The Ideal Electric & Mfg. Co.

In the Matter of THE IDEAL ELECTRIC & MFG. Co. and LOCAL 705, UNITED ELECTRICAL, RADIO AND MACHINE WORKERS OF AMERICA Cases Nos. R-1091 and C-1183.-Decided February 27, 1940 Electric Motor Manufacturing and Distributing Industry-Interference, Re- straint, and Coercion: anti-union statements-Discrimination: charges of in lay- offs, dismissed-Unit Appropriate for Collective Bargaining : hourly paid pro- duction and maintenance employees , including hourly paid foremen, but excluding office employees-Collective Bargaining : charges of, dismissed for lack of ma- jority-Complaint : dismissed ; agreement by Regional Director that if respondent posted notice not in accordance with Intermediate Report, Board would not enter remedial order ; Board upholds agreement despite Regional Director's error in approving notice-Investigation of Representatives : question concerning representation of employees : claim of union to represent majority-Election Ordered Mr. Max W. Johnstone, for the Board. Messrs. Earl W. LeFever, and Thomas F. Veach, of Cleveland, Ohio, for the respondent. Mr. Harry A. Sellery, Jr., of counsel to the Board. DECISION ORDER AND DIRECTION OF ELECTION STATEMENT OF THE CASE On January 14, 1938, Local 705, United Electrical, Radio and Machine Workers of America, herein called the Union, filed with the Regional Director for the Eighth Region (Cleveland, Ohio) a peti- tion and on February 25 and August 2, 1938, amended petitions alleging that a question affecting commerce had arisen concerning the representation of employees of The Ideal Electric & Mfg. Co., Mansfield, Ohio, herein called the respondent, and requesting an investigation and certification of representatives pursuant to Section 9 (c) of the National Labor Relations Act, 49 Stat. 449, herein called the Act. On February 18, 1938, the Union duly filed charges and on Febru- ary 25 and August 2, 1938, amended charges with the Regional 20 N. L. R. B., No. 86. 894 THE IDEAL ELECTRIC & MANUFACTURING COMPANY 895 Director alleging that the respondent had engaged in and was engag- ing in unfair labor practices affecting commerce within the meaning of the Act. On August 5, 1938, the National Labor Relations Board, herein called the Board, acting pursuant to Section 9 (c) of the Act and Article III, Section 10 (c) (2), and Article II, Section 37 (b), of National Labor Relations Board. Rules and Regulations-Series 1, as amended, ordered an investigation upon the petition and authorized the Regional Director to conduct it and to provide for an appropriate hearing upon due notice, and further ordered that for the purpose of hearing the two cases be con- solidated and that one record of the hearing be made. On September 2, 1938, the Union filed third amended charges alleging that the respondent had engaged in and was engaging in unfair labor prac- tices affecting commerce within the meaning of the Act. Upon the charges and the amended charges the Board, by the Regional Director, issued its complaint dated September 14, 1938, alleging that the respondent had engaged in and was engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (1), (3), and (5) and Section 2 (6) and (7) of the Act. Copies of the complaint, accompanied by notice of hearing, were duly served upon the respondent. and the Union. On September 15, 1938, the Regional. Director issued a notice of hearing in the repre- sentation case, copies of which were duly served upon the respondent and the Union. In respect to the unfair labor practices, the complaint, as amended during the course of the hearing, alleged in substance: (1) that the respondent in 13 specified particulars had interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act; (2) that the respondent discriminatorily dis- charged or laid off Roy A. Conn and Oscar B. Killinger, and later refused to reinstate Conn, because of their union membership and activities; and (3) that the respondent at various times since Decem- ber 1, 1936, refused to bargain collectively with the Union as the exclusive bargaining representative of all hourly paid employees of the respondent, excluding office employees, although such employees constituted an appropriate bargaining unit and the Union repre- sented a majority thereof. On September 23, 1938, the respondent filed an answer in which it denied the allegations of the complaint in respect to the unfair labor practices and affirmatively alleged that the two named employees were laid off for business reasons. Pursuant to the notices, a hearing on both the petition and the complaint was held in Mansfield, Ohio, from October 3 through 17, 1938, before Webster Powell, the Trial Examiner duly designated by the Board. The Board and the respondent were represented by 896 DECISIONS OF NATIONAL LABOR RELATIONS BOARD counsel and participated in the hearing. Full opportunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing upon the issues was afforded all parties. At the close of the Board's case counsel for the Board moved to conform the pleadings to the proof. The Trial Examiner granted this motion. At the commencement of the hearing, at the close of the Board's case, and at the close of the hearing, the respondent made several motions to dismiss the complaint. During the course of the hearing the Trial Examiner granted the respondent's motion to dismiss the complaint