analysis of whether or not the Union is entitled to a bargaining Order in the first instance. F. Post- Walkout Negotiations On or about March 20, Raney received a telephone call from a Methodist minister whose church organiza- tion had scheduled its convention to be held at the Re- spondent's Memphis hotel . Pursuant to the minister's sug- gestion to resume negotiations, Raney telephoned Stokes at his Atlanta home . Stokes testified that he had also re- ceived a telephone call from that Methodist minister wherein the prospect of a cancelled convention was raised, and the status of negotiations were discussed. In consequence of the minister's intervention , the parties agreed to meet again. Attempts to remove the pickets aborted because of Plott's refusal to reinstate those strik- ers who had been replaced. However, no offer to return to work was made. The next negotiation session occurred on March 22. In attendance were Stokes, Plott, Raney, Jones, Boyd, and a Federal mediator. Some quibbling occurred upon Raney's refusal to address Stokes pursuant to his request as "Arch" rather than "Art." Alleged union picket line violence was also discussed. The most certain and de- tailed recollection of that meeting was that of Stokes whom I credit. Stokes asserted to Boyd that if the Union made a proposal in accord with Respondent's economic position there would be a contract. Before Boyd could respond, Jones stated : "There's no way. There's no way. They got mad at me for going down to 23 cents ." Stokes asked, "So, you are at 23 cents instead of 25 cents?" After a silence, the Union agreed to 23 cents as the wage demand for nontipped employees . Stokes reminded them that the Respondent's offer had been "on the table" for a long time and that the strike by then had caused the Re- spondent to lose business.8 Therefore, Stokes concluded, the Respondent remained adamant on its economic posi- tion and he observed, "it appears that you're not budging from your position on the economics ." The Union then presented Respondent with a complete contract propos- al, including a wage demand of 23 cents for nontipped employees. The meeting adjourned. 8 A loss of $200, 000 in rates occurred in March as a result of cancella- tions. Total occupancy declined 9 percent in March HYATT REGENCY MEMPHIS On March 29, Stokes forwarded a letter to Boyd wherein he stated that a review of the Union's March 22 written proposal reflected, "no movement from the ne- gotiations in late 1982, which culminated in an impasse around the middle of January, 1983." Stokes offered to meet again when and if the Union was "prepared to make a proposal which will remove us from impasse." Stokes asserted therein that from February 1982 to Janu- ary 1983 Respondent had made substantial concessions in nine contract proposals in areas of language and econom- ics, but that the last proposal had been withdrawn upon the impasse reached in January 1983 . Stokes concluded by inviting the Union to contact him when it was pre- pared to "negotiate in good faith." Boyd responded to Stokes by letter dated April 6. Boyd insisted that the March 22 proposal was "definitely different" from its prior proposals. Boyd asserted that the Union was willing to meet "anytime" upon contact from Respondent . On April 15, Boyd wrote to Stokes and asserted that the Union had not received yet any counterproposal to its March 22 proposal despite several requests. Jones stated that union negotiators would be available to negotiate "either across the table, by mail, or by phone." He then solicited Stokes' "position in this matter." By letter dated April 18, Carmichael responded to Boyd's letter of April 6. He asserted that Respondent was awaiting a union offer "responsive to the issues" and which "reflects significant movement " so as to "remove the negotiations from impasse." He asserted that until such time, negotiations would be a "waste" of "time and money" for both parties. On April 26, Jones wrote to Carmichael and asserted that the Union's March 22 proposal contained several un- specified "movements." He observed that the Union had not received a counterproposal but was "still available to negotiate" "across the board, by mail, or by phone." On April 27, Boyd wrote to Carmichael in response to Car- michael's April 18 letter. He accused Stokes and Carmi- chael of failing to negotiate and failing to make a coun- teroffer to the Union's position by demanding an 8-cent raise for tipped employees in the first year of contract and 5 cents as offered by Respondent for the next 2 years with a 1986 wage reopener . This, he noted, would drop the Union's wage demand for tipped employees from the "original" 10-cent raise. He asserted that this constituted a "significant" movement, and he requested a date to meet. On May 9, Carmichael responded to the April 25 and 26 letters of Jones and Boyd . He stated therein that since the Union had not made a demand "consistent with Hyatt's offer of November 24," that therefore the parties were still at impasse. He asserted that the Union had not made an offer constituting sufficient significance to break the impasse. On May 16, Jones wrote to Carmichael . In that letter he challenged Carmichael's assertions of nonmovement by the Union but went on to state, "We will again, with- out a proposal from you, modify our offer of March 22, 1983." He went on to point out that the Union had moved on the tipped employees' wage increase demand, noted above, and repeated that movement . He asserted 303 that the Union had made "numerous other" unspecified changes embodied in the March 22 proposal, to which it had received no counteroffers . He accused Respondent of being "regressive" and stated : "We need some signifi- cant movements on your part so that we can get this matter settled." Jones stated that he was available to "discuss the issues" and willing to meet when Respond- ent was ready to negotiate in good faith . Carmichael re- sponded by letter dated May 31 wherein he incorporated by reference the position stated in his earlier correspond- ence and again asked for a proposal that would move the parties from impasse. On June 6, Jones responded by letter that the Union had made several proposals and several changes but was still awaiting a counterproposal. Carmichael responded in kind by letter dated June 20. On July 6, Jones wrote to Carmichael and denied the ex- istence of impasse, asserted that the Union had made sig- nificant concessions, and accused Respondent of bad- faith regressive bargaining . On July 15, Carmichael, by letter to Jones, reiterated his above-described position. On July 21, Jones wrote to Carmichael . In that letter he repeated the April 27 offer to modify the March 22 wage demand regarding tipped employees . He asserted that such movement was significant . On July 22, by letter, Jones offered to "move on something else." He of- fered to accept Respondent's last wage proposal with a reopener in the fourth and fifth years, but demanded status quo on holidays as prior to negotiations. He assert- ed, "it will be very hard to get this ratified, but I will do everything possible to get this ratified." He solicited a re- sponse. By letter of July 29, Carmichael responded to the July 21 and 22 correspondence by stating that such corre- spondence "confirmed the impasse in negotiations which existed since January 12, 1983 ." He asserted that the Re- spondent's proposal in "early 1983" had been its final proposal but that the Union continued "to fail to realize that we have been at impasse for many months ." He in- vited the Union to reconsider its proposal in light of Re- spondent's final offer. The trial in this case commenced on August 8. During the course of the trial , in an effort to settle the case, the parties resumed negotiations . The General Counsel con- tends and alleges that Respondent persisted in surface bargaining thereafter and adduced evidence of that bar- gaining. The first such negotiation session occurred on August 9, 1983, between Jones, Carmichael, and Stokes. A brief discussion touched upon the issues of holidays, timeclocks, insurance, the status of the 31 remaining strikers, and a wage reopener proviso . Jones testified, without contradiction , as to this meeting . The Union de- manded that Respondent maintain the same number of holidays as existed prior to its certification. Stokes stated that "he didn't feel like he could give it, due to the cost and so forth," but stated he would consult Plott on this issue. As to timeclocks, the parties repeated the same ar- guments that had been advanced in prior negotiations. Jones asked that insurance benefits consist of no less ben- efits than those "presently in effect." Jones testified: The answer was similar to the others, that they would pay the majority of the provisions for the 304 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD benefits and to clear up the air, the "majority" does mean it could be 51 percent or more. They did not hold on any specific figure. Jones then asked for reinstatement "for all strikers." This was rejected on the grounds that the strikers had en- gaged in picket line misconduct. Jones offered to exclude those strikers "who are indicted or proven guilty of picket line violence." Stokes said he would have to "run it by" Plott. Jones then asked for a raise reopener after the third year of the contract . Stokes insisted on a 5-year contract. There was no agreement. On August 10, Jones, Stokes, and Carmichael met again. Jones offered to accept the Respondent's ninth proposal , subject to employee ratification . He also de- manded the maintenance of insurance at their present levels, and that "all employees on strike will be returned with full seniority and rights provided for under the con- tract," and he demanded a wage reopener after the third year of the contract. The same arguments , as hitherto raised, were advanced and discussed again . With respect to reinstatement of strikers, Jones said that he would not seek reinstatement of strikers who were "prosecuted or proven guilty." Stokes then proceeded to name specific individuals whom he alleged were guilty of misconduct, e.g., firebombing , pistol brandishing, etc. Jones pointed out that some of the original strikers had subsequently resigned their employment at Respondent . Jones then re- duced his demand to reinstatement of 24 strikers subject to later proof of individual misconduct culpability. Re- spondent conceded that in this negotiation it took the po- sition that it would not reinstate any of the remaining strikers on that basis (Tr. 946-947 and 955). Jones ex- plained that the Union refused to execute a contract ,.with no stipulation , no protection" for the remaining strikers. It appears from correspondence that another meeting took place on August 11, but there is no testimony as to what occurred . On August 30, Carmichael submitted to Jones by letter Respondent's tenth contract and wage proposal. In that letter he stated : "We cannot, at this point, agree with your proposal to reinstate the striking employees, most of whom have engaged in misconduct of some sort." On the morning of the October 18 session of this trial, the parties again met privately. Included in that meeting were Jones, Boyd, Raney, Stokes, and Car- michael . The Union accepted that proposal on condition that 24 of the 31 remaining strikers be reinstated subject to confirmation of picket line misconduct . The Respond- ent refused to reinstate any of the strikers. Because of that refusal the Union did not agree to the tenth proposal. Had there been agreement