United Technologies Corp.

UNITED TECHNOLOGIES CORP. 571 Hamilton Standard Division of United Technologies Corporation and Hamilton Standard Independ- ent Fire/Security Officers Association. Cases 39-CA-3438-2 and 39-CA-3681 September 18, 1989 DECISION AND ORDER BY CHAIRMAN STEPHENS AND MEMBERS CRACRAFT AND DEVANEY On December 7, 1988, Administrative Law Judge Raymond P. Green issued the attached deci- sion. The Respondent filed exceptions and a sup- porting brief; the General Counsel filed exceptions and a supporting brief; and the General Counsel and the Respondent filed answering briefs. The National Labor Relations Board has delegat- ed its authority in this proceeding to a three- member panel. The Board has considered the decision and the record in light of the exceptions and briefs and has decided to affirm the judge's rulings, findings,' and conclusions and to adopt the recommended Order as modified. The judge found that the Respondent violated Section 8(a)(5) and (1) of the Act by failing and re- fusing to bargain in good faith with the Union, withdrawing recognition from the Union, and making unilateral changes in certain mandatory subjects of bargaining. Additionally, the judge found that the Respondent violated Section 8(a)(1) by telling employees that the selection of the Union as collective-bargaining representative was futile. For the reasons set forth by the judge and as explained in more detail below, we agree with the judge that the Respondent violated the Act, as al- leged. As more fully set forth in the judge's decision, following a Board-conducted election on June 15, 1983, and a subsequent Board decision ordering the Respondent to bargain with the Union, 2 the Union ' The Respondent has excepted to some of the judge's credibility find- ings The Board's established policy is not to overrule an administrative law judge's credibility resolutions unless the clear preponderance of all the relevant evidence convinces us that they are incorrect . Standard Dry Wall Products, 91 NLRB 544 ( 1950), enfd 188 F.2d 362 (3d Cir. 1951) We have carefully examined the record and find no basis for reversing the findings. We correct the following inadvertent errors in the judge's decision The Respondent requested bargaining materials from a private labor re- porting service on March 13, 1986, not March 21, 1986; Schrodi selected April 9, 1986, as the date for the first bargaining session , not April 8, the parties negotiated on July 9, 1986, not July 8, Leary's March 18 letter to Carter indicated that Schrodi would be on vacation until early April, not late March; the date of the meeting at sec 111 , par 18 of the decision is June 30, 1988, not June 30, 1987 2 United Technologies Corp., 275 NLRB No 195 (Aug 19, 1985), enfd mem. No 85-4177 (2d Cir 1986) requested bargaining with the Respondent by letter dated March 13, 1986. At the Union's request, the Respondent established the first bargaining session for April 9, 1986. Thereafter, the Respondent and the Union met and negotiated at 24 bargaining ses- sions between April 9, 1986, and March 12, 1987. The first bargaining session was devoted to pre- liminary discussions and the establishment of ground rules for negotiations. After this initial ses- sion, the Union mailed its bargaining proposals to the Respondent. Thereafter, the next 12 bargaining sessions, from May 8 to October 30, 1986, were largely spent with the Respondent reading the Union's proposals aloud one-by-one; asking union negotiators questions about each proposal, such as why the Union wanted the proposal and what pre- cisely did the proposal mean; and encouraging the Union to correct assorted typographical, grammati- cal, and other errors in the proposals. During these 12 bargaining sessions, the Union repeatedly asked the Respondent when it was going to be submitting counterproposals. The Re- spondent refused to submit counterproposals before completing its review of the Union's proposals, and refused to discuss economic issues until settling all contract language issues. At the conclusion of this phase of the negotiations, which lasted more than 6 months, the Respondent had not agreed to any of the Union's proposals and had yet to submit any counterproposals. At the December 3, 1986 negotiation session, the Respondent began submitting its counterproposals to the Union. The Respondent would submit a single proposal to the Union and solicit comments, questions, and discussions regarding that proposal before presenting its next proposal. According to testimony credited by the judge, when the Union objected to the manner in which the Respondent was presenting its proposals, the Respondent's chief negotiator replied that, if the Union wanted, the parties could call off negotiations and wait until the Company had a full contract proposal, which the Company would then present on a "take-it-or- leave-it" basis. Despite the Union's protests over the Respondent's piecemeal submission of bargain- ing proposals, the Respondent followed this proce- dure for the remaining negotiation sessions. On March 24, 1987, the Respondent wrote the Union that it was suspending negotiations in order to investigate a decertification petition allegedly signed by a majority of the unit employees. On April 2, 1987, the Respondent withdrew recogni- tion from the Union on the basis of the petition. It is undisputed that the Respondent subsequently ini- tiated certain unilateral changes without bargaining with the Union. 296 NLRB No. 79 572 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD In determining whether a party has bargained in bad faith, the Board looks to the totality of the cir- cumstances in which the bargaining took place. Hotel Roanoke, 293 NLRB 184 (1989); Port Plastics, 279 NLRB 362, 382 (1986); Atlanta Hilton & Tower, 271 NLRB 1600, 1603 (1984). The Board examines not only the parties' behavior at the bargaining table, but also conduct away from the table that may affect the negotiations. Hotel Roanoke, above; Port Plastics, above. Among other indicia that a party has bargained in bad faith , the Board also considers whether a party has engaged in delaying tactics and whether a party has made unilateral changes in mandatory subjects of bargaining . Atlan- ta Hilton & Tower, above. In reviewing the totality of the Respondent's conduct here, we find that the Respondent violated the Act by refusing to bargain in good faith with the Union. We find the following factors to be especially significant. First, after almost 1 year of bargaining with the Union , the Respondent had not presented any economic proposals, despite repeated prompt- ing from the Union, and had never even internally discussed its economic demands . Further, at the time Respondent withdrew recognition from the Union, the Respondent had still not completed drafting its proposed contract language. Because the Respondent never made any economic propos- als to the Union and had not completed drafting its proposed contract language, the Union could not have agreed to a contract prior to the withdrawal of recognition even if it capitulated