Beckerman Shoe Corp. of Kutztown

In the Matter of BECKERMAN SHOE CORPORATION OF KUTZTOWN and UNITED SHOE WORKERS OF AMERICA In the Matter of BECKERMAN SHOE CORPORATION OF BOYERTOWN and UNITED SHOE WORKERS OF AMERICA Cases Nos. C-723 and C-724, respectively. -Decided March 27, 1940 Shoe Manufacturing Industry-Interference, Restraint , and Coercion: ques- tioning of employees by plant superintendent and foremen regarding union membership, anti-anion statements by supervisors , lock-out threats , and promise of a wage increase to deter employees from union membership-Strike: caused by unfair labor practices-Unit Appropriate for Collective Bargaining: pro- duction employees at Boyertown factory, exclusive of foremen and office em- ployees-Representatives : proof of choice : membership applications ; majority established prior to strike ; stipulated testimony that many employees failed to read union membership applications and of statements made by union or- ganizer, held not to impair showing of majority ; unnecessary to consider majority status following sit-down strike in view of finding of no refusal to bargain-Collective Bargaining : charges of refusal to bargain collectively, dis- missed ; impasse reached in the negotiations-Reinstatement : denied employees who engaged in sit-down strike ; ordered as to striking employee who did not participate in sit-down strike-Back Pay: ordered in the event that reinstate- ment of striking employee upon application is refused from five days after such refusal to offer of reinstatement-Employer: responsibility of corporate suc- cessor for unfair labor practices committed by predecessor , where successor corporation acquired ownership of plant where unfair labor practices were committed with knowledge of their commission , and was subject to sub- stantially the same stock ownership and control as predecessor , and continued the business of the predecessor. Mr. Geoffrey Cunniff and Mr. Joseph Castiello, for the Board. Stevens ct; Lee, by Mr. John B. Stevens and Mr. Allan K. Grim, of Reading, Pa., for the respondent. Mr. Leo Goodman, of Washington, D. C., and Mr. George Martin, of Philadelphia, Pa., for the United. Mr. Roman Beck, of counsel to the Board. DECISION AND ORDER STATEMENT OF THE CASE Upon charges and amended charges duly filed by United Shoe Workers of America, herein called the United, the National Labor 21 N L. R. B., No. 123 1222 BECKERMAN SHOE CORPORATION 1223 Relations Board, herein called the Board, by John E. Johnson, Act- ing Regional Director for the Fourth Region (Philadelphia, Penn- sylvania), issued its complaint, dated May 7, 1938, against Beckerman Shoe Corporation of Kutztown, Kutztown, Pennsylvania, herein called the respondent, 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 National Labor Relations Act, 49 Stat. 449, herein called the Act. The complaint alleged in substance : (1) that the respondent in- timidated its employees to discourage membership in the United, and discriminatorily discharged John Houck,' an employee at Kutztown; (2) that the respondent refused to bargain collectively with the United as the representative of its Boyertown 2 production employees, although a majority of them within an appropriate unit had desig- nated the United as their collective bargaining representative; (3) that on or about August 7, 1937, the respondent's Boyertown em- ployees struck because of the respondent's unfair labor practices; and (4) that by the foregoing acts, and in other ways, the respondent 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 upon the United. The respondent filed an answer denying the material averments of the complaint, denying that it had any knowledge of the United's designation by a majority of the Boyertown employees, and denying that it had refused at any time to bargain collectively with the United. Separate charges having been filed in respect to the unfair labor practices alleged to have occurred at Kutztown and Boyertown, re- 1 The complaint was dismissed as to Huck on motion of counsel for the Board 2 Until May 9, 1938, the respondent owned and operated shoe factories at Kutztown and Boyertown , Pennsylvania On May 9 , 1938 , Beckerman Shoe Corporation of Boyertown, a separate corporation , herein called the Boyeitown Company, was organized under the laws of Pennsylvania and acquired the respondent 's Boyertown plant, in which it con- tinued the manufacture and sale of shoes. On January 4, 1940, the respondent and Becker- man Shoe Corporation of Boyertown entered into a stipulation with the United and with counsel for the Board which , by its terms , was to become a part of the record herein The stipulation provides. That from May 1, 1937 , down to and including May 9, 1938 , Max Beckerman [the respondent's president ] was the majority owner and in control of the Beckerman Shoe Corporation of Kutztown ; That on and after May 9, 1938 , the said Max Beckerman became the majority owner and in control of the Beckerman Shoe Corporation of Boycitown, while con- tinuing majority ownership , and control of the Beckerman Shoe Corporation of Kutzto s n. The relationship of the respondent and the Boyertown Company is discussed more fully in Section I and in the section entitled "The Remedy" of this Decision 1224 DECISION'S OF NATIONAL LABOR RELATIONS BOARD spectively,3 the Board, acting pursuant to Article II, Section 37 (b), of National Labor Relations Board Rules and Regulations-Series 1,. as amended, ordered the proceedings based upon such charges con- solidated for the purpose of hearing. Pursuant to notice, a hearing was held at Reading, Pennsylvania,. on May 19, 20, and 23, 1938, before James C. Batten, the Trial Examiner duly designated by the Board. The Board and the re- spondent were represented by counsel and participated in the hear- ing. Full opportunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing upon the issues was. afforded all parties. During the course of the hearing, the Trial Examiner made various rulings on motions and objections to the admission of evidence. 