on striker re- instatement, the Union would have conceded the time- clock issue, the Respondent wage proposal , i.e, its previ- ously stated "final offer," the managerial discretion to grant merit wage increases and virtually all other re- maining substantive issues . The 10 Respondent proposal, which essentially repeated the ninth, included a minor language change as to the merit raise proviso . It added language to the insurance section clarifying that "majori- ty" means more than 50 percent , and an employee ratifi- cation clause. The wage schedule for employees encom- withdrawn at trial passed the February merit raises within those raises called for in the first year of the contract. Although the parties met thereafter, striker reinstatement proved to be the obstacle to final contractual agreements. G. Alleged Conduct Violative of Section 8(a)(1) The conduct alleged to be violative of Section 8(a)(1) of the Act pertains to the period of March 12 through 15 prior to the employee strike . Three alleged agents of Re- spondent are involved , i.e., admitted Supervisor Anthony Pologruto, the executive chef; Judy Dial, alleged super- visor of cashiers; and Richard Bell, assistant sous chef. The supervisory status of Dial and Bell is in dispute.9 1. Status of Richard Bell The General Counsel adduced sketchy, generalized, conclusionary testimony with respect to the duties of As- sistant Sous Chef Bell to the effect that he has instructed kitchen employees as to the proper preparation of food and has stated to some employees what job function they should perform, e.g., check the food bar or clean the re- frigerator. There is also testimony that Pologruto told employees to follow his directions . The uncontradicted evidence in the record reveals that Bell performs manual work tasks in the kitchen throughout the entire day, e.g., cooking and food preparation. The testimony of General Counsel's witnesses reveals that the work of kitchen em- ployees is routine and highly repetitive. The work sched- ule is prepared by Pologruto . Employees are familiar with their functions and do not need close supervision. On one occasion Bell told an employee who initially re- fused to "cut up fruit," as instructed by Bell , that he could "write up" the employee. She testified, however, that she had no idea what that meant . There is no evi- dence that Bell has the authority to hire, fire , reward, or punish employees or to effectively recommend such action upon application of his independent judgment and discretion and without independent investigation by Po- logruto, or that Bell can otherwise affect the employ- ment status of an employee . The evidence of his author- ity to assign work is at best ambiguous and vague. It has not been proven by the General Counsel by way of pro- bative, competent evidence that Bell had the authority to apply independent judgment and discretion to the assign- ment of job functions, and that he was not merely con- veying routine instructions as to repetitive work that arises from his superior experience and skill in processing food in the kitchen . I conclude that the evidence is insuf- ficient to sustain a finding that Bell was a supervisor within the meaning of the Act at the time that he alleg- edly made coercive remarks to employees. It is therefore unnecessary to evaluate the nature of these remarks. 2. Status and conduct of Judy Dial At the time of the events herein, Dial occupied the po- sition of food and beverage cashier supervisor under whom eight persons were employed . She testified that prior to March 1983 she was subordinate to Respondent 9 The allegation relating to Pologruto in par 7(a) of the complaint was HYATT REGENCY MEMPHIS fiscal officer James Barnish . Under his supervision, she was vested with the independent authority to hire and ef- fectively recommend firing of employees. She testified that Barnish was replaced by Brad Corson beginning in March and that he rescinded her discretion in hiring and firing, and scrutinized and independently evaluated her recommendations. Under Corson she testified that her re- sponsibility of hiring and firing was reduced to that of making suggestions which had little impact . She testified that her authority to discipline employees remained un- changed and that she exercised it on an exclusive basis. Her duties consisted of being responsible for the prepara- tion of employee work schedules, for the payroll prepa- ration, and for arranging of relief breaks for employees. Her performance of actual cashier duties was limited to only 1 day a week. Cashier Margaret Chambers testified credibly and without contradiction that Dial also exer- cised the authority to grant time off, issue disciplinary warnings and written commendations , to issue written work evaluations, and to conduct employee work evalua- tion interviews . Clearly Dial possessed sufficient supervi- sory indicia to constitute her status as supervisory within the Act's meaning. Evidence of Dial's alleged coercive conduct is limited to the testimony of one employee, Chambers, and in- volves a single incident which purportedly occurred within the week prior to the March 17 strike. Chambers testified that Dial came down to "Room Service," pre- sumably her work station, and asked for Chambers' ad- dress and telephone number and indicated to her that a strike appeared to be probable and that safe transport would be provided to employees who desired to cross a picket line. Chambers then asked Dial whether the rumors she had heard were true, i.e., strikers would lose seniority and other benefits; and that Dial answered that it was a possibility and that it could happen. Upon an ex- haustion of recollection, and some leading by counsel for the General Counsel, she added that Dial also told her that there was a possibility that she could lose her senior- ity and benefits and "come back as ... a new employ- ee." Pursuant to leading questions phrased to elicit "yes" or "no" answers, Dial categorically denied stating such possibility to Chambers. She testified that she did speak to Chambers on the day before the strike and read "ver- batim from a paper that they [her supervisors] gave us." She repeated this testimony , i.e., she "read her that speech." In her testimony she had little recollection of the content of that speech which contained "four or five different points." She testified that she subsequently searched for that speech but could not find it. In cross- examination, she testified that the speech was not a paper given to her but rather was something she wrote down at a meeting . In view of Dial's lack of recollection of what she actually told Chambers, her inconsistency as to what she read to Chambers, and in view of Chambers' somewhat greater certainty and detail in testimony, I credit Chambers. 3. Alleged conduct of the executive chef Several employees testified as to alleged coercive re- marks made by Executive Chef Pologruto to a group of kitchen employees at an impromptu meeting conducted 305 by him in his office a few days before the strike. They testified that Pologruto alluded to the prospect of an im- minent strike. They testified that he told them that strik- ers "would" or "could" be replaced , and that in the event they were reinstated it would be as new employees and that they "would" or "could" lose their accumulated seniority and pension benefits. Upon being asked, he as- sured them that they would be given good recommenda- tions in the future event that strikers sought jobs at other employers. Present at the meeting with Pologruto was Sous Chef Rubin Chriswell. He was called as a Respondent witness but was not questioned as to this incident . Pursuant to a series of leading questions phrased to elicit a simple re- sponse of "yes" or "no," Pologruto categorically denied making these statements attributed to him by General Counsel's witnesses . He did not testify as to what he did say to them. In the absence of corroborated , detailed, convincing, certain, spontaneous testimony by Pologruto, I credit the testimony of General Counsel 's witnesses who were generally mutually corroborated and who were somewhat detailed and certain in demeanor, and vivid in recollection. 4. The discharge of Christopher Wiseman The complaint alleges that Respondent discharged em- ployee Christopher Wiseman on or about October 15, 1982, because of his union activities and because of other concerted activities protected by the Act for the purpose of discouraging union or protected activities by employ- ees. More precisely, the General Counsel argues that Wi- seman was discharged because he, as an alleged known union supporter , had only a month earlier refused to comply with Respondent's request of him that he testify on behalf of its defense in the prior unfair labor practice proceeding held during the weeks of September 20 and October 25, 1982, regarding the issue of whether Re- spondent had discriminatorily effectuated certain work rules involving timesheets in consequence of the Union's certification as bargaining agent . The General Counsel argues that Wiseman's refusal to testify on behalf of Re- spondent constituted a refusal "to take action against the Union" which amounts to "taking action in support of the Union" and therefore is "activity protected by the Act." Respondent contends that it was unaware of Wise- man's prounion sympathies, that numerous other wit- nesses testified at the prior unfair labor practice trial with respect to the issue of timesheets , that many other employees refused to testify on its behalf on that issue with impunity, and that there was nothing special or urgent about Wiseman's prospective testimony. Respond- ent contends that Wiseman was discharged "for valid job related reasons, including falsification of his time sheets; poor and incompetent performance in his position; and failing to appear for scheduled work on two or three consecutive days." Wiseman was hired in September 1980 and com- menced work as a kitchen employee under the supervi- sion of Executive Chef Pologruto and Sous Chef Cris- well. On January 25, 1982, he became cafeteria manager 306 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD until several months before his discharge when he was transferred to the job of baker's helper. During the 1981 union organizing campaign he execut- ed a union authorization card, wore a union belt buckle and fixed a union bumper sticker on his car for an undis- closed period of time. There is no evidence as to the cir- cumstances in which this conduct occurred and therefore no basis to warrant an inference that Respondent was aware of it. Wiseman testified, without contradiction, that on an unspecified date prior to the election he and coworker Sheila Porter were called into Criswell 's office where they were both asked how each "felt about the Union." He responded that it was not any of Criswell 's business. He was asked nothing further. He did not indicate how Porter responded, if at all, nor did he relate any further context of this encounter. This is the totality of evidence of Respondent's exposure to Wiseman's union sympathies and/or activities. In cross-examination, Wiseman conced- ed that he "never told anyone what [he] thought one way or the other about the Union." Thus there is no basis upon which to premise an inference that in October 1982, Respondent regarded Wiseman as either a union activist or a union sympathizer. There is no evidence nor even argument advanced by the General Counsel as to why Respondent particularly desired the testimony of a prounion activist/sympathizer or why