H. F. Wilcox Oil and Gas Co.

In the Matter of H. F. WILCOX OIL AND GAS COMPANY; WILCOX REFINING DIVISION AND/OR W. M. FRASER and OIL WORKERS INTER- NATIONAL UNION, LOCAL 257 Case No. C-1605.-Decided, November 25, 1940 Jurisdiction : oil producing and refining industry. Unfair Labor Practices Interference, Restraint, and Coercion: anti-union statements; threats of dis- crimination for union activity ; attempt to induce employee to refrain from union activity by promise of permanent job; hastily adopting higher wage schedule at time union was attempting to negotiate contract ; domination and interference with formation and administration of "inside" labor organization. Discrimination: discharges for union activities and because of close relationship of certain employees with union representative. Collective Bargaining: union's majority established by consent election-failure to bargain in good faith. Agreeing to recognize a union as representing only part of an appropriate unit does not constitute collective bargaining. Remedial Orders : reinstatement and back pay; order to bargain collectively. Unit Appropriate for Collective Bargaining : all production, refinery, pipeline, bulk plant, drilling crew, and construction employees of the Company in the Bristow, Stroud, and Oklahoma City areas, excluding supervisory, clerical, office and temporary or extra employees. Alleged lease of part of employer's property held not to affect the appro- priate unit. Provision in prior consent election agreement is pertinent although not conclusive. Definitions The operations of a Company's properties under a contract which pur- ports'to be a lease but which gives the Company power to control the oper- ations constitute part of the Company business. Mr. Charles M. Brooks and Mr. V. Lee McMahon, for the Board. Mr. Horace B. Clay and Mr. D. E. Martin, of Tulsa, Okla., for the respondent Company. Johnson d Jones, by Mr. Fletcher M. Johnson, of Bristow, Okla., for the respondent Fraser. Mr. William M. Bush, of Bristow, Okla., for the Union. Mr. R. L. Bruce and Mr. R. H. Stickel, of Fort Worth, Texas, for the International Union. , Mr. Louis Newman, of counsel to the Board. 28 N. L. R. B, No. 19. . 79 80 DECISIONS OF NATIONAL LABOR RELATIONS BOARD DECISION AND ORDER STATE31ENT OF-THE CASE Upon a fourth amended charge' duly filed by Oil, Workers Inter- national Union, Local 257, herein called the Union, the National Labor Relations Board, herein called the Board, by the Regional? Director for the Sixteenth Region (Fort Worth, Texas), issued- its. complaint dated January 27, 1940, against H. F. Wilcox Oil and Gas Company, Tulsa, Oklahoma, herein called the Company, and Wilcox Refining Division and/or W. M. Fraser, alleging that they had engaged in and were engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (1) and (5) and Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat. 449, herein called the Act, and that the Company had also engaged in and was engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (3) and Section 2 (6) and (7) of the Act. Copies of the complaint and of notice of hearing thereon were duly served upon the Company, Fraser, and the Union.2 With respect to the unfair labor practices, the complaint alleged in substance : (1) that on or about December 11, 1938, the Company and Fraser "purportedly' entered into a contractual relation" under which Fraser has, since January 1, 1939, operated the Company's refinery and pipe-line properties in the State of Oklahoma, "and that this arrangement was made for the purpose of avoiding the Com- pany's obligation to bargain collectively with its refinery and pipe- line employees; (2) that the Company, on or about December 29, 1938, and the Company and Fraser, on or about January 4, 1939, and thereafter, failed and refused to bargain collectively with. the Union as exclusive -representative. of, the employees in a unit appro- priate for the purposes of collective bargaining, although the Union - had prior thereto been designated by a majority of the employees in the appropriate unit as their representative for such purposes; (3) that the Company and Fraser, by refusing to bargain collectively with the Union, and the Company, by other acts and conduct, inter- A charge and amended charges had - previously been filed by the Union on December 12, 1938, January 14, 1939, April 22, 1939, and July 21, 1939. 2 The record shows that "Wilcox Refining Division" is simply the trade name'under which the respondent, Fraser, has since January 1, 1939, operated the Company's refinery and pipe-line system at Bristow , Oklahoma. The so-called Division is not a separate legal entity, and our Decision and Order affect only the Company and Fraser . See Section I B, infra. We shall at times hereinafter refer to the Company and Fraser collectively as the respondents. H. F. WILCOX OIL AND GAS COMPANY 81 fered with, restrained, and coerced their employees in the exercise of, the rights guaranteed in Section 7 of the Act; and (4) that the Com- pany discharged one employee, E. W. Vanmeter, on November 2, 1938, and two other employees, Robert Wendell and Richard Wen- dell, on December 8, 1938, because of their union membership and activities. On February 3, 1940, the Company filed with the Regional Director a motion to make the complaint more definite and certain. There is some dispute as to the Regional Director's ruling, but the motion was subsequently renewed by the Company at the hearing herein and was there denied by_ the, Trial Examiner.3 Although the information which the motion sought to elicit was not furnished by the Regional Director, the Company duly filed an answer consisting of some 17 typewritten pages. There is no indication in the record that the Company was in any way prejudiced, either in its presentation of evidence or in its cross-examination of witnesses, by the Trial Exam- iner's denial of the motion to make more definite and certain. The Company did not claim surprise as to any evidence introduced by counsel for the Board and made no request during the hearing for a postponement to enable it to meet the Board's case. In the absende of any showing of prejudice, we affirm the denial of the Company's motion to make more definite and certain. Thereafter the Company and Fraser filed separate answers to the complaint, dated February 9, 1940, in which they admitted entering into the contract of December 11, 1938, but denied the allegations of unfair labor practices contained in the complaint. The Company in its answer also admitted the discharges of Vanmeter and the two Wendells, but alleged affirmatively that they had been discharged "because of misconduct, unsatisfactory work and neglect in the per- formance of their duties." The Company in its answer also made certain affirmative allegations with respect to the contract of Decem-' her 11, 1938, and further admitted: (1) that the unit alleged in the complaint would be appropriate for the purposes of collective bar- gaining, if the contract of December 11, 1938, had not been made ; and (2) that it had refused to bargain collectively with the Union as the Counsel for the Company stated at the hearing that the Regional Director on Febru- ary 3 , 1940, during a long distance telephone conversation in which Board counsel also par- ticipated, promised to furnish the requested information in writing and to have the com- plaint amended accordingly upon the opening of the hearing This was denied by counsel fol the Board It appears that a stenographic record of the telephone conversation was made by an employee of the Board in the Regional Office, and Company counsel has therefore charged the Board with "wiretapping" and requested at the hearing that a certified copy of the stenographic record of the conversation be produced The characterization of re- cording a telephone conversation as "wiretapping " is obviously frivolous . Since the Com- pany has not been prejudiced in any way by its failure to receive the information' requested in its motion, we affirm the Trial Examiner 's denial of the Company's request for produc- tion of a certified copy bf ' the stenographic record of the telephone conversation. 82 DECISIONS OF NATIONAL LABOR RELATIONS BOARD representative of the refinery and pipe-line employees at Bristow, Oklahoma.4 Pursuant to notice, a hearing was held at Bristow, Oklahoma, from February 12 through February 23, 1940, before Henry W. Schmidt, the Trial Examiner duly designated by the Board. The Board, the Company, and Fraser were represented by counsel, the Union by one of its officers, and all participated in the hearing .5 Full opportunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing upon the issues was afforded all parties. ' At the opening of the hearing the Company filed a written motion to dismiss the complaint on the ground that it was "not signed and issued by the Secretary of the Board or the Assistant Secretary of the Board." The motion was denied by the Trial Examiner. During the course of the hearing the Trial Examiner granted a motion by counsel for the Board to strike froi i the Company's answer allegations that certain representatives of the Board had attempted to intimidate and coerce it into reemploying Robert and Richard W'endell.6 The Trial Examiner also granted, without objection, a motion by counsel for the Board to conform the complaint to the proof as to names, dates, and other formal matters. At the close of the Board's case and again at the close of the hearing, the Company and Fraser made motions to dismiss the complaint, which were denied by the Trial Examiner. Rulings on other motions and on objections to the admission of evi- dence were also made by the Trial Examiner during the course of the hearing. The Board has reviewed all the rulings of the Trial Examiner and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Company and Fraser requested and received leave to file briefs with the Trial Examiner within 20 days after the close of the hearing, but failed to do so. Thereafter the Trial Examiner issued his Intermediate Report dated June 7, 1940, copies of which were duly served upon the Com- pany, Fraser, and the Union.7 In his' Intermediate Report, the Trial Examiner found that the Company and Fraser had engaged in and were engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (1) and (5) and Section 2 (6) and (7) of the Act, and that the Company had also engaged in and was engaging 4 The Company further alleged in its answer that certain representatives of the Board had attempted to intimidate and coerce it into reemploying Robert and Richard Wendell. These allegations are noted by us below. 