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 22, 1938, the Trial Examiner filed his Intermediate Re- port, in which he found that the respondent had committed unfair labor practices affecting commerce, within the meaning of Section 8 (1) and (5) and Section 2 (6) and (7) of the Act, and recom- mended that the respondent cease and desist from such unfair labor practices and take certain affirmative action remedial of their effect. On July 1, 1938, the respondent filed exceptions to the Intermediate Report and thereafter filed briefs in support. of its exceptions. Pur- suant to notice, hearings for the purpose of oral argument upon the exceptions to the Intermediate Report were held on October 20, 1938, and July 6, 1939, before the Board in Washington, D. C. At both hearings, the respondent appeared by counsel and the United by its representative, and they participated in the argument. On October 27, 1939, the respondent and Beckerman Shoe Corpora- tion of Boyertown filed a petition requesting the Board to reopen the record and direct a further hearing for the purpose of receiv- ing,eyidence as to the identity of the respondent's employees who engaged in the sit-down strike hereinafter, mentioned. On January 4, 1940, the respondent, Beckerman Shoe Corporation of Boyer- town, the United, and counsel for the Board entered into a stipula- tion, subject to the approval of the Board, which set forth the names of the respondent's employees who engaged in the sit-down strike and the facts concerning the Boyertown Company. The Board hereby approves the stipulation Ind makes it a part of the record herein. The Board has fully considered the respondent's exceptions to the Intermediate Report and, in so far as they are inconsistent with g The only evidence relating to the commission of alleged unfair labor practices at the Kutztown plant was stricken from the record without objection We shall accordingly dismiss the allegations of the complaint that refer to the Kutztown factory BECKERMAN SHOE CORPORATION 1225 the findings, conclusions, and order set forth below, finds them to be without merit. Upon the entire record in the case, the Board makes the following: FINDINGS OF FACT J. THE BUSINESS OF TIIE RESPONDENT AND OF THE BOYERTOWN COMPANY At the time of the occurrence of -the unfair labor practices alleged in the complaint, Beckerman Shoe Corporation of Kutztown, the -respondent, was a Pennsylvania corporation engaged in the manu- facture and sale of shoes at Kutztown and at Boyertown, Pennsyl- vania.' Prior to the acquisition on May 9, 1938, by the Boyertown Company of the respondent's Boyertown plant, the respondent's gross sales amounted to approximately $600,000 a year. Approxi- mately 85 per cent of the shoes which the respondent manufactured -while it owned both the Kutztown and Boyertown factories were regularly shipped by it in interstate commerce from those factories to other States and approximately 60 per cent of the raw materials which it then used for production were shipped to its factories from States other than Pennsylvania. The respondent admitted in its .answer the allegations of the complaint relating to the interstate nature of its business operations. Since May 9, 1938, the averagq gross sales of the respondent and .of the Boyertown Company have each amounted to approximately $300,000. Since that date approximately 75 per cent of the output of both companies has been shipped in interstate commerce from their Pennsylvania factories to other States and approximately 60 per cent of the raw materials which they have used for production have been delivered to their Pennsylvania factories from other States. II. THE LABOR ORGANIZATION INVOLVED United Shoe Workers of America is a labor organization affiliated -with the Committee for Industrial Organization.' It admits to membership production employees of the respondent, exclusive of supervisors. III. THE UNFAIR LABOR PRACTICES A. Interference, restraint, and coercion In the latter part of June or the early part of July 1937, the United began to organize the respondent's Boyertown and Kutztown eni- A See footnote 2, supra. 5 Now the Congress of Industrial Organizations. 1226 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ployees and chartered Local Union No. 153 to admit them to mem- bership. The respondent soon attempted to alienate the United's member- ship. Peter Smith,6 the president of Local Union No. 153, testi- fied that in July 1937, Sam Savoca, the superintendent of the respondent's Boyertown factory, questioned him regarding the C. I. O. in the presence of Raymond Pettyjohn, his foreman. According to Smith, Savoca remarked on that occasion : "Don't you know that they [the C. I. 0.] are troublemakers . . . ? All they want is your money . . . Furthermore, Beckerman won't join the C. I. O... . If you get in these union activities, one of these days . . . I will just turn the key and you will be out of a job." Smith further testified that on several other occasions Savoca and Pettyjohn urged him to persuade his fellow workmen not to join the United, and that Savoca offered him money if he would do as they asked. Notwithstanding the respondent's hostility to the United, 80 of the Boyertown production employees signed United membership applications at a meeting held on August 2, * 1937. The following day the United sent a telegram to the respondent informing the respondent that it had been designated as the bargaining representa- tive of a majority of the Boyertown employees, and requesting a bargaining conference not later than August 9, 1937. Confronted with this request, the respondent intensified its efforts to undermine the United's membership. Joseph Redcay, a thread laster, testified that on August 3, 1937, Savoca had offered him a wage increase and a second-hand automobile if he would dis- close who the leaders were in the organizing campaign of the United. On the same day, Savoca and Pettyjohn addressed the cutting- department employees, who had assembled in the factory office at the direction of their foreman. The following extract from the testimony of Leroy Heydt, a cutter, describes what took place at the meeting : .. . They started asking us, each one, if you were for the union or against the Union. Q. Who asked you that? A. Ray Pettyjohn. Q. He asked each member of the cutting department? A. Yes. The credibility of Peter Smith and of the other witnesses from whose testimony we have quoted in Section III A is considered later in this Decision . For reasons hereinafter stated, we later find that Savoca and the respondent 's other supervisors , In substance, made the antiunion statements attributed to them by these witnesses. BECKERMAN SHOE CORPORATION 1227 Q. Was Savoca there when Pettyjohn was asking if they were for the union or against the union? A. Yes. Q. What happened after that? A. He said if you join the union, they are just after your quarter. Q. 25 cents? A. Yes. They said if we would join the union we would not have any work, and if we would stick with the company we would have plenty of work. Q. How long did that talk last? A. An hour and a half. Q. During the hour and a half was the conversation all about the union? A. Yes. On the following day, August 4, 1937, George Haddad, the fore- man of the thread lasters, called the men in his department together. After they had assembled, Savoca, according to Redcay, told the thread lasters : "Listen, boys, I don't want you to join the union. Mr. Beckerman might consider signing up with the A. F. of L., but the C. I. O.