as to 4 of the 13 specified particulars in respect to which the complaint alleged that the respondent had interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act,' but reserved his rulings on the respondent's motions to dismiss various other portions of the complaint. During the course of the hearing the Trial Examiner made several rulings on other motions and on objections to the admis- sion of evidence. The Board has reviewed all the rulings of the Trial Examiner and finds that no prejudicial errors were committed. The rulings are hereby affirmed. On February 4, 1939, the Trial Examiner filed his Intermediate Report, copies of which were duly served upon the parties. He found that the respondent had engaged in and was engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (1) and (5) and Section 2 (6) and (7) of the Act. He recommended that the respondent cease and desist from interfering with, restrain- ing, and coercing its employees in the exercise of the rights guar- anteed in Section 7 of the Act, and that the respondent bargain collectively with the Union as the exclusive collective bargaining representative of its hourly paid production and maintenance em- ployees, excluding office employees. He further recommended that the complaint be dismissed as to the allegedly discriminatory lay-offs of Conn and Killinger, and in so far as it alleged that the respondent, by circulating among its employees biased accounts of previous labor troubles in order to discourage affiliation with the Union, had inter- fered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. On February 16, 1939, the respondent filed exceptions to the Inter- mediate Report and on March 16, 1939, a brief in support of its exceptions. Pursuant to notice, a hearing for the purpose of oral argument on the exceptions was held before the Board in Washing- 1 That the respondent ( 1) unreasonably disciplined union members for attending to union business; (2) conspired to prevent its employees from joining the Union; (3) granted raises to non-union employees in order to influence its employees not to join the Union ; and (4 ) by various other methods and means, interfered with, restrained, and coerced its employees. THE IDEAL ELECTRIC & MANUFACTURING COMPANY 897 ton, D. C., on October 31, 1939. The respondent was represented by counsel . and participated in the argument. The Union filed a letter in lieu of oral argument. The Board has considered the re- spondent's brief and exceptions to the Intermediate Report and the Union's letter, and finds the exceptions, except such as are consistent with the findings of fact and order herein, without merit. Upon the entire record in the case, the Board makes the following : FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT The Ideal Electric & Mfg. Co., an Ohio corporation, maintains its principal office and place of business in Mansfield, Ohio. It -is en- gaged in the manufacture and distribution of electrical motors of various sizes. A substantial portion of the respondent's business consists of manufacturing such motors to special order. The re- spondent normally purchases between about $160,000 and $170,000 worth of materials annually. About 8 per cent of the raw materials used in the manufacture of the respondent's products are shipped from points outside Ohio. The total value of the finished products manufactured by the respondent in 1937 was about $540,000, 80 per cent of which were shipped to points outside Ohio. II. THE UNION Local 705, United Electrical, Radio and Machine Workers of America, is a labor organization affiliated with the Committee for Industrial Organization,2 admitting to membership all hourly paid production and maintenance employees of the respondent, excluding office employees. III. THE UNFAIR LABOR PRACTICES A. Interference, restraint, and coercion At 9 a. m. on December 15, 1936, following a union meeting on December 14, 1936, a union committee told O. J. Fink, vice president in charge of production, that the union employees were about to engage in a sit-down strike for an hour unless 12 non-union em- ployees joined the Union or were laid off. The respondent refused to instruct such employees to join the Union, or to lay them off. Thereupon, the union employees stopped work. A few minutes after work had ceased Fink issued instructions to the foremen "to ask the boys if they were not going back to work to ring the clock" and the 9 Now the Congress of Industrial Organizations. 898 'DECISIONS OF NATIONAL LABOR RELATIONS BOARD foremen did so. All the production and maintenance employees punched out their time cards and left the plant . The plant remained closed until about March 22, 1937 , when it was reopened pursuant to an agreement negotiated on March 19, 1937 , under the auspices of the Board's Regional Office for the Eighth Region . The agreement consisted of a letter from the Regional Director to the Union stating the terms of the settlement. A copy of this letter was sent to the respondent. In substance, the agreement provided for (1 ) the return to work of all persons employed at the date of the strike, (2) over- time pay, ( 3) "due consideration " to seniority in lay-offs and re- hirings, (4) a wage increase, and (5 ) recognition of the Union as the bargaining representative of its members. % About January 1938 the respondent instituted a series