to the Re- spondent's every demand. Even though these negotiations involved the first collective-bargaining agreement between the par- ties, we fail to find this factor to be a sufficient ex- planation for the Respondent's delay in presenting its counterproposals or its failure to present eco- nomic proposals. Rather , the totality of the evi- dence indicates that the Respondent's item-by-item review of the Union's proposals, its piecemeal sub- mission of counterproposals, and its insistence on resolving all issues relating to contract language before discussing economic issues were delaying tactics designed to frustrate the bargaining process. Second, we find the Respondent's December 3, 1986 statement at the bargaining table constitutes further evidence of bad-faith bargaining . As noted above, the Respondent's chief negotiator told the Union, in response to the Union's opposition to the piecemeal submission of bargaining proposals, that the Respondent could wait until it had a full con- tract proposal that could then be presented on a take-it-or-leave-it basis. In the totality of circum- stances here, this statement by the Respondent's chief negotiator clearly evidences bad-faith bar- gaining. Finally, we find additional evidence of the Re- spondent's bad-faith bargaining in its unilateral transfer of a unit employee from the Respondent's main facility to its Midway Green facility during the course of bargaining without notifying the Union or bargaining over the transfer . It is undis- puted that the Respondent did not notify the Union of this action or provide the Union an opportunity to bargain even though the parties were then cur- rently engaged in negotiations . We note that the Respondent had previously "temporarily" trans- ferred a unit employee to Midway Green and, once the Union raised the issue at the bargaining table, unilaterally transferred that employee back to its main facility without notice to the Union or pro- viding the Union with an opportunity to bargain over the decision.3 Based on the totality of the circumstances in which the bargaining took place , including the Re- spondent's delaying tactics, its statement that it could submit a contract to the Union on a "take-it- or-leave-it" basis, and its unilateral change in a mandatory subject of bargaining, we find that the Respondent violated Section 8(a)(5) and (1) by fail- ing and refusing to bargain in good faith . Cf. Hartz Mountain Corp., 295 NLRB 418 (1989) (no surface bargaining found where employer presented union with comprehensive counterproposals, including proposals regarding economic issues, as soon as its questions regarding union's proposals were an- swered; agreement was reached on a number of significant items; and employer did not engage in other conduct evidencing bad-faith bargaining).4 8 In light of the previous temporary transfer and the issue being raised at the bargaining table, we agree with the judge that the Respondent's unilateral permanent transfer was a mandatory subject of bargaining See Kansas Education Assn., 275 NLRB 638 (1985) The judge's finding that the Respondent violated the Act by transfer- ring the unit employee flowed from his finding that the Respondent un- lawfully withdrew recognition from the Union . We find, however, that the Respondent's conduct independently violated Sec. 8(a)(5) and (1) be- cause the transfer occurred on March 9, 1987, prior to the withdrawal of recognition . Thus, even in the absence of a finding that the Respondent engaged in surface bargaining and unlawfully withdrew recognition, we find that the Respondent 's unilateral conduct violated the Act 4 Contrary to the Respondent 's contention, we also find that the charge alleging the unlawful transfer of a unit employee was timely filed. Although the Union's president learned of a new post created by the Re- spondent on April 4, 1987, there is no evidence that the Union learned prior to May 20, 1987 , that the transfer of the unit employee was to be permanent or that the new post created by the Respondent was located at Midway Green. In light of the Respondent's repeated insistence during negotiations that no unit employees had been permanently assigned to Midway Green , we find the union president's observation of a new post number in the Respondent's security records insufficient in itself to start the running of the 10(b) period Furthermore, the charge is closely relat- ed to the initial charge and, even were the charge barred by Sec 10(b), events occurring outside the 10(b) period may be considered as evidence of the Respondent's refusal to bargain in good faith Continued UNITED TECHNOLOGIES CORP. 573 AMENDED REMEDY The General Counsel has excepted to the judge's failure to require, as part of the remedy for the Re- spondent's unilateral change in terms and condi- tions of employment, that the Respondent rescind those unilateral changes at the request of the Union. We find merit in the General Counsel's ex- ception, and we shall modify the Order according- ly. ORDER The National Labor Relations Board adopts the recommended Order of the administrative law judge as modified below and orders that the Re- spondent, Hamilton Standard Division of United Technologies Corporation, Windsor Locks, Farm- ington, and East Granby, Connecticut, its officers, agents, successors, and assigns, shall take the action set forth in the Order as modified. 1. Insert the following as paragraph 2(b) and re- letter subsequent paragraphs. "(b) On request by the Union, revoke the unilat- eral changes in the rates of pay, wages, and other terms and conditions of employment that were placed into effect by the Respondent in the appro- priate bargaining unit, until such time as the Re- spondent negotiates with the Union in good faith or an impasse in negotiations is reached." 2. Substitute the attached notice for that of the administrative law judge. In light of our decision here, we find it unnecessary to pass on the General Counsel's exception regarding the judge's failure to rely on the posthearing 8(a)(1) statement by Supervisor McGrath as further evidence of the Respondent's refusal to bargain in good faith. APPENDIX WE WILL NOT refuse to bargain collectively and in good faith concerning rates of pay, hours of em- ployment, and other terms and conditions of em- ployment with the Hamilton Standard Independent Fire/Security Officers Association as the exclusive representative of the employees in the bargaining unit described below: All full-time and regular part-time dispatchers, technicians, fire protection officers, security officers, fire/security officers and security re- ceptionists at our Windsor Locks, Farmington, and East Granby facilities; excluding all other employees, chiefs, captains, lieutenants, office clerical employees, professional employees; and other supervisors as defined in the Act. WE WILL NOT withdraw recognition from the above-named Union. WE WILL NOT unilaterally change wages and terms and conditions of employment without first notifying and bargaining with the Union. WE WILL NOT tell our employees that selecting