-never. They are only a bunch of racketeers . . . You keep away from the union and don't sign up, and I will get you a 5-per cent raise plus the bonus if you will keep out ..." In testifying regarding Savoca's speech, Calvin Weiss, a thread laster, confirmed in part Redcay's version of Savoca's statements ; Weiss added, how- ever, that Savoca also made the following threat, "In case you join the union, why, one morning you might find the place locked up, because I got enough money and I can go on a vacation." On August 5, 1937, the day after Savoca's speech to the thread Tast- ers, Pettyjohn,7 in the presence of Savoca, addressed the women of the fitting department, who had assembled in the factory office at the re- quest of their foreman. At the hearing, Jenny Bauer, an employee of that department, gave the following account of what took place at this meeting : He (Pettyjohn) asked us not to join the union because it was no good. He said it was a bunch of racketeers and that if we would stick to the firm and to the company, that would be good for us and they would be good to us and they would treat us nice and .give us our 5-per cent bonus right'away and we would not have to wait until Christmas to get it. Then he said, "I am going to 7 Pettyjohn succeeded Savoca as the superintendent of the Boyertown factory after the latter went into business for himself. 1228 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ask each one present whether you are for the union or against it . . ." He said if we joined the union they can take-I think he said 7/8-of your pay away from you without consulting . . . He said if we belonged to the union we would come in to work some morning and the doors might be locked on us." Although at the hearing Savoca and Pettyjohn denied ever having threatened or bribed employees to keep them from joining or remain- ing members of the United, they were not asked to affirm or deny hav- ing made disparaging remarks about the United. As we have previously noted, in testifying to the threats and financial inducements which Savoca, and Pettyjohn made to persuade the employees to abandon their union affiliation, the union witnesses also stated that Savoca and Pettyjohn made several such derogatory remarks. The testimony of the union witnesses in regard to these matters, in contrast to that of Savoca, was forthright, specific, and consistent; and its verity was not impugned on cross-examination. In view of important differences between Savoca's and Pettyjohn's versions of the departmental meetings, we are unable to accept either's testimony concerning them. Savoca stated that he decided to call the meetings "to see what they [the employees] wanted" because he heard that a union organizer was in town, that a few employees had joined the Union, and that certain employees were dissatisfied with the wage rates. However, Savoca declared he had not taken these rumors seri- ously, and had so informed Max Beckerman at the time. Pettyjohn, on the other hand, testified that the meetings were called to avert a sit-down strike that Savoca and he feared was imminent. Pettyjohn stated that, at Savoca's direction, he had asked the employees of the cutting and fitting departments "... not to sit down or have any trouble, but go ahead and work until Mr. Beckerman would come in, and he can straighten out whatever grievances they have . . . " In explaining why Savoca and he feared that the employees contemplated a strike, Pettyjohn said that on August 3 he questioned Peter Smith as to the United's membership strength and was told by Smith that approximately 60 per cent of the employees were then members of the Union, and that there would be a strike. Savoca, however, did not even mention the Smith incident in his testimony. In marked con- trast to Pettyjohn's professed anxiety over the Union's organizational success, Savoca, as has been noted, affected an attitude of unconcern. Indeed, Savoca testified that so far as he then knew only a few em- ployees had joined the Union. In view of their contrasting attitudes, it is not surprising that they differed as to the reason for calling the meetings. Savoca asserted that he desired merely to find out why the employees were dissatisfied and what they wanted. w He did not state that a strike was imminent, which he desired to prevent. BECKERMAN SHOE CORPORATION 1229 Pettyjohn, on the other hand, declared that on instructions from Savoca he had pleaded with the employees not to engage in a sit- down strike. In view of these discrepancies between Savoca's and Pettyjohn's testimony, we are unable to accept either's version of what occurred, at the departmental meetings. We find that, in substance, Savoca and Pettyjohn made the remarks disparaging to the United described above; that in their speeches to the cutting, fitting, and thread lasting departments they promised the employees a wage increase and a. bonus if the employees would give up the United, and threatened them with a lock-out if they remained loyal to the United. These attempts of Savoca and Pettyjohn to undermine the mem- bership of the United were supplemented by acts of certain foremen : At the hearing, Gordon Spohr, a thread Laster, quoted his foreman, Haddad, as having told him prior to his joining they Union that the United was a "bunch of racketeers." While Haddad denied talk- ing with any employee about joining the Union, he did not specifi- cally deny the statement attributed to him by Spohr. Sadie Weiser, a packing-department employee, testified, without contradiction, that on August 2, 1937, her