6 Representatives of Oil Workers International Union also entered their appearance and attended the hearing 6 The Trial Examiner also excluded evidence offered by the Company in support of these allegations in its answer . This evidence , like the allegations in the Company's answer, is irrelevant to the issues involved in the proceeding, and we therefore affirm the Trial Examiner 's ruling. 7 A copy of the Intermediate Report was also served upon Oil Workers International Union. H. F. WILCOX OIL AND GAS COMPANY in unfair labor practices affecting commerce, within the meaning of Section 8 (3) and Section 2 (6) and (7) of the Act. He, recommended that they cease and desist therefrom and that they take certain affirm- ative action designed to effectuate the policies of the Act. On July 3, 1940, the Company and Fraser filed with the Board their exceptions to the Intermediate Report, and on July 26, 1940, pursuant to an extension of time granted by the Board, the Company submitted a brief in support of its exceptions. The Union did not file exceptions or a brief and none of the..parties requested leave to argue orally before the Board. The Board has considered the exceptions of the Company and Fraser to. the Intermediate Report, and also the brief submitted by the Company, and finds the exceptions to be without merit in so far as they are inconsistent with the findings of fact, conclusions of` law, and order set forth below. Upon the entire record in the case, the Board makes the following: FINDINGS OF FACT I. THE BUSINESS OF THE RESPONDENTS A. Prior to 1939 H. F. Wilcox Oil and Gas Company is a Delaware Corporation licensed to do business in the State of Oklahoma and having its prin- cipal office in Tulsa, Oklahoma. Prior to January 1, 1939, it was engaged in the business of producing, refining, and distributing crude petroleum, natural gas, and petroleum products. Production of crude petroleum was carried on by the Company in the States of Texas, Oklahoma, and Kansas, in which it operated 70, 155, and 11 wells, respectively. The Company also maintained and operated drilling, pumping, and storage equipment in all three 'of these States. More than 50 per cent of this equipment was originally manufactured in and obtained from other States, though most of the actual purchases were made by the Company from supply, houses within these States and particularly within the State of Texas. Dur- ing 1938 the Company's purchases of drilling and pumping equip- ment for all of -its wells averaged approximately $1,000 per day. Replacement parts and other equipment were shipped by the Com- pany from State to State, as required in its business. The Company's production of crude petroleum during 1938 was approximately 400,000 barrels in Texas and approximately 800,000 barrels in Oklahoma.8 This crude petroleum, as well as natural gas extracted from some of the Company's properties, was sold largely B The record does not show the Company's Kansas production. 413597-42-vol. 28-7 84 DECISIONS- OF NATIONAL LABOR RELATIONS BOARD to various nationally known oil and pipe-line companies, though part of the crude petroleum produced by, the Company in Oklahoma was transported to ,its own refinery at Bristow, Oklahoma, and • there refined. This and other crude petroleum refined in the Company's Bristow plant was transported there through a pipe-line gathering system owned and operated by the Company. The present proceeding is concerned primarily with the Company's properties and employees in and about Bristow, Stroud, and Okla- homa City, Oklahoma. Prior to June 1938 the pipe-line system through which the Company's Bristow refinery obtained most,or all of its crude petroleum was limited to the Bristow area. During June 1938- the system was.extended by the Company to the Stroud area, in which the Company has a number of wells. Approximately' 1,000 barrels of crude petroleum per day, of which about half came from the Company's wells and half from the Oklahoma wells of other, oil producers, were received at the Company's Bristow refinery prior to the extension of its pipe-line system; subsequent thereto, the amount of crude petroleum received at the Bristow refinery from the Company's wells was increased to approximately 2,000 barrels per day. A total of approximately 900,000 barrels of crude petroleum was processed at the Company's Bristow refinery during 1938, resulting in approximately 500,000 barrels,of gasoline, approximately' 125,000 barrels of kerosene, and approximately 125,000 barrels of fuel oil. Of these products, 40 per cent of the gasoline and 80 per cent of the kerosene were shipped out of Oklahoma into other States, and substantially all of the fuel oil was sold to the St. Louis-San Fran- cisco Railway Company, an interstate common carrier. B. The "Lease" of December 11, 1938 The Company's production of crude petroleum during 1939 re- mained much the same as it had been during 1938, except that its Oklahoma production was slightly higher. The amount of crude petroleum carried through its pipe-line system in the Bristow and Stroud areas was increased to approximately 123,000 barrels per month, of which approximately 82,000 barrels came from the Com- pany's wells. A total of approximately 1,400,000' barrels of crude petroleum was refined. at the Bristow refinery during 1939, resulting in approximately 800,000 barrels of gasoline, approximately 200,000 barrels of kerosene, and approximately 200,000 barrels of fuel oil. Of these products, 45 per cent, of' the gasoline and 80 per cent of the kerosene were shipped outside the State of Oklahoma, and substantially all of the fuel oil was again sold to the St. Louis- San Francisco Railway Company. H. F. WILCOX OIL AND GAS COMPANY 85 On December 11 or 12, 1938, the Company and the superintendent of its Bristow refinery, William M. Fraser, signed a written con- tract dated January 1, 1939, providing for the operation by Fraser, on and after January 1, 1939,, of the Company's refinery and bulk plant at Bristow and the connecting pipe-line system. The Com- pany and Fraser insist that this contract was a lease of the proper- ties in question by the Company to Fraser, that Fraser has since operated these properties independently and without company con- trol, and that the operation of these properties is therefore no longer a part of the Company's business. - This arrangement between the Company and Fraser was ad- mittedly suggested by and modeled after a similar arrangement be- tween the Company and-L., G. Murrell with respect to the Com- pany's distributing properties." 'The contract between the Com- pany and Murrell, dated-February 1, 1937, gave Murrell "full and complete control, supervision and operation of all its service, or filling stations and bulk plants," with the exception of the "refinery bulk station" at Bristow and a service station at Tulsa. The con- tract provided that these properties were to be operated by Murrell under the trade name of "L. G. Murrell, Marketer and Jobber" and that he was to give the Company a bond in the sum, of $25,000 for the faithful performance of his duties. In return, Murrell was to receive $315.00 a month plus a "bonus" of 10 per cent of the net profits realized from the operation of the properties. The arrange- ment could be terminated by the, Company at any time upon pay- nient to Murrell of 1 month's compensation in advance plus any accumulated bonus, and by. Murrell upon giving the Company 30 days' notice. The arrangement with Murrell continued in effect through 1938. Losses suffered by the Company in the operation of its Bristow re- finery led to consideration by the Company and Fraser of an ar- rangement with respect to the refinery similar to that between the Company and Murrell with respect to the Company's distributing properties. Conferences between Company officers and Fraser, the gist of which 'does not appear in detail in the record, resulted in the signing on December 11 or 12, 1938, of the document which the respondents assert is a lease. The document provided for the trans- fer to Fraser, as of January 1, 1939, of "full and complete control, supervision and operation" of the Company's Bristow refinery, its "tank farm storage" at Bristow, its pipe-line gathering system, its tank cars, and all other facilities used in the transportation of crude 9 These properties are operated by Murrell as the Company's marketing division. They include approximately 27 bulk and retail stations in Kansas , 15 in Missouri , 15 In Okla- homa, and 1 bulk plant in Texas The major part of the net profits realized from their operation goes to the Company. 9 86 DECISIONS OF NATIONAL LABOR RELATIONS BOARD oil to the refinery and in the manufacture and sale of refined prod- ucts. These properties were to be operated by Fraser under the trade name, "Wilcox Refining Division," and Fraser was to give the Company a "fidelity bond" in the amount of $25,000 guaranteeing the faithful performance of his "duties." As "compensation for managing and operating" the properties in question, Fraser was to receive $380.00 a month plus a "bonus" of 10 per cent of the net profits derived therefrom. This bonus was to be fixed or computed not on a calendar year basis, but on a cumulative basis, so that no bonus would be payable to Fraser unless, at the time of computation thereof, the operations of the properties' under Fraser's supervision showed a net profit for the entire period since January 1, 1939. Un- less permanent pipe-line connections (apparently other than those provided by the Company's pipe-line system) with substantial re- ductions in the price of crude oil were obtained by Fraser, the_ re- finery was to continue to take the oil from Company leases at the Company's posted market price, "as has been the practice in the past." Fraser was to furnish the Company with complete monthly financial statements, together with supporting schedules and analyses "as prescribed by the Company," and was to obtain Company ap- proval of all disbursements for capital improvements and additions in excess of $500. The current assets of the "Refining Division," as reflected ' on the books of the Company on December 31, 1938, were to be charged-to';the "Capital Account-of the-Refining Divi- sion," and the Company was in addition to supply sufficient cash to bring the "net working capital of the Refining Division" as of January 1, 1939, up to $2,500. The Company was given the right to terminate the arrangement at any time upon payment to Fraser of 1 month's compensation in advance, plus any accumulated bonus, and Fraser was given the right to terminate the arrangement upon giving the Company 30 days notice in writing.10 10 The document is of sufficient importance to be set forth here at length : H. F. Wilcox Oil & Gas Company, Tulsa, Oklahoma, proposes to turn over to you as of January 1, 1939, the full and complete control, supervision and operation of its refinery, located at Bristow, Oklahoma, together with its tank farm storage located at Bristow, Oklahoma ; its pipe line gathering system now operating to run oil to the refinery ; all Company owned tank cars, and any other facilities now being used in con- nection with the transportation of crude oil to the refinery, and the manufacture, sale or disposition of refined products, subject to the following conditions. 