of weekly meetings of the foremen. These meetings, over which Fink presided, were normally devoted to a discussion of the respondent 's produc- tion problems. At orie of these meetings about the middle of Jan- uary, S. Glenn Vinson, president and general manager, addressed the foremen. He informed them that the respondent was about to submit a bid for a contract, but that the respondent was "a little undecided" whether or not it should do so. As the reason for such indecision, he explained that the bid was for a contract involving a large sum of money and for work requiring a considerable time for completion. He stated that the respondent's uncertainty about submitting a bid arose from rumors of unrest among the employees and of a possible strike. He added that the respondent's bankers would object to financing another strike, a reference to the above-mentioned closing of the respondent's plant from December 1936 until March 193 7 . Merl Ray Purkeybile, the machine-shop foreman, testified that Vinson also said, "If they (the Union) demand a closed shop, you know what that means. " J. W. Funk, mechanical supervisor, testified that Vinson further stated that if any group of employees obtained exclusive bargaining rights and asked for a closed shop, in all probability the respondent's "backers" would withdraw their support, and would not finance another strike. It should be noted that when the Union, in effect, demanded a closed shop in December 1936, as above mentioned , the respondent shut down the plant. Purkeybile, who was a witness for the re- spondent, further testified that at the foremen's meeting Vinson also said that it was strange that the Union should call in an "outsider" to settle its differences with the respondent. The reference to an "out- sider" apparently referred to Edwin Beal, international representa- tive of United Electrical, Radio, and Machine Workers of America, who at that time was participating in conferences between the respondent and the Union. 3 Sometimes referred to in the record as "Perkibaugh." THE IDEAL ELECTRIC & MANUFACTURING COMPANY 899 At this meeting, Vinson did not ask the foremen for their comments, but suggested that they express their views to Fink and that Fink and he could thereafter discuss the matter. According to Fink's recollec- tion, Vinson also stated, "Now, Boys, do whatever you can to keep the .boys in line, keep them satisfied." Fink's testimony in this regard is confirmed by that of William Geary, the foreman of the punch department. We find that Vinson made the statement attributed to him by Fink and Geary. Vinson thereupon left the meeting. At the hearing Vinson explained that his reason for thus address- ing the foremen was to get some- expression from them regarding the correctness of the rumors, since he. believed that the foremen could ascertain whether or not the- rumors were well-founded. He testified that he did not recall making any statement regarding a closed shop or how large a membership the Union might have among the re- spondent's employees. In view, however, of the testimony of Pur- keybile and Funk, both of whom were witnesses for the respondent, we find that Vinson stated to the foremen that if the Union demanded recognition as the sole bargaining agent and a closed shop, the plant would close. -After Vinson left, Fink and the foremen discussed the rumor con- cerning a strike. Some of the foremen stated that they had not heard such a rumor; others, that they had heard the rumor, but did not believe that it was correct. Fink concluded the discussion by telling- the foremen that he thought it was up to all of them, including himself, to. "check into" the matter. and to "see what could be done to keep the boys in. line," since he, Fink, would hate to see another strike. Thereafter Purkeybile admittedly told some employees, who were not identified at. the' hearing, that if the Union secured exclusive bargaining rights and demanded a closed shop, the respondent's plant would close, as Vinson had said that the respondent's bankers would not operate the plant under, a closed-shop arrangement. Ac- cording to the testimony of four employees, Frank Hembery,4 Albert Mulberg, John Staats, and Joseph Young, Purkeybile also stated in substance that if the Union was designated as such representative by 75 per cent of the employees, the plant would close. Funk made a similar statement to John Clapsaddle, a welder. Hembery testified that on two occasions while he was at work in . January 1938 5 Purkeybile asked him if he was a union member and Sometimes referred to in the record as "Hemperly." The transcript reads "January 1933," but this is obviously a typographical error. The Union was not organized until the fall of 1936. In 1933 Hembery was not employed by the respondent until September of that year . Moreover, it was subsequently in the course of these conversations that Purkeybile told Hembery , as above mentioned , that if the Union secured a 75 per cent membership among the respondent 's employees , the plant would close. The sequence .of the conversation demonstrates clearly that it occurred in January 1938. 