it desired or needed the particular testimony of Wiseman , other than Wiseman's own testimony. Wiseman testified that "a month or so" prior to his discharge, he was interviewed by Attorney Carmichael in the presence of Personnel Director Taggert in one of the secretary's offices upstairs from the kitchen . Wiseman testified that Carmichael said he wanted him to testify on behalf of the hotel in the unfair labor practice trial to the effect that employment conditions did not change fol- lowing the Union's certification, but he answered that he did not "know enough about it" to go down and testify. Wiseman testified that Carmichael then told him that he "didn't need to know anything about it ." He testified, "all he wanted to do was for me to make a statement to say nothing had changed." In cross-examination, upon persistent questioning, and after a display of palpable nervousness, flustering, hesitation, and reluctance, Wise- man first reiterated that Carmichael told him that he did not need to know the facts to testify, but he then sheep- ishly retracted that testimony and admitted that Carmi- chael did not tell him that he did not need to know the facts. Wiseman further testified that in the interview that Taggert told him that Respondent was "in trouble and they needed some help from some of the other employ- ees that nothing had changed since the Union came in"- and that Carmichael told him to think about it and to call him the next day. Wiseman gave no further response as to whether he would be willing to testify. Wiseman testified that the next day, while at work in the kitchen , Carmichael telephoned him and asked what his decision was with respect to testifying and he re- sponded that he "didn't think [he] wanted to go down there and testify." At that point, according to Wiseman, Taggert's voice was heard on the telephone . She asked if he would testify and he said "no." According to Wise- man she stated that he "could lose [his] job if [he] didn't [testify]." He further testified that he said he did "not know enough about it . . . to testify ," and Taggart then simply said "okay" and hung up. On cross-examination, again with the hesitancy and uncertainty that marked his entire testimony particularly in critical areas, when asked "precisely" what it was that Taggert told him, he an- swered : "Look. If you don't go down and testify you could lose your job"-Wiseman paused , thought for some moments, shifted uneasily and added : "-you could possibly lose your job." He testified that she said nothing further. Wiseman testified that neither Carmichael nor Taggert explained the significance of his particular testi- mony. Carmichael testified that he prepared the Respondent's defense in the prior case and with respect to the issue of timesheets he interviewed more than 100 employees as prospective witnesses, and, according to his unchal- lenged testimony, between 35 to 40 employees testified pursuant to subpoena on behalf of the Respondent on the same issue, and 20 or more employees had refused to tes- tify. He testified that Taggert was present at these inter- views when she happened to be nearby . Taggert testified that she was actually present at the interviews of about 60 or more employees. Carmichael testified that he inter- viewed Wiseman in the same routine manner as all po- tential employee witnesses, that it was in a personal interview, that on this occasion Taggert was present, that he asked Wiseman about the underlying facts and whether he was willing to testify and that upon express- ing hesitancy to get involved , Carmichael told him: "Fine, no problem. We've got plenty of people who are going to testify on that issue." Carmichael testified , without controversion, that among those who refused to testify was Rod Gray who subsequently engaged in the strike, and Erma Bradley and several other kitchen employees. Carmichael, of course, was aware that all he needed to compel testimo- ny was to have a witness subpoenaed , as he had done with other witnesses. Taggert corroborated Carmichael. She further testified that Carmichael explained to Wiseman that he wanted nothing more than the true facts from Wiseman. She denied uttering the threat of job loss. Taggert recalled that in her presence Rod Gray and Essie Butler refused to testify. With some uncertainty, she thought that Annie Bates and "possibly" Liz Fuzz were also among those employees. She and Plott testified without controversion, that no retaliation was taken against any of the other em- ployees who refused to testify. Four employees were called by Respondent to testify that they had been interviewed and had refused to testify without impunity-Annie Bates, Liz Fuzz, William Sea, Jr., and Fentress Small. They all corroborated Carmi- chael as to the format of the interview. None of the four explicitly placed Taggert at the interview . Fuzz and Sea testified that Taggert did not speak to them about testify- ing, but they did not indicate that she was absent from the interview room . Bates testified that only Carmichael HYATT REGENCY MEMPHIS was present. Small was not asked whether anyone else was present. The General Counsel's assertion in its brief that Wise- man was distinguishable from the other employees who refused to testify by virtue of the fact that he was the only one to do so in the presence of Taggert is thus un- supported by record evidence. The only evidence on this point is Taggert's virtually uncontroverted testimony. With respect to Bates and Fuzz, her testimony did not categorically place them at interviews where she was present and therefore I cannot wholly discredit her in areas of noncontroversion. Furthermore, there is no record evidence to support the General Counsel's assertion that Wiseman was distin- guishable because of his union activities, which we have seen were minimal and remote in time . There is no evi- dence to establish that Wiseman was any more prounion at the time of the testimonial solicitation than the other potential witnesses . Thus Respondent's testimonial evi- dence that Wiseman was only one face in a crowd of po- tential witnesses interviewed by it, and indistinguishable from any other witnesses who refused to testify, stands uncontroverted except for Wiseman's testimony concern- ing the Taggert telephone threat . According to Carmi- chael, there had been only one person -to-person prior interview with Wiseman, at which no threats were made. As between Wiseman and Carmichael , the latter is far more credible. Wiseman was contradictory in part, in- consistent in part, evasive, hesitant, and uncertain in de- meanor and often in need of leading questions. Crediting Carmichael, there was no followup telephone call. Ac- cordingly, Taggert's denial of a threat uttered by the fol- lowup telephone call must be credited. Wiseman was asked by counsel for General Counsel whether prior to October 1982 he had received "any communications, any sort of discipline" for his work, and he answered, "None that I know of." Wiseman testified further that "a couple of days" after the testimonial solicitation and alleged threat, he entered Pologruto's office where on the desk he saw a letter ad- dressed to him and which he picked up and started to read when he was interrupted by the entrance of em- ployee Robert Bell. According to Wiseman , the letter criticized his work performance with respect to the prep- aration of desserts and stated that Respondent wanted to reduce his pay and demanded an improved work per- formance. That letter was never subsequently received by Wiseman and neither it nor a copy of it was to be found in Wiseman's personnel file which was produced pursuant to a subpoena served upon Respondent. Wise- man testified that he replaced the letter in Pologruto's desk. He testified: I was called into the Chef's office about three or four days later, and he told me that he was going to have to let me go. . . . He told me he was going to let me go and we talked about camping, and he talked about he was getting ready to take his vaca- tion and he was going on vacation. Upon further examination he repeated his testimony. Upon a third go-around by counsel for the General 307 Counsel, he then changed his testimony to the effect that during the conversation subsequent to reading the unde- livered letter Pologruto told him that he was to be put on probation for 30 days. Wiseman asked why and Polo- gruto answered that he was being put on probation "be- cause of the letter," i.e., presumably the letter Wiseman had not even received. The mystery of the undelivered letter was never resolved. Wiseman testified that "a day or so later" after being put on probation he was summoned to the office by Po- logruto and told that he was being terminated because of the dissatisfaction of Plott and Taggert with his work performance. He then testified that he then engaged in the pleasant chit-chat about the chef's camping trip and then "shook hands" and he departed. He testified that between probation and termination he had received no complaints about his work. In cross-examination, he testified that on October 23, Pologruto interviewed him. He estimated that event to have followed the discovery of the undelivered letter by "a couple of weeks or three or four days" and finally by "a couple of days." He testified that he saw and read a memorandum addressed to him that Pologruto had on his desk on October 23 but, like the earlier letter, which was different in form and content, was not presented to him. The October 23 memorandum was adduced into evidence. It recited disappointment with Wiseman's per- formance as cafeteria manager and alluded to the transfer to the bake shop as an effort to rehabilitate him but that his performance was a continued disappointment, and he was put on probation for 30 days after which consulta- tion with Plott and Taggert would determine his future retention. The October 23 memorandum contained a series of complaints of the quality of his preparation of desserts and Sunday brunch. His goals were set at im- proved punctuality, improved dessert, and Sunday brunch preparation, increased productivity, better orga- nized work habits, and improved attitude toward fellow employees. Wiseman testified that he was verbally criticized by Pologruto at that meeting as to his work quality and told that Respondent would like to cut his wages. He testified that Pologruto referred to past criticism of the dessert bar. When questioned in cross-examination as to past criticism of the dessert bar, oblivious to his direct exami- nation testimony of the absence of past criticism, he testi- fied that he could not recall the date when Pologruto had been previously dissatisfied "because he always said things like that" to Wiseman and other employees. He admitted that at least a "couple of times" in the past Po- logruto explicitly criticized his preparation of the des- serts. On redirect examination, he could not estimate the number of discussions he had with Pologruto wherein his dessert work was criticized because Pologruto "would always have something to say about different things." He gave examples and when asked again how often these criticisms occurred, he answered "everyday." He quali- fied the testimony subsequently by asserting that Polo- gruto criticized everyone else in the kitchen on a daily basis. No specificity, details, context, or other foundation was given to his testimony concerning the daily criticism 308 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD of the other employees . He testified that Pologruto was very demanding with respect to the