foreman, George Hyam, warned her against having anything to do with the United, and told her that "they were a bunch of racketeers." We find that Haddad and Hyam made the above statements.8 We find that the respondent, by the statements and acts of Savoca, Pettyjohn, Haddad, and Hyam, found above, interfered with, re- strained, and coerced its employees in the exercise of the rights guar- anteed in Section 7 of the Act. B. The strike During the afternoon of August 4, 1937, the foreman of the cutting department told his men that he had no further work for them to do, and that he would let them know when they would again be needed. A general lay-off of the cutters had never occurred before, and the members of the United shop committee became alarmed at the situa- tion. That evening the Committee went to the home of a United organizer and informed him of what had taken place. The latter reminded the Committee that Max Beckerman was in a position to shift work from Boyertown to the Kutztown and Brooklyn plants which he controlled, and told the Committee that the respondent's attempts to alienate the Union's membership and threats of a lock- sCf. Swift cE Company v. National Labor Relations Board, 106 F. (2d) 87, 93, wherein the Court said : "Furthermore , with respect to the acts of the supervisory foremen, the doctrine of re8pondeat superior applies, and petitioner is responsible for the actions of its supervisory foremen, even though it had no actual participation therein " 1230 DECISIONS OF NATIONAL LABOR RELATIONS BOARD out lent support to the employees' fear that the lay-off of the cutters foreshadowed a shut-down of the entire, plant. He then advised the Committee to instruct the cutters to return to the factory the next morning, and to insist that they be given work. In keeping with this advice, the cutters came to the factory the following morning, and the United shop committee demanded that Savoca give them work. The testimony concerning the Committee's conversation with Savoca and the events following it is in conflict. The union witnesses stated that except for the son of a foreman the cutters were given no work that morning; but the respondent's wit- nesses denied this, asserting that Savoca informed the Committee that be had no tickets 9 to give the cutters. They further stated that Savoca then offered to permit the cutters to work on stock shoes if the Committee insisted upon their being given work, but that the Com- mittee refused to allow the cutters to work without tickets. The respondent offered no explanation at the hearing for the Committee's alleged insistence on tickets. There is no evidence that the employees enjoyed benefits when working on shoes accompanied by tickets de- nied them when working on stock shoes. Moreover, Savoca himself testified that it was the respondent's regular practice to manufacture stock shoes whenever the supply of tickets was exhausted. In the absence of evidence that the union committee's alleged insistence on tickets had a rational basis, we cannot believe that it did insist upon tickets. We are unable to credit the testimony of the respondent's witnesses in this respect and are satisfied that Savoca did not offer the cutters any work on August 5, 1937.10 The Committee's conversation with Savoca occurred during the morning of August 5. About noontime, certain employees stopped working in protest against the respondent's failure to give work to the cutters. In the latter part of the afternoon all of the women and the younger men went home, while the older men remained in the plant. This was the beginning of the sit-down strike. The follow- ing morning, the United established a picket line outside the factory. The day after the strike began, Max Beckerman, the respondent's president and treasurer, entered the plant and addressed the sit-down strikers. The United witnesses testified that Beckerman said he would never recognize the C. I. 0., urged them to settle the strike without the intervention of outsiders, and promised them a wage increase if they would do as he requested. At the hearing, Becker- 0 These tickets were tags affixed to the shoes during the manufacturing process, which recorded the size of the shoe and the several operations involved in its manufacture. -The tickets were prepared in the respondent 's sales office and were sent from that office to the Boyertown factory. 10 The complaint did not allege any unfair labor practice by reason of the respondent's failure to offer the cutters work on August 5, 1937, and we make no finding with respect thereto. BECKERMAN SHOE CORPORATION 1231 rrlan denied making these statements, and testified that he urged the sit-down strikers to select a committee "or anybody" to confer with him with a view to settlement of the strike; that, while he was speak- ing to the strikers, a representative of the United, who was then out- side the factory, shouted to the men: "Don't listen to him; just stay where you are; don't walk -out; don't go down in the office." Beck- erman admitted at the hearing that prior to the strike he had been informed of the United's telegram of August 3 requesting a bargain- ing conference. Nevertheless he made no effort to confer with the United's representative who he knew was then outside the plant. His failure to do so makes it difficult for us to believe that he told the strikers he would confer with "anybody" whom they designated. We are convinced that Beckerman made the statements to the sit-down strikers attributed to him by the United witnesses. The sit-down strikers left the plant on August 17, 1937,11 after which they joined the pickets. Though respondent attempted to resume manufacturing shortly thereafter, several months elapsed before it was able to operate normally. The United's secretary tes- tified that 51 United members remained on strike at the time of the hearing, and other witnesses testified that the strike was still in effect at that time. We find that the underlying cause of the strike was the employees' fear that the August 4 lay-off of the cutters foreshadowed a lock- out; 11 that their fear was engendered by the respondent's attempts to destroy the Union by means of the intimidation and threats found above; that the respondent did not give the cutters work on August 5, 1937, and that the employees went on strike in protest, believing that the failure to give the cutters work was the precursor of the lock-out that had been threatened. We therefore conclude that the strike of August 5 was directly caused by the respondent's unfair labor practices.13 We further find that the strike remained current at the time of the hearing. 