900 DECISIONS OF NATIONAL LABOR RELATIONS BOARD if his dues were currently paid. According to Staats, near the end of January 1938 Purkeybile asked him if his union dues were paid up. When Staats stated that he was one month in arrears in pay- ment of his union dues, Purkeybile said, "If I were you, I would hold off a little while in paying it." Staats testified that the reason advanced by Purkeybile was that if the union membership included 75 per cent of the employees, the plant would close. Young testi- fied that while he was at work early in 1938 Purkeybile asked him if he was a union member. Young testified that shortly thereafter "everybody was talking about" what Purkeybile had said to various employees. At the hearing, Purkeybile denied that he had made any statement to any employees that the plant would close if the Union was desig- nated as the collective bargaining representative of 75 per cent of the employees. He further denied that he had ever told any em- ployee not to pay his union dues or to stay away from union meet- ings. On the contrary, he claimed that he told them to attend the union meetings, that he knew that a number of them were not attend- ing the union meetings, and that they should ascertain what was occurring at such meetings, so that if any "trouble" ensued they would know what was "going on." He stated that he talked to Hembery, among others, about going to the union meetings. Purkeybile's admission that he talked with Hembery about going to union meetings is consistent not only with the testimony of Hembery, but also with that of Mulberg, Staats, and Young regard- ing Purkeybile's anti-union statements to them. We find that Purkey- bile made the statements attributed to him above. In its brief the respondent argued : There was no evidence that said Purkeybile was authorized by respondent to make any of the statements attributed to him, and further that even assuming that the statements were made and respondent authorized them to be made, the statements, fairly considered, do not justify any conclusion therefrom that respondent thereby interfered with, restrained, or coerced any- body; in fact, the evidence shows just to the contrary, and that no one was interfered with, restrained, or coerced by what Mr. Purkeybile is alleged to have said. Purkeybile testified that neither Fink nor Vinson asked him to tell the employees that if the Union secured recognition as the sole bargaining agent and demanded a closed shop, the plant would close. On the other hand, Mulberg testified that Purkeybile stated that he had orders to tell all the employees that if the Union did not stop its "ridiculous ideas" and constant "running" into the respondent's office, the bank in Cleveland would cease to finance the respondent. THE IDEAL ELECTRIC & MANUFACTURING COMPANY 901 We do not find it necessary to resolve this conflict in the testimony of Purkeybile and Mulberg. Even if we assume that Purkeybile's testimony is correct, his activities, above described, are the logical result of Vinson's exhortation to the foreman to "do whatever you can to keep the boys in line." It is apparent that Purkeybile took this injunction more literally than the other foremen. He sought affirmatively to coerce the union members to abandon further union activity or any effort to secure additional members among the re- spondent's employees. The respondent took no precautions to pre- vent its concern regarding the possibility of another strike from being transformed into an unlawful attempt to weaken the Union by threatening that the plant would be closed if the Union received a majority of members among the employees. It is responsible for the consequences which flowed from Vinson's speech to the foreman and for the anti-union statements made by Purkeybile.° The respondent's contention that since the evidence does not show that any one was interfered with, restrained, or coerced by Purkey. bile's activities and statements is presumably directed to the fact that Hembery, Mulberg, Staats, and Young continued to pay their union dues after January 1938, and that the Union continued to exist. A similar argument was made in Matter of Montgomery, Ward and Company and Warehouse Employees' Union No. 00, 097, etc.' In that case we said : It is sufficient that the conduct which constitutes the gravamen of the unfair labor practice normally results in interference, restraint, and coercion; it is immaterial that the proscribed conduct does not produce the desired result. The respondent's invasion of the field of union activity which the Act reserves as a matter of right to the employees is in itself an unfair labor practice. We adopt that language as applicable here. That the employees whom the respondent warned not to engage in union activities did not observe the warning, but continued to engage in such activities does not legitimize the respondent's unlawful conduct. We find that, by circulating reports to the effect that if the Union was successful in ,organizing a majority of the workers in the plant the plant would close, by questioning its employees as to their union affiliations for the purpose of influencing its employees against affiliation with the Union, and by influencing union members against 6 "With respects to the acts of the supervisory foremen, the doctrine of respondeat superior applies and petitioner (the Company ) is responsible for the actions of its super- visory foremen, even though it had no actual participation therein." Swift & Company V. National Labor Relations Board, 106 F. (2d) 87, 93 (C. C. A. 10), mod'g and enf'g Matter of Swift & Company, a Corporation and Amalgamated Heat Cutters and Butcher 'Workmen of North America, Local No. 641, et al., 7 N. L. R. B. 269. 