Royal Lace Paper Works, Inc.

In the Matter of ROYAL LACE PAPER WORKS, INCORPORATED and FEDERAL LABOR UNION No. 21863, A. F. OF L. Case No. C-1628.-Decided October 10, 1940 Jurisdiction : paper manufacturing industry. Unfair Labor Practices. Company-Dominated Unions: formation of employee representation plan follow- ing display of interest on part lof employees in outside organization-par- ticipation in formation of : suggesting formation ; soliciting authorization signatures-contribution of support to : permitting activities on company time and property-interference : anti-union statements ; declarations of union preference ; discrimination in regard to conditions of employment ; instigating the holding of elections for departmental representatives to deal with re- spondent-indicia of domination: lack of opportunity to instruct representa- tives; absence of constitution and bylaws; inactivity of organization follow- ing its establishment-formation of successor organization to employee representation plan in an attempt to set up a spurious, organization for collective bargaining; failure of respondent to free employees from effects of its coercive conduct which characterized the formation and subsequent ac- tivities of the predecessor, organization and actually formed the basis for the successor organization ; supervisory employees among signatories of petitions circulated in formation of successor as well as predecessor ; all representatives designated also representatives of predecessor. Where a clause in a contract between a company union and the respondent was obviously based upon Section 7 of the Act, but eliminated the phrase, "to form, join, or assist labor organizations," and in its place, provided that the respondent recognized the "right of the employees to * * _* form an association for the purposes of concerted activities," the Board held that the respondent thus attempted to emphasize the right of its employees to organize an "association" of their own and to gloss over their right to join outside labor organizations. Remedial 'Orders : company-dominated unions disestablished;, contract abrogated. Mr. Mark Lauter, for the Board. Kotzen, Mann d Siegel, by Mr. Abraham ?Mann, of New York City, and Mr. David Groberg, of Brooklyn, N. Y., for the respondent. Charlton Ogburn, by Mr. C. C. Johnson, of New York City, for the Union. Mr. Irving A. Cook, of Brooklyn, N. Y., for the Committee. Mr. Harold Weston, of counsel to the Board. 27 N. L. R. B., No. 138. 757 758 DECISIONS OF NATIONAL LABOR RELATIONS BOARD DECISION AND ORDER STATEMENT OF THE CASE Upon charges and amended charges duly filed by the Federal Labor Union No. 21863, herein called , the Union, the National Labor Rela- tions Board, herein called the Board, by the Regional Director for the Second Region (New York City ), issued its complaint, dated May 17, 1940, against Royal Lace Paper Works, Incorporated , Brooklyn, New York,, 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) and (2) and Section 2 (6) and (7) of the National Labor Relations Act, 49,Stat. 449, herein called the Act. A copy of the complaint, accompanied by a notice of the hearing, was duly served upon the respondent and upolj the Union. With respect to the unfair labor practices, the complaint , in sub- stance, alleged , that beginning in about June 1937 the respondent dominated, interfered with, and contributed support to the formation and administration of a labor organization of its employees known as the Committee and that by the aforesaid acts and by other acts the respondent interfered with, restrained, and coerced its 'employees in the exercise of the rights guaranteed in Section 7 of the Act. On May 27, 1940, the respondent filed its answer admitting certain allegations of the complaint with respect to its business, but denying the averments of unfair labor practices and alleging affirmatively that the Committee represents the free and voluntary choice of the majority of the respondent's employees. On June 3, 1940, the Committee filed a' petition for leave to intervene in the proceedings. This petition included a paragraph in the nature of an answer to the complaint in which the Committee denied the allegations of the complaint that it is dominated by the respondent. Pursuant to notice a hearing was held in Brooklyn, New York, on June 3, 4, 5, 6, and 7, 1940, before James C. Paradise, the Trial Examiner duly designated by the Board. At the commencement of the hearing, the Trial Examiner granted the Committee's petition for leave to intervene. The Board, the respondent, the Union, and the Committee were represented by counsel and were afforded full oppor- tunity to be heard, to .examine and cross-examine witnesses, and to introduce evidence bearing upon the issues. During the hearing counsel for the Board moved to amend the complaint by adding to it allega- tions that in May 1940 the respondent dominated, interfered with, and contributed support to the formation and administration of a labor or- ROYAL LACE PAPER WORKS, INCORPORATED 759 ganizatiori of its employees known as the Collective Bargaining Com- mittee, as successor to the Committee. The Trial Examiner granted this motion, overruling the objections of counsel for the respondent and counsel for the Committee. The respondent and the Committee availed themselves of leave granted by the Trial Examiner and amended their respective answers to deny the afore-mentioned additional allegations. They , were also afforded, but did not avail themselves of, an opportu- nity to adduce further evidence bearing upon the said additional allegations. At the close of the hearing counsel for the Board moved that the complaint be conformed to the proof and this motion was granted by the Trial Examiner without objection. At the close of the Board's case and again at the end of the hearing, counsel for the respondent and counsel for the 'Committee moved that the complaint be dismissed on the ground that the evidence failed to support the alle- gations. The Trial Examiner reserved decision upon these motions and denied them in his Intermediate Report. During the course of the hearing the Trial Examiner made several rulings on other