a union would be futile. WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exer- cise of the rights guaranteed you by Section 7 of the Act. WE WILL, on request, bargain with the Union and put in writing and sign any agreement reached on terms and conditions of employment for our employees in the above bargaining unit. WE WILL, on request by the Union, revoke the unilateral changes in the rates of pay, wages, and other terms and conditions of employment which we put into effect in the bargaining unit, until such time as we negotiate with the Union in good faith or reach an impasse in negotiations. NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post and abide by this notice. Section 7 of the Act gives employees these rights. To organize To form, join, or assist any union To bargain collectively through representa- tives of their own choice To act together for other mutual aid or pro- tection To choose not to engage in any of these protected concerted activities. HAMILTON STANDARD DIVISION OF UNITED TECHNOLOGIES CORPORA- TION Micheal A. Marcionese, Esq., for the General Counsel. Charles V. Gagliardi Esq. and Edward J. Dempsey Esq., for the Respondent. James L. Kestell, Esq. (Kestell, Pogue & Gould), for the Charging Party. DECISION STATEMENT OF THE CASE RAYMOND P. GREEN, Administrative Law Judge. These cases were heard by me on June 27, 28, and 29 and October 13, 1988. The charge in Case 39-CA-3438- 2 was filed on May 8, 1987. That charge alleged that since December 1, 1986, the Company engaged in sur- face bargaining and that on April 2, 1987, the Company unlawfully withdrew recognition. The charge and 574 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD amended charge in Case 39-CA-3681 were filed on No- vember 20 and December 11, 1987. These alleged certain unilateral changes, namely, the transfer of a unit employ- ee to a new location, the granting of a wage increase, and the institution of a new grievance procedure. The consolidated complaint was issued on February 26, 1988. It alleged as follows: 1. That from April 1986 through April 1987, during the course of collective bargaining, the Respondent failed and refused to bargain in good faith and without any intention of reaching an agreement. 2. That on or about April 2, 1987, the Respondent withdrew recognition from the Union. 3. That in May 1987, the Respondent unilaterally transferred an employee to another facility. 4. That on or about July 1, 1987, the Respondent uni- laterally instituted a wage increase for the bargaining unit employees. 5. That on or about November 17, 1987, the Respond- ent unilaterally instituted a new personnel policy includ- ing a new grievance procedure. 6. That on or about June 30, 1988, the Respondent by a supervisor, told its employees that the selection of the Union as a bargaining representative was futile. The Respondent admits that it withdrew recognition on April 2, 1987; that it unilaterally granted unit employ- ees wage increases; that it unilaterally instituted new per- sonnel policies (including a grievance procedure); and that it transferred an employee. The Respondent asserts, however, that it negotiated in good faith and that it only withdrew recognition after it had obtained objective evi- dence that the Union no longer represented a majority of the employees in the bargaining unit . It therefore con- tends that the unilateral changes were not unlawful as the Union no longer was the majority representative at the time such changes are made . It also contends that the transfer of a single employee to a separate facility is not a mandatory subject of bargaining.' On the entire record, including my observation of the demeanor of the witnesses, and after considering the briefs filed by the General Counsel and the Respondent, I make the following FINDINGS OF FACT 1. JURISDICTION The Respondent admits and I find that it is an employ- er engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act and that the Union is a labor organization within the meaning of Section 2(5) of the Act. II. ALLEGED UNFAIR LABOR PRACTICES A. Background The Respondent is a defense contractor engaged in manufacturing aerospace products. Its facilities are locat- I Respondent asserts that certain allegations are barred by the statute of limitations set forth in Sec 10 of the Act Respondent has not howev- er, specified which allegations of the complaint are so barred As I do not see any allegations which are barred by the 6 -month statute of limita- tions, I reject this defense. ed at various locations in Connecticut. For many years the Respondent's production and maintenance employees have been represented by Lodge 743 , International Asso- ciation of Machinists and Aerospace Workers, AFL- CIO. On June 15, 1983, in Case 39-RC-435, the Board's Hartford office held an election in the following unit of employees: All full-time and regular part-time dispatchers, tech- nicians, fire protection officers, security officers, fire/security officers and security receptionists at the Employer's Windsor Locks, Farmington, and East Granby facilities ; excluding all other employ- ees, chiefs, captains, lieutenants, office clerical em- ployees, professional employees ; and other supervi- sors as defined in the Act. The Union ultimately was certified as the representa- tive of the above-described unit on March 21, 1985, after a hearing had been held regarding the eligibility of cer- tain voters and regarding certain allegations of employer preelection misconduct . After the certification, the Union made a request to bargain which was refused by the Em- ployer. This resulted in an Order by the Board on August 19, 1985, that the Respondent bargain with the Union. United Technologies Corp., 275 NLRB No. 195 (Aug. 19, 1985). This Order was thereafter efiforced by a United States court of appeals on March 7, V986. B. The Negotiations Following the court's order, the Union by its presi- dent, Dick Carter, wrote to the Respondent on March 13, 1986, seeking to begin negotiations . The letter was addressed to Jack Leary, who was the vice president of personnel resources for the Company's Hamilton Stand- ard Division. Leary responded by letter dated March 18 and stated that the Respondent's chief spokesman during the negotiations would be Walter Schrodi who would be on vacation until sometime in late March. On March 21, the Company wrote to the the Bureau of National Affairs asking for samples of contracts that various companies had with security unions. The BNA sent such samples and the Company made an analysis of those contracts at or near the commencement of negotia- tions with the Charging Party. On March 27, 1986 Carter wrote again to Leary re- questing a schedule for bargaining dates . He also advised Leary that the Union had set April 27, 1986, as its target date for completing negotiations. (April 27 was the expi- ration date of the Company's contract with the IAM which represented a unit of about 4000 employees at Hamilton Standard .) The Union, in the letter, also indi- cated that if the target date was not met, it would con- sider