11 Shortly after Beckerman's arrival in Boyertown , he instituted proceedings in the County Court of Berk's County , Pennsylvania, to evict the sit-down strikers The County Judge before whom the proceeding was pending suggested an amicable disposition of the matter. The United representative thereupon informed the Judge that he would instruct the sit-down strikers to leave the factory provided someone would inspect it prior to the men's withdrawal to verify the fact that they were leaving "everything in- a first-class condition " The United insisted upon an inspection of the plant because Beckerman had asserted that the sit-down strikers damaged it . The United organizer testified that the Judge himself inspected the factory , and that the men left the building promptly thereafter. 12 A witness for the United testified that the employees went on strike because of the respondent's intimidation of the United members following the Union' s request for a bar- gaining conference and because the employees interpieted the unprecedented lay-off of the cutters as the precursor of the lock-out that had been threatened. 'g Cf. Republic Steel Corporation v. National Labor Relations Board, 107 F. (2d) 472 (C. C. A 3), mod'g and enf'g as mod . Matter of Republic Steel Corporation and Steel Workers Organizing Committee, 9 N. L. R B 219, where the Board found, and the Court concurred in the finding, that the employer's interference with the right to self-organiza- 1232 DECISIONS OF NATIONAL LABOR RELATIONS BOARD C. The alleged refusal to bargain collectively 1. The appropriate unit The complaint alleged that the respondent's production employees at the Boyertown factory constituted an appropriate bargaining unit. At the hearing the respondent's president stated that such a unit, exclusive of foremen and office employees, would be appropriate. We have previously determined in similar cases that a unit of that kind is appropriate 14 and there is nothing in the record to render it inappropriate in this case. We find that the respondent's production employees at its Boyer- town factory, exclusive of foremen and office employees, constitute a unit appropriate for the purposes of collective bargaining, and that said unit insures and will insure to said employees the full benefit of their right to self-organization and to collective bargaining, and otherwise effectuates the policies of the Act. 2. Representation by the United of a majority in the appropriate unit There are 139 persons listed on the respondent's pay roll for the week ending July 31, 1937,15 of whom 7 are foremen, 2 are office employees, and 1 is a shipping clerk; hence during that pay-roll period there were 129 employees within the appropriate unit. The record does not indicate that any change occurred in the number of employees within the appropriate unit between July 31 and Au- gust 5, 1937, the date the strike began. Ninety-two signed United membership applications were intro- duced in evidence. A comparison of the signatures on these appli- cations with the respondent's pay roll of July 31, 1937, shows that all of the signers were then employees of the respondent within the unit above found appropriate. The genuineness of the signatures was not disputed, and the United organizer testified without contra- diction that 80 of the applications were signed in his presence at the United organizational meeting of August 2, 1937. Thus the United tion of its employees was the fundamental , underlying cause of a strike precipitated by the employer's refusal to sign an agreement with the Union, which refusal was not found to be an unfair labor practice . The Board's analysis of the causal relationship between the antecedent unfair labor practices and the strike in the Republic case is applicable to the causal relationship of the unfair labor practices and the strike in the present case 14 See Matter of A. Fink and Sons Co., Inc. and Amalgamated Meat Cutters & Butcher Workmen of N. A., Local 422, A. F. of L., 9 N. L R B . 441; Matter of Newark Rivet Works and Unity Lodge No. 420, United Electrical d Radio Workers of America, C. I 0., 9 N. L. R. B 498; Matter of American Numbering Machine Company and International Associa- tion of Machinists, District # 15, 10 N. L: R. B. 536; Matter of Union Envelope Company and Envelope Workers Union No. 393 and International Printing Pressmen and Assistants' Union of North America, 10 N., L. R. B. 1147 15 The pay-roll period preceding the strike BECKERMAN SHOE CORPORATION 1233 represented a majority of the employees in the appropriate unit on that date. The respondent offered to call as witnesses 41 employees who had signed United membership applications to testify: (1) that they signed the applications without having read them; and (2) that they were induced to sign them by the statement of a union organizer that they would be fined if they delayed joining the Union until after it had succeeded in organizing the employees, and that at such time they would not be permitted to work for the respondent unless they were union members. Counsel for the Board stipulated that these witnesses would so testify. The record clearly shows that these employees realized they were joining a union when they signed the membership applications. In view of this, it is immaterial that they failed to read the applications11, We do not think that the statements of the union organizer noted above are controlling on the issues here presented.17 We, therefore, conclude that the stipulated testimony does not impair the United's showing of a majority status on August 2, 1937. We find that on August 2, 1937, the United was the duly desig- nated representative.of the majority of the respondent's Boyertown employees in the unit above found appropriate for the purposes of collective bargaining, and that pursuant to Section 9 (a) of the Act, it was then the exclusive representative of all the employees in such unit for the purposes of collective bargaining. As we have previously noted, the sit-down strike occurred on August. 