motions and on objections to the admission of evidence . We have reviewed the rulings of the Trial Examiner and find that no prejudicial errors were committed. The 'rulings are hereby affirmed. On June 28, 1940, the Trial Examiner issued his Intermediate Report, copies of which were duly served upon the parties, in which 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 (2)' and Section 2 (6) and (7) of the Act. He recommended that the respondent cease and desist from its unfair labor practices, that it withdraw all recognition from and completely disestablish the Committee and the Collective Bargaining Commit- tee, and that it take certain other action to remedy the situation brought about by its unfair labor practices. ,On August 1, 1940,'the respondent filed its exceptions to the Inter- mediate Report. The Committee notified the Board by letter, dated August 2, ' 1940, that it desired to have the exceptions filed by the respondent considered as being also the Committee 's exceptions. The Board has reviewed the exceptions to the Intermediate Report and finds them to be without merit in so far as they are inconsistent with the findings, conclusions , and order set forth below. Upon the entire record in the case, the Board makes the following : FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT Royal Lace Paper Works, Incorporated , a New York corporation with its principal office and place of business in Brooklyn , New York, 760 DECISIONS OF NATIONAL LABOR RELATIONS BOARD is engaged in the manufacture, sale, and distribution of shelf paper, lace paper doilies, paper specialties, and related products. The principal materials used by the respondent in its manufac- turing operations are roll paper, cellophane, ink, paint, paste, and glue. During 1939 approximately 40 per cent in volume of the raw materials purchased by the respondent, valued at more than $100,000, were purchased and shipped to it from points outside thee State of New York. During the same period a like percentage of the finished products manufactured by the respondent, valued at more than $100,000, was shipped to points outside the State of New York. The respondent concedes that it is engaged in commerce within the meaning of the Act. II. THE ORGANIZATIONS INVOLVED Federal Labor Union No. 21863 is a labor organization affiliated with the American Federation of Labor, admitting to membership employees of the respondent. ' The Committee and the Collective Bargaining Committee 'are desig nations given a group of employee representatives selected by the employees of the respondent in June 1937, and May 1940, respectively, for the purpose of dealing with the respondent concerning wages, rates of pay, hours of employment, and conditions of work. Both the Committee and the Collective Bargaining Committee are un- affiliated labor organizations in which employees of the respondent participate. III. THE UNFAIR LABOR PRACTICES A. Interference, restraint, and coercion; interference With, and domination and support of, the Committee and the Collective Bar- gaining Committee Prior to June 1937 there had been no attempt to organize the employees of the respondent although the employees had discussed, in a general way, the subject of unions and the possibility of obtaining a wage increase. On about June 13, 1937, however, departmental, representatives were selected by the employees at the suggestion of the management. Virginia Silvasi and Jennie McAvoy, employees who were among the 12 or 13 representatives selected, testified as to the method of their selection. According to the uncontroverted testi- mony of Silvasi, Rose De Luca, assistant floorlady in the shelf- paper department, during working hours, distributed slips among the employees in her department and instructed them to select "repre- sentatives for negotiations" and to "write out the name of the ROYAL LACE PAPER WORKS , INCORPORATED 761 girl we wanted to represent us." Silvasi testified that the ' ballots were shortly thereafter collected in a box and were counted by Caro- line Ulrich, the floorlady, who then informed Silvasi that she had been selected representative of the employees in her department . Jennie McAvoy, an employee in the chute department , testified that in a part of the chute department located in another building from which the respondent was then in the process of moving, the employees' received instructions by telephone to select a representative . McAvoy, who later became a leader of the Committee , testified that she first became aware of the selection of representatives when a telephone call was received from the new building, instructing the em- ployees in the old building to select someone to "talk for the girls." McAvoy furtlier testified that she "imagined" the call came • from a forelady , explaining that "no one else would really `phone there as I know of."' Representatives were selected in all departments of the 'plant. Neither De Luca, Ulrich, nor any of the respondent's employees or officials were called to deny or explain Silvasi's -and McAvoy's testimony. , We find, as did the Trial Exam- iner, that the idea of selecting representatives originated with the respondent 'and that the representatives were selected during' working hours in the plant at the respondent 's request and instigation. It appears that the initiative for further activities by the represen- tatives came mainly from McAvoy, who had been in the employ of the respondent since 1923 , was one of its senior employees in length of service, and later became a supervisory employee. McAvoy arranged for a meeting with one Sam Smith, who claimed to be an A. F. of •L. representative or organizer, and the representatives met with him on about June 15, 1937, at which time Smith explained the relative advantages of affiliation with the C. I. O. or A. F. of L. and stated that he would assist the employees in affiliating with either -of these organizations, should they so desire. On June * 17, 1937, a general meeting was held, attended by about 100 employees. They were addressed by Smith who explained' union organization to them, told them that although he was an A. F. of L. representative, he favored the C. I. 