17 N. L. R. B. 191. 283031-41-vol. 20--58 902 DECISIONS OF NATIONAL. LABOR RELATIONS ' BOARD the payment of union dues, as set forth above, the respondent has interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. The complaint also alleged that the respondent, in certain other specified particulars, has interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. As noted above, during the course of the hearing the Trial Examiner dismissed 4 of the 13 specified particulars of alleged inter- ference, restraint, and coercion, and the Board has reviewed' and affirmed such dismissal.8 The complaint also alleged that the respondent, (1) by establishing an organization known as "Ideal Electric Cooperative Association," to supplant the Union among its employees, (2) by laying off union members in violation of stated seniority provisions, while retaining employees of less service on similar work, (3) by refusing to bar- gain in good faith with the Union, (4) by circulating among its employees biased accounts of previous labor troubles occurring at its plant to discourage those employees from affiliation with the ° Union, (5) by refusing and failing to nominate a responsible official with whom the Union might meet on grievances and other conditions of employment and utilizing such action to embarrass and harass the Union and to avoid the Union's demands for collective bargain- ing, (6) by failing and arbitrarily refusing to consider. a contract with the, Union, and (7) by laying off union officers in violation of its stated seniority provisions, had interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Sec- tion 7 of the Act. In his Intermediate Report, the Trial Examiner found that there was insufficient proof to support the allegation of the complaint that the respondent, by circulating among its employees biased accounts of labor troubles occurring at its plant between December 1936 and March 1937 in order to discourage such employees from affiliating with the Union, interfered with, restrained, and coerced its em- ployees. No exceptions were filed to this finding. Nevertheless, in his Intermediate Report the Trial Examiner denied the respondent's motion, upon which he had reserved in ruling at the hearing, that the complaint be dismissed in this particular. Upon an examination of the. record we find that the evidence does not support such allega- tion. The respondent's motion as to this specified particular of alleged interference, restraint, and coercion will, therefore, be granted, and the complaint in respect thereto will be dismissed. The Trial Examiner in his Intermediate Report made findings of fact in regard to the other particulars of alleged interference, re- 6 See footnote 2, supra. THE IDEAL ELECTRIC & MANUFACTURING COMPANY 903 straint, and coercion, but did not conclude that any of them con- stituted interference, restraint, or. coercion, within the meaning of Section 8 (1) of the Act, except the allegation that the respondent failed and arbitrarily refused to consider a contract with the Union. We will consider this allegation and the allegation that the respond- ent, by refusing to bargain in good faith with the Union, interfered with, restrained, and coerced its employees, in Section III C, below, in connection with the alleged refusal to bargain collectively. With respect to the other allegations enumerated above, upon an examina- tion of the record we find that the respondent has not (1) established an organization known as "Ideal Electric Cooperative Association," to supplant the Union among its employees, (2) laid off union mem- bers in violation of stated seniority provisions, while retaining em- ployees of less service on similar work, (3) refused to nominate a responsible official with whom the Union might meet on grievances and other conditions of employment and utilized such action to em- barrass and harass the Union and to avoid the various demands for collective bargaining, and (4) laid off union officers in violation of its stated seniority provisions. Accordingly, such allegations will be dismissed. B. The allegedly discriminatory lay-offs The complaint alleged that on December 24, 1937, the respondent discriminatorily discharged or laid off Roy A. Conn and has since refused to reinstate him, and that on January 27, 1938, the respond- ent discriminatorily discharged or laid off Oscar B. Killinger and reinstated him on February 28, 1938. The respondent's defense was that both employees had been laid off for lack of work. The Trial Examiner found that they had not been discriminatorily laid off and recommended that the complaint be. dismissed as to them. No excep- tions were filed to these findings and recommendations. Upon an examination of the record we find that it does not support the allega- tions of the complaint with respect to Conn and Killinger. Accord- ingly, such allegations will be dismissed. C. The alleged refusal to bargain collectively 1. The appropriate unit The complaint alleged that all hourly paid production and main- tenance employees, excluding office employees,9 constitute a unit ap- propriate for the purposes of collective bargaining. All production and maintenance employees are paid at an hourly rate, except a few foremen who are on salaries. Foremen on salary '9 This exclusion also covers two or three clerical employees working in the plant. 