1 Properties to be operated under the trade style or name of "Wilcox Refining Division". 2. You to furnish the Company a fidelity bond in the amount of $25,000 00, guaran- teeingthe faithful performance of your duties 3 The operation of the Division to be completely decentralized in that you are to make all purchases of raw materials, supplies, etc , pay all bills, royalties, payrolls, etc , supervise the issuance of credits, collections on accounts, notes, etc , and main- tain your own sales department for the disposal of your products. The one exception to this rule is the work performed by A. L. Chapman in connection with the issuance of Division of Interest sheets, which will be-handled as in the past, and for which the H. F. WILCOX OIL- AND GAS COMPANY 87 In January 1940 this arrangement between the Company and Fraser was renewed upon substantially the same terms." Operation of 'the Company's refinery and pipe-line properties under this arrangement with Fraser was much the same as it had been before. Fraser's fixed monthly compensation of $380.00 was the same as it had been prior to January 1, 1939, when he was ad- mittedly employed by the Company as its refinery superintendent. Although Fraser, at the hearing, denied that he was under any legal Company will bill the Refining Division, monthly, in the amount of $100 to cover expenses incurred by Mr. Chapman in,maintaining records, etc. 4 Your compensation for managing and operating the properties mentioned herein shall be $380.00 per month, plus a bonus of 10%Jo of net profits therefrom, calculated before depreciation charges and exclusive of any profit or loss accruing from the sale or abandonment of capital assets. It is also understood that the calculation of the 10% bonus is to be made on the accumulation of net profits over net losses. The period for calculation of said commissions shall be cumulative and not for the calendar year in that all prior losses shall be absorbed by subsequent profits before commissions become payable. Settlement of commissions , when payable, shall be semi-annual, and as soon as practical after January 1st and July 1st. N 5. It is to be understood that, all things being equal, that is, unless permanent pipe line connections with substantial reductions in the price of crude oil are obtained, the Refining Division will continue to run the oil from Company leases at the Wilcox' posted market price, as has been the practice in the past. 6 This arrangement for the supervision and operation of said properties may be terminated by the Company, at any time, upon the payment to you of one month's compensation of $380 00 in advance, plus any accumulated bonus, as aforesaid ; or it may be terminated by you upon giving the Company thirty days' written notice. ,7. You shall furnish to the Company, as soon as practical after the close of busi. ness each month, complete financial statements , together with supporting schedules, and analyses , as prescribed by the Company. 8. On disbursements of funds for capital improvements , additions or betterments in excess of $500.00, you shall obtain the full approval of the management of the Company. 9. Working Capital-Inventories as at December 31, 1938, shall be taken, of all crude oil, refined products, chemicals , supplies, etc , together with accounts receivable and any , other accounts affecting the current assets and liabilities of the Refining Division as reflected on the books of the Company at December 31, 1938, and shall be charged to the Capital Account of the Refining Division. Sufficient cash shall be sup- plied by the Company to bring the net working capital of the Refining Division, as at January 1, 1939, to $2,500.00. In the event bank balances of the Refining Division exceed an amount necessary for the competent and continued operation of the proper- ties, such funds in excess shall be remitted to the Company, and will operate to reduce the Capital originally advanced 10. It is to be understood that you shall maintain insurance on the properties cov- ered by this agreement on the same ratio to investment as is in effect at the date of this agreement, and also that proper compensation and liability insurance shall be maintained. 11. The full and complete control , operation and supervision of said properties shall be construed to mean, (subject to foregoing exceptions and comments ), that the man- agement of said properties , the purchase and sale of products therefor and thereat, the expense of operation thereof and in conection therewith, and the employment of clerks and workmen , and the fixing of their compensation , shall be entrusted to your judg- ment absolutely. a The 1940 contract provided for an increase in Fraser's monthly compensation from $380 to $500, with the proviso that the difference was to'be charged against any bonus which might become payable to Fraser under the terms of the contract. The 1940 contract also provided for payment to the Company of 5 cents for each barrel of oil pumped through Its pipe-line system and of a pumping charge of 1 cent per barrel for oil produced from certain wells. t 88 DECISIONS OF NATIONAL LABOR RELATIONS BOARD obligation 12 on and after January 1, 1939, to take from the Company the crude oil produced at its wells, his denial is clearly contrary to the provisions of Section 5 of the contract and he, himself, admitted that in practice the Bristow refinery continued to take -the entire output of crude oil from Company leases reached by the pipe-line system. Despite the fact that it is customary in the industry for refiners to post a price for crude oil at which it is understood all purchases from producers are made, Fraser continued after January 1, 1939, to "buy" crude oil from the Company at its posted price. Indeed, Fraser continued to pay the Company's posted price for all crude oil purchased for use in the refinery, including oil pur- chased from producers other than the Company. T. H. Riggin, who acted as sales manager for the Company prior to 1939, was retained' in that capacity for the so-called Refining Division. He was paid the same salary in 1939 as in 1938 and, at the time of the hearing herein, was occupying an office in the Company's' office building in Tulsa, Oklahoma'."' In 1938 Riggin had negotiated a contract with the St. Louis-San Francisco Railway Company for the delivery of fuel oil by the respondent Company to the railroad. Deliveries under this contract continued to be made by Fraser subsequent to January 1, 1939, 'at the same contract prices and in accordance with arrangements made by Riggin in the same, manner in which he had made them while employed as the Company's sales manager. Simi- larly, a group insurance policy covering the refinery employees was simply continued in force after Fraser took over, apparently without any question as to the alleged change in status of the employees in question. This presented no practical difficulties, since the refinery personnel continued unchanged after January 1, 1939; although Fraser at once had all the refinery employees make out new appli- cations for employment, he admittedly never looked at these applica- tions after they had been filled out. For new employees hired after January 1, 1939, Fraser used the same form of employment applica- tion blank as had the Company, even though the form had printed on it the name "H. F. Wilcox Oil & Gas Company." The Company's name also appeared: (1) on the form of time card used by it-in the refinery prior to January 1, 1939, and continued in use thereafter by, Fraser, and (2) as a background on the checks used by the "Refining Division" during 1939 and 1940.14 A direct telephone line 12 Fraser conceded that he was under a moral obligation to do so. 13 Fraser testified at the hearing that Riggin 's office in the Company 's Tulsa building was rented by him from the Company and had been occupied by Riggin only since October 1939 Prior thereto, Riggin had occupied office space rented by Fraser in another building in Tulsa. 1; Fraser explained at the hearing that the form of check bearing the Company's name was not changed because it would have cost $50.00 to have a new plate made. -H. F. WILCOX OIL AND GAS COMPANY 89 between the refinery and the Company's offices in Tulsa was con= tinned in operation subsequent to January 1, 1939, although Fraser testified that he paid the Company $100 a month for its use. Fraser has never registered in any government office as doing business under the trade name and style of Wilcox Refining Division, nor has he changed in any way the standards or specifications observed at the refinery in the manufacture of gasoline. In explaining the making of the contract, the Company and Fraser repeatedly asserted that it was suggested by and modeled after the Murrell contract, which had produced such satisfactory re- sults. It may, then, reasonably be assumed that the Fraser contract was intended to and did establish the same relationship between him and the Company as the earlier contract had established between Murrell and the Company. It therefore become significant that the minutes of a meeting on December 11, 1938, of the Company's execu- tive committee, at which the proposed contract with Fraser was dis- cussed and approved, refer to Murrell as a department head of the Company.15 Of similar import is the testimony of Morris Harrison, a witness at the hearing, that he was first employed by the Company in 1929; that he has always worked in the marketing department; that he has been and is working under Murrell, and considers him- self still an employee of the Company; and that Murrell is known to him and others as the Company's sales manager."' It also appears that Fraser, during the latter part of 1939, appeared before a meet- ing of the stockholders of the Company and delivered an oral report presumably on the operations of the refinery. We are convinced by the facts above recited, and we find, that the - contract between the Company and Fraser was not a lease of the Company's properties referred to therein and that the operation of those properties,, though confided to. Fraser's care and supervision, continued to be part of the Company's business. The contract, itself, has none of the ordinary provisions of a lease. It contains no ex- press words of conveyance or lease, providing only that Fraser should have "control, supervision and operation" of the properties The pertinent part of the minutes to which we refer reads as follows : A discussion was had relating to the future operation of the refinery. The following Department Heads were invited to sit in the meeting to participate in the discussion of the, subject: H. B. Ward William Fraser T. H Riggin W. R Bingham C. L. Miller L. G. Murrell A. L. Chapman [Italics supplied.] 