0., and that if the employees so desired, he would ascertain whether the C. I. O. would organize them. Many of the employees paid money at this meeting in sums ranging from 50 cents to $2. These payments were intended to be toward initiation fees, but it does not appear that the employees knew which, if any, organization they were joining and the receipts given them were uninformative on, this point. On June 19, 1937, the representatives accompanied Smith to a C. I. O. office in New York City, where the-matter of obtaining a 762 DECISIONS OF NATIONAL LABOR RELATIONS BOARD C. I. O. charter was discussed, and the representatives were •given application cards to.be signed by the employees. It does not appear that these cards were ever used. On June 25, 1937, a general meeting of employees was held at an American Legion Hall in Brooklyn. At this meeting the em- ployees selected McAvoy as president, Stiesi as treasurer, and Herbert Bodtke as secretary. Smith and two C. I. O. delegates addressed the employees on their right to organize and the advantages of affiliation with the C. I. O. and there was some discussion ' by the employees of the question of affiliation with the C. I. O. or the A. F. of L., but no decision was reached. Additional funds were collected at, this meeting, for which receipts were issued. A short time later a meeting for female employees only was ar- ranged by McAvoy in a private home. There they discussed the problem of affiliation with the C. I. O. Silvasi testified that McAvoy expressed opposition to such a move and stated that if the employees joined the C. I. 0., respondent might install machinery in the chute department to the detriment of the employees working there. Ac- cording to Silvasi, McAvoy also suggested that they retain an attorney to confer with the respondent regarding a contract. The employees were sharply divided on, the matter of affiliation with the C. I. 0., but came to no decision. McAvoy did not deny Silvasi's testimony. At this point, near the end of June 1937, while the representatives were in a 'state of indecision as to affiliation, a meeting of all the respondent's employees, including supervisory employees, was held on the fifth floor of the plant during working hours. This meeting lasted about one-half hour. Silvasi testified without contradiction that the meeting was announced on her floor by Assistant Floorlady De Luca and that the machinery was shut down during the meeting. The employees were addressed by L. A. Voltter, treasurer of the re- spondent, who, according to Silvasi, told the employees that he would "never stand for an outside union coming into the plant, . . . [nor] ,have anybody telling him how to run his plant or what to do; that, after all, he was only keeping the plant open as a favor to us [the employees], [and] that he could lock up the place and throw the key away and go back to his chicken farm." Silvasi testified that Voltter thereupon introduced Roth, his attorney, who first asked the employees why "pay tribute to gangsters," and then stated that "every month there would be five dollars paid out of our [their] pay to different causes, and why not, have a committee appointed there and draw up our [the employees'] demands and bring them to Mr. Voltter." According to Silvasi, Roth also observed that "Voltter would give it to us just as well as we could get it through a union, that they were all a bunch of gangsters, in his estimation, * * * ROYAL LACE PAPER WORKS, INCORPORATED 763 and that Mr. Voltter would give to us' [the employees] vacations with pay, and time and one-half overtime, and holidays." Silvasi's testimony is undisputed and we find, as did the Trial Examiner, that Voltter and Roth made the statements attributed to them. After the meeting, the employees discussed the remarks of Voltter and Roth. They expressed concern over his threat to close the plant, and according to Silvasi's uncontroverted testimony, several stated that they would rather have a company union than lose their jobs. The, representatives then met in the anteroom outside Voltter's office with Voltter and Roth. Roth told the representatives, apparently when he was asked to represent them, that he could not do so since he was attorney for the respondent and that if the employees wished to negotiate a contract with the respondent, they should retain their own attorney. The representatives were then left alone by Voltter and Roth to make a decision. After discussion in which McAvoy was the most outspoken advocate of an inside union, the representatives voted to accede to the proposal made by Voltter and Roth to form their own organization to negotiate with the respondent. Four or five of the representatives, including McAvoy, Bodtke, and Stiesi, then proceeded to engage the services of Irving Cook, an attor- ney. The representatives asked Cook to negotiate a contract with the respondent for them and Cook requested them to formulate their demands. The entire group of representatives returned to see Cook on July 8, 1937, and presented the demands of their respective depart- ments dealing with hours of work, rates of pay, vacations, grievances, and job security. At this time the representatives paid Cook $50 for his services. Cook, claiming, to have had no previous experience in such matters and to have known very little about the Act, then visited the Regional Office of the Board, where he obtained a copy of the Act and was told by some unidentified person there that it would be de- sirable for him to obtain a collective bargaining authorization signed by a majority of the employees. On July 15 the representatives con- ferred with Cook again and discussed their demands with him. At about this time Cook communicated. with the respondent for the pur- pose of arranging a meeting to discuss a contract. The respondent stated that it would be necessary for Cook to provide evidence that the representatives had been authorized to act as representative by a majority of the employees. On about July 19 Cook prepared a paper by the terms of which the employees who signed authorized 13 named persons 1 to represent them in collective bargaining with the respondent. The 13 persons named 1 John Coane, John Azurkas , William Brustman , Joseph Nagle, Harry Klonoski, Melvin Schuler, Herbert Bodtke, Harry Piechocki, Jennie McAvoy, Virginia Sofield (Silvasi), Catherine McLaughlin , May Stiesi , and Margaret Maraflno. 