quality of the food preparation. Although Wiseman was uncertain of the month of his discharge, he conceded that his last day of work could have been November 7. He testified that he did work on the date of his discharge . At one point he testified the date was "the 14th." He had no recollection of whether he worked Monday, November 8, through Thursday, November 11. After a colloquy between counsel as to whether by the "14th " Wiseman meant "November 14," he testified that he meant "October 14," as suggested by counsel for General Counsel . When presented with a timesheet dated November 7 bearing his name, he testi- fied that it was not his signature , but that he did not "re- member" whether he worked that day. He identified the writing as that of Pologruto . Timesheets, he testified, are normally signed by the employee when he enters on duty. He denied that he missed 2 straight days of work prior to his discharge. On cross-examination, Wiseman testified, contrary to his direct examination, that Pologruto did not state any reason for his discharge . The following exchange oc- curred: Q. [By Mr. Carmichael] He didn't give you a reason at all; he just called you in and you all just passed the time of day and he said he was letting you go? A. That was it. He was the Chef. He was in charge of me. He hired me. Q. And he didn't give you any reason? A. No reason whatsoever. Upon further questioning pointing out the improbability of such conduct, he again changed his testimony to state that Pologruto gave as the reason for the discharge the mysterious letter described above and said "that they were unhappy with my work and that was it." Wiseman denied that he falsified timesheets during the week prior to his discharge, but he admitted that he in fact had falsified his departure time to read 30 minutes more work than actually performed . With great uncer- tainty he placed that event "maybe six or seven months or longer" prior to his discharge . He testified that the chef told him at the time that his conduct was improper. This is contrary to his previous testimony that he was not given at least a verbal disciplinary communication prior to the solicitation of his testimony. When asked in redirect examination whether he was absent for 4 days prior to his discharge , he answered, "I don't remember." He asserted, however, that he had never been absent without prior notification . In rebuttal, he testified that he never worked less than 5 days a week. He changed his testimony by then testifying that he did work 4 days a week and, also, only on infrequent occasion less than that. In cross-examination , Wiseman conceded that falsifica- tion of timesheets, failure to report to work without prior notice and improper performance of work duties were offenses that warranted discharge. Pologruto testified that he discharged Wiseman for a number of reasons-principally falsification of timesheets, a failure to report for duty without notification and a long history of poor work performance. He described Wiseman's inadequacies as a cafeteria manager and the subsequent transfer to the baker's helper job. He testified that there his work deteriorated despite Pologruto's pre- cise instructions as to the proper preparation of desserts, etc. Pologruto, Plott, and Criswell all testified as to the poor quality of the desserts, which elicited customer complaints. Pologruto admitted that, although he often verbally criticized Wiseman, he never in haec verbs threatened to discharge him because of his work per- formance. Pologruto testified that when he criticized Wi- seman when he was a cafeteria manager, he did not phrase it as a "warning or anything," but he had talked to Wiseman daily about his failure in that area and told him that it was his decision to place him in the kitchen as a baker's helper, where his performance might im- prove. There is no other evidence in the record for the reason for Wiseman's transfer from cafeteria manager to baker's helper several months prior to his discharge other than the testimony concerning Wiseman's poor work. Pologruto testified that Wiseman's use of abusive lan- guage to fellow workers was a contributory factor in the discharge motivation . However, he and director of pur- chasing Thelma Hubbard , were inconsistent, uncertain, and confused as to when such an incident occurred. Re- spondent's personnel file for Wiseman reveals a discipli- nary communication addressed to Wiseman, dated No- vember 10, 1981, which issued a 1-day suspension for the use of abusive language to a supervisor . That document bears the apparent signature of Wiseman entered in ac- knowledgment of receipt, and is not challenged by the General Counsel as authentic. Pologruto testified that on November 7 Wiseman falsi- fied his timesheet . He testified that upon searching for Wiseman an employee informed him that Wiseman had left early and that he then discovered that Wiseman had entered a false departure time, thus claiming 30 minutes more time than earned. Pologruto testified he therefore had to correct the entry and that he wrote in Wiseman's name at the correct time, i.e., 2:30 p.m., not 3 p.m. Inas- much as Wiseman's testimony as to dates and sequences of events is so unreliable, I must credit Pologruto that the falsification of the timesheet occurred on the date specified by Pologruto and not as vaguely indicated by Wiseman as "maybe six or seven months" previously. With respect to the third major reason for the dis- charge, "no show-no call," Pologruto testified that Wise- man had originally been erroneously scheduled for 4 days off Monday, November 8, through Thursday, No- vember 11. Upon Wiseman's complaint , he had been re- scheduled to work Wednesday, November 10, and Thursday, November 11, but Wiseman failed to report for work until Friday, without calling in. This incident, coming on the heels of the November 7 falsification, prompted Pologruto to meet with Wiseman and to notify him of his suspension . Although Pologruto testified that Wiseman thereupon left the property after the interview Friday morning, documentary evidence discloses that Wiseman worked on Friday for the entire day. Polo- HYATT REGENCY MEMPHIS gruto had no explanation, but could only surmise that he may have been off duty himself on Friday and did not see Wiseman until Saturday . Pologruto testified that he told Wiseman during the suspension interview that he was going to recommend termination, and that he re- viewed with Wiseman a memorandum addressed to Wi- seman and dated " 11/10/82" wherein the falsification in- cident and failure to report for duty without notice on Wednesday were recited . It also recited the impact caused by his absence, i.e., an employee had to be trans- ferred from a busy job to compensate for his disruptive absence . Pologruto testified that he presented Wiseman with the November 10 memorandum, but that Wiseman refused to sign it. The memorandum is a personnel form in triplicate. Retention by Respondent of the copy enti- tled "employee copy" indicates Respondent retained cus- tody of all copies of it. In rebuttal testimony , Wiseman denied ever seeing the memorandum dated November 10. Because of his confusion as to what he read in Polo- gruto's office and when he read it, and his inconsistency as to what was said by Pologruto , I must defer to Polo- gruto as the more reliable witness on this point.10 Respondent's payroll records reveal that Wiseman did not work the first 4 days of that week. Clearly this indi- cated a deviation from his normal workweek as he testi- fied variously that he did not normally work less than 4 or 5 days a week. However, Respondent normally records both excused and unexcused employee absences but there is no such recordation of absences for Wiseman that week. The evidence does not indicate whether this practice is universal , nor whether deviations are extraor- dinary. However, Wiseman's own recollection of his work experience during his last week of employment is extraordinarily poor. His testimony consisted merely of a categorical denial that he was ever absent without notice. He gave no detailed testimony as to what he did during that last week . He did not explain the unusually short workweek. He proffered no testimony to the effect that he was absent with notice. Banquet cook Fentress Small testified credibly that during early November 1982 Small had been working with Wiseman in the kitchen when for several days, because of Wiseman 's absence of several days, Small had to perform Small's own work and the work of another employee, Herman Porter, so that employee could substitute for Wiseman who had been unexpectedly absent without notice . Small testified that a similar incident occurred in early 1982 or late 1981. Small also testified to observations of frequent con- frontations between Pologruto and Wiseman regarding the quality of the desserts. Subsequently, Wiseman telephoned Taggert and asked for a termination notice, but, he testified, she asked for a resignation letter. He said he needed a termination form in order to obtain unemployment compensation . Taggert said he did not need it because the Peabody Hotel was hiring and she could obtain a job for him there. Wiseman rejected that offer, he explained, because he did not want 10 There is insufficient basis for General Counsel's argument that reten- tion of the employee copy raises an inference that the memorandum was contrived at a later time. In view of Pologruto's credited testimony, it can be inferred that Wiseman did not receive and/or retain a copy be- cause he refused to sign the acknowledgment of receipt of said copy 309 the assistance of Respondent. Taggert did not contradict him. Subsequently, Wiseman received in the mail a separa- tion notice form from the Tennessee Department of Em- ployment Security. It was dated November 15, 1982, and signed by a Respondent personnel department employee. In the brief space set forth , it was stated "No show! No call-2 days . . . violation of Co. policy. Considered voluntary [indecipherable]." Wiseman thereupon tele- phoned Taggert but she was not available. Respondent's "Personnel Action Form," found in its records for Wiseman, reveals that the form was submit- ted November 24, 1982, and that in slightly more than half of the three-line space under "explanation" was the following: "To [sic] much time loss, no show no call for two days." Of nine specified reasons to be checked off, only "excessive tardiness" was marked. The "Violation of Company Policy" entry was not checked. Without objection, Respondent adduced into evidence several absence with notice recordations but none of which were apparently signed by Wiseman in acknowl- edgment of receipt . Wiseman conceded that he had in the past been absent. There is no testimony by him as to the frequency and details of those occasions . There is no evidence of disparity of treatment of Wiseman with re- spect to his attendance in comparison to other employ- ees. The General Counsel argues that it is disparate treat- ment for Wiseman to have been considered a "voluntary quit," after missing only 2 days, particularly when the November 10 memo was written only after the first day of absence. The General Counsel cites as evidence, Re- spondent's Employee Handbook on page 28 under the Section "Attendance," the following: Any employee who fails to report for work without calling in as outlined above for three consecutive days, will be removed from the payroll as a "volun- tary quit." The General Counsel adduced no other evidence as to this apparent policy and its actual application. That