a work stoppage or other appropriate action. On April 4, Schrodi responded with a fetter stating that he had selected April 8 as the date for the first meeting. The first meeting was held on April 9. Thereafter, there were a total of 24 negotiating sessions through March 12, 1987. At the negotiations, the Union was rep- resented by Dick Carter as its chief spokesman , by its at- torney, Dan Livingston (who at times also acted as a UNITED TECHNOLOGIES CORP. 575 spokesman), and by its officers, Dave Oliver, Art Theo- fane and Skip Hunter. (The latter three individuals were also employees of the Hamilton Standard Division.) At various times, Attorney Ruth Pulda also attended as a representative for the Union . The Respondent's repre- sentatives were Walter Schrodi and John Carpino as chief spokesmen, Beth Amato, Craig Gaudreau, and Dave McGrath. Schrodi and Carpino are directors of labor relations for the corporation, United Technologies. Amato is a corporate labor attorney . Craig Gaudreau is the division's (i.e., Hamilton Standard), compensation and benefits analyst and McGrath is the division's direc- tor of security. The first meeting, on April 9 primarily dealt with ground rules. At this meeting the Union repeated its desire to reach an agreement by April 27. The Company said that the earliest time that it could meet again was on May 8, because of negotiations with the IAM .2 Carter replied that by May 8 , his Union might be on strike. Carter also said that the Union was willing to meet at any time and any place in order to get an agreement by April 27. On April 28 the Company and the IAM made a new contract for the large production and maintenance em- ployee unit. Accordingly the Union's "deadline" passed without any action on its part. On April 29 the Union sent to the Company a pro- posed contract. This was a 37-page document, which in part contained contract language identical to that in the contract between Hamilton Standard and the IAM. This was intended to shorten bargaining by making proposals which the Company had already agreed to with another union. On May 8, Schrodi, starting at page one of the Union's proposed contract questioned the name of the Union be- cause the name in the proposal was slightly different from the name in the Board's certification. The Union explained that in the interim between the time the peti- tion was filed and the commencement of negotiations it had changed its name (in 1984). As to the next item on the Union's proposed contract which stated that there would be "prompt and fair disposition of grievances," Schrodi stated that this proposal assumed that there was going to be a grievance procedure. At the May 8 meeting the Company said that it wanted to hire part-time employees as a means of cutting costs and wanted the Union to agree to allow the Com- pany to hire such people at reduced wage rates. The Union took the position that part -time employees would be part of the bargaining unit, and would have to be hired at the existing wages and conditions until bargain- ing had reached an impasse. At the time this issue was raised by the Company there were in fact no part-time security personnel employed. Subsequently there was further discussion on this issue raised by the Company but it ultimately was dropped in October 1986 and there neither was any agreement reached on the subject nor were any part-time employees hired into the unit. 2 None of the people who were involved in these negotiations on behalf of the Respondent were also directly involved in the negotiations with the IAM. Also at the May 8 meeting , the Union stated that it would give the Company 10 days notice before taking any job action, provided that the parties were engaged in bargaining. At the conclusion of the meeting Schrodi of- fered to meet on May 15, 20, 21, and 22, but the Union could not meet on the last three dates as its attorneys were not available. On May 8, Schrodi told the Union's committee that the Company would not submit its own counterproposals until the parties had reviewed completely the Union's proposed contract. A series of 12 bargaining sessions took place on May 15, June 3, 4, and 26, July 8, August 13 and 14, Septem- ber 17 and 18, and October 1, 15, and 30 (all in 1986). Without going into specific details of the discussions at this point, it is noted that all of these meetings involved review, item by item, by the Company of the Union's contract proposals, in seriatim. Essentially, this consisted of a procedure whereby Schrodi would read a union proposal and then demand to know exactly what the Union meant by it. This was done not only as to clauses which did in fact have confusing elements, but also as to clauses which had been copied out of the Company's contract with the IAM and which had been part of that agreement for many years . Generally, each meeting dealt with two or three clauses in the Union's proposed con- tract. During this series of meetings , the Union on various occasions asked when the Company was going to make its counterproposals. The Company responded that it would only do so after reviewing the Union's proposed contract. The Company also made it clear that it was not willing to discuss economic issues until after all contract language issues had first been agreed to. The Union re- luctantly went along: By the meeting of October 30, 1986 , the parties had finished reviewing the Union's proposed contract insofar as the language items were concerned . By this time, about 5 months after bargaining had commenced, the Company had not made any counterproposals of its own and had not agreed to accept any of the Union's pro- posed contract language . At this meeting the Union asked the Company when it would be getting its coun- terproposal. Schrodi said that he would bring them to the next meeting which was scheduled for December 3, 1986. On December 3, 1986, at the outset of the meeting, Schrodi stated that the division (Hamilton Standard), was doing poorly and had to cut costs. He stated that the company was considering possible layoffs, an early retirement program and contracting out the guard serv- ice. After the initial statements, Schrodi handed to the union representatives, a single sheet of paper which read: Article 1 Agreement This Agreement made and entered into this day of by and between the United Technologies Corporation for and on behalf of Hamilton Stand- ard Division, hereinafter called the "company" and the HAMILTON STANDARD INDEPENDENT 576 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD FIRE/SECURITY OFFICERS ASSOCIATION, hereinafter called the "union." When the Union asked where the rest of the Compa- ny's counterproposal was, Schrodi responded that he in- tended to present each of the company 's counterpropos- als, one at a time. When the Union objected, Schrodi said that if the Union wanted, the parties could call off negotiations, wait until the Company had a full contract proposal which the Company would then present on a take-it-or-leave-it basis . The Union responded that this was not the only two alternative means of