764 DECISIONS OF NATIONAL LABOR RELATIONS BOARD were those who had previously been chosen as departmental repre= sentatives. This paper was signed on July 19, 20, and 21, by 148 em- ployees, more than a majority of those employed by ' the respondent. Some signed in Cook's office, some in an office across the street from the plant, and at least 20 in the plant itself, under the following circum- stances, as testified by Cook : "I got in touch with Mr. Voltter, and I told him I couldn't expect all these people to come over to my office ; would it be all'right if I had some of them sign in the outside office at the plant." Cook testified that Voltter gave him permission to use the anteroom outside his office in the plant for the purpose of having the authorization signed and to call McAvoy to help him. Cook went to the plant during working hours and upon arriving told the switch- board operator that he wished to see McAvoy. The latter came down from her place of work on the fourth floor and Cook told her that he desired to obtain additional signatures-to the authorization. McAvoy returned to the plant and shortly thereafter she or one of the other representatives returned with a group of employees. Subsequently another group was brought down in the same way. The employees in both of these groups signed the authorization in an anteroom outside the general offices, on the ground floor of 'the plant, the procedure taking "no more than 1 hour," according to Cook's testimony., Among the signers of the authorization were Helen Bullerjohn, supervisor of the chute girls, and James Brown, assistant foreman in the roll-shelf department. - Shortly before July 22 Cook submitted the demands of the employ- ees to the respondent. The respondent in turn expressed willingness to grant certain concessions including time and a half for overtime for men and time and one-third for women, an 8-hour day and 40-hour week, seven holidays during the year' on which, if the employees worked, they were to receive pay at overtime rates, vacations with pay and a 5-per cent wage increase to all piece workers. The respondent refused to increase the wages of time workers. The demands which had been given Cook by the employees called for wage increases for both piece and time workers, ranging from 20 to 25 per cent, time and half for overtime for all employees, nine holidays per year,, on which, if the employees worked, they would receive pay at two and a half times the normal rate and 1 week's vacation with pay for employees with a year of service. On July 22 Cook and all the representatives met in the plant with the respondent and its attorney for the purpose of discussing the employees' demands. The meeting lasted from lunch time until closing time, the representatives being away from their work during that period. 'No final decision was reached but it was agreed that the representatives would submit a written proposal covering the ROYAL LACE PAPER WORKS, INCORPORATED 765 points at issue. On July 23 Cook met with the' representatives in his office and discussed with them the formulation of their proposal. This proposal was embodied in a letter sent, by Cook to the attorney for the respondent on July 26. With respect to hours, overtime, holidays, and vacations, this proposal reflected the offer originally made by respondent to Cook. However, the representatives still' asked for a 10-percent wage increase for piece workers and an ad- justment of the wages for some time workers. On July 30 Cook conferred with the respondent's attorney who agreed to substantially all of the modified demands of the employees except those calling for a 10-percent wage increase for piece workers. and an adjustment of certain time rates. As to the former, the re- spondent reiterated its 5-percent offer, to which Cook agreed; no provision was made for the time workers. Cook and the respondent's attorney then drafted a contract and later that day the respondent's attorney sent Cook three revised pages for substitution in the contract. Cook testified that after he had received the revised draft, of the contract, he went to the Regional Office of the Board and showed it to some unidentified person there who looked at, it and stated that if a majority of the employees had designated the Committee as their agent, the contract would, be considered in the same manner as any other contract. This person was told nothing of the manner in which the representatives had been selected or of the circumstances sur- rounding the preparation of the contract. At that time, no charge or petition had been filed with the Board and no investigation had been made of the matter. On August 2 the contract was signed by the respondent 2 and the representatives at a conference lasting 2 hours. In this document, for the first,time, the representatives are formally designated as "The Committee" and the offiders previously elected on June 25, 1937, are designated as officers of "The Committee." Revealing of the attitude of Cook and the respondent toward the Committee is the second article of the contract which reads as follows : The employer does hereby recognize and reaffirm the right of the Employees to self-organization and to form an association for the purpose of concerted activities and to bargain collectively through representatives of their own choosing and for their mutual aid and protection. [Italics supplied.] Since this paragraph is based upon Section 7 of the Act,, it was scarcely accidental that the language of that section " . . . to form, join, or assist labor organizations, to bargain collectively through ' Edward Karfiol , president of the respondent, David Groberg, attorney for the respond- ent. and Voltter represented ' the respondent at the conference. - 766 DECISIONS OF NATIONAL LABOR RELATIONS BOARD representatives of their own choosing, and to engage in concerted activities . . . " was replaced in paragraph 2 of the contract by the italicized