1e Harrison pointed out that the marketing department has separate offices and a separate bank account. These, however, may be due as much to desired convenience in location and bookkeeping as to absence of Company control over the operations of the marketing department. 90 DECISIONS OF NATIONAL LABOR RELATIONS BOARD covered. No rent or other consideration is reserved by the Company, for permitting the use of its properties; rather, it exercises the pre- rogatives and incurs the risks of ownership management by taking the profits. Fraser receives a' fixed amount per month as "com- pensation for managing and operating the properties mentioned herein," plus a "bonus" of 10 per cent of the net operating profits. To guarantee the faithful performance of his "duties" in "managing and operating the properties," Fraser gives the Company a bond in the amount of $25,000. Working capital is provided by the Com- pany and is to be returned to it as excess funds become available out of the operations of the "Refining Division." Most important of all, perhaps, the Company retains the right to terminate its arrange- ment with Fraser at any time, upon payment of 1 month's compen- sation plus any accumulated bonus, thereby giving it the same means of control over Fraser as it has over any employee and as it had over Fraser himself before the contract was made. In this essential respect Fraser's position has not in any way been changed. .The execution of the contract produced no appreciable change in the operation of the properties which it covered. The refinery, bulk plant, and pipe-line system continued functioning with the same personnel'and as an integral part of the Company's business. The Company's entire output of crude petroleum from wells reached by its pipe-line system continued to be taken by the refinery for proc- essing' purposes, Purchases of crude oil for use in the refinery, whether from the Company or from other oil producers, continued to be made at the Company's posted price, although it is the practice in the industry for the purchasing refinery to fix and post the price at which if buys. Deliveries under a fuel oil contract between the Company and the St. Louis-San Francisco Railway Company contin- ued to be arranged and made subsequent to the contract's expiration on January 31, 1939, without any question as to Fraser's new status and,without the execution of a formal contract. There is evidence that Murrell, with whom the Company has an arrangement sub- stantially the same as that with Fraser, is regarded as being essen- tially the head of a department or division of the Company's busi- ness; and Fraser's appearance at a meeting of the Company's stock- holders to report on the operations of the refinery can be regarded only as a concrete manifestation of the obligation owed by an oper- ating executive to the owners of the business by which he is employed. Similarly, if ' Fraser were really an independent entrepreneur who has leased the properties necessary for the conduct of his business, it is unlikely that he would have retained so many of the outward signs of Company ownership and operation. H. F: WILCOX OIL AND GAS COMPANY-''' - - 91 There is testimony in the record that, beginning January 1, 1939, Fraser's operation of and supervision over the refinery, bulk plant, and pipe-line system were uncontrolled and unsupervised by the Com- pany's officers; This testimony stands without direct contradiction, though it must be clear that such testimony is by its very nature diffi- cult to controvert except through the mouths of interested witnesses. Taking the testimony at its face value, however, we do not believe that it changes the situation in any important respect. We have al- ready referred to the provision in the contract empowering the Com- pany to terminate the contract at any time upon payment to Fraser of 1 month's compensation in advance. Like the power to discharge which is the employer's ultimate means of control over his'employees, the Company's right summarily to terminate the contract gives it complete control over Fraser's supervision and operation of the refinery, bulk plant, and pipe-line system. That the Company's- power of control may not in fact have been exercised is immaterial, since the right to control rather than actual exercise of that right is the touchstone of the employer-employee relationship. We find that the contract between the Company and Fraser was not and is not, either in law or in fact, a lease by the Company to Fraser of the properties therein mentioned, and that the operation of these properties subsequent to December 31, 1938, continued to constitute a part of the Company's business." II. THE ORGANIZATION INVOLVED Oil Workers International Union, Local 257, is a labor organiza= tion chartered by Oil Workers International Union, which is affili= ated with the Congress of Industrial Organizations.- It admits to membership, among others, all persons employed by the Company in the Bristow, Stroud, and Oklahoma City districts, excluding super- visory and clerical employees, but including production, refinery, pipe-line, bulk plant, 'drilling crew, and construction employees. III. THE UNFAIR LABOR PRACTICES A. Interference, restraint, and coercion The Union was first chartered in 1933, when it was affiliated with the American Federation of Labor. In August or September 1938 the Union renewed its efforts to organize the employees of the Com- 17 Cf. Matter of The Park Floral Company and United Greenhouse and Floral Workers Union No. 510 of the United Cannery, Agricultural, Packing and Allied Workers of America, affiliated with the Congress of Industrial Organization, 19 N L R. B. 404; Matter of Inter- state Granite Corporation and Granite Cutter's International Association of America, Char- lotte Branch, 11 N. L. R. B. 1046. 92 DECISIONS OF NATIONAL LABOR RELATIONS BOARD .pang. Frank Dunn, the Company's vice president, admitted at the hearing that he began to hear rumors of union activity among the Company's employees in September 1938. By October of that year the Union had succeeded in persuading a substantial number of the Company's employees to join or rejoin, although the Union's •organiz- ing efforts continued through November and December. On October 7, 1938, the Union held a meeting in Bristow. Ores Flinn, who was then employed by. the Company as a roustabout in the Stroud area, attended the meeting and joined the Union.1s While Flinn was at the meeting,. Frank Riley, who was then a farm boss or lease foreman in charge of some of the Company's wells in the _ Sac-Fox ai ea, called at Flinn's home and inquired for him. Flinn, his wife, and Riley had been friends since childhood,,and Riley had been instrumental in Flinn's obtaining employment with the Company. In the course of his conversation with Mrs. Flinn, Riley indicated, that he knew or guessed that Flinn was attending the union meeting. Mrs. Flinn testified at the hearing that Riley then made the following remarks, among others : Ores thinks he is helping himself, but he is not, because if he goes over there and joins that union or signs any kind of papers I am going to' lay him off. We will lay off all the men that go to the union and sign papers. We will lay them all off and hire new men to suit ourselves. * * * I thought Ores had more sense than that. He might have to go hungry, and I don't care much if he does. Riley denied- at the hearing ever having made these statements or any other statements with respect to the Union to Mrs. Flinn, and also 'denied ever having seen Flinn or any other employees of the Company wearing union buttons. The Trial Examiner, on `the basis of his observation of the witnesses, and relying in part upon the friendly relationship between the Flinns and Riley and upon the role subsequently played by Riley in the Independent Employees Asso- ciation, discussed below, found in his Intermediate Report that Mrs. Flinn's testimony was entitled to credence over Riley's denial. We agree with the Trial Examiner's view and sustain his finding. Flinn, himself, testified that sometime during November 1938 Riley urged him to use his influence with other employees of the Company to have them drop out of the Union, and promised Flinn that if he did so he would have permanent employment with the Company. Riley at first denied having made this statement to Flinn; later, however, he admitted having been with Flinn at the time and place "Flinn testified that he joined the Union on November 7, 1938, at the above-described meeting, but other testimony in the record fixes the date of the meeting as October 7, 1938 F. ' WILCOX OIL AND GAS COMPANY 93 at which Flinn testified the statement was made, but claimed that he did not remember his conversation with Flinn at the time. Here, again, the Trial Examiner who heard the witnesses rejected Riley's testimony and accepted as true the testimony which Riley denied. In View of Riley's subsequent interest in the activities of the Inde- pendent Employees Association , we sustain the Trial Examiner's find- ing that Riley made the request and promise attributed to him by Flinn. It also appears from the record that the Company 's refinery super- intendent, Fraser, like Riley, was opposed to the Union . On October 11, 1938, one of the Company 's refinery -employees, Francis N. Wright, joined the Union. Approximately 2 weeks later, in the course of a conversation , at the refinery, Fraser asked Wright if he did not think he had made a mistake by joining the Union. On several occasions thereafter, while explaining to refinery employees a new wage scale promulgated by the Company to comply with the` Fair Labor Stand- ards ' Act of 1938, Fraser commented that $2.00 a month would have to be set aside by the employees for payment of union dues. It was also testified at the hearing that Fraser, early in December 1938, after' the Union had presented a proposed contract to the Company and had filed with the Board a petition for investigation and certification of representatives , said to two or three of the Com- pany's' refinery employees : "If you boys would forget this damned union and think about your bread and butter , we would get along mighty well." Later in December, while an election was being con- ducted by the Board among the Company's employees, Fraser is alleged to