904 DECISIONS OF NATIONAL LABOR RELATIONS BOARD are not eligible for membership in the Union. The remaining fore- men, most of whom are working foremen, are paid on an hourly rate. The Union desires that the hourly paid foremen be included in the appropriate unit. Working foremen are eligible to member- ship in the Union. The appropriate unit sought is coterminous with the Union's eligibility provisions. Both at the hearing and the oral argument the respondent stated that it had no objections to the unit sought. Accordingly, we shall include hourly paid foremen in the unit. We find that all the respondent's hourly paid production and maintenance employees, including hourly paid foremen, but exclud- ing office employees, constitute a unit appropriate for the purposes of collective bargaining and that said unit will insure to employees of the respondent the full benefit of their right to self-organization and to collective bargaining and otherwise effectuate the policies of the Act. 2. Representation by the Union of a majority in the appropriate unit The complaint alleged that on and after December 1, 1936, the Union was the duly designated representative of a majority of em- ployees in the appropriate unit and was, therefore, the sole bargain- ing representative of all the employees in such unit, and that on and after that date the respondent on various occasions refused to bargain collectively with the Union as such representative. As we have stated in Section III A, above,' the strike which began in December 1936 was settled in March 1937, and the employees re- turned to work. The agreement settling the strike provided, inter alia, that the respondent would bargain with the Union as the repre- sentative of its members concerning grievances, wages, rates of pay, hours of employment, and conditions of work. Between March and October 1937 the Union frequently met with Fink and occasionally with Vinson respecting conditions of work and various alleged grievances. Sometime between October 25 and November 8, 1937, the union shop committee at a conference with the respondent presented Fink with a written agreement and asked him to sign it on behalf of the respond- ent. Among other matters this contract provided for recognition of the Union as the exclusive collective bargaining representative of the employees in the appropriate unit. At this conference the union shop committee told Fink that the Union claimed to represent a majority of the employees covered, by the agreement. Fink did not dispute this claim. He told the committee that it would be necessary for him to refer the agreement to the other officers and to the direc- tors of the respondent. Thereafter the agreement was referred to THE IDEAL ELECTRIC & MANUFACTURING COMPANY '905 Vinson and by him to the individual directors. At a conference sometime between November 8 and 22, 1937, the union shop committee asked Fink for the respondent's decision regarding the agreement. Fink returned the contract to the committee with a statement that the respondent did not intend to enter into a contract at that time. There is a conflict in the evidence as to whether or not Fink ampli- fied his statement, but we find, as did the Trial Examiner in his Intermediate Report, that Fink also told the committee that the respondent was content to continue to operate under the strike-settle- ment agreement, but if the respondent's business improved, the com- mittee might thereafter again present the contract. In his Intermediate Report the Trial Examiner found that there were 138 employees in the appropriate unit in November 1937, that at that time the Union had been designated by a majority of the em- ployees as their collective bargaining representative, and that the respondent by its conduct, described above, had refused to bargain collectively with the Union as the exclusive bargaining representative of a majority of its ,employees in the, appropriate unit. He based his finding respecting the number of employees in the appropriate unit in November 1937 upon the respondent's pay roll of November 8,1937. That pay roll contains only the names of employees who actually worked during the preceding two-week period. It does not contain the names of employees who were laid off during such period because they were ill, on vacation, on leave, or because of lack of work. Such persons are regarded by the respondent as its employees even if they are not actually working during a pay-roll period. Their names appear in a list of current employees in 1937 and must, consequently, be included in determining the number of employees in the appro- priate unit. Combining the pay roll of November 8, 1937, and such list, the total number of eligible employees in the appropriate unit on November 8, 1937, was 153. Accordingly, 77 employees would be required for a majority.in.the appropriate unit. It is the Union's practice to deem any member whose dues are in arrears three months or less as a member in good standing. A mem- ber who is laid off by reason of lack of work or sickness or who is on strike may receive a union stamp in lieu of the payment of dues, and by doing so remain a member in good standing. According to the Union dues book, 76 employees