phrase. It may be inferred that the respondent thus was attempting to emphasize the right of its employees to organize an "association" of their own and to gloss over their further right to join outside labor organizations. We find that by the foregoing the respondent sought to influence its employees to adhere to an in- dependent organization such as the Committee and to refrain from affiliating with any outside labor organization. Prior to the signing of the contract, the representatives were called to the respondent's office where the contract was read to them. They made no objection to it except that the representatives of the men on the fifth floor refused to sign unless their constituents authorized them to do so. The fifth floor employees were sent for, and after con- siderable discussion, and upon their being given bonuses, they agreed to withdraw their objections. The proceedings for the signing of the contract took place during working hours, the representatives and the other employees involved being called away from their work. It appears that none of them, at least of those who worked on a time basis, lost any pay for the time spent in discussion and signing of the contract. After the contract was signed, Cook was paid $1001y the Committee for services rendered. The contract was for a 2-year term and provided for automatic renewal at the end of that time in the absence of notice of termina- tion by either of the parties within 60 days prior to the expiration date. No notice of termination has ever been given and the contract is still in effect. There was never a meeting of the employees to ratify the contract nor has the Committee met since it was signed in 1937. Although the contract provides for a grievance committee, no such committee has ever been designated nor have the representatives acted on behalf of the employees in any matter affecting their relations with the respondent. Such grievances as have arisen have either been wholly ignored for lack of effective representation or have been handled directly by the employee or group of employees affected. "The Com- mittee" has never had any constitution or bylaws or membership or dues requirements, although money was collected from the employees and paid to Cook for his services. In September 1937 McAvoy and- some of the other representatives told Cook that they were interested in incorporating an Employees' Association. It does not appear that this was the result of action taken by the representatives as a group or that they had been author- ized to take such action by the employees. As a result Cook prepared a Certificate of Incorporation under the Membership Corporation ROYAL LACE PAPER WORKS, INCORPORATED 767 Laws of New York.3 The Certificate stated as the purpose of the proposed corporation, "For ,the purpose of securing by united action the most favorable conditions as regards wages, hours, conditions of employment and labor; and by proper means to elevate the moral, intellectual and social conditions of its members." On December 20, 1937, after a hearing at which representatives of the C. I. O. and A. F. of, L. objected that the Committee was company dominated, the Certificate -was disapproved by the Board- of Standards and Ap- peals of the New York State Department of Labor "on the ground that the purposes of the proposed corporation are inconsistent -with the provisions of the Labor Law and public policy."4 Between December 1937 and, the latter part of January 1940, when the Union started its organization drive in the respondent's plant, "The Committee" and the representatives remained inactive. Cer- tain of the representatives left the employ of the respondent during that period, but no successor representatives were chosen. McAvoy was promoted to a supervisory position in 1938 which she held for about a year, and Herbert Bodtke also became a supervisor. Neither McAvoy nor Bodtke was removed as a representative. - Not until the Union began organizational activities among the re- spondent's employees did the members of the Committee again become active. In January or February 1910 when the Union first began its campaign, and again in March 1940 when the organization drive of the Union had made substantial progress; McAvoy and one or two representatives, reported the activities of the Union'to Cook who, on March 13, 1940, prepared a letter to the respondent protesting against any negotiations between the respondent and the Union, and stating that "We can ourselves negotiate a contract with you . ... without the aid of any outside organization," and that "In due time a com- mittee appointed by us will call upon you for the purpose of nego- tiating such a contract." This letter was signed by 129 employees and was forwarded to the respondent by Cook. The respondent informed Cook that since the Union also claimed to represent a majority of the employees, and since the number of signatories to the letter of March 13 left the wishes of a majority in doubt, the respondent could not recognize either group unless an overwhelming majority could be shown to support it. Thereupon, on March 21, the day that the Union called a strike, Cook prepared another letter supplementing the first 3After pieparing the Certificate, Cook received $50 from the Committee for services rendered 4 The respondent, which introduced the above evidence, contends that the Committee's attempt to obtain corporate status is evidence of its freedom fiom company domination. While this testimony is relevant as an account of a phase of the labor relations history of the respondent , it does not have the significance which the respondent would have us attribute to it 768 DECISIONS OF NATIONAL LABOR RELATIONS BOARD one and gave it to McAvoy for the'purpose of obtaining additional signatures. This was done and the second letter, was sent to the re- spondent by Cook. On March 21 the respondent notified the Union that Cook had substantiated his claim that he represented a majority of the employees and that, therefore, the respondent could not deal with the Union. On the same day the respondent issued a mimeo- graphed circular to its employees advising them, among other things, as follows : As