Milne Chair Co.

In the Matter Of MILNE CHAIR COMPANY and UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA , LOCAL No. 1882 Case No. C-73,0.-Decided December 1, 1939 Furniture Manufacturing Industry-Interference, Restraint, and Coercion- Company-Dominated Unions: (Athletic Club) domination and interference with; notices of meeting signed by respondent's president posted in plant ; employees paid for time spent at company-dominated union meetings ; order disestablishing withheld ; contract with, abrogated ; (Association) formation of by supervisory employee; soliciting membership in, by supervisory employee, on company time and property ; admission by respondent of such activities, respondent responsible even though it had no actual participation therein ; employees paid for time spent at company-dominated union meetings ; ordered, refuse to recognize as representative of employees-Strike: not caused by unfair labor practice- Strike Settlement Agreement: construction of by respondent not so unreasonable as to impute bad faith-Discrimination : charges of, dismissed. Mr. Berdon M. Bell, for the Board. Shepherd, Curry do Levine, by Mr. T. Pope Shepherd, and Mr. Clifford Curry, of Chattanooga, Tenn., for the respondent. Mr. Herbert G. B. King, of Chattanooga, Tenn., and Mr. H. W. Blicmenberg, and Mr. D. Maher, of Washington, D. C., for the United. Mr. Alvin O. Moore, and Mr. Tom Cate, of Chattanooga, Tenn., for the Association. Mr. William Strong, of counsel to the Board. DECISION AND ORDER STATEMENT OF THE CASE Upon charges and amended charges duly filed by United Brother- hood of Carpenters and Joiners of America, Local No. 1882, herein called the United, the National Labor Relations Board, herein called the Board, by the Regional Director for the Tenth Region (Atlanta, Georgia), issued its complaint dated April 18, 1938, against Milne Chair Company, Chattanooga, Tennessee, herein called the respond- ent, alleging that the respondent had engaged in and was engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (1), (2), and (3) and Section 2 (6) and (7) of the National 18 N. L. R. B., No. 10. 53 54 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Labor Relations Act, 49 Stat. 449, herein called the Act. The com- plaint, as amended at the hearing, alleged in substance that the respondent (a) on and after December 3, 1935, discouraged member- ship in the United by refusing to reinstate 49 named employees who had participated in a strike at the respondent's plant for the reason that they were members of the United and participated in the strike; (b) dominated and interfered with the formation and administration of the Athletic Club, and the Association of Milne Chair Workers, Local Unit No. 16, 9f the League of Democratic Unions, herein called the Association, and fostered, promoted, and encouraged their growth; and (c) by the foregoing acts and refusals and by other acts interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. The complaint and the accompanying notice of hearing were duly served upon the respondent and the United. The respondent there- after duly filed an answer to the complaint denying the unfair labor practices charged. Pursuant to notice, a hearing was held at Chattanooga, Tennessee, from April 28 to May 6, 1938, inclusive, before William P. Webb, the Trial Examiner duly designated by the Board. On April 28, 1938, the Association filed with the Trial Examiner a petition to intervene which the Trial Examiner granted. The Board, the respondent, the United, and the Association were represented by counsel and par- ticipated in the hearing. Full opportunity to be heard, to examine ,and cross-examine witnesses, and to introduce evidence bearing on the issues was afforded all parties. Counsel for the Board and for the respondent moved to amend the complaint and answer, respec- tively, to conform to the proof. The motions were granted by the Trial Examiner. Numerous other motions and objections to the admission of evidence were made and ruled upon by the Trial Ex- aminer at the hearing. The Board has reviewed the rulings of the Trial Examiner and finds that no prejudicial errors were committed. The rulings are hereby affirmed. On June 2, 1938, the respondent filed a brief. On June 27, 1938, the Trial Examiner issued his Intermediate Report, wherein he found that the respondent had engaged in and was engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (1), (2), and (3) and Section 2 (6) and (7) of the Act. He recommended that the respondent cease and desist from engaging in its unfair labor practices and take certain affirmative action to effectuate the policies of the Act. Subsequently, the respondent and the Association filed exceptions to 'the Intermediate Report. The respondent also requested oral argument before the Board. MILNE CHAIR COMPANY 55 Pursuant to notice duly served upon the parties , a hearing for the purpose of oral argument was held before the Board in Washington, D. C., on April 21, 1939. The respondent, the Association , and the United were represented by counsel and participated in the argument. The Board has considered the respondent's brief, the respondent's and the Association 's exceptions to the Intermediate Report, and the argu- ments in support thereof, and, in so far as the exceptions are incon- sistent with the findings , conclusions , and order set forth below, finds them to be without merit. At the close of the hearing in May 1938, the respondent and the United entered into an agreement which provided