bargaining. After a caucus, the Union told the Respondent that it wanted the Company to submit its contract proposal in its entirety by February 1, 1987. The Union further stated that if the Company did not provide an entire con- tract counterpropogal by that date, it would abrogate its commitment to give 10 days notice before taking strike or other action. According to Schrodi, he adopted the procedure of presenting individual counterproposals because he "didn't want to have a full contract out there you can get in a position of horse trading . By going one proposal at a time you won't get yourself in a horse swapping sit- uation where you're buying language you don't agree with." (Of course the other thing that you can avoid is the other side saying "Ok, I'll take it.") During the remainder of the December 3 meeting, the company submitted two more contract clauses, neither of which, in my opinion is of much substance. These were: Article 11 Coverage The union, having been certified by the National Labor Relations Board in Case No. 39-RC-4335 is hereby recognized by the company as the exclusive bargaining agent for the following employees: All full-time and regular part-time dispatchers, technicians, fire protection officers, security offi- cers, fire/security officers and security reception- ists at the Employer's Windsor Locks, Farming- ton, and East Granby facilities; excluding all other employees, chiefs, captains, lieutenants, office clerical employees, professional employees; and other supervisors as defined in the Act. Article III Purpose It is the intent and purpose of the parties hereto that this agreement shall promote and improve the rela- tionship between the company and its employees and the employees represented by the Union, and between the company and the union; moreover, it is recognized by both parties that they have a mutual interest and obligation to maintain friendly coopera- tion between the company and the union which will eliminate interference with the efficient operation of the company's business so as to improve the com- petitiveness of the company in the marketplace for the benefit of both management and its employees. To summarize, the Company on December 3 made counterproposals on three clauses, one stating that there would be an agreement , one stating that the Company would recognize the union (as required by law), and the last stating that the Company should be competitive. To my mind this was not a good beginning for the next phase of bargaining. At the next meeting, on December 17, the Company made a single proposal and this was an interim proposal for layoffs and recalls to be in effect during the period before the execution of any collective -bargaining agree- ment. On January 7, 1987, the Company made a single coun- terproposal dealing with the subject of union representa- tion. In essence, the Company proposed that the Compa- ny would recognize the Union's appointment of a bar- gaining committee of three employees (including a chair- man) and the appointment of one steward for each shift consisting of more than five employees. The Company further proposed that the persons appointed by the Union had to be full-time employees having worked at least 12 continuous months. On January 20, 1987, the Company submitted its coun- terproposal regarding a grievance procedure . This pro- vided that the procedure would be the sole and exclusive means of resolving any disputes with employees. In es- sence, the Company proposed a three-step grievance pro- cedure with the Company's answer at the third step to be final and binding. It also proposed that the first step should be between the employee and his or her supervi- sor. At a meeting on January 29 the Company submitted proposals regarding three new subjects and also made a revised proposal regarding its proposal for an interim layoff-recall procedure. On January 29 the company proposed a no-solicitation clause which prohibited soliciting of employees for union membership or dues on company premises while either the solicitor or solicitee were performing work. The Company also proposed a nondiscrimination clause whereby it agreed that its current policy was not to dis- criminate against employees on the basis of race , color, religion, gender, etc. Finally, the Company proposed a very broad management-rights clause. On February 18, the Company revised its previous proposals regarding an interim layoff-recall procedure. It also made a revised offer on the coverage clause, origi- nally proposed on December 3, 1986, and a revised no- solicitation clause, which was slightly less restrictive. Similarly, the Company revised slightly, its proposed union representation clause so as to allow the Union to select who it wanted when negotiating for a collective- bargaining agreement. The new item presented by the Company at this meeting was a broad no-strike clause. As to this, the proposed clause prohibited the union and its representatives or employees from engaging in any strikes (whether primary or secondary), work stoppages, slow downs, sit downs, organized absences or sicknesses, picketing, sympathy strikes, refusals to cross picket lines UNITED TECHNOLOGIES CORP. 577 of other unions, or any other interferences with company operations. The Company also proposed that breach of this provision could result in nonreviewable discharge or discipline against any employee and termination of the collective-bargaining agreement at the Company's sole discretion. At the meeting on February 19, the Company submit- ted a revised union representation clause wherein it agreed to increase the number of employees the Union could appoint to the bargaining committee from three to four. It also agreed to permit the Union to appoint a steward at the Farmington location. Also at the February 19 meeting the Company revised its management-rights proposal, specifically in section 2. In essence, while proposing to retain the exclusive right to unilaterally restructure, eliminate or subcontract out work for any reason, with a concomitant union waiver over decision bargaining, the Company did propose that if such a decision permanently reduced the unit by 50 percent or more, it would bargain with the Union over the effects. On March 2, the Company made a revised offer re- garding a grievance clause. In this regard, it agreed to modify its earlier proposal so as to allow a shop steward to be present at a first-step adjustment made between an employee and his/her supervisor. Also the Company proposed that if an employee claimed that he was dis- charged for just cause, such a grievance would be arbi- tral. On March 12 the Company made a proposal regarding seniority. At this meeting, the Union accepted four out of the five sections of the Company's proposed clause. Also the Company submitted a revised no-strike clause, which in essence allowed the Union to terminate the agreement in the event of a company lockout. Addition- ally, the Company again revised its proposed grievance clause, this time to permit arbitration of any case where an employee is discharged for