have said to one of the Company's employees , Goodwin : "I am certainly surprised to think a man of your intelligence would stoop so low as to associate with a bunch of reds and highbinders like John L. Lewis amid his C . I. 0." Both these statements were denied by Fraser. As to the first, he claimed that at the time the remark is alleged to have been made he and the men were excited over 'a threatened accidental shut-down of one of the refinery stills , and that even then all he said was : "If you boys would think more of your work and drop this union discussion on the ground , why, we will get along better out here. " ' As to the second alleged remark, Fraser testified that he had simply pointed out to Goodwin during the elec- tion that union representatives were soliciting votes at or near the polling booths and had asked Goodwin whether he wanted to asso- ciate with a group which stooped to such low tactics. The Trial Examiner held, in his Intermediate Report, that Fraser's denials and explanations were entitled to as little credence as those offered by Riley, and found that the statements attributed to Fraser had actually been made. In view of the part subsequently played by Fraser in the 94 DECISIONS OF NATIONAL- LABOR RELATIONS BOARD relations between the Union and the Company, and particularly in view of Fraser's subsequent refusal to deal with the Union, we believe the Trial Examiner was justified in finding as he did. We sustain his finding. Prior to October 24, 1938, the effective date of the wage and hour provisions of the Fair Labor Standards Act of 1938, most of the Company's employees worked 56 hours a week and all of them except common laborers were paid on a monthly salary basis. To meet the requirements of the Fair Labor Standards Act, the: Company, follow- ing extended conferences among its officers, announced various adjust- ments in the wage rates which it would pay. The record indicates that these adjustments included placing most of the Company's employees on an hourly pay basis and resulted in smaller net income for many of them. At about the same time, on October 25, 1938, the Company posted-a notice that the refinery would be shut down on November 1. The day the notice was posted, William M. Bush, an officer of the Union and an employee of the Deep Rock Oil Corporation, telephoned Fraser to inquire as to how long the refinery would be shut-.down and as to the. Company's rehiring the laid-off men when -operations were resumed."' Bush was informed by Fraser that the refinery would be closed 30 to 60 days and that all the men would be rehired when the refinery was reopened. In the course of the conversation, which included some discussion of the Union, Fraser asked Bush who was "stirring up all the trouble among the employees." Bush replied that there was no trouble and that the mere fact that employees joined a labor organization did not mean trouble. Bush - requested Fraser to meet with a committee from the refinery, but Fraser refused on the ground that nothing could be done about the shut-down and that he therefore saw no reason for a meeting. The morning of the following day, October 26, Bush called on Fraser, told him that the Union wanted to enter into a contract with the Company, and handed him a copy of a proposed contract which had been prepared by the Union. Fraser at first declined to accept it, saying that he had no authority to bargain with respect thereto, but eventually took it with the understanding that he would trans- mit it to Frank B. Dunn, the Company's executive vice president. During the course of their conversation that morning, Fraser and Bush discussed unions in general and Fraser commented that he' had been in touch with many labor organizations and could not see that they had ever helped employees to any great extent. Later the same day Bush agaili called on Fraser and was told that Dunn had 19 At the hearing, Fraser testified that he had no recollection of Bush's telephone call, but did not deny that it had taken place. WILCOX OIL AND GAS-COMPANY 95 already been there and had taken with him the copy of the Union's proposed agreement. On ,October 28 Bush wrote. to Dunn at the Company's office in Tulsa, requesting him to arrange to see the union committee. On the same day Fraser submitted to Dunn in Tulsa a proposed .new wage. scale based on the rates being paid by Bush's employer, the Deep Rock Oil Corporation. Despite the extended study of wage rates which had been made by the Company's officials during the several months preceding the effective date of the Fair Labor Stand- ards Act, the new scale of wages presented by Fraser was approved and adopted by the Company's executive committee almost immedi- ately upon, its presentation. Dunn admitted at the hearing that he did not make a study of the new wage scale before it was adopted, and asserted that he did not remember what led to its acceptance by the Company's executive committee. The next day, October 29, Fraser,assembled the available refinery employees, informed them of the proposed action by the Company with respect to wage scales, and asked them to express their approval or disapproval by way of a vote. Since the new wage scale meant a decrease in working hours coupled with an increase in aggregate income for many of the em- ployees, it was naturally approved by the employees present. On October 30 Fraser posted, a notice of the new wage rates, and on November 1 they became effective. The same notice confirmed an- announcement which Fraser had made at the preceding day's meet- ing to the effect that the Company was also granting a 1-week vacation with pay to employees of 1 year's standing, and a 2-week vacation with pay to employees of 2 or more years' standing. The notice of October 30 also stated that the refinery, which had been shut down a few days prior to the previously announced date of November 1, would-"start up" on November 1 on a 40-hour per week basis. There is testimony in the record that Fraser, at the meeting of refinery employees on October 29, 1938, stated that the new and higher wage rates were being put into effect because of the Fair Labor Standards Act and not because of the activity of the Union. At the hearing, however, Fraser admitted that the changed schedule which became effective November 1, 1938, was in addition to wage and hour changes which had previously been made by the Company to comply with the Fair Labor Standards Act. That the Com- pany's action in raising wage rates and reducing hours of work on November 1, 1938, so soon after the wage and hour changes induced by the Fair Labor Standards Act, was considered with suspicion even at the, time appears from a portion- of Fraser's notice of Oc- 96 DECISIONS OF NATIONAL LABOR RELATIONS BOARD tober 30, 1938.20 Fraser explained at the hearing that this part of the notice had been prompted by charges then being circulated among the refinery employees that the- Company's action was not being taken in good faith. In view of the incredibility of the expla- nation for the raise advanced by Fraser at the meeting of October 29, 1938, the haste with which the new schedule was proposed and adopted, and the close connection in time between the Union's re- quest for recognition and a contract 'and the Company's announce- ment of the wage increase, we believe that the suspicions expressed at the time by the Union and the Company's employees were well founded. We are borne out in this 'conviction by the Company's admitted financial embarrassment during the fall of 1938, which led to the lay-off on October 10 or 11, 1938, for some 21/2 or 3 weeks of all production or field employees in the Sac-Fox area except pumpers, in an effort by the Company to reduce expenses. It is-also significant, we think, that the schedule of November 1, 1938, re- mained in effect only a comparatively short time; early in 1939, probably not later than the middle of January'21 there was an- nounced a revised wage and hour schedule which substantially reduced the rates of pay and- increased the weekly hours of work. We are convinced by these facts, and we find, that the Company's purpose in hastily adopting on November 1, 1938, a wage schedule granting its employees higher rates was to dissuade its employees from their union membership and activities.22 . During November 1938, shortly after the Union had made its re- quest for recognition and a contract' and after the Company had announced the wage increases discussed above, there was organized among the Company's employees an organization knowii as "Inde- pendent Employees Association of the H. F. Wilcox Oil & Gas Company," herein called the Association. At the first formal meet- ing,held for the purpose of forming the Association, 6 of the 13 employees present were men described by Fraser at the Tearing as "key men." Included among these men were Keith Tiernan, refin- 20 The last 2 paragraphs of the notice read as follows : _ It has come to my attention that some of our employees have used the argument that we are not sincere in our attitude and that this Company is using this statement for subterfuge and deccivement. This is to advise that any effort on the part of any agitator to thus injure the Company 's good will toward their employees will be dealt Ni ith summarily and immediate dismissal from our service will result. - Lying propaganda intended to injure our organization will not be tolerated any longer. 21 This was shortly after Fraser began operation and supervision of the refinery and pipe line under the terms of the contract upon which the respondents based their refusal to deal with the Union. This refusal is discussed below. 22 Cf. Matter of The Triplex Screw Company and Amalgamated Association of Iron, Steel and Tin Workers of North America, Local No 1583, 25 N. L R B 1126 , and cases therein cited at p. 9, footnote 11.- -H. F. WILCOX OIL AND GAS COMPANY 97T, ery yard foreman who has 'almost complete charge of the refinery in the absence of Fraser; Charles Schane, foreman in charge of the crude stills; E. W. Harvell, head treaterSat the refinery; and H. G. Stalnaker, the refinery clerk and Fraser's secretary. - Other super- visory employees who then or subsequently participated in the formation and administration of the Association were John Oakes, pressure still foreman; Fred Elmore, Frank Riley, and J. J. Denton, farm bosses; Rocky Webb, tool driller; and Elmer Davis, head rousta- bout. - Stalnaker 'served as temporary chairman of the organization until the election of permanent officers at a meeting on November. 