for the reinstate- ment of the persons named in the complaint . Thereafter the respondent filed with the Board a petition requesting approval of the contract and of settlements made pursuant thereto and requesting the dismissal , in part, of the complaint . The United filed an answer, supported by affidavits , in opposition to the respondent 's petition. Thereafter the respondent filed a motion addressed to the answer and the affidavits submitted by the United, and both parties filed addi- tional briefs. In view of our determination in Section III, Al hereof, we need not consider the, petition or the motion. Upon the entire record in the case, the Board makes the following: FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT Milne Chair Company is a Tennessee corporation engaged, at Chattanooga, Tennessee , in the manufacture, sale, and distribution of chairs and other furniture. During 1937 approximately 50 per cent of the raw materials and supplies used by the respondent at its plant were imported into Tennessee, and 94 per cent of the finished products of the respondent were distributed to points in other States. In 1937 the respondent employed more than 300 persons at its plant. H. THE ORGANIZATIONS INVOLVED United Brotherhood of Carpenters and Joiners of America, Local No. 1882, is a labor organization affiliated with the American Feder- ation of Labor, admitting to membership employees of the respondent. The Athletic Club was an unaffiliated labor organization , admitting to membership employees of the respondent. Association of Milne Chair Workers, Local No. 16, is a labor organ- ization, affiliated with the League of Democratic Unions, admitting to membership employees of the respondent. 2S2029-41-vol . 1.S-5 56 DECISIONS OF NATIONAL LABOR RELATIONS BOARD III. THE UNFAIR LABOR PRACTICES A. The failure to reinstate strikers Early in September 1935 the United, which had been organizing the respondent's employees for about a year and had a substantial number of members among them, submitted a scale of proposed wage increases to the respondent. The respondent countered with a proposal for de- creases and requested all its employees to attend a meeting during working hours on September 12, 1935, for a reading and discussion of its proposed wage scale' A few employees who were members of the United refused to attend the meeting and went on strike. That evening, at a meeting, the United voted to join the strike. About a week after the strike began the plant shut down and remained shut for 7 days. Thereafter it resumed operations. The strike lasted until December 3, 1935. Although there is some evidence that during the period immedi- ately preceding the strike D. E. Milne, the respondent's vice president, as well as several of its supervisory employees, indicated hostility to the United and discouraged membership in it, and although members of the United testified that Milne's conduct was largely responsible for the strike, the record does not support a finding that the strike was caused by unfair labor practices of the respondent.2 We find that it was not. During the strike the respondent was unable to fill accumulated orders and lost some of them. This fact and a reduced volume of new orders required curtailment of production. At the close of the strike the plant was operating with about one half as many employees as had previously been employed.3 On December 3, 1935, the strike was settled by a written agreement providing, among other things, for preferential reemployment of strikers. The agreement required that strikers wishing to return to their jobs should register with the respondent within 2 weeks and that the respondent should not hire new employees until all registrants had been returned to work. The agreement also established a wage scale. It provided furtli2r that "This contract shall cover a period of six months from date of execution, at the end of which time a careful survey of business conditions will be made by the First Party 'The complaint does not allege that at the time of the events under discussion the United was the representative of a majority of the respondent 's employees in an appropri- ate unit. 2 The complaint contains no specific allegation of interference , restraint, or coercion by the respondent prior to the strike and no allegations that the strike was caused by unfair labor practices. 2It was not contended that discriminatory considerations contribute'-] to the respond- ent's curtailment of production. MILNE CHAIR COMPANY 57 [the respondent], and if business conditions have improved to a point justifying increase in wages, the Company [the respondent] will submit an adjusted basis of wages commensurate with condi- tions. * * * " Most of the strikers registered within the specified period; some did not. In the 6-month period following the execution of the agree- ment the respondent engaged more than 70 former strikers who had registered, and no persons other than former strikers. After the expiration of the 6-month period, the respondent no longer consulted the registration list in making replacements but reverted to its usual practice of hiring men on application. Between June 4 and December 17, 1936, it engaged 79 persons who applied for jobs. Of these 31 were former strikers and 48 were new employees. In that period the respondent did not refuse reinstatement to any striker who applied to it. In December 1936 the number of strikers who were not then em= ployed by the respondent approximately equalled the number of new