you know an outside organization representing only a minor- ity of our workers has called a strike and has intimidated, coerced and threatened our employees with bodily injury if they go to work. We are pleased to see that a good majority of our workers dis- regarded these acts and reported for work this morning, and have been working'all through the day. We assure you that we are deeply appreciative of your attitude and loyalty to the company and in turn we assure you that the company has not been asleep during the day. The attorney for the majority of the employees has informed us that in the near future he will confer with your committee in regard to future terms and, conditions of employment, and we will be glad to bargain with your committee which represents the majority of our employees. [Italics supplied.] The testimony shows that the letters of March 13 and 21, prepared by Cook, were circulated among the employees and were signed by them in the plant during working hours and in some cases at the suggestion of supervisory employees. Nick Benedetto, an employee in the maintenance department, testified that about a week before the strike, he saw one of the employees circulating the March 13 ' letter in the plant and was asked to sign it. According to Benedetto, when he refused to do so, Assistant Forelady De Luca asked him why, and observed, "Isn't it better to play with the bosses than with the Union?" Vera Adams testified to the open circulation of the March 13 letter among the employees on -the fourth floor and to the fact that May Stiesi, one of the representatives,,had the letter on her desk, to which, the other employees went during working hours for the purpose of signing it. Rose Penna, employed on the third floor, testified that the March 13 letter was brought to her during working hours and that she was asked to and did sign it in the presence of James Brown, assistant foreman. She also testified that she signed the March 21 letter'in the plant during lunch hour at the request of McAvoy. John , ROYAL LACE PAPER WORKS, INCORPORATED 769 Hall, an employee, testified that he saw the March 13 letter 6 being circulated in the sample department and heard Helen Bullerjoln, forelady in that department, ask the employees to sign it. Ann Hughes, employed on the fifth floor, testified that she was asked to sign this letter in the plant during working hours by Winifred Rode, assistant forelady, in the presence of De Luca, and that Rode and De Luca also solicited other workers in that department. All of the above testimony is uncontradicted and was credited by the Trial Examiner and we find it to be in accordance with fact. The March 13 letter was signed by De Luca and Bullerjohn, while the March 21 letter was signed by De Luca and Rode. Cook and MdAvoy testified that in May 1940, while the strike of the Union was in progress, and after the Board had intervened in the situation, a group of the representatives, including McAvoy, Marafino, and Stiesi, met with Cook and told him that they desired to demonstrate that they had-the backing of a majority of the em- ployees, and that they wanted to appoint a new committee to bargain with the employer. Cook thereupon prepared petitions stating : We the undersigned . . . do hereby appoint the representatives named below as our "Collective Bargaining Committee" and rep- resentatives to enter into a contract with our employer .. . Cook told the representatives that it was important that the petitions be signed at his office outside of working hoiirs. This was the first time that such a precaution had been taken. Between May 16 and 20, 114 employees came to Cook's office and signed the petitions which desig- nate McAvoy, Stiesi, Marafino, and McLaughlin, all representatives and the first two still officers under the original plan, as their new bargaining committee. It is to be noted that the signers of the petition included Winifred Rode, Rose De Luca, and James Brown, all super- visory employees.. Prior to formation of the Collective Bargaining .Committee, there existed no real organization for collective bargaining by the employees. It is equally clear that formation of the Collective Bargaining 'Committee was merely an attempt to set up a spurious organization for collective bargaining. In contrast to the assistance given Cook and the representatives by the respondent, was the hostility and opposition to outside union activities, expressed by the respondent's supervisory employees. Bene- detto testified that on the day after the first general meeting of the Union, he was asked by his foreman, George Thomas, whether he had been at the union meeting. When, according to Benedetto, he 6 Although the witness could not identify the letter that was being circulated, the surrounding circumstances justify the inference that it was the'March 13 letter. - 323428-42-vol. 27-50 770 DECISIONS OF NATIONAL LABOR RELATIONS BOARD replied in the affirmative, Thomas stated that if he did not stay away from the Union, he would get into trouble. Benedetto further testi- fied that on March 18, 1940, he complained to Thomas that overtime work which had formerly been given him was being given to others, whereupon Thomas stated that if Benedetto stayed away from union meetings and had nothing to do with the Union, he would be better off. It is Benedetto's testimony that he then asked whether he would get his overtime work back if he abstained from union activity, to which Thomas replied, "You play ball with me and I will see what I can do about getting your overtime back again." Ann Hughes testified that in March 1940 Rose De Luca spoke to her on the day after a union meeting, and referred to another employee as having been at the meeting and as being an active union member. According to Hughes, De Luca then said, in reference to the em- ployee in question, "She will be crying for her job when this is all over." Rose Penna, employed in the roll-shelf department, testified that a few days after she first attended a union meeting on February 20, 1940, she was removed from the automatic machine on which she usually worked and,for which she was paid on a piece basis, and was assigned to a hand