violating the no-strike clause, the arbitration to deal only with the question of whether the employee engaged in the prohibited con- duct. During the March 12 meeting, the Union indicated that it was willing to meet around the clock in order to reach an agreement by March 18. The Company, howev- er, stated that it could not meet again until March 30 be- cause the Company was too busy on a defense depart- ment audit. March 12 turned out to be the final negotiation ses- sion. To recap, the evidence shows that up until March 12, 1987, the Company starting on December 3, 1986, presented some counterproposals regarding basically eight subjects, and one of which dealt with an interim procedure to deal with layoffs pending an agreement to a contract. The evidence also shows that at most there were tentative agreements regarding a union representa- tion provision, a seniority clause, the coverage clause,' 9 The only real problem raised with respect to the coverage clause was whether employees assigned to a new location , Midway Green, should be in the unit. Ultimately, the parties agreed to disagree , leaving open the question as to whether that location was an "accretion." and a nondiscrimination clause.4 The evidence shows that by March 12 the Company had not yet proposed a full and complete contract, had not drafted such a docu- ment, and in my opinion had no intention of doing so in the foreseeable future. Moreover, it is clear that the Company had not considered, even internally, what eco- nomic proposals (such as wages), it would make to the Union if and when it ever finished presenting its noneco- nomic proposals.8 C. The Withdrawal of Recognition On February 11, 1987, a bargaining unit employee, Stephen LaFanchise, sent a letter to McGrath, director of security, stating that he had contacted the NLRB and was circulating a petition amongst the employees to get rid of the Union. The letter went on to state that he would be ready to file a petition with the NLRB 1 year after the commencement of negotiations. Leary, on behalf of the company, responded to La- Franchise by sending a letter stating whether or not you present the Company with a petition, the Company will be obligated to recognize and bargain with the Union at least until the expiration of the 1-year period, March 21, 1987." On March 23, LaFranchise sent a copy of a petition signed by 23 employees to McGrath. After reviewing the situation with the Company's legal staff, the Respondent decided to withdraw recognition. At the time, there were 41 employees in the bargaining unit and there were 23 signatures on the petition. Also, on March 23, LaFranchise filed with the Board's Regional Office a decertification petition in Case 39- RD-113. On March 24, company counsel, Edward J. Dempsey sent a letter to the Union's attorney Daniel Livingston. In this letter Dempsey stated that he was asked to review the decertification petition and situation . He went on to advise Livingston that because of the situation, the Company was postponing the negotiation sessions sched- uled for March 30 and 31. On April 2, Dempsey sent another letter to Living- ston. In pertinent part he stated: I have reviewed that petition and other informa- tion supplied to me by Hamilton Standard and have advised Hamilton Standard that there exists suffi- cient objective considerations to support a good faith doubt on the part of the Company as to the union's continued majority status. In view of these circumstances, I have been asked by the Company to inform you, as a repre- sentative of the Union, that the Company will no 4 The parties also reached a tentative agreement over the Company's proposed interim agreement for layoffs and recalls S At one point during negotiations the Union said that it would be will- ing to accept the existing fringe benefit package offered to the employees The Company then gave to the Union a booklet describing its benefits, but stated that it would not necessarily be offering these to the Union Schrodi testified that the Company refused to offer the existing fringe benefits because the "economic package would be predicated on many things Now maybe this Union, for a substantial raise .. might want to give up a certain amount of sick days 578 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD longer recognize the union as a representative of the Company's employees. D. The Unilateral Changes It is undisputed that on July 2, 1987, the Company granted to the unit employees a wage increase of 4-1/2 percent. This raise was granted unilaterally, without notice to or bargaining with the Union. It also is undisputed that on November 17, 1987, the Company instituted a new personnel policy for unit em- ployees which included a grievance procedure. This too was promulgated unilaterally without notice to or bar- gaining with the Union. The Respondent has a facility at Midway Green which is located about 5 miles away from its facility at Windsor Locks. As noted above, although the Union was certified to represent security employees at Windsor Locks, Midway Green was not included in the certification, pre- sumably because at the time, there were no bargaining unit employees located at that facility . In April 1986 at the outset of negotiations, the Union indicated that it had information that unit employees were being sent there to work. At that time Security Director McGrath denied this. Later, in July 1986, the Union, during negotiations stated that a unit employee Jacob was working at Midway Green and McGrath indicated that her assign- ment there was only temporary. Shortly thereafter, Jacob was reassigned back to the Windsor Locks facility. Still later in the negotiations, when the subject of Midway Green came up, the Company insisted that no unit employees were being assigned to that location on a permanent basis. According to Company Representative Leary, a deci- sion was made in early March 1987 to assign a security officer to Midway Green on a permanent basis . He testi- fied that such an employee was in fact permanently as- signed to that location on March 9, 1987. There is no dispute that the Company did not notify the Union about this permanent assignment and did not offer to bargain about the decision before it was made or implemented. As noted above the final negotiation session took place on March 12, 1987, and the Company formally withdrew recognition on April 2. E. Other Allegations On June 30, 1988, at a regular meeting of the security department, McGrath gave a brief summary of what had taken place during the 3 days of this hearing. Among other things he told the employees that at the hearing it was necessary to disclose the names of the people who had signed the decertification petition . He also told em- ployees that anyone who harassed those employees would be disciplined. The credible evidence further shows that at this point in the meeting , McGrath said that there was no union here, that there never was one and that there never would be one. III. ANALYSIS The crucial issue in this case is whether, as alleged by the General Counsel, the