employees hired since June 3. The United contends that the agree- ment required the respondent to exhaust the registration list before hiring new men and that by abandoning reference to the list and hiring new men it both violated the agreement and discriminated against the strikers whom it had not recalled. The respondent contends that it has not discriminated. It inter- prets the agreement as binding it for 6 months only, and points to the fact that even after the expiration of the 6-month period it reinstated such strikers as applied to it. We need not decide whether the term expressed in the agreement applies only to wage adjustments, as contended by the United, or also to preferential reinstatement of strikers, as contended by the re- spondent. The construction adopted and acted upon by the re- spondent is not so unreasonable as to justify the imputation to it of bad faith. The United did not inform the respondent of its disagree- ment with the respondent's construction until June 1937, a full year after the respondent ceased referring to the registration list. Among the individuals named in the complaint, as amended, are eight strikers whom the respondent reinstated but whose employment was subsequently discontinued. At the hearing evidence was adduced for the purpose of showing that the respondent discriminated in ter- minating the employment of several of them and discriminated with respect to the terms or conditions of employment of others. Such evidence need not be set out in detail. We have considered it and find it unconvincing. The individuals in question were not shown to have been appreciably more active or more conspicuous in their activity on behalf of the United than were the strikers whom the respondent 58 DECISIONS OF NATIONAL LABOR RELATIONS BOARD reinstated pursuant to the agreement and retained in its employ, and the circumstances surrounding the termination of their employment do not, in the light of the entire record, _ sustain a finding of union discrimination. The respondent, having reinstated none but strikers until June 3, 1936, and having hired strikers and others indiscriminately there- after does not appear to have discriminated in regard to the hire and tenure of employment of its employees within the meaning of Section 8 (3) of the Act. The allegation of the complaint that it has done so will be dismissed. B. Domination of labor organizations 1. Background; the Industrial Council On October 4, 1934, just after the United had its inception, C. V. White, an officer of the respondent, and others organized the Indus- trial Council. On October 19, 1934, a notice signed by Morrison, the president of the respondent, was posted in the plant announcing the establishment of the Industrial Council. A set of mimeographed articles and bylaws for the Industrial Council were prepared by the respondent. Copies of the articles and bylaws were also posted in the plant. These instruments provide, in part, that the Industrial Council is to act as the representative of the respondent's employees for the purposes of collective bargaining with. respect to wages, hours, and conditions of employment. Among other provisions in the articles, one states that the chairman of the Works Council, which is the executive body of the Industrial Council, is to be one of the respond- ent's superintendents or other employee designated by the respondent. The secretary is also appointed by the respondent. Meetings of the Council were held in the plant during working hours. Although the respondent dominated and interfered with its forma- tion and administration prior to the effective date of the Act, the Industrial Council became inactive shortly after its inception and there is no evidence that the respondent dominated and interfered with its administration after the Act became effective on July 5, 1935. 2. The Athletic Club On April 23, 1937, the respondent's foremen circulated petitions throughout the plant, which provided that their signers "agree to work with this Committee for a period of 12 months." The foremen circulating these petitions stated to the employees that Morrison wanted them to sign as quickly as possible. MILNE CHAIR COMPANY 50 On April 28, 1937, foremen notified employees that a meeting would be held during working hours in the packing room of the plant. A notice, signed by Morrison, announcing the meeting, was posted on the time clock. The plant ceased to operate at 4 p. in. that day. Those attending were instructed by the foremen not to punch the time clock until after the meeting, as the respondent would pay them for time spent at the meeting. Those who did not attend the meeting were not paid for that period of time. William Kerr, son of the respondent's foreman, Tom Kerr, pre- sided at the meeting, and informed the employees that its object was to form an organization to keep out "outside unions." The name "Athletic Club" was adopted at this meeting. The superintendent of the plant, E. E. Conant, and Foreman Ward Hurt, were present. On May 3, 1937, a second meeting was held at the same place and time, and under the same conditions, pursuant to a notice signed by Morrison and posted on the clock. Again, those attending the meet- ing were paid by the respondent for the time so spent. William Kerr presided at the meeting. Those at the meeting elected A bargaining committee to deal with the respondent. It was announced that the respondent's attorney would draw a collective bargaining contract, which would then be submitted by the Athletic Club