23, 1938, when he was made treasurer, Charles Schane became one of the directors of the Association and was an active participant in its affairs. Fraser testified at the hearing that "one or two of the boys" asked him at the time whether they "could form some such thing";,upon further examination, Fraser specified that one of the. employees who thus approached him -was his secretary and the chairman of the organizing group, H. G. Stalnaker. So far as the record shows, the only formal action taken by the Association was the issuance of membership cards, the adoption of bylaws, and the preparation of an elementary form of contract which was submitted to the Company. The proposed contract, which was submitted by Stalnaker to Fraser, was never thereafter discussed.. At a conference of representatives of the Company and the Union on November 21, 1938, the Company representatives referred to an Asso- ciation-request for recognition as a reason for refusing to consent to a comparison by the Board of the Union's membership cards and the Company's pay roll. Subsequently, on December 31, 1938, at another conference of Union and Company representatives, Fraser referred to the Association's claim of majority representation as complicating the question of Company recognition of the Union. Almost immedi- ately after January 1, 1939, when the contract between the Company and Fraser became effective, the Association' apparently4 ceased to function. It is clear, as found by the Trial Examiner, that the Asso- ciation was organized primarily by supervisory employees of the Company, who thereafter gave it their active support, and that until its disappearance the Association served only as an aid to the Com- pany,in its efforts to avoid granting recognition to the Un1on.23i We find that the Company through its supervisory employees, dominated and interfered with the formation and administration of Independent Employees Association, and thereby and by the state- ments made by Fraser and Riley and the wage increases of November 28 Cf. National Licorice Co. v. N. L. R. B., 309 U. S. 350, enf'g as mod . Matter of National Licorice Company and Bakery and Confectionery Workers International Union of America, Local, Union 405, Greater New York and Vicinity, 7 N. L. R. B. 537. 98 DECISIONS -OF NATIONAL LABOR RELATIONS BOARD 1, 1938, interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. B. The refusal to bargain collectively 1. The appropriate unit The complaint alleges, and the Union contends, that all production, refinery, and pipeline employees of the Company and Fraser at- Bristow, Stroud, and Oklahoma City, Oklahoma, constitute a unit appropriate for the purposes of collective bargaihirig.24 On November 1, 1938, at a conference between Company and Union representatives, it was agreed to, submit the union membership cards and a copy of the Company's -pay roll •to the Board's Regional Office in order to determine whether the Union represented a majority of 'the employees. The Company subsequently withdrew its consent to this method of checking the Union's claimed membership. It was then'agreed, at a conference of---Company and union representatives on December 5, 1938, that an` election should be conducted by the Board to determine whether or'not the. Union represented a majority of the employees. In the written "Agreement for Consent Election" signed by the Company, the Union, and a representative of the Board on December 6, 1938, it was agreed that the election should be con- ducted among all production, refinery, pipeline, bulk plant, drilling crew; and construction employees in the' Bristow, Stroud, and Okla- homa City areas, excluding supervisory and temporary or extra employees 25 Neither respondent makes any general contention that the unit fixed in the consent election agreement of December 6, 1938, and alleged in the complaint herein, is not appropriate for the purposes of col- lective bargaining.26 Their position is that, though this unit might 24 More particularly, the complaint defines the appropriate unit as including all produc- tion, refinery , pipeline, bulk plant, drilling crew, and construction employees in the'Bristow, Stroud, and Oklahoma City districts , excluding supervisory and temporary or` extra em- ployees In the petition for investigation and certification of representatives filed with the Regional Director for the Sixteenth Region on November 14, 1938, the Union alleged the appropriate unit to be all production , pipeline, and refinery employees in the Bristow, Stroud, and Oklahoma City areas , exclusive of supervisory , clerical, and office employees. In the consent election agreement , the Company also undertook to recognize the Union as the exclusive representative of all the employees in the appropriate unit if the Union, received a majority of the votes cast in the election , and to be bound by the results of the election for a period of 1 year subsequent thereto. We refer to the consent election agree- ment, however , not because we regard the Company as still bound by its provisions but merely to show the unit which the Company in December 1938 admitted was appropriate for the purposes of collective bargaining. 20 The Company, for example , in its answer to the complaint herein, specifically admits "that a unit for the purposes of collective bargaining , composed of the Production, Refinery, and Gathering or Pipeline Employees , employed at-the properties of H. F. Wilcox Oil & Gas Company in Bristow, Stroud and Oklahoma City in the State of Oklahoma , . . . is a unit appropriate for the purposes of.collective bargaining under the act, . had said Refinery, and Gathering'System not have been leased by this respondent to W. M Fraser . . H. F. WILCOX -OIL AND GAS' COMPANY 99 otherwise be entirely appropriate, the arrangement entered into by them on December 11 or 12, 1938, constituted a lease to Fraser of the Company's refinery, bulk plant, and pipeline at Bristow, and that since January 1, 1939, the persons employed at those properties have therefore constituted a separate unit for collective bargaining pur- poses. Differently phrased, the contention is, that on January 1, 1939, the persons employed in operating the refinery, bulk plant, and pipe- line system ceased to be employees of the Company and became employees of Fraser. - We have heretofore stated and explained our conclusion that the arrangement between the Company and Fraser is not, either on its face or in operation, it lease of the properties in question, and that the operation of these properties continued on and after January 1, 1939, to he a part of the Company's business. We have also pointed out that the Company's refinery, bulk plant, and pipeline system continued to be operated on and after January 1, 1939, without any change either in personnel 'or in the methods and results of operation, except that Fraser was apparently clothed with somewhat broader authority than he had previously exercised. The Company's right of control over Fraser in the discharge of his duties was not only left undisturbeda by the contract, which provided that the Company could terminate it at any time,,but was in effect strengthened by the contract requirement that Fraser furnish the Company with a penal bond in the sum of $25,000 to guarantee the faithful performance of his duties. We therefore find that the relationship between the Com- pany and Fraser continued on and after January 1, 1939, to be that of employer and employee, and that the persons employed in the operation of the Company's refinery, bulk plant, and pipeline system continued to be employees of the Company.27 2T Even if we did not find that the arrangment between the Company and Fraser was not a lease, we should still be of the opinion that the persons employed by the Company and the persons employed by Fraser on and after January 1, 1939, together constitute a single unit appropriate for the purposes of collective bargaining. Section 2 (2) of the Act defines the term "employer " as including "any person acting in the interest of an employer, di- rectly or indirectly" ; and Section 2 (1) of the Act defines the term "person " as including "one or more individuals , . . . corporations, . . As we have stated above, the contract between the Company and Fraser gave Fraser managerial powers over the properties in question , and 90 per cent of the profits realized from Fraser' s operation of those properties were reserved to the Company. In discharging his duties under the contract, Fraser is therefore clearly "acting in the interest" of the Company ; and be and the Company may properly be regarded as constituting an "employer" within the meaning of the definitions contained in the Act Under Section 9 (b) of the Act, the Board is authorized in a proper case to fix the unit appropriate for the purposes of collective bargaining as the "employer, unit," and we regard the Company and Fraser in their Oklahoma operations to be an "employer" within the meaning of the Act. i The Company, in its biief , argues that the Board is not in privity of contract with either itself or Fraser and may therefore not attack the Validity of the alleged lease. It is evi- dent, we think, that the validity of the contract as between the Company and Fraser, the parties thereto, is not impugned by our decision . The contract has in- fact been set up, by the Company and Fraser , as an affirmative defense to the allegation that they have 413597-42-vol. 28-8 • • - 100 DECISIONS OF NATIONAL LABOR RELATIONS -BOARD We find that all production, refinery, pipeline, bulk plant, drilling crew, and construction employees of the Company in the Bristow, Stroud, and Oklahoma City areas in the State of Oklahoma, excluding supervisory, clerical, office, and temporary or extra employees, at all times material herein constituted and that they now constitute a unit appropriate for the purposes of collective bar- gaining with respect to rates of pay, wages, hours of employment; and other conditions of employment, and that said unit insures to employees of the Company 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 Union of a majority in the appropriate unit In accordance with the consent election agreement signed by the Company and the Union on December 6, 1938, an election was con- ducted by the Board on December 19, 20,-and 21, 1938, at Bristow,, Stroud, and Oklahoma City, respectively, among the-employees in the appropriate unit. Of 138 eligible employees, 136 participated in the election, 90 voting for the Union and 46 against the Union. This was a substantial majority of the employees in the appropriate unit, and there is no evidence or contention that the Union did not thereafter continue to represent a majority of the employees in such unit .211' We find that, on December 21, 1938, and at all material times there- after, the Union was the duly designated representative of a ma- j ority of the employees in the appropriate unit, and that, pursuant to Section 9 (a) of the Act, it was and is the exclusive representative of all the employees in such unit for the purposes of collective bar- gaining with respect to rates of pay, wages, hours of employment, and other conditions of employment. 