Respondent has bargained in good or bad faith. In this respect, the National Labor Relations Act does not require either a company or a union to make concessions. Thus, it is not sufficient for a finding of bad faith to conclude that one of the parties has maintained a tough posture and has engaged in hard bargaining. NLRB v. American National Insurance Co., 343 U.S. 395 (1952); Peelle Co., 289 NLRB 113 ( 1988). As stated by the Supreme Court in H. K. Porter v. NLRB, 379 U.S. 99 (1970) It is implicit in the entire structure of the Act that the Board acts to oversee and referee the process of collective bargaining, leaving the results of the con- test to the bargaining strengths of the parties... . While the parties' freedom of contract is not abso- lute under the Act, allowing the Board to compel agreement when the parties themselves are unable to agree would violate the fundamental premise on which the Act is based-private bargaining under governmental supervision of the procedure alone, without any official compulsion over the actual terms of the contract. It therefore is important to note that the bargaining positions taken by parties are shaped by their respective strengths vis a vis each other and it is not necessarily un- lawful for the stronger side to make demands and take positions consistent with its strength. Thus the Court noted in NLRB v. Insurance Agents International Union, 361 U.S. 477 (1960): The presence of economic weapons in reserve, and their actual exercise on occasion by the parties, is part and parcel of the system that the Wagner and Taft-Hartley Acts have recognized . . . the truth of the matter is that at the present statutory stage of our national labor relations policy, the two factors- necessity for good faith bargaining between parties, and the availability of economic pressure devices to each to make the other party incline to agree on one's terms-exist side by side. Although a company (or union) may engage in hard bargaining, Section 8(a)(5) of the Act still requires it to bargain in good faith . This good-faith requirement is ba- sically defined as a willingness to enter into a contract. NLRB v. Insurance Agents Union, supra. Thus even though it is permissible for a company to use its relative strength to press for contract terms favorable to itself, it may not use its strength to engage in futile or sham ne- gotiations with no intention of ever reaching an agree- ment. NLRB v. Herman Sausage Co., 275 F.2d 229, 232 (5th Cir. 1960). As stated by the Board in Abingdon Nursing Center, 197 NLRB 781, 787 (1972): [G]ood faith, or want of it, is concerned essentially with a state of mind. . . . That determination must be based upon reasonable inference drawn from the totality of conduct evidencing the state of mind with which the employer entered into and partici- pated in the bargaining process. . . . All aspects of the Respondent's bargaining and related conduct UNITED TECHNOLOGIES CORP. 579 must be considered in unity, not as separate frag- ments each to be assessed in isolation.6 The Respondent asserts that as it became obvious that it had the economic strength , it "utilized skillful and ex- perienced negotiators who were attempting to achieve for the Employer . . . the best deal possible for itself." It contends that during the negotiations it met with the Union at reasonable times and places ; that it listened to and discussed the Union's demands; that it made objec- tive proposals of its own ; that it made concessions there- by demonstrating a flexible attitude; that it provided the Union with relevant information when requested; and that it reached a number of tentative agreements as to certain contract clauses. If the law requires parties to bargain in good faith and if good faith is defined as a willingness to reach an agree- ment, then I do not see how the Company bargained in good faith. While it no doubt is true that the Company had the relative bargaining power, I do not think that it ever intended to reach any agreement with the Union even on its own terms . Rather, it is my opinion that the entire posture of the Company's bargaining tactics was to delay as long as possible and to put off indefinitely the making of a contract offer. The evidence in this case shows that the Company in- sisted on discussing in extraordinarily fine detail, the pro- visions of the Union's contract proposals, ostensibly to make sure that the parties understood the meaning of the language even when the Union 's proposed contract lan- guage was "plagiarized" from the Company's own con- tracts with another labor organization. Moreover, this process took more than 7 months and the Company in- sisted that it would not make any counterproposals before a complete review of the Union's proposed con- tract language. The evidence also shows that when the Company fi- nally got down to submitting counterproposals it did so one or two clauses at a time. More significantly, the Company, within the entire period of negotiations, never made a complete contract offer either as to contract lan- guage or as to economic issues . Thus, there was never any time when the Union could have accepted a compa- ny offer since no offer was ever made. To my mind this is distinctly different from seeking a contract on one's own terms, since the terms of such a contract were never made known to the Union during the more than 11 months of bargaining. By March 12 , 1987 (the final bargaining session), the Company had still not presented to the Union all of its counterproposals. Indeed, by this time it had not drafted a complete set of counterproposals. What's more, the Company had not even discussed among its own repre- sentatives, what kind of economic package it would offer to the Union. It therefore seems obvious to me that by this date not only had the Company not made a contract offer which was capable of acceptance, but that it had no intention of making such an offer within the foreseea- ble future. 6 See also Re,chhold Chemical II, 288 NLRB 69 (1988) In Southside Electric Cooperative, 243 NLRB 390 (1979), the Board held that a company engaged in sur- face bargaining when it limited the frequency and dura- tion of negotiation meetings and when it refused, for 7 months to submit an economic proposal in response to the Union. The Respondent cites Industrial Waste Service, 268 NLRB 1180 (1984), in support of its contention that its bargaining strategy was lawful . In that case, the General Counsel alleged that the company bargained in bad faith by among other things, refusing the union 's request to present a total contract proposal and by submitting one- page or one-paragraph proposals instead . The administra- tive law judge noted that by the commencement of a strike, the company had made counterproposals on many of the union's ideas, had expressed its opposition to other union demands, and was bargaining. However the period of time in question was less than 3 months whereas in the present case, more than 11 months of the certification year had gone by with no total contract counterproposal even in contemplation