to the respondent. On May 11, 1937, a third meeting of the Athletic Club was held, at the same time and place, and under the same conditions. Again, a notice that the meeting would be held was signed by Morrison and was posted in the plant. George Smith, chairman of the bargaining committee, opened the meeting, and the contract prepared by the re- spondent's attorney was read. On May 12, .1937, the respondent and an "Employees' Committee," consisting of white and negro employees, signed the contract.4 The contract recites that the Employees' Committee, having been selected by a majority of the respondent's employees, is recognized as the collective bargaining agency for all of the respondent's em- ployees, and deals with wages, hours, and conditions of employment. The contract, by its terms, appears to have expired on May 12, 1938. The Athletic Club held no further meetings after May 11, 1937, its chief activity since that date having been the management-of a cafe- teria, the profits from which were used for the relief of indigent employees. The respondent alleges that the Athletic Club ceased to exist in 1937 and that its membership was absorbed by the Association. 4 The contract states that it is between the respondent and "an organization of the employees of the Milne Chair Company plant, represented by the undersigned committee." Sections III to XIV of this contract refer to an "Association" as representative of the employees. 60 DECISIONS OF NATIONAL LABOR RELATIONS BOARD We find that the respondent dominated and interfered with the formation and 'administration of the Athletic Club, a labor organiza- tion of its employees, and contributed" support to it, thereby interfer- ing with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act. 3. The Association On November 16, 1937, the United filed an amended charge in this proceeding, which included an allegation that the Athletic Club was employer-dominated. One week later, on November 23, 1937, Tom Kerr, a foreman, held a meeting of the respondent's employees in the locker room of the plant. Other foremen notified the employees that Kerr wanted to see them there for the purpose of forming a union. The meeting was held during working hours, at 9 a. m. Employees who attended the meeting did so without deduction in pay for time so spent. Tom Kerr stated at this meeting that the name of the union which was to be formed was the League of Demo- cratic Unions 15 and that its purpose was to keep out of the plant both the American Federation of Labor and the Committee for In- dustrial Organization. Perry Ballew, an employee, testified that his foreman, Ward Hurt, referred to the Association as a "company union," and that another foreman, Townsend, asked him whether he had been to "one of these company union meetings." Neither Hurt nor Townsend testified at the hearing. We find that Hurt and Townsend made the statements attributed to them. After the formation of the Association, foremen of the respondent solicited employees during working hours to become members of the Association. The president of the Association is Tom Kerr, a foreman; its sec- retary is Foreman Carl Dixon; Foreman Hurt and Clyde Kerr, a son of Tom Kerr, are committeemen. Two of the four other com- mitteemen of the Association are former committeemen of the In- dustrial Council or the Athletic Club. The respondent, in its brief, admits that "one of the foremen was active in the organization of the L. D. U. and solicited membership at the plant during working hours." The respondent contends, how- ever, that such activity was unknown to it and that it is therefore not responsible for the activity. The contention is without merit. s The League of Democratic Unions, herein called the L . D. U., was formed in the latter part of 1937 by Jac Chambliss , an attorney of Chattanooga , Tennessee. It has approxi- matelv 18 locals , of which the Association is Local No. 16. MILNE CHAIR COMPANY 61 The respondent is responsible for the actions of its supervisory fore- men even though it had no actual participation therein e On January 20, 1938, the Association sent a letter to the respondent advising that it had 225 members and requesting a conference for the purpose of discussing a proposed contract prepared by the L. D. U. On March 2, 1938, the respondent replied, advising that although it had checked the membership proof of the Association and found that a majority of the employees were members of the Association it felt itself bound by the contract with the Athletic Club and could not con- tract with the Association. It suggested that the Association inter- vene in this proceeding and secure certification by the Board, as collective bargaining agent of the respondent's employees. On the entire record we find that the respondent formed the Asso- ciation and has dominated and interfered with its administration and has contributed financial and other support to it, thereby interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act. We find, further, that the Association is incapable of serving the respondent's employees as their genuine representative for the purposes of collective bargaining. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE We find that the activities set forth in Section III B above, oc- curring in connection with the operations of the respondent described in Section I above, have a close, intimate, and substantial relation to trade, traffic, and commerce among the several States, and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that the respondent dominated and interfered with the formation and administration of the Athletic Club and the Asso- ciation, and contributed support to them, and thereby interfered with, restrained, and coerced its employees, in the exercise of the rights guaranteed in.Section 7 of the Act, we shall order, the respondent to cease and desist from such unfair labor practices. By reason of the respondent's acts, the Association cannot serve the employees of the respondent as their genuine representative for the purposes of collective bargaining. In order to restore to the em- ployees the rights guaranteed them under the Act, we shall order the 6 See Swift & Company v. National Labor Relations Board, 106 F. (2d) 87, enf'g. as mod., Matter of Swift & Company and Amalgamated Meat Cutters and Butcher Workmen of North America, Local No. 641, and United Packing House Local Industrial Union No. 300, 7 N. L. R. B. 269. 62 DECISIONS OF NATIONAL LABOR RELATIONS BOARD respondent to refuse to recognize the Association as representative of any of its employees for purposes of collective bargaining. Since the record does not disclose the continued existence of the Athletic Club, we shall withhold our order directing the respondent to disestablish the Athletic Club. We shall, however, order the respondent to cease giving effect to its contract with the Athletic Club or to any extension or renewal thereof, and shall issue such further order as is necessary to bar the resumption of the activities which constituted the unfair labor practices, and thus effectuate the policies of the Act.7 Upon the basis of the foregoing findings of fact and upon the entire record in the case, the Board makes the following : CONCLUSIONS OF LAW 1. United Brotherhood of Carpenters and Joiners of America, Local No. 1882, and Association of Milne Chair Workers, Local Unit No. 16 of the League of Democratic Unions, are labor organizations, and the Athletic Club was a labor organization, within the meaning of Section 2 (5) of the Act. 2. By dominating and interfering with the formation and adminis- tration of the Athletic Club and by contributing support to it, the respondent engaged in unfair labor practices within the meaning of Section 8 (2) of the Act. 3. By dominating and interfering with the formation and adminis- tration of the Association of Milne Chair Workers, Local Unit No. 16 of the League of Democratic Unions, and by contributing support to it, the respondent engaged in unfair labor practices within the mean- ing of Section 8 (2) of the Act. 4. By interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act, the respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (1) of the Act. 5. The aforesaid unfair labor practices are unfair labor practices affecting commerce, within the meaning of Section 2 (6) and (7) of the Act. 6. The respondent has not engaged in unfair labor practices within the meaning of Section 8 (3) of the Act. ORDER Upon the basis of the above findings of fact and conclusions of law, and pursuant to Section 10 (c) of the National Labor Relations Act, the National Labor Relations Board hereby orders that the re- 7 See Matter of Wisconsin Telephone Company and Telephone Operators Union, Local 175-d, International Brotherhood of Electrical Workers, etc., 12 N. L. R. B. 375, MILNE CHAIR COMPANY 63 spondent, Milne Chair Company, and its officers, agents, successors, and assigns, shall : 1. Cease and desist from : (a) Dominating or interfering with the administration of the Asso- ciation of Milne Chair Workers, Local Unit No. 16, of the League of Democratic Unions, or the formation or administration of any other labor organization of its employees, and contributing support to the Association of Milne Chair Workers, Local Unit No. 16 of the League of Democratic Unions, or to any other organization of its employees; (b) Giving effect to its contract dated May 12, 1937, with the Athletic Club, or to any extension or renewal thereof or to any suc- cessor contract with said Athletic Club ; (c) In any other manner interfering with, restraining, or coercing its employees in the exercise of their right to self-organization, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purposes of collective bargaining or other mutual aid or protection, as guaranteed in Section 7 of the National Labor Relations Act. 2. Take the following affirmative action which the Board finds will effectuate the policies of the Act : (a) Refuse to recognize the Association of Milne Chair Workers Local Unit No. 16 of the League of Democratic Unions, as representa- tive of any of its employees for the purpose of dealing with the respondent concerning grievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work;. (b) Post notices in conspicuous places throughout all departments and divisions of the plant, stating that the respondent will cease and desist in the manner set forth in 1 (a), (b), and (c) and that it will take the affirmative action set forth in 2 (a) of this Order; (c) Maintain such posted notices for a period of at least sixty (60) consecutive days from the date of posting; (d) Notify the Regional Director for the Tenth Region, in writing, within ten (10) days from the date of this Order what steps the respondent has taken to comply herewith. AND IT IS EIITHER ORDERED that the complaint, in so far as it alleges that the respondent has discriminated in regard to the hire and tenure of employment and conditions of employment of the persons named in the complaint, be, and it hereby is, dismissed.