5, 1937. The stipulation of January 4, 1940, mentioned above, sets forth the names of 60 employees who engaged in the sit- down strike. Forty-seven of the sit-down strikers were members of the United. In view of our finding, hereinafter made, that the respondent did not refuse to bargain collectively with the United, it is unnecessary for us to consider whether the United continued 16 In Matter of Campbell Machine Company, David C Campbell and George E. Campbell, co-partners . trading as Campbell Machine Company and Intel national Association of Ma- chinists, Local No 889; Shipwrights, Boatbuilders & Caulkers ; and International Brother- hood of Electrical Workers, Local No 569, 3 N L R B 793 , 798, the Board stated : "By voluntarily joining a labor organization an employee in effect designates that labor organi- zation as his representative for purposes of collective bargaining" 19 In Matter of Viking Pump Company and Lodge 1683. Amalgamated Association of Lion, Steel and Tin Workers of North America, through the Steel Workers Organizing Committee, affiliated with the Congress of Industrial Organizations ( fo)merly Committee for Industrial Organization ), 13 N. L. R. B 576, the employer asserted that an employee had threatened his fellow v orkmen with the loss of their jobs if they did not join the Union Our comment upon his statement is, apposite here : However, his alleged statements to his fellow wiorlauen could only have meant that they might lose their jobs if the Amalgamated obtained a closed shop, since he was not a supervisory employee. Statements of that kind are not unusual during an organizational campaign in a hitherto unorganized plant, especially when the union's efforts are obstructed by employer interference such as is shown in this case. 1234 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to represent a majority of the respondent's employees throughout the period of the bargaining negotiations, which followed the sit-down strike. 3. The alleged refusal to bargain After the sit-down strikers had left the respondent's plant on August 17, 1937, the respondent's attorney wrote a letter to the Regional Director in which he stated that the respondent believed the United did not represent more than 15 to 20 per cent of the Boyertown employees. Despite this assertion, the respondent's attorney further stated in that letter that the respondent was willing to meet the representatives of the Union but would require proof of the Union's majority. Thereafter representatives of the respond- ent and of the United met on August 20, 23, September 2, 13, and December 3, 1937. Max Beckerman, the respondent's president, con- ducted virtually all of the negotiations on its behalf. The United was represented chiefly by George Martin, its organizer for the State of Pennsylvania 18 At the first conference held on August 20, 1937, Martin presented the Union's demands, which included certain minimum wage rates, and a 40-hour workweek, with extra compensation for overtime. Beckerman rejected the union proposals. Martin testified that the subject of union recognition was discussed and that Beckerman ad- mitted that the United represented a majority of, the Boyertown employees. Peter Smith confirmed Martin's testimony in substance. Smith added, however, that Beckerman had offered to reinstate all of the strikers at the wage rates and working conditions then pre- vailing. According to Beckerman, the discussion at this meeting related principally to the Union's wage and hour proposals. Becker- man stated that he had informed the union representatives that he could not consider any wage increase because the Boyertown em- ployees lacked sufficient skill to manufacture merchantable shoes, and that the respondent would have to suffer a substantial loss in the disposal of a warehouse full of unmerchantable shoes, which these inexperienced employees had made. Although Beckerman denied that he had conceded the Union's majority status, he said 18 The testimony of Beckerman and of Martin relating to the bargaining negotiations is in large part contradictory . The other witnesses who testified with respect to the nego- tiations were Herman Levin and Peter Smith , in behalf of the United , and John B . Stevens, the respondent's attorney . Levin's testimony relates solely to the conference of August 23, at which he represented the Union in the absence of Martin; Smith 's testimony relates solely to the conference of August 20 The testimony of Stevens is very general in char- acter except as to the August 23 conference . Inasmuch as there was no dispute concerning the events of the August 23 meeting , the history of the bargaining negotiations was pre- sented almost entirely in the sharply conflicting testimony of Beckerman and Martin. BECKERMAN SHOE CORPORATION 1235 that he had offered to enter into a contract with the United as the representative of all the Boyertown employees for a period of a year upon the basis of the then prevailing wages, hours, and work- ing conditions. Beckerman added that at the conclusion of the group discussion he had repeated this offer to one Greco, a New York representative of the United who was present at this conference, and had suggested to Greco that the Union's attorney should pre- pare such a contract. Greco was not called as a witness. We are satisfied that Beckerman's testimony relating to this conference is substantially correct. The parties again met on August 23. At this meeting Beckerman refused to sign an agreement for a consent election. At the hearing Beckerman stated that his refusal was due to resentment of the sit- down strike and his belief that the Union had resorted to intimida- tion and deception in soliciting members. Beckerman did not, however, persist in this attitude. On the contrary, at a subsequent conference he himself suggested a consent election to resolve the ques- tion of the Union's majority, but this time the United refused to agree. While discussing the Union's contract proposals at one of the later meetings, Beckerman suggested that the Union should furnish a bond guaranteeing its performance of whatever contract might be agreed upon.19 We do not think, however, that Becker- man's remark concerning a bond was advanced as a serious and final impediment to the consummation of a contract. Nor do we think that the Union regarded it as such. During all the conferences sub- sequent to that of August 23, the controversy over wages and hours continued, but no agreement was ever reached. In making this find- ing, we have not overlooked Martin's testimony that at the last con- ference he expressed a willingness to enter into a contract on the basis of the prevailing wage rates. Although this was not denied, there was no evidence that the United was then willing to withdraw its demands for a 40-hour week and overtime. We are convinced that the controlling factor in the break-down of the negotiations was the inability of the parties to agree upon substantive terms. Accord- ingly, we shall dismiss the complaint in so far as it alleges that the respondent refused to bargain collectively. 