on the respondent's part. It is my opinion that the Respondent entered into and conducted itself in these negotiations with no intention of reaching an agreement. I therefore conclude that the Re- spondent in this respect has violated Section 8(a)(5) of the Act. See Whisper Soft Mills, 267 NLRB 813, 814 (1983), reversed on other grounds 754 F.2d 1381 (9th Cir. 1984); Howmet Corp., 197 NLRB 471, 486 (1972). The Respondent claims that its withdrawal of recogni- tion on April 2, 1987, was justified because it had a good-faith doubt as to the Union's continued majority support. It relies on the fact that it received a petition seeking to decertify the Union signed by a majority of the employees in the bargaining unit. Having determined, however, that the Respondent al- though going through the motions of bargaining, did so with no intention of reaching agreement , it follows that the Respondent may not justify its withdrawal of recog- nition even if all of the unit employees had expressed their desire to rid themselves of union representation. Thus, the employees' dissatisfaction with the Union's progress at negotiations ultimately was caused by the Employer's refusal to bargain in good faith. According- ly, I conclude that the Respondent's withdrawal of rec- ognition violated Section 8(a)(1) and (5) of the Act. Southside Electric Cooperative, 243 NLRB 390 (1979). Further, having found that the Respondent's with- drawal of recognition violated the Act, it also follows that its unilateral changes in terms and conditions of em- ployment made contemporaneously with and after the withdrawal of recognition must also violate Section 8(a)(1) and (5) of the Act. See Hearst Corp., 281 NLRB 764 (1986); Southside Electric Cooperative, supra. There is no dispute that the wage increase given to the unit employees in July 1987 was a mandatory subject of bargaining. Nor is there any dispute that the establish- ment in November 1987, of a new grievance machinery for the unit employees was a mandatory subject of bar- gaining. Finally, it is my opinion that the transfer of a unit employee to a new location (particularly one which 580 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD the employer contended was outside the unit), also in- volves a mandatory subject of bargaining. Inasmuch as the Respondent made the changes noted above without notice to or bargaining with the Union, at a time when it had an obligation to bargain with the Union, it is my opinion that it violated Section 8(a)(1) and (5) of the Act in this respect. The credible evidence establishes that on June 30, 1987, Security Director McGrath told employees at a meeting that as far as he was concerned there never had been a union at the Respondent, and that there never would be one . While I do not view this transaction as having that much significance in the context of this entire case, and I shall not rely on the statement to sup- port my previous conclusions of bad-faith bargaining, I do agree with the General Counsel that the statement does constitute a violation of Section 8(a)(1) of the Act. In this respect and in view of my earlier finding of bad- faith bargaining, I view the statement as expressing to unit employees the futility of selecting a bargaining rep- resentative. Dorothy Shamrock Coal Co., 279 NLRB 1298 (1986). CONCLUSIONS OF LAW 1. By bargaining with the Union, with no intention of reaching an agreement , the Respondent has violated Sec- tion 8(a)(1) and (5) of the Act. 2. By withdrawing recognition from the Union on April 2, 1987, the Respondent has violated Section 8(a)(1) and (5) of the Act. 3. By unilaterally changing terms and conditions of employment of the employees in the unit represented by the Union, the Respondent has violated Section 8(a)(1) and (5) of the Act. 4. By telling employees that the selection of the Union would be futile, the Respondent has violated Section 8(a)(1) of the Act. 5. The aforesaid unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. REMEDY Having found that the Respondent has engaged in cer- tain unfair labor practices, I find that it must be ordered to cease and desist and to take certain affirmative action designed to effectuate the policies of the Act. In order to ensure that the bargaining unit employees will be accorded the services of their collective -bargain- ing representative for the full period provided by law, I shall recommend that the initial period of certification as beginning on the date the Respondent commences to bar- gain in good faith with the Union. See Mar-Jac Poultry Co., 136 NLRB 785 (1962). On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed' 7 If no exceptions are filed as provided by Sec 102 46 of the Board's Rules and Regulations , the findings, conclusions, and recommended Order shall, as provided in Sec . 102 48 of the Rules, be adopted by the ORDER The Respondent, Hamilton Standard Division of United Technologies Corporation, Windsor Locks, Farmington, and East Granby, Connecticut, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Bargaining in bad faith with the Hamilton Standard Independent Fire/Security Officers Association by enter- ing into negotiations with no intention of reaching an agreement. (b) Withdrawing recognition from the aforesaid Union. (c) Unilaterally changing terms and conditions of em- ployment without first notifying and bargaining with the Union. (d) Telling employees that the selection of the Union as their collective-bargaining representative is futile. (e) In any like or related manner interfering with, re- straining, or coercing employees in the rights guaranteed to them by Section 7 of the Act. 2. Take the following affirmative action necessary to effectuate the policies of the Act. (a) On request, bargain with the Union as the exclusive representative of the employees in the following appro- priate unit concerning terms and conditions of employ- ment and, if an understanding is reached, embody the un- derstanding in a signed agreement. The appropriate bargaining unit is as follows: All full-time and regular part-time dispatchers, tech- nicians, fire protection officers, security officers, fire/security officers and security receptionists at the Employer's Windsor Locks, Farmington, and East Granby facilities; excluding all other employ- ees, chiefs, captains, lieutenants, office clerical em- ployees, professional employees , and other supervi- sors as defined in the Act. (b) Post at its facilities in the State of Connecticut, en- compassed by the Board's certification in Case 39-RC- 435, copies of the attached notice marked "Appendix."a Copies of the notice, on forms provided by the Regional Director for Region 34, after being signed by the Re- spondent'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 Respond- ent to ensure that the notices are not altered , defaced, or covered by any other material. (c) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Re- spondent has taken to comply. Board and all objections to them shall be deemed waived for all pur- poses 8 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 "