same handbook specifies on page 25 under "Control Cards and Time cards" that falsification of a timecard is cause for "immediate disciplinary action ." No evidence was ad- duced to demonstrate that discharge for that infraction alone, or in combination with other infractions by an em- ployee of poor work performance history who failed to report for duty on the heels of such conduct, constitutes disparate treatment. Instead, Wiseman's testimony on cross-examination as to the terminability of such offenses is left standing unqualified in the record. The General Counsel argues that the reasons for Wise- man's discharge are pretextual. He relies on the suspi- cions arising from such factors as the inconsistent testi- mony regarding foul language, the failure of disciplinary memoranda to bear Wiseman's acknowledgment of re- ceipt, the unexplained fact that Wiseman was allowed to work 1 full day after failure to report for duty, the fail- ure of the termination notices to specify all reasons now proffered for the discharge, and the longstanding tolera- tion of the poor work performance . It is apparent that 310 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Respondent's evidentiary presentation raises serious sus- picions as to the actual precipitating motivation for the discharge. The General Counsel, however, has the burden of proving the case. The Board stated in the Wright Line case:' l ... we shall henceforth employ the following causation test in all cases alleging violation of Sec- tion 8(a)(3) or violations of Section 8(a)(1) turning on employer motivation . First, we shall require that the General Counsel make a prima facie showing sufficient to support the inference that protected conduct was a "motivating factor" in the employ- er's decision . Once this is established, the burden will shift to the employer to demonstrate that the same action would have taken place even in the ab- sence of the protected conduct. Very recently, the Supreme Court answered affirma- tively the question of "whether the burden placed on the employer in Wright Line is consistent with Sec. 8(a)(1) and 8(a)(3) as well as with Sec. 10(c) of the Act which provides that the Board must prove an unlawful labor practice by a `preponderance of the evidence."' Citation of Section 10(c) omitted.' 2 In the Wright Line case, the General Counsel had ad- duced evidence of employer knowledge and hostility di- rected to an employee of admirable work record because of that employee's active role in a union organizing cam- paign, suspect timing of the adverse action, the departure from past disciplinary practice, and the lack of significant impact of the reason advanced for the cause of adverse action toward the employee. In Transportation Manage- ment a similar factual pattern involved a departure from past practice . A variety of factors can thus give rise to an inference of unlawful motivation sufficient to establish a prima facie case. In cases involving alleged discrimina- tory group or individual layoffs, the Board has frequent- ly cited the factors of suspect timing coupled with hostil- ity toward employee representation ' 3 in support of a finding of a prima facie case. In the absence of evidence of expressed antiunion animus, a prima facie case might not be shown where the evidence gives rise to, at most, a suspicion , i.e., the prof- fered reason for the layoff, lack of work, was contradict- ed by the hiring of new employees to perform the work of the laid-off employees.14 In this case the General Counsel has failed to adduce sufficient probative, competent, credible evidence to sus- tain the burden of proof. Much of General Counsel's case is premised directly on the testimony of Wiseman, whom I have found is not a reliable witness and whom I find is less credible than Pologruto and Taggert, despite the obvious deficiencies in their testimony . The General 11 Wright Line, 251 NLRB 1083 , 1089 (1980), enfd 622 F 2d 887 (1st Cir 1981 ), cert denied 455 U S 989 ( 1982). 12 NLRB Y. Transportation Management Corp , 462 U S 393 ( 1983). 13 See, for example, Balch Pontiac Buick , 260 NLRB 458, 463 (1982), Dutch Boy. Inc, 262 NLRB 4 (1982): Acme Die Casting Corp., 262 NLRB 777 (1982); Rain- Ware Inc., 263 NLRB 50 (1982). 14 Delta Hosiery. Inc., 259 NLRB 1005, 1010 ( 1982), re layoff of em- ployee McGrady. Counsel has not proven that Respondent was aware of Wiseman's union activity nor that Respondent manifested animous against employees who refused to testify on its behalf in an unfair labor practice proceeding. The Gener- al Counsel has not proven that Wiseman's refusal to testi- fy was any different from the numerous other employees who refused to testify with impunity. The General Coun- sel has not proven with cogent , clear, probative evidence that Wiseman was subjected to discriminatory or dispar- ate personnel practices. Even had the General Counsel demonstrated a prima facie case, he did not rebut the Respondent 's showing that Wiseman was discharged for a complexity of rea- sons unrelated to the refusal to testify. Respondent has established that Wiseman had a history of poor perform- ance, that he was transferred to the position of baker's helper from that of cafeteria manager because of poor work and for the purpose of rehabilitation , that he con- tinued to manifest poor performance , that the precipitat- ing reasons for his discharge was the confluence with that poor performance of the falsification of his timesheet and failure to report for duty without prior notice. Accordingly, I find that Wiseman was not discharged for activities protected by the Act. Conclusions 1. The 8(a)(5) violations a. Surface bargaining-pre-September 1982 Counsel for General Counsel in the brief sets forth the General Counsel's position as follows: The facts reveal along and arduous cause of bar- gaining between the parties, beginning in January, 1982, which has yet to culminate in a collective bar- gaining agreement. While, as stated above, neither party is obligated to reach agreement upon a con- tract, each is required to put forth a genuine good faith effort to do so at all times. The facts reveal that over the course of bargaining Respondent has demonstrated by its conduct, particularly as mani- fested during the later stages of negotiations as the parties edged closer to agreement, that it in fact has lacked the requisite intent and, although going through the motions of collective bargaining, has in fact taken actions designed to defeat any possibility of an agreement between the two sides. According- ly, Respondent has been engaged in bad faith, sur- face bargaining in violation of Sections 8(a)(1) and (5) of the Act. Respondent's true motivation did not manifest itself until late in the negotiations. The conduct by Respondent which is relied upon in support of this allegation did not occur until late 1982 and 1983. The General Counsel thus appears to be arguing that Respondent engaged in surface bargaining throughout the course of bargaining but that its "true motive" was not disclosed until the end of 1982. This comports with the General Counsel's amendment of the complaint at the trial in this matter wherein surface bargaining is ex- HYATT REGENCY MEMPHIS plicitly set forth not only with respect to the period cov- ering the end of 1982 and beginning of 1983 , but also for the entire course of bargaining . The complaint, however, originally alleged that the parties commenced bargaining in January 1982 and continued thereafter during which period of time Respondent engaged in three specifically alleged acts, i.e.: (1) made regressive proposals with respect to wages and benefits; (2) failed to meet or communicate with the Union regarding negotiations between January and March 1983; and (3) attempted to undermine employee support for the Union during negotiations by unilaterally imple- menting wage increases on or about February 1, 1983, in excess of the latest proposal by Respond- ent. Paragraph 18 of the complaint alleged generally and without specificity: By its overall acts and conduct including the con- duct described above . . . Respondent has failed to bargain in good faith throughout the course of col- lective bargaining negotiations and specifically since September 7, 1982. The complaint as it stood prior to the trial in this matter alleged three specific acts that constituted bad- faith bargaining by Respondent since September 7, 1982, and also alleged undisclosed unspecified conduct consti- tuting bad-faith bargaining throughout negotiations with- out reference to whether it consisted of bad faith at the bargaining table or some unspecified conduct away from the table. In spite of General Counsel's amendment of complaint in the midst of the trial to explicitly allege sur- face bargaining from the inception of bargaining, the General Counsel argues in its brief as noted above. The conduct by Respondent which is relied upon in support of this allegation did not occur until late 1982 and 1983. Elsewhere in the brief the General Counsel cites pre-September 1982 conduct as manifestations of bad-faith bargaining, i.e., the insistence upon mana- gerial discretion with respect to the insurance bene- fit and merit raise provisos , and Respondent's eco- nomic offers which amounted to a regression from economic benefits afforded to employees prior to the Union's certification. The General Counsel's position with respect to surface bargaining was also set forth during the trial when the issue was raised over whether the General Counsel had improperly split causes of action and unnecessarily sub- jected Respondent to multiple litigation by failing to con- solidate the 8(a)(5) bad-faith bargaining allegation herein with the bad -faith bargaining allegation in the case heard by Judge Robertson and wherein the judge subsequently recommended, inter alia, a broad bargaining Order. In the discussion at trial as to whether the General Counsel was in compliance with the principles set forth in Peyton 311 Packing Co., 129 NLRB 1358 (1961), and Jefferson Chem- ical Co., 200 NLRB 992 (1972), counsel for the General Counsel distinguished the facts of the case by arguing that at the time of the investigation and litigation of the first bad-faith bargaining charge, Respondent 's bad faith, i.e., surface bargaining, was not "manifest," although one of the cardinal indicia relied upon in this case, unilateral wage action is directly related to the prior litigation. Thus counsel for the General Counsel was arguing that pre-September 1982 conduct did not contain manifesta- tions of bad-faith bargaining , and therefore, it was urged, General Counsel did not breach the duty placed upon him to investigate all matters that were encompassed by the earlier charge, and to proceed appropriately by liti- gating manifest surface bargaining in the first proceeding, or consolidating by motion thereafter. In Jefferson Chemical, the Board dealt with a situation where a subsequent litigation alleged surface bargaining, and the prior litigation involved violations of Section 8(a)(5) based upon unilateral actions alleged in a com- plaint filed pursuant to charge which also alleged broad bad-faith bargaining. The Board stated at footnote 3: Our dissenting colleagues argue that the General Counsel should not be required to be aware of each and every fact giving rise to a possible unfair labor practice prior to the issuance of a complaint since its investigation is normally limited to the allega- tions set forth in the charge . While we do not dis- agree with this principle, we believe that, as a cor- ollary, the General Counsel is dutybound to investi- gate all matters which are encompassed by the charge, and to proceed appropriately thereafter. As noted by the Administrative Law Judge, the charge in Jefferson Chemical Co., Case 23-CA-4088, filed on August 31, 1971, was a broad "refusal to bargain collectively" charge. The General Counsel was thereby put on notice to investigate all aspects of that 8(a)(5) and (1) charge and his failure to litigate bad-faith bargaining in that case, for whatever reason, cannot now justify his litigation of surface bargaining in the instant case. Moreover, the Charging Party itself is not totally without fault here. At the time the charge in Jeffer- son Chemical Co., Case 23-CA-4088 was filed, if not by the time the complaint in that case issued, the Charging Party must have known of the Re- spondent's bargaining tactics (the first bargaining session was held in July 1971) and if it was dissatis- fied with the General Counsel's "narrow" com- plaint, it could have made the facts regarding the alleged surface bargaining known either before or during the hearing in that case. Instead , however, the Charging Party chose to file a second charge, the charge herein (which, in part, spans the same time period as that covered by the charge in the earlier case), 2 days after the hearing was recessed. We believe that such multiple litigation of issues which should have been presented in the initial pro- ceeding constitutes a waste of resources and an abuse of our process and that we should not permit it to occur. 