in the appropriate unit were members in good standing in November 1937. This figure is one less than the number required for a majority. Moreover, Paul John Boyd, one of such 76 employees, testified that he resigned from the Union on September 18, 1937, and there is nothing in the record to contradict his testimony. Consequently, we do not find it necessary to consider whether or not Alfred Beller should properly be included in deter- 906 DECISIONS OF NATIONAL LABOR RELATIONS BOARD; mining whether or not the Union on November 8, 1937, had been designated by a majority of the employees in the appropriate unit as their collective bargaining representative.10 Since the Union did not represent a majority of the employees in the appropriate unit when the contract was presented to the respondent it was not then entitled to recognition as the sole bargaining agent. After the respondent rejected the contract in November 1937, the Union twice conferred with the respondent in regard to the rein- statement of certain employees who had been laid off. At the second of these conferences in January 1938 the Union again claimed to represent a majority of the employees and demanded recognition as the exclusive bargaining representative upon the basis of such claim. Combining the respondent's pay roll for January 1, 1938, and the list of current employees as of that date, the total number of eligible employees in the appropriate unit in January 1938, was 142. Accord- ing to the dues book, less than one-half of that figure were union members in good standing in January 1938. Since the Union did not represent a majority of the employees in the appropriate unit when it demanded recognition as such representative in January 1938, it was not then entitled to recognition as the sole bargaining agent. We find that on November 8, 1937, and in January 1938, the Union was not the duly designated representative of the majority of the employees in the unit which we have found to be appropriate and that it was not on November 8, 1937, or in January 1938, pursuant to Section 9 (a) of the Act, the exclusive representative of all the employees in such unit for the purposes of collective bargaining. We therefore find that the record does not support the allegation of the complaint that on or about November 8, 1937, and in January 1938, the respondent refused to bargain collectively with the repre- sentatives of its employees, pursuant to Section 9 (a) of the Act. Accordingly, such allegation will be dismissed. There remain for our consideration the allegations of the com- plaint that the respondent, by failing and arbitrarily refusing to consider a contract with the Union and by refusing to bargain in good faith with the Union, interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. We have found that the respondent did not refuse to bargain collectively with the Union as the representative of its em- ployees pursuant to Section 9 (a) of the Act. Upon an examination of the record we likewise find that it does not support the allegations of the complaint that the respondent, by failing and arbitrarily refusing to consider a contract with the Union and by refusing to 10 Beller, although not a union member, was nevertheless a member of the union shop committee. THE IDEAL ELECTRIC & MANUFACTURING COMPANY 907 bargain in good faith with the Union, interfered with, restrained, and coerced-its employees. Accordingly such allegations will be dismissed. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the respondent set forth in Section III A, above, occurring in connection with the. operations of the respondent de- scribed 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 com- merce and the free flow of commerce. THE REMEDY In his Intermediate Report the Trial Examiner recommended that the respondent post notices, stating that it would cease and desist from interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act and from refusing to bargain collectively with the Union as the sole bargaining representative of all the respondent's hourly paid production and maintenance employees, and maintain such notices for a period of at least sixty (00) consecutive days. In his brief and at the oral argument before the Board, counsel for the respondent argued that the respondent had,posted the requisite notice which had been approved by the Regional Director. The notice referred to reads as follows: TO ALL EMPLOYEES A charge was filed with the National Labor Relations Board alleging that the management of this company was interfering with the union organizational activities of its employees. If there has been interference of any kind it has been carried on without our consent, authority or approval. Accordingly we advise- All the employees of this company shall have the right to self- organization, to form, join or assist labor organizations, to bar- gain collectively through representatives of their own choosing, and to engage in concerted activities, for the purpose of collective bargaining or other mutual aid or protection, without interfer- ence or fear of being discriminated against for so doing, as provided by Sections 7 and 8 'of the ' said National Labor Relations Act. THE IDEAL ELECTRIC & MFG. COMPANY. 