3. The refusal to bargain On December 29, 1938, approximately a week after the results of the election had been informally certified to the parties, representa- refused to bargain collectively within the meaning of the Act, and it is their reliance upon the contract which compels us to examine and construe its provisions . We have not de- nounced the contract as in any way invalid, but have merely found that it is not either on its face or in operation , a lease of the pioperties in question . We are also of the opin- ion that. even if it were a lease, the contract would not affect our decision as to the appro- priate unit and would constitute no defense to the allegation that the Company and Fraser have refused to bargain collectively within the meaning of the Act. 18 At a conference with union representatives on January 10, 1939, Fraser did take the position that the election results furnished no conclusive basis for believing that a ,majority of the refinery, bulk plant, and pipeline employees had voted in favor of the Union. This contention , however, obviously does not affect the fact that the election results showed the Union to have been designated as their representative by a majority of the employees in the entire unit which we have found to be appropriate. H. F. WILCOX OIL AND GAS COMPANY 101 tives of the Company and the Union- met at the Company's office in Tulsa, Oklahoma. The Company then advised the Union for the first time that, because of the signing of the "lease," the Company could not negotiate with the Union with respect to the refinery, bulk plant, and pipeline employees. The union representatives de- murred to the Company's exclusion of these employees from the discussion, but the conference was permitted to continue and the conferees considered the proposed contract which had, been sub- mitted by Bush in October 1938. There was no discussion of the refinery, bulk plant, and pipeline employees and no agreement was reached, but the conferees arranged to meet again on December 31. There was further discussion of the proposed contract at the con- ference of December 31, but again no definite agreement was reached beyond a promise by the Company's representatives to present the proposed contract to the Company's board of directors on January 2, 1939, and then to meet again with the union representatives on January 4. The proposed contract was presented to the Company's board of directors for consideration, and its bargaining representa- tives were authorized to negotiate with the Union for a contract containing no provisions for a closed shop, a check-off, or arbitration of disputes.29 On January 4, 1939, another conference was held at the Com- pany's Tulsa office, as scheduled. Again the conferees discussed the terms of the -proposed contract -which had been submitted by the Union. The testimony as to what else took place at this conference is sharply conflicting'. The Company's representatives testified that on January 4, 1 1939, they discussed the proposed contract -only with respect to the Company's employees inAhe production and construc- tion departments; the Union's chief representative in the negotia- tions, R. H. Stickel, testified that he at no time regarded a contract covering less than all the employees as satisfactory, and that he insisted throughout the-negotiations that the Company bargain with the Union as the representative of all the employees who had been eligible to participate in the December election. The Company's representatives testified that the conferees on January 4, 1939, came to an agreement which, it was understood, would be reduced by the Union to typewritten form and presented to the Company on Jan- uary 7 for execution; Stickel testified that certain changes in the proposed contract were agreed upon and that he undertook to have the contract retyped in its revised lormn, but that the changes were expressly made subject to approval by the Company's board of 21 The proposed contract submitted by the Union had contained closed-shop, check-off, and arbitration clauses. 102 DECISIONS OF NATIONAL LABOR RELATIONS' BOARD directors and that there was no final agreement between the ,con- ferees.30 There is also conflicting testimony as to whether a revised draft of the proposed contract was ever prepared by the Union and submitted by it to the Company, Dunn testifying that no such revised draft was ever delivered to him, and Stickel and his wife testifying that such a revised draft was prepared by them and was delivered to Dunn in person on approximately January 7, 1939. Apparently in the hope of obtaining identical contracts with the Company and Fraser, and thereby eliminating all dispute as to the appropriate unit, the union representatives met with Fraser on January 10, 1939, at Bristow, and proposed that he enter into an agreement with the Union covering the refinery, bulk plant, and pipeline employees. The Company, though refusing to deal with the Union as the representative of all the employees in the appro- priate unit, had expressed a willingness to recognize it as the repre- sentative of the employees in the production and construction departments. Fraser, on the other hand, flatly refused to recognize the Union as the collective bargaining representative of the refinery, bulk plant, and pipeline employees, taking the position that they had become his employees on January 1, 1939, when the "lease" went into effect, and that he was not bound by the' results of the election which had been held in December. Fraser proposed to -the union representatives that another election, not under Board supervision, be held among the refinery, bulk plant, and pipeline employees, and that the name of the Association be placed on the ballot in this election. The proposal was rejected by the union representatives, and the conference ended without any discussion of the terms of the Union's proposed contract. About February 5, 1939, Stickel telephoned the Company's vice president, Dunn. At the hearing Stickel testified that he was told by Dunn on February 5, 1939, that the latter had no further word as to the contract and that the Company still could not deal with the Union as the representative of the refinery, bulk plant, and pipe- ] ine employees. Dunn testified that on February 5, 1939, he asked Stickel to come in for further discussion of the contract; that Stickel replied that he was busy and could not come, but would call at a later time; and that Stickel thereafter never appeared for further discussion. We see no need for resolving this conflict in testimony, since it is not disputed that the Company on February- 10 Stickel also testified that, apart from any question as to the unit of employees to be covered by the contract , no final agreement could have been reached at the conference on January 4, 1939, because the Company at that time proposed to put into effect a substan- tial reduction in wages to which the Union could not consent. - ' , H. F. WILCOX OIL AND GAS COMPANY - 103 5; 1939, "regardless of what took place between Dunn and Stickel, was still, unwilling to deal with the Union as collective bargaining representative of the refinery, bulk plant, and pipeline employees. We believe the record is clear that both the Company and Fraser, on December 29, 1938, and thereafter, refused to accord recognition to the Union as the exclusive collective bargaining agency for all the employees in the appropriate unit. This refusal was based, and is now defended, on the ground that the "lease" between the Com- 'pany and Fraser destroyed what would otherwise have been. the appropriate unit and created two new and separate units as to one of which the Company could not bargain with the Union. Upon the present record we are not convinced that this contention was, or is, advanced in good faith. On December 6, 1938, when it signed the consent election agreement, the Company recognized the pro= priety of including .the refinery, bulk plant, and pipeline employees in the appropriate unit. Although the discussions of the proposed "lease" had then admittedly reached an advanced stage, no intimation bras given either to the Union or to the Board's representative of the impending transaction between the Company and Fraser or of the effect which they believed it might have upon the question of the appropriate unit. Subsequent to the execution of the "lease" on December 11 or 12, 1938, and prior to the beginning of the elec- tion on December 19, neither the Company nor Fraser made any attempt to defer the holding of an election which, from-their point of view, could be only fruitless. They gave neither the Board nor the Union notice that the agreed-upon unit was no longer regarded by them as appropriate and that they would therefore not abide by the results of the election. When questioned at the hearing with respect to whether he had notified the Union in December 1938 that the Company, because of the "lease," would not bargain with respect to the refinery, bulk plant, and pipeline employees, the Company's vice president, Dunn, replied that he "didn't think it was any of their business." Fraser admitted at the hearing that he kept the "lease" secret for a few days after its execution, but both he and the Company contended that notice was given to the Union and to the employees shortly prior to the beginning of the election on December 19, 1938. While there is conflicting testimony as to just how and to what extent the Union was apprised of the "lease," we believe that the record as a whole establishes that Fraser, through Tiernan and Harvell, two supervisory employees in the refinery who were active in the Independent Employees Association, caused vague news of the "lease" to be spread among the refinery employees a 104 DECISIONS OF NATIONAL LABOR RELATIONS BOARD few days. prior to December 19; 1938.31 On the other hand, -there is testimony in the record which indicates that this news, partly perhaps because of its vagueness, had an unsettling effect upon the Company's employees; 32 and it is not unreasonable to infer that the information was made available to the Company's employees as it was in order to affect the employees' participation in the election in a manner unfavorable to the Union. If the Company and Fraser really wanted to advise the Board and the Union of the "lease" and the effect which they attributed to it, they chose a most peculiar way to do so.33 ' It was not until the evening of December 29, 1938, after the Union had attempted to bargain with the Company for all the