312 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD In Neuhoff Bros. Packers, 159 NLRB 1710, 1711 fn. 1 (1966), the Board stated that certain 8(a)(1) allegations were litigable despite their occurrence at approximately the same time and similarity to violations found in an earlier case. There the Board stated: The alleged violations occurred after the complaint issued in the earlier case, were not known to the General Counsel at the time of the earlier hearing, were independent acts, and were not the type of al- leged violations commonly known or readily dis- coverable, even after an exhaustive investigation. 1 s In this case the underlying surface bargaining charge was filed on March 7, 1983, and alleged violations of Section 8(a)(5) "by refusing to bargain" commencing in January 1983. The first amended charge was filed by the Union on March 4, and for the first time surface bargain- ing was alleged to have occurred "during the past six months." As noted above, the General Counsel at other times in the trial, and in the brief, argues that bad faith was evi- dent from Respondent's pre-September 1982 conduct. By midsummer 1982, Respondent's bargaining posture had become obvious. Certainly by the fall of 1982, at the time of the first litigation, Respondent's positions with respect to economics, and with respect to managerial dis- cretion, had become issues. Clearly the bargaining of the parties constituted the context within which the Re- spondent's refusal to grant wage increases in accord with what the General Counsel alleged was its past policy. The bargaining position of Respondent was clear and manifest in that context, and not merely discoverable after an exhaustive investigation. Yet the General Coun- sel explicitly disavowed alleging surface bargaining before Judge Robertson, and the Union filed no surface bargaining charge until April 1983 and even then limited its allegation to the period of 6 months preceding April, i.e., September 1982.16 I conclude that under the ration- ale of Jefferson Chemical, the General Counsel and the Union are estopped from now alleging that Respondent engaged in surface bargaining violative of Section 8(a)(5) prior to September 1982. Clearly, the Union had no prior challenge to the lawfulness of Respondent's bargaining stance up to that time. Finally, having reviewed this matter in depth, and having studied recent Board decisions, I conclude that it was error for me to have permitted the General Counsel to have amended the complaint, so late into the litigation of this matter, to allege with particularity surface bar- gaining from the outset of negotiations. Herb Kohn Elec- tric Co., 272 NLRB 815 (1984); Seaward International, 270 NLRB 1034 (1984). Accordingly, I must reject the General Counsel's argument raised in the brief that Re- spondent engaged in surface bargaining by virtue of spe- 15 See also Maremont Corp., 249 NLRB 359 (1980), involving 8(axl) allegations that comprised separate factual allegations 6 months apart in time. The Board distinguished Peyton Packing, supra, where the General Counsel was precluded from litigating twice the same facts , first as viola- tions of Sec. 8(a)(1) and then as Sec 8(a)(5) Jefferson Chemical was not discussed 18 Judge Robertson 's decision reflects that the Union was represented at the trial before him. cific bargaining positions preceding September 1982, as the complaint prior to trial amendment was too broad and vague to support such litigation. Respondent's pre-September 1982 conduct must of ne- cessity be evaluated to form the context of subsequent al- leged surface bargaining, which did not become the sub- ject of investigation until after the issuance of Judge Robertson's decision, and which, of course, was distinct in nature, i.e., regressive proposals, failure to meet, and unilateral wage increases. b. Surface bargaining commencing in the fall of 1982 and continuing thereafter The Board summarized the state of the law regarding bargaining obligations recently in Atlanta Hilton & Tower, 271 NLRB 1600, 1603 (1984), as follows: Under Section 8(d) of the Act, an employer and its employees' representative are mutually required to "meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment . . . but such obliga- tion does not compel either party to agree to a pro- posal or require the making of a concession." Both the employer and the union have a duty to negoti- ate with a "sincere purpose to find a basis of agree- ment," but "the Board cannot force an employer to make a 'concession' on any specific issue or to adopt any particular position." The Employer is, nonetheless, "obliged to make some reasonable effort in some direction to compose his differences with the union, if § 8(a)(5) is to be read as imposing any substantial obligation at all." It is necessary to scrutinize an employer's overall conduct to determine whether it has bargained in good faith. "From the context of an employer's total conduct, it must be decided whether the em- ployer is lawfully engaging in hard bargaining to achieve a contract that it considers desirable or is unlawfully endeavoring to frustrate the possibility of arriving at any agreement." A party is entitled to stand firm on a position if he reasonably believes that it is fair and proper or that he has sufficient bargaining strength to force the other party to agree. NLRB v. Advanced Business Forms Corp., 474 F.2d 457, 467 (2d Cir. 1973). Although an adamant insistence on a bargaining position is not of itself a refusal to bargain in good faith, Neon Sign Corp. v. NLRB, 602 F.2d 1203 (5th Cir. 1979), other conduct includes delaying tactics, unreasonable bargaining demands, unilateral changes in mandatory subjects of bargaining, efforts to bypass the union, failure to designate an agent with sufficient bargaining authority, withdrawal of already agreed-upon provisions, and arbitrary scheduling of meetings. [Footnote citations omit- ted.] In that decision the Board viewed the totality of that em- ployer's conduct, including the appearance at 13 negoti- ating sessions, its agreement with the union's proposal on sick leave, an offer of a 20-cent wage increase, and past HYATT REGENCY MEMPHIS successful bargaining with that union, and found that the employer had engaged in hard but good-faith bargaining. The Board reversed the decision of the administrative law judge who had found that the employer had "never seriously considered the Union 's proposal," categorically rejected proposals without making counterproposals and insisted on a 1-year contract extension on a "take it or leave it basis." In the instant case, the General Counsel , at least at one point in the brief and during oral argument, premised the theory of surface bargaining upon three specific courses of conduct by the Respondent , i.e., the regression in its economic offer, after September 1982, the refusal to meet in January 1983, and the unilateral increase in wages of February 1983. c. Regression in bargaining The General Counsel argues that "from the beginning .. . Respondent chose a course of extremely hard bar- gaining over economic and non-economic portions of the contract," and "took positions and reached agreements with the Union that in fact amounted to an overall re- duction in the benefits" previously enjoyed by the em- ployees. There is no complaint allegation nor complaint amendment to the effect that Respondent's economic po- sition from the outset constituted bad faith in that it re- gressed from the past level of employee benefits prior to union certification as a retaliatory tactic. At the outset of negotiations, the Respondent warned the Union of its fi- nancial problems. It offered to argue and substantiate its position by data and other information desired by the Union. However, the context of these negotiations fail to reveal that the Union at any time challenged or ques- tioned the Respondent's proffered explanation for its eco- nomic offers. There is no evidence that it sought to dis- cuss reasonable alternatives to what the Respondent sought in the way of labor cost savings . The evidence merely discloses that the Union made its economic offers by starting at a level which Respondent contended was far above industry standards, and continued slowly to descend from that initial demand. The Respondent took the position in bargaining that it needed to reach agree- ment on economics which would be in accord with area and industrywide levels and which would provide it with economic vitality at a time of ascending labor costs and declining room occupancy rates. The Respondent represented to the Union that its offers were comparable to other levels where it had negotiated agreements or other of its facilities and comparable to competitor's levels. There is no evidence that the Union challenged, questioned , or sought ever to debate Respondent's argu- ments. What is evident from the record evidence is that the Respondent made its offer and the Union simply re- jected it, descending subsequently from an arbitrary level that it had set, in the hope and expectation that since it had come down, therefore the Respondent must come up. There is no evidence that Respondent's economic po- sition was unreasonable in light of its financial situation. The evidence adduced by the Respondent supports its argument that it was economically motivated with re- spect to economic offers . There is no evidence that throughout most of 1982 from January through fall that 313 it had engaged in dilatory tactics or other tactics to sub- vert the bargaining process or in attempts to erode the Union's support by employees. Its bargaining position re- flects no attempt to undermine the Union 's representa- tional role, or status as bargaining agent. Its contract offers reveal no attempts to incorporate language inimi- cal to the bargaining process, or the grievance proce- dure, or to the Union's ability to meet with and commu- nicate with employees. It readily agreed to seniority rights, monthly labor-management grievance meetings, a union bulletin board, a