machine for which she was paid on a time basis at a substantial reduction in pay. She testified that when work was slack on the automatic machines, it was customary for the girls working on them to be assigned to time work, a day at a time in rotation, and that this was the first occasion she had ever been taken off the machines under such circumstances for more than a clay. According to Penna seniority was generally observed in laying girls off the automatic machines and Penna had longer service than two, of the girls who had shown no interest in the Union, and who were kept on the machines when she was taken off. Penny testified that after she had been off the machines for about 4 days, she complained to Charles Schultz, who was in charge of her department. - Penna further testified that he first told her that she had less seniority than the others, but that when she disputed this, he stated that the truth was that he did not like "this Union business." It is Penna's testi- mony that she then told him that she had gone to the union meeting only out of curiosity and that that did not indicate that she wanted the Union and that Schultz then stated that he would try to straighten the matter out and the following day she was restored to her machine. The testimony of Benedetto, Hughes, and Penna is uncontroverted and we find, in accordance with the finding of the Trial Examiner, that the events took place as these witnesses testified. ROYAL LACE PAPER WORKS, INCORPORATED 771 CONCLUSIONS Upon all the evidence , we are satisfied that the respondent in 1937 embarked upon a course of action designed to produce an unaffiliated organization of its employees amenable to its will. As already noted, at a time when employees weref.making,no efforts at concerted activity but had, through their conversation, manifested an interest in unions, the respondent, without any request on their part, instigated the holding of elections for departmental representatives to deal with the respondent. The respondent contends that the evidence relating to the action of the representatives in considering affiliation with the A. F. -of L. and the C. I. O. establishes their freedom from company domination. It is clear, however, that while the representatives apparently, were considering this problem the respondent took strong action to assure that they would not affiliate with any outside organ- ization. This took the form of the general meeting of the employees in the plant during working hours called by the respondent. At the meeting the respondent made clear to the employees that union affili- ation might result in the loss of their jobs and openly suggested formation of a committee of employees to negotiate with the respond- ent. The representatives quickly followed the respondent's plain suggestion , retained an attorney , and, within a month, a contract had been consummated between the respondent and the Committee. Counsel for the respondent contended at the hearing that the Board had approved the Committee's contract and in effect had ".approved"- the parties to the contract , so that the Board had no "right in one breath to put their stamp of approval on a document, and in another breath try to destroy it" by the proceeding herein. This contention apparently is based on Cook's testimony as to his conversations with Board representatives at the Regional Office. Cook could -not identify the person or persons whom he allegedly consulted at the Regional Office. No charge against the respondent had, at that time, been filed, and it is clear that the unidentified individual or individuals in question had no knowledge of the circumstances Surrounding the selection of the representatives and the preparation of the Commit- tee's contract. There is no merit in the respondent's contention that the Board is barred from proceeding herein. We have also considered the fact, urged upon us by the respondent, that no connection was shown between the respondent and Cook, the representatives attorney , and that Cook apparently was paid for his services by funds collected from the employees. We do not feel, how- ever, that these circumstances suffice to support the conclusion that the representatives' actions represented the untrammeled wishes of the employees, when viewed in the light of all of the evidence. For- 772 DECISIONS OF NATIONAL LABOR RELATIONS BOARD mation of the Committee was instigated- and suggested by the re- spondent, as was the contract obtained by it. Supervisory employees were among the signatories of the petitions circulated in the forma- tion of the Committee. Once formed, the Committee failed to call any meeting of employees to ratify the contract or, indeed, to function in any way after the contract ,was signed until over 2 years later, when the Union began its organizational campaign. The Committee pos- sessed none of the features of organization, such as a constitution, bylaws, regular meetings, or grievance committee, that ordinarily characterize truly independent labor organizations. We have already noted the difference in the respondent's attitude toward the Committee and the Collective Bargaining Committee, on one hand, and toward the Union, on the other. The respondent and its supervisory em= ployees instigated formation of the Committee and tolerated the solicitation of membership for the Committee and the Collective Bar- gaining Committee, but also its officials took a more active part in the organizational activities of the two committees. On the other hand, a ,number of employees who joined the Union were soon ap- prised by their supervisors that their union membership was displeas- ing to the respondent. Finally, no effort was made by the respondent to free the employees from the effects of its coercive conduct which had characterizedthe formation and subsequent activities of the Com- mittee and which -actually formed the basis for formation of the Collective Bargaining Committee. Supervisory employees were among the signatories of the petitions circulated in the formation of the Collective Bargaining Committee as well as of the Committee. In view of the background of interference by the respondent, related above, the choice