19 Beckerman's testimony relating to this incident is, in part , as follows : Well, he [ Martin] also brought up the question of our responsibility in keeping my contract If they signed a contract, I said, "Can you be responsible without putting up a bond?" I just made a statement ; I didn't mean it seriously. Mr. Martin said, "We have enough money." He said , "We could put up a bond for $100,000 " I said, "All right ; I don't want $100,000. If you put up $5,000." He said, "You put up $5,000." 1236 DECISIONS OF NATIONAL LABOR RELATIONS BOARD IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE We find that the activities of the respondent set forth in Section III above, occurring in connection with the operations of the respond- ent described in Section I above, have a close, intimate, and substan- tial relation to trade, traffic, and commerce among the several States, and have led and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. THE REMEDY The respondent owned the Boyertown plant when the unfair labor practices found above occurred. After the issuance of the complaint in this proceeding and shortly prior to the hearing, Beckerman Shoe Corporation of Boyertown acquired the respondent's Boyertown plant and continued the manufacture and sale of shoes at that plant. There is no evidence of any change either in the workmen or the management of the Boyertown plant subsequent to its acquisition by the Boyertown Company. When the unfair labor practices were committed and at all times thereafter, Max Beckerman, the respond- ent's president and treasurer, owned a majority of its stock and con- trolled its business. Max Beckerman has also owned a majority of the stock of the Boyertown Company and has controlled its -business affairs ever since the Boyertown Company acquired the Boyertown plant.20 Under these circumstances, we find that the Boyertown Company has succeeded to the ownership of the Boyertown plant with full notice of the pendency of this, proceeding and is responsible for the unfair labor practices in which the respondent has engaged with respect to employees of the Boyertown plant.Y1 We further find that Max Beckerman is under an obligation to exercise his control over the Boyertown Company to procure the latter's cooperation to the extent necessary to effect compliance with our - Order.22 The facts stated above are set forth in the stipulation of January 4, i940 , to which the respondent and the Boyertown Company were parties That stipulation was entered into after the respondent and the Boyertown Company had petitioned the Board to reopen the record in this proceeding Under these circumstances it is apparent that the Boyer- town Company has intervened in this proceeding and is subtect to the jurisdiction of the Board 21 See Matter of National Supply Company and Steel TVoike,s Organizing Committee, 16 N L. R B 304; National Labor Relations Board v. Arthur L. Gotten and Abe J. Colman, co-partners doing business as Kiddie Koi.er Manufacturvng Company, 105 F. (2d) 179 (C C A 6). Cf Federal Trade Commission v Standard Education Society, at at, 302 U. S 112 =2 National Labor Relations Board v Hopwood Retinning Co., Inc, 98 F (2d) 97 (C C. A 2), enfg in part Matter of Hopwood Retinning Conmpany, Inc and Metal Polishers, Buffers, Platers and Helpers International Union Local Ao. 8 and Teamsters Union, Local No 584, 4 N L R. B. 922; National Labor Relations Board v . Hopwood Retinninq Co , Inc, et at, 104 F. (2d) 302 (C C A 2) ; National Labor Relations Board v Arthur L Gotten and Abe J. Colman, co-partners doing business as Kiddie Kot-er Mannfactuitug Company, 105 F. (2d) 179 (C. C. A 6) , of Federal Trade Commission v Standard Edu- cation Society, at al, 302 U. S. 112. BECKERMAN SHOE CORPORATION 1237 Having found that the respondent has engaged in certain unfair labor practices, we will order it and its successor, the Boyertown Company, to cease and desist therefrom and to take certain affirma- tive`adtion designed to effectuate the policies of the Act. Since the strike was caused by the respondent's unfair labor prac- tices, we would ordinarily require the reinstatement upon application of all the strikers, in order to restore, as far as possible, the situation existing prior to the strike. We shall not require this to be done in the present case, however, for the reason that all but one of the strikers participated in the sit-down strike. The reinstatement of those who participated in the sit-down strike will not be ordered.23 In order to effectuate the policies of the Act, we shall order the respondent and the Boyertown Company, upon application, to offer reinstatement to Sallie Bartman, the only striking employee who did not participate in the sit-down strike.24 The offer of reinstatement shall be without prejudice to the seniority and other rights and privileges of Sallie Bartman. Any person not in the respondent's employ at the Boyer- town plant at the commencement of the strike on August 5, 1937, and who has since been hired at that plant either by the respondent or by the Boyertown Company shall, if necessary to provide employ- ment for Sallie Bartman, be dismissed. We shall also order the respondent and the Boyertown Company to make Sallie Bartman whole for any loss she will suffer by reason of their refusal, upon her application following the issuance of this Order, to reinstate her in the manner set forth above, by payment to her of a sum of money equal to that which she would normally have earned as wages during the period from 5 days after the date of such application for reinstatement to the date of the offer of reinstatement, less her net earnings 25 during that period. 21 See National Labor Relations Board v. Fansteel Metallurgical Corporation , 306 U. S. 240. 