grievance and arbitration proce- dure, including arbitration, certain privileges for union stewards, and a union dues-checkoff clause. It offered the Union whatever information and assistance it needed to negotiate. The General Counsel argues that Respondent's insist- ence of managerial discretion in merit raises and with re- spect to insurance coverage was an attempt to force the Union to waive and relinquish its statutory right to rep- resent employees and cites in support thereof United Contractors, 244 NLRB 72, 73 (1979); Smyth Mfg. Co., 247 NLRB 1139 (1980), and Struthers Wells Corp., 262 NLRB 1080 (1982). Those cases are all distinguishable in what the employees therein all sought retention of such extensive discretion as to freeze out the Union from any meaningful participation in the determination of wages, benefits, and working conditions. In Struthers Wells, for example, the employer, inter alia, refused to bargain con- cerning a union shop, resisted seniority rights, and sought a waiver of the Union and/or employee to grieve over withheld merit raises. In United Contractors, the em- ployer demanded a 20-percent wage reduction during a time of widespread inflation without a claim of economic need, and also demanded a management 's rights clause that would have required the Union to surrender all its bargaining rights with respect to the setting of work rules, hours of work, assignment of work, discipline, dis- charge, subcontracting and "any effective means of par- ticipation in important decisions affecting the terms and conditions of employment." In United Contractors, the employer's strategy was to submit an "offer " that was patently unacceptable to the Union . In Smyth, the em- ployer submitted proposals that "no self respecting Union could accept," including "abandonment of the Union's right to information," and the relinquishment of previously negotiated representational privileges . In that case the preceding contract with the same union had al- ready incorporated a merit raise proviso which implicitly incorporated managerial discretion but which the em- ployer sought to expand so as to totally exclude the Union from having any review thereof. The totality of conduct by the employer in that case revealed a desire to substantially cripple the representation role of the Union. Because of the employer's proffered economic basis for proposals of economic reductions, reliance upon such proposals was explicitly excluded from a determination of surface bargaining in that case . In the instant case, the attempt to incorporate managerial discretion in certain areas is not indicative of a desire to undermine the Union's representational role, nor to convert the employ- er's proposal to one that no self-respecting union could 314 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD accept. With respect to the basic wage rates, these clear- ly were to be the result of negotiations . Although the merit raises were sought to be determined on an individ- ual basis as an incentive device pursuant to discretion of Respondent, there is no evidence that Respondent re- fused to bargain over alternative suggestions offered by the Union, nor demanded the total exclusion of the matter from the grievance procedure or from any other employee-union review. In fact there is no evidence that the Union even sought as an alternative proposal some participation or review role in a merit raise system. The Union simply rejected it out of hand without any rea- soned argument. Respondent 's contract proposals as a whole fail to reveal that it sought to exclude the Union from representational participation in the determination of wages, benefits, and working conditions. Certainly, until the Respondent reduced its previously offered wage demand in the winter of 1982, the Union had not per- ceived the employer as attempting such goal nor did it reject Respondent's offer as proposals patently unaccept- able and unworthy of serious discussion. A review of the bargaining up to the point of regres- sion in wage and holiday benefits fails to disclose that Respondent had engaged in bad-faith bargaining. The Respondent had made its best and final economic offer and remained adamant on that offer, based upon financial arguments that it was prepared to argue and demon- strate. As the General Counsel concedes adamancy, by itself, is not dispositive of the issue of good faith but is only one factor to consider . NLRB v. American National Insurance Co., 343 U.S. 393 (1952). The issue then is not whether the Respondent refused to make economic con- cessions which it could possibly afford to make, but whether that adamancy was one factor indicative of a fixed intent to avoid contractual agreement . There is no lawful precedent to support the notion that an employ- er's generosity or ability to contribute more to its em- ployees' welfare is a factor to be scrutinized, or that a governmental agency may pass judgment upon the eco- nomic fairness of an employer's bargaining position in determining whether adamancy on economic offers con- stitutes bad faith. To the contrary, the Board has stated that it will not directly or indirectly compel concessions "or otherwise sit in judgment upon the substantive terms of collective bargaining agreements." Chevron Chemical Co., 261 NLRB 44, 46 (1982). On the facts litigated herein, I cannot find that Respondent's insistence upon its final, best economic offer, prior to September 1982, was dictated by anything more than what it determined was prudent business self-interest dictated by the finan- cial condition of its Memphis operation. The General Counsel argues that Respondent's reduc- tion of its wage and holiday offer in its ninth proposal, was contrived for the purpose of avoiding agreement which it feared might happen as the Union's descending demands more closely approximated that of the Re- spondent. In fact the Union's wage demand did not ap- proximate Respondent's offer until the fall of 1983. Had the Respondent not reduced its wage demand by 2 cents from 20 cents for nontipped employees, the parties would still have been several cents apart, as the Union by statements of negotiators indicated that there was no realistic expectation that it would agree to less than 23 cents per hour for the nontipped employees. The Gener- al Counsel argues, however, that the reduction in its offer was motivated by a desire to make contract agree- ment further remote. He cites UBC Local 1780, 244 NLRB 277, 281 (1979), for the proposition that a reduc- tion in offers by an employer, without adequate explana- tion, without significant compensatory proposals , is inim- ical to good-faith bargaining. That case is distinguishable from the facts herein. There the employer offered in- creasingly regressive proposals while it failed to offer a rational explanation for such regression in a context wherein it made coercive statements to employees con- cerning concurrent negotiations. 17 A regression in economic position during bargaining is not of itself dispositive of the good-faith issue where eco- nomic considerations and the ability to compete motivate the regressive bargaining stance . Charlie's Oil Co., 267 NLRB 764 (1983). Furthermore, it is no manifestation of bad faith for an employer to change his bargaining pos- ture to one less favorable when he does so in "flexing economic muscle" in consequence of an intervening cir- cumstance, including the passage of time which strength- ens his stance, e.g., the successful withstanding of a strike. O'Malley Lumber Co., 234 NLRB 1171, 1179 (1978); Deister Concentrator Co., 253 NLRB 358, 393 (1980); Barry- Wehmiller Co., 271 NLRB 471 (1984). In quoting Hickinbotham Bros. Ltd., 254 NLRB 96, 102 (1981), the Board stated in Barry- Wehmiller, supra, con- cerning an employer's proffered reasons for bargaining regression: "It is immaterial whether the Union, the General Counsel, or [the Administrative Law Judge] find these reasons totally persuasive." What is important is whether they are so illogical as to warrant the conclusion that the Respondent by offering them demonstrated an intent to frustrate the bargaining process and thereby precluded the reaching of any agreement. We do not find that to be the case here. Nor do we find that the Respondent's proposals can fairly be characterized as so harsh, vindictive, or otherwise unreasonable as to warrant the conclusion they were proffered in bad faith. [Citations omit- ted.] A reduction of a proposal is also not indicative of bad faith where, as in this case, the rejection of the earlier proposal by the Union was likely. The facts of this case similarly do not warrant the con- clusion of bad-faith motivation for Respondent's prof- fered reasons for the regression in the wage proposal and the reduction of one paid holiday. The Respondent had warned at the outset that subsequent events may cause it to change its proposal for the better or worse, and that it was not immutable and would not remain open indefi- nitely. The Respondent's recalculation of its position oc- "See also Pacific Grinding Wheel Co, 220 NLRB 1389 (1975), where- in the employer made increasingly progressive proposals throughout bar- gaining in the absence of evidence to support a claim of economic moti- vation HYATT REGENCY MEMPHIS curred generally at the time of the year when it makes it economic prognostications . Its opinion of what was a fi- nancially prudent economic offer in the fall of 1982 was based upon economic data. Its argument again was not questioned or challenged by the Union. There was no at- tempt by.the Union to engage in a critique or inquiry of Respondent's proffered data . The Union simply did not want to hear what Respondent was willing to say in de- fense of its position . The Union approached bargaining from the thesis that every action has an inverse reaction, i.e., if it descended from an initially high demand, bar- gaining dynamics would levitate the Respondent from its best offer. When Respondent descended further, the Union cried foul but sought no meaningful discussion as to why Respondent found it necessary to descend. Simply put, the Respondent was never really put to the test as to the sincerity of its economic representations by the Union , nor was its evidentiary presentation success- fully challenged by the General Counsel , who implies, in his brief, that the Respondent must prove good faith by proving economic necessity for its bargaining posture. The Respondent, however, has adduced evidence that its first proposal was calculated at a level which was not completely justified by economics but was tendered as a quid pro quo in part, for quick agreement . The offer was not accepted . Much time elapsed, during which it became increasingly apparent that its losses, in absolute terms, became progressively worse . The review of its history of operation revealed that the owners had not achieved any substantial profits. Therefore the time of the reduced bargaining offer coincided generally with the time of year Respondent normally predicted its future business level and set its goals . The evidence sub- mitted by Respondent is sufficient to preclude a finding that its proffered reasons for its changed bargaining stance were so illogical or unreasonable as to necessarily warrant an inference of bad faith. d. The February wage increases The General Counsel argues that the unilateral Febru- ary wage increases were unlawful because they were cal- culated to erode employee union support in anticipation of a strike, deviated from past practice, were granted in the absence of