908 DECISIONS OF NATIONAL LABOR RELATIONS BOARD We have considered the correspondence between the Regional Di- rector and counsel for the respondent-with regard to the posting of the notice. We find that the then Regional Director agreed that if the above-quoted notice was posted, the Board would not enter an order remedial of the unfair labor practices: Although we are of the opinion that the Regional Director's agree- ment with counsel for the respondent does not estop the Board from the entry of such an order, effective administration of the Act requires the Board's agents to have the respect and confidence of employers with whom their work brings them in contact.- We think that in view of the Intermediate Report the then Regional Director erred in this case in making such an agreement. We believe, nevertheless, that the policies of the Act will be best effectuated herein by giving effect to such agreement. We shall enter an order that the complaint be dismissed. V. THE QUESTION CONCERNING REPRESENTATION As we have stated above, the Union has claimed for some time to represent a majority of the employees in the unit which we have found to be appropriate and on the basis of such claim has sought recognition as the sole bargaining representative. At the hearing the Union introduced evidence that it represents a substantial num- ber of the employees in the appropriate unit. We find that a question has arisen concerning the representation of employees of the respondent. VI. THE EFFECT OF THE QUESTION CONCERNING REPRESENTATION UPON COMMERCE We find that the question concerning representation which has arisen, occurring in connection with the operations of the respondent described in Section I above, has a close, intimate, and substantial relation to trade, traffic, and commerce among the several States, and tends to lead to labor disputes burdening and obstructing com- merce and and the free flow of commerce. VII. THE DETERMINATION OF REPRESENTATIVES The Union claims to represent a majority of the employees in the appropriate unit. We find that an election by secret ballot is neces- sary to resolve the question concerning representation. ll Cf. Matter of Godchaux Sugars, Inc. and Sugar Mill Workers' Union, Locals No. 21177 and No. 2188, etc., 12 N. L. R. B. 568; Matter of Hope Webbing Company and Textile Workers Organizing Committee of the C. I. 0., Local No. 1., 14 N. L. R. B. 55; Matter of Stromberg-Carlson Telephone Manufacturing Company and United Electrical, Radio c6 Machine Workers of America, Local No. 509, 18 N. L . R. B. 526. THE IDEAL ELECTRIC & MANUFACTURING COMPANY 909, We find that those eligible to vote in the election shall be employees in the appropriate unit whose names appear on the pay roll immedi- ately preceding the date of our Direction of Election, including employees who did not work during such pay-roll period because they were ill or on vacation and employees who were then or since have been temporarily laid off, but excluding those employees who have since quit or been discharged for cause. Upon the basis of the foregoing findings of fact and upon the entire record in the proceeding, the Board makes the following: CONCLUSIONS OF LAw 1. A question affecting commerce has arisen concerning represen- tation of employees of the respondent, within the meaning of Section 9 (c) and Section 2 (6) and (7) of the Act. 2. All hourly paid production and maintenance employees of the respondent, including hourly paid foremen, but excluding office em- ployees, constitute a unit appropriate for the purposes of collective bargaining, within the meaning of Section 9 (b) of the Act. ORDER Upon the basis of the foregoing findings, and pursuant to Section 10 (c) of the National Labor Relations Act, the National Labor Relations Board hereby orders that the complaint be, and it hereby is, dismissed. DIRECTION OF ELECTION By virtue of and pursuant to the power vested in the National Labor Relations Board by Section 9 (c) of the National Labor Rela- tions Act, 49 Stat. 449, and pursuant to Article III, Section 8, of National Labor Relations Board Rules and Regulations-Series 2, 9s amended, it is hereby DIRECTED that, as part of the investigation authorized by the Board to ascertain representatives for the purposes of collective bargaining with The Ideal Electric & Mfg. Co., Mansfield, Ohio, an election by secret ballot shall be conducted as early as possible but not later than thirty (30) days from the date of this Direction, under the direction and supervision of the Regional Director for the Eighth Region, acting in this matter as agent for the National Labor Relations Board, and subject to Article III, Section 9, of said Rules and Regulations, among the hourly paid production and maintenance employees of said company, including hourly paid foremen, who were employed during the pay-roll period last preceding the date of this Direction, including employees who did not work during such pay-roll period 910 DECISIONS OF NATIONAL LABOR RELATIONS BOARD because they were ill or on vacation, and employees who were then laid off, but excluding office employees and employees who have since the aforesaid pay-roll period quit or been discharged for cause, to determine whether or not they desire to be represented by Local 705, United Electrical, Radio and Machine Workers of America, for the purposes of collective bargaining. MR. WILLIAM M. LEISERSON took no part in the consideration of the above Decision, Order, and Direction of Election.