24 While the record does not clearly identify all of the employees who went on strike, the United secretary testified that 51 members of the United remained on strike at the time of the hearing . She prepared a list of these 51 employees , which was introduced in evidence. The record shows that one of the employees named on that list, Raymond Rothenberger, had left the respondent 's employ prior to the date of the strike , and that two others, Andrew Hiryak and Ignacious Tucker, were reemployed by the respondent prior to the hearing. We have compared the names of the remaining 48 striking employees with the stipulated list of employees who engaged in the sit -down strike and find that all of the 48, except Sallie Bartman, participated in the sit -down strike Though it is not certain from the record that Sallie Bartman reported for work on the day the strike began , her name appears on the respondent's pay roll of July 31 , 1937, and she is included in the list of those who remained on strike at the time of the hearing 2513Y "net earnings" is meant earnings less expenses, such as for transportation, room, and board; incurred by an employee in connection with obtaining work and working else- where than for the respondent , which would not have been incurred but for the unlawful refusal to reinstate him or the consequent necessity of his seeking employment elsewhere See-Matter of Crossett Lumber Company and United Brotherhood of Carpenters and Join- ers of America, Lumber and Sawmill Workers Union, Local 2590, 8 N. L R B 440 Monies received for work performed upon Federal, State, county , municipal, or other work-relief 8 :0 :2-41-vol 21--79 1238 DECISIONS, OF NATIONAL LABOR RELATIONS BOARD Upon the basis of the above findings of fact and upon the entire record in the case, including the aforesaid stipulation, the_ Board. makes the following : CONCLUSIONS OF LAW 1. United Shoe Workers of America is a labor organization; within the meaning of Section 2 (5) of the Act. 2. By interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed by Section 7 of the 'Act, the respondent has engaged in and is engaging in unfair labor-prac- tices, within the meaning of Section 8 (1) of the Act. 3. The aforesaid unfair labor practices are unfair labor practices affecting commerce, within the meaning of Section 2 (6) and (7) of the Act. 4. The respondent has not engaged in unfair labor practices, within the meaning of Section 8 (3) and (5) of the Act. 5. Beckerman Shoe Corporation of Boyertown, a successor to the ownership and business of the respondent's Boyertown plant, has acquired that plant with notice of the pendency of this proceeding and is obligated to remedy the aforesaid unfair labor, practices engaged in by the respondent at that plant. 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 respondent, Beckerman Shoe Corporation of Kutztown, Kutztown; Pennsylvania, and Beckerman Shoe Corporation of Boyertown, Boyertown, Pennsylvania, and their officers, agents, successors, and assigns shall: 1. Cease and desist from in any manner interfering with, restrain- ing, or coercing their employees in the exercise of the right to self- organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purpose of collective bargain- ing and other mutual aid and protection. 2. Take the following affirmative action, which the Board finds will effectuate the policies of the Act : projects are not considered as earnings, but as provided in the Order herein shall be de- ducted from the sum due the employee, and the amount thereof shall be paid over to the appropriate fiscal agency of the Federal, State, county, municipal, or other government or governments which supplied the funds for said work-relief projects Republic Steel Cor- poration, et at. V. National Labor Relations Boa? d, 107 F (2d) 472 (C C A. 3), enf'g as mod , Matter of Republic Steel Corporation and Steel Workers Organizing Committee, 9 N L R B 219 BECKERMAN SHOE CORPORATION 1239 (a) Offer to Sallie Bartman, upon application, immediate and full reinstatement to her former or a substantially equivalent posi- tion at the Boyertown plant, without prejudice to her seniority and other rights or privileges previously enjoyed by her; (b) Make Sallie Bartman whole for any loss of pay she will. have suffered-by reason of the respondent's and Beckerman Shoe Corpora- tion of Boyertown's refusal to reinstate her following, the issuance of this Order as required by paragraph 2 (a) of this Order, by the payment to her of a sum of money equal to the amount which she normally would have earned as wages during the period from 5 clays after the date of her application for reinstatement to the date she is offered reinstatement, less her net earnings 26 during said period; provided that the respondent and Beckerman Shoe Corporation of Boyertown shall deduct from the back pay due her a sum equal to that received by her, if any, for work performed upon Federal, State, county, municipal, or other work-relief projects during the period for which back pay is due her under this Order, and shall pay any such amount deducted to the appropriate fiscal agency of the Federal, State, county, municipal, or other government or governments which supplied the funds for said work-relief projects; (c) Immediately post notices in conspicuous places throughout their plants at Kutztown and Boyertown, Pennsylvania, and main- tain such notices for a period of at least sixty (60) consecutive days, stating that the respondent and Beckerman Shoe Corporation of Boyertown will cease and desist in the manner set forth in paragraph 1 of this Order; and that the respondent and Beckerman Shoe Cor- poration of Boyertown will take the affirmative action set forth in paragraphs 2 (a) and (b) of this Order; (d) Notify the Regional Director for the Fourth Region, in writing, within ten (10) days from the date of this Order, what steps the respondent and Beckerman Shoe Corporation of Boyertown have taken to comply herewith. AND IT IS FURTHER ORDERED that the complaint be, and it hereby is, dismissed in so far as it alleges that the respondent discriminatorily discharged John Houck and in so far as it alleges that the respondent has engaged in unfair labor practices, within the meaning of Section 8 (5) of the National Labor Relations Act. MR. WILLIAM M. LEISERSON took no part in the considerations • of the above Decision and Order. "See footnote 25, supra