bargaining impasse, not encompassed within the framework of the Respondent 's most recent proposal, and were impermissible even if they comported with past practice. The evidence in the record supports Respondent's eco- nomic explanation for the need for wage adjustments. General Counsel adduced no evidence before me to dem- onstrate that the wage increases were deviations from past practice . The employer's evidence that individual wage reviews and raise were due pursuant to past prac- tice is unrebutted . There is no demonstration nor argu- ment as to how these wage increases deviate from the past practice and policy of the Respondent as it was argued to have existed in Judge Robertson 's case. The evidence is insufficient for me to conclude that the in- creases were calculated to erode employee union support of an expected strike . Further, the evidence fails to dem- onstrate that the raises exceeded Respondent's most recent wage offer . The wage increases complained of in 315 the complaint, were individual raises which varied from employee to employee pursuant to merit factors applied by Respondent's managers. The Respondent's most recent contract proposal encompassed an offer as to the basic minimum wage rate, and the granting of merit raises above that minimum . There is no complaint allega- tion that Respondent established a minimum wage rate in excess of the last contract proposal . The Respondent's contract proposals set forth no maximum rates . The evi- dence does establish that the wage increases, as a whole, did not exceed Respondent's last economic offer. The evidence fails to establish, as General Counsel argues, that the individual amounts were calculated to constitute a coercive signal to the employees. The General Counsel argues in the pending case heard by Judge Robertson that the Respondent breached its past practice by failing to engage in individual employee wage reviews and by failing to grant discretionary merit raises. Yet, it is now argued before me that Respondent violated the Act by engaging in the selfsame conduct. The General Counsel's argument is untenable. It is cor- rect that an employer may not continue to act unilateral- ly despite preunion certification discretionary practice with respect to wage rates, and other benefits and condi- tions of employment. However, Respondent here is not charged with setting new wage rates . It is charged with granting individual raises to employees of varying amounts determined by application of discretion applied to the merits of each employee, i.e., that conduct which the Union and the General Counsel insisted must contin- ue in the first case heard by Judge Robertson. With respect to impasse, the Board evaluates several factors in determining whether negotiations have "ex- hausted the prospects of concluding an agreement," and whether stalemate was reached prior to the implementa- tion of unilateral changes that are "reasonably compre- hended within . . . pre-impasse proposals ," including such factors as length of negotiations, the importance of the issue, and the understanding of the parties of the state of negotiations. Taft Broadcasting Co., 163 NLRB 475, 478 ( 1967), petition to review the Board's Order denied 395 F.2d 622 (D.C. Cir. 1968); an impasse thus exists where the party asserting impasse is justified in concluding that continued bargaining would be fruitless; E. I. du Pont & Co., 268 NLRB 1065 (1984), and cases cited. This is so despite the fact that the parties, at the time of declared impasse, were closer than they had been previously. Taft Broadcasting Co., supra. Where, despite the Union's continued submission of counterproposals after numerous bargaining sessions, and where the parties had "adequate opportunity to discuss their differences, the employer bargained hard but in good faith remained firm and the Union indicated nonac- ceptance of the employer's position, it was found appar- ent that the parties had exhausted "the realistic possibili- ty of reaching agreement," an impasse was found. E. I. du Pont, supra at 1066. Furthermore, impasse may be reached even after a few bargaining sessions where the subject of the change, e.g., wages, was of "supreme im- portance" to the employer with respect to its ability to 316 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD compete. Bell Transit Co., 271 NLRB 1272 (1984).18 Also, as stated by the Board in Western Publishing Co., 269 NLRB 355 (1984): Furthermore, after an impasse has been reached on one or more subjects of bargaining, an employer may implement any of its pre-impasse proposals, even if no impasse has occurred as to those particu- lar proposals which are put into effect . [Taylor-Win- field Corp., 225 NLRB 457 (1976); Taft Broadcasting Co., supra.] The findings of fact herein establish that as of the date of the merit increases, the Respondent had reason to con- clude that further discussions with the Union would be fruitless. Statements of union negotiators , particularly in January, February, and March, indicated that a union offer of less than 23 cents was not a realistic expectation. There appeared to be no other area of unresolved issues that would be susceptible to further meaningful discus- sions. Respondent reiterated its positions and the Union simply rejected the employer's proposals as unaccept- able. From the state of the evidence in the record it ap- pears that negotiations seem to have degenerated to a series of repeated proposals and demands and stereo- typed rejections with no evidence of the entrance into the discussion of new arguments , new insights, new ap- proaches, or alternative reasoned arguments . Additional- ly, the Respondent was presented with the proposal of a strike, and so advised of that probability. Based upon my reading of the Board's interpretation of impasse set forth in the above -cited cases, I conclude that impasse was reached in critical bargaining issues, particularly the issue of the basic wage rate of nontipped employees, if not on the precise issue of merit increases, and that such impasse was reached prior to the imple- mentation of the February merit raises. e. Alleged refusal to meet or communicate Counsel for the General Counsel argues that Respond- ent refused to meet or communicate with the Union from January 17 to the outset of the strike which he charac- terizes as the "most critical period of the entire negotia- tions process." Much of the General Counsel's factual premise is structured upon the testimony of union negoti- ator Jones concerning this period of time. As indicated in the factual findings, I did not find his testimony reliable. I do not find clear evidence in the record that the Union made numerous meaningful efforts to resume face-to-face negotiations which were ignored by Respondent. Com- munications occurred during this time. Union representa- tives who supposedly had difficulty in contacting Carmi- chael, were able to make telephone contact with Stokes. Based upon those conversations and other communica- tions, Respondent had reason to believe that negotiations were at impasse. Assuming that the General Counsel es- tablished that Carmichael purposely refused to make contact with the Union, I conclude, for the reasons dis- 18 The Board reached that conclusion "irrespective- of post-impasse bargaining movement by the employer, or whether a contract was ulti- mately agreed to since neither event "would show intrinsically that no prior impact existed ." Bell Transit, supra at fn 12 cussed above, that the parties were at impasse and that nothing in the communications from the Union indicated that there was a realistic expectation that continued mar- athon face-to-face discussions would be fruitful. I con- clude this, notwithstanding the Union's expressed will- ingness to make new proposals with respect to its wage demand for tipped employees and movement in other minor areas. Impasse had been reached at the very least on the issue of the wage rates for nontipped employees. Carmichael was correct in his assessment that expressed to the Union that it had failed to manifest willingness to make significant movement toward Respondent's offer. As concluded above, Respondent's firmness on its eco- nomic offer was not proven to have been made in bad faith. Accordingly, I conclude that Respondent's reluc- tance to meet and communicate during the period Janu- ary 17 to March 17, even if proven, is not indicative of bad faith but rather may be indicative of a reluctance to engage in meaningless, repetitive, stereotyped discus- sions, where no reasonable prospect of agreement was in- dicated. Accordingly, I conclude that there is insufficient evi- dence upon which to find that Respondent engaged in bad-faith surface bargaining up through the issuance of complaint. f. Subsequent negotiations The General Counsel at trial alleged that Respondent persisted in surface bargaining during resumed bargain- ing concurrent with the trial. The factual findings reveal that the parties had virtually agreed to all economic terms of the contract, but that the Union conditioned agreement upon the reinstatement of 24 strikers, and that Respondent refused reinstatement, in part at least, be- cause of alleged picket line misconduct. It is not clear whether any or all of the strikers have been replaced. Regardless of whether the subject of striker replacement is a mandatory bargaining subject, I cannot conclude that the evidence sufficiently establishes that Respondent's position was frivolous and unreasonable. Much credible evidence was adduced to the effect that substantial picket line misconduct occurred. As to those strikers that Respondent did not accuse of picket line misconduct, there is no evidence that positions were available for them. The strike, I conclude, was an economic strike and not an unfair labor practice strike. I find that the sole purpose of the strike was to protest Respondent's bar- gaining positions. Since I have found insufficient evi- dence of bad-faith bargaining, the strike was not in pro- test of Respondent's unfair labor practices. The strikers were economic strikers. I find that the post-complaint bargaining constituted an extension of good-faith bargaining, and that the employ- er's position with respect to immediate reinstatement of economic strikers was not proven to have been adopted for the purpose of avoiding contractual agreement. Accordingly, I find no merit to the 8(a)(5) allegations of the complaint. HYATT REGENCY MEMPHIS 2. The 8(a)(3) issues In view of the factual findings above , I conclude that the 8(a)(3) allegations of the complaint are without merit. 3. The 8(a)(1) issues Although I have made findings above that Respond- ent's agents made coercive statements to employees who were about to engage in protected union activities, i.e., a strike, I do not feel that it is necessary to recommend any remedial Order in this regard. The recommended re- medial Order in Judge Robertson's decision now pending 317 before the Board contains sufficient notice to the em- ployees that they have the right to engage in protected activity and that Respondent will not interfere with that right. Should Judge Robertson's recommended Order be adopted by the Board and ultimately complied with or enforced, an additional remedial Order in this regard will be superfluous. If his Order is not adopted, then the in- fractions in this case will constitute isolated, insignificant incidents which clearly did not impact the decision of the employees involved to strike and to remain on strike. [Recommended Order dismissing complaint omitted from publication.]