of the employees in designating the Collective Bar- gaining Committee was not a free one, and the latter organization is no more than a thinly disguised revision of the Committee. We find that the respondent has dominated and interfered with the formation and administration of the plan of employee representa- tion created in June 1937, which is referred to in the contract of August 2, 1937, as the Committee, and of the Collective Bargaining Committee created in May 1940, and that it has contributed support thereto. By such conduct, and by the various acts of its officials and supervisory employees detailed above indicating hostility to the Union, the respondent has interfered with, restrained, and coerced its employees in the exercise of their rights guaranteed in Section 7 of the Act. IV. TILE EFFECT OF TIIE 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 re- ROYAL LACE PAPER WORKS , INCORPORATED 773 spondent set forth in Section I above, have a close, intimate, and substantial relation to trade, traffic , and commerce among the several States, and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that the respondent has engaged in unfair labor practices , we will order it to cease and desist therefrom and to take certain affirmative action designed to effectuate the policies of the Act and to restore as nearly as possible the conditions which existed prior to the commission of the unfair labor practices. We have found that the respondent- dominated and interfered with the formation and administration of the plan of employee representation , later designated as "The Committee," and with the formation and administration of the Collective Bargaining Com- mittee, and contributed support to these organizations . In order to effectuate -the policies of the Act and to free the employees of the respondent from the effects of such domination and interference, we shall order the respondent to disestablish and withdraw all recog- nition from the Committee and the Collective Bargaining Committee as the representative or representatives of its employees for the pur- poses of dealing with it concerning grievances , labor disputes, wages, rates of pay, hours of employment , and conditions of employment. - On August 2, 1937, the respondent entered into an agreement with the Committee which provided a means whereby the respondent utilized an employer-dominated labor organization to frustrate self- organization among, and to defeat collective bargaining by, its em- ployees. Under these circumstances , any continuation , renewal, or modification of the agreement between the respondent and the Com- mittee would perpetuate the forces which have deprived employees of the rights guaranteed to them by the Act and would render,in- effectual other portions of our remedial order. - We shall therefore direct the respondent to cease giving effect to any co'ntract existing, or claimed , by it to exist, between it and the Committee, or to any modifications or extensions thereof. Upon the basis of the above findings of fact and upon the entire record in the case , the Board makes the following: CONCLUSIONS OF LAW 1. Federal Labor Union No. 21863, the Committee, and the Col- lective Bargaining Committee , are labor organizations within the meaning of Section 2 (5) of the Act. 774 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 2. By dominating and interfering with the formation and ad- ministration of the Committee and of the Collective Bargaining Committee, and by contributing support to said organizations, the respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (2) of the Act. 3. By interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act, the respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8.(1) of the Act. 4. The aforesaid unfair labor practices, and each of them, are unfair labor practices affecting commerce within the meaning of Section (6) and (7) of the Act. ORDER Upon the basis of the foregoing findings of fact and conclusions of law, and pursuant to Section 10 (c) of the National Labor Rela- tions Act, the National Labor Relations Board hereby orders that the respondent, Royal Lace Paper, Works, Incorporated, Brooklyn, New York, and its officers, agents, successors, and assigns shall: 1. Cease and desist from : (a) In any manner dominating or interfering with the administra- tion of the Committee and the Collective Bargaining Committee, or with the formation and administration of any other labor organization of its employees, and from contributing financial support to the Com- mittee, to the Collective Bargaining Committee, or to any other labor organization of its employees; (b) Giving effect to its contract, dated August 2, 1937, with the Committee or to any renewals, extensions, or modifications thereof; (c) In any other manner interfering with, restraining, or coercing its 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 bargaining or other mutual aid or protection as guaranteed in Section 7 of the Act. 2. Take the following affirmative action which the Board finds will effectuate the policies of the' Act : (a) Withdraw all recognition from the Committee and from the Collective Bargaining Committee as the representative or representa- tives of any of its employees for the purpose of dealing with the respondent in any manner concerning grievances, labor disputes, wages, rates of pay,_ hours of employment, or other conditions of employment, and completely disestablish said Committee and ROYAL LACE PAPER WORKS, INCORPORATED 775 Collective Bargaining Committee as such representative or representatives; (b) Post immediately in conspicuous places in its plant at Brook- lyn, New York, and maintain for a period of at least sixty (60) consecutive days from the date of posting, notices to its employees stating that the respondent will not engage in the conduct from which it is ordered to cease and desist in paragraphs 1 (a), (b), and (c) and that it will take the affirmative action set forth in para- graph 2 (a) of this Order; (c) Notify the Regional Director for the Second Region in writ- ing within ten (10) days from the date of this Order what steps the respondent has taken to comply herewith. i