employees in the appropriate unit and had been told that the Com- pany could not bargain with respect to the refinery, bulk plant, and pipeline employees, that the Bristow Daily Record appeared with a i,The manner in which news of the "lease" was conveyed to the refinery employees is illuminated by the following excerpts from Fraser's testimony at the hearing : A. Well, I-told men all around. It was'known openly that I was taking it over the first Q. Can you name us any persons besides Harvell and Tiernan that you told that to? A. I can't swear to it, no. * 3 E k * i O Q Did you try to keep that from anyone, a secret about you going to take over this plant in-1939? A. Yes, for a few days . . s m • a x s s Q. . . . Did you make any public announcement to the newspaper about it? A. No, I never did go to the newspapers with it Q The newspaper came to you? A. The newspaper came to me on the 28th of December, I think it was However, I announced it through Tiernan to the men in the yard. Q. You just told Tiernan what had happened. Is that right? A. I told Tiernan 'I was leasing it as of the first, and I wished him to make it known among the men. _ Q. You knew, did you not, that that was not done? A I knew it was done. Q A public announcement was made to the men collectively? A. No, he didn't gather them together. He just spread the news. Q. He told you then, later, that he was telling everybody he came in contact with. Is that the way you knew it? A. No, he probably didn't do that You whisper it to one man, and the rest of them would know it within 20 minutes, I should think. s e s s s a s This devious approach to the refinery employees is in sharp contrast with the direct action which the Company took on October 29 and 30, 1938, approximately a month and a half before, when it wanted to inform its employees of the new wage schedule. At that time Fraser first assembled the refinery employees and made an open announcement of the Com- pany's proposal, and then posted a notice on the plant bulletin board. 32 Stickel, for example, testified at the hearing that he first heard of a proposed "lease" on the evening of December 19, 1938, when some of the Union members at Bristow told him of the rumors in the plant and inquired of him as to the possible effect of such a transac- tion. Stickel also testified that he was told on December 19, 1938, that the "lease" would be made on January 1, 1939, if the Union won the election B3 Imight be added that the evidence, in any case, tends to establish only that the em- ployees were informed` of the "lease" ; there is no showing that either the Company or Fraser, prior to the election, revealed their opinion as to the effect of the "lease" on the question of the appropriate unit. H. F. WILCOX OIL AND GAS COMPANY- 105v story of the "lease." And it was not until the conference of Decem- ber 29, 1938, that the Union was informed of the Company's determi- nation not to abide by the consent election agreement or the election results.34 The secrecy with which the "lease" was admittedly sur- rounded for several days following its execution, the equivocal man- ner in which news of the "lease" was given circulation among the Company's employees just prior to the election, and the delay by the Company and Fraser in making known their disavowal of the previously agreed upon unit because of the "lease" are not the hall marks. of open and frank dealing. Nor do we believe there was anything, either in the contract itself or in the methods and results of operation thereunder, upon' which the Company and Fraser' could have based any reasonable belief that on and after January 1; 19. 39, they were lessor and lessee, respectively, of the properties covered by the contract. The Trial Examiner in his Intermediate. Report has found, and we are convinced the record fully supports the finding, that the dispute as to the- appropriate unit was cre- ated by, the respondents solely for the purpose of , avoiding the obligation imposed by the- Act and, in December 1938 and January 1939, by the consent election agreement to bargain collectively with the Union. That the representatives of the Company met With the representatives of the Union and discussed the terms of the proposed contract does not satisfy the requirements of the Act, so long as the Company does not recognize the Union as the exclusive collective bargaining representative of all the employees in the appropriate unit and negotiate with it as such. We find that on December 29 and 31, 1938, and on January 4 and 10, 1939, and thereafter, the Company, through its supervisory officials;, including Fraser, refused to bargain collectively with the Union as the exclusive representative of its employees in an appro- priateunit, and thereby interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. 85 $' Fraser did not inform the Union of his refusal to be bound by the election results until sometime in January 1939. a5 Matter of The Federbush Co., Inc.' and United Paper Workers, Local Industrial Union No. 292, affiliated with the C. 1. 0., 24 N. L. It. B. 829; Matter of Acme-Evans Company and Federal Labor Union No 21873, affiliated with the A. F. of L, 24 N L. R. B 71. Cf. Matter of Pittsburgh Plate Glass Company and Federation of Flat Glass Workers of America, affiliated with C. I. 0., 15 N. L. It. B 515, enf'd , Pittsburgh Plate Glass Co. v. N. L R B., July 23, 1940 (C. C. A. 8) ; Matter of The W H. Kistler Stationery Company and Denver Printing Pressmen and Assistants Union No. 40, 24 N. L. It. B. 960. 106 DECISIONS OF NATIONAL LABOR RELATIONS BOARD C. The discriminatory discharges 1. Robert and Richard Wendell 36 Robert Wendell was first employed by the Company in 1923 or 1924 and Richard Wendell-in 1926. They both worked for the Com- pany intermittently thereafter in the construction and production departments until their discharge on December 8, 1938. Both joined the Union on October 4, 1938, wore union bottons, and solicited members from among the other employees of the Company. In its answer to the complaint, the Company admitted having discharged the Wendells but alleged affirmatively that they had been discharged because of misconduct, unsatisfactory work, and neglect in the performance of their duties. They were notified of their discharge by their farm boss, Frank Riley, who explained to them at the time that the reasons for their discharge were that their wages had been garnisheed and that they were brothers. At the hearing, some attempt was made to show that the Company's established policy was not to employ relatives, par- ticularly in the relation of superior and subordinate. Neither Robert nor Richard occupied a supervisory position; both had been inter- mittently employed for many years; and it, is clear from the record that the alleged general policy of the Company against employing relatives, if it existed at all, was frequently and openly disregarded. While-Robert admitted at the hearing that his wages had been garnish- eed in 1932 and again in 1935, there is no showing that Richard's wages were ever garnisheed. In any case, we cannot believe that events which occurred so long before 1938 were the true reasons for the discharge of the Wendells. Apparently aware of the insufficiency of the reasons given -the Wendell brothers at the time of their discharge, the Company at the hearing adduced evidence of the following additional reasons justify- ing its action ; that Robert had been arrested in Oklahoma City during 1935 on a charge of larceny; that Robert had failed to pay a grocery bill of approximately $10 which he incurred in 1935 while working for the Company at Pampa, Texas ; and that both Robert.and Richard were arrested during ' 1938 for drunkenness or disorderly conduct, the former in April and the latter in October. 'Here, again, as in the case of the garnishee orders, the Company seeks to rely upon events which were followed by its continued employment or reem- ployment of the Wendells ; and here, again, we cannot but believe, ' Robert Wendell is apparently known, and is frequently referred to in the record, as Bert Wendell Richard Wendell 's full name is Henry Richard Wendell , but he is known and referred to in the record , and we therefore refer to him in our decision, as Richard. H. F. WILCOX -OIL AND • GAS COMPANY - 107 particularly since these events were not included among the reasons mentioned to the Wendells at the time of their discharge,- that the Company would not have waited until December 1938 to discharge the Wendells, if it had regarded the events in question as being grounds for discharge. The plea that the Company's vice president, Dunn, and its production superintendent, J. M. Clover, did not know until on or after December 5, 1938, that Robert and Richard Wendell were still in the Company's employ is in part irrelevant and in part incredible. Knowledge of the identity of its employees is not to be imputed to a corporate employer only if and when one of its execu- tive officers knows it; and Clover admitted at the hearing that he frequently checks the pay roll and is familiar with the persons hired and discharged in the production department, which is the depart- ment over which he has supervision and in which- the Wendells were employed prior to their discharge. - The Company also adduced evidence that Robert and Richard Wendell were delinquent in paying their accounts with Frank T. Lynch who, until the latter part of 1938, leased from the Company and operated a gasoline filling station in Oklahoma City. When Lynch, relinquished his lease he was in debt to the Company, and he therefore turned over to it, among other assets, four of the-accounts receivable which he then had on his books. These included the accounts of Robert' and Richard Wendell, who owed approximately $34 and $9; respectively. Written reminders of these unpaid accounts were sent by the Company to the Wendells toward the end of October 1938, when they, along with a number of other production employees of the Company in the Stroud area, were temporarily laid off for lack of work.' The Wendells resumed work early in November 1938, and the amounts due from them to Lynch were deducted by the Com- pany from the first pay checks which the Wendells thereafter re- ceived, covering the period November 1 to November 15, 1938. This seems to us,to have been a .reasonably expeditious settlement of the accounts. In any event, the Wendells were no more undesirable as employees-than other employees of the Company who were similarly indebted to Lynch, two of whom had their accounts transferred to the Company along with the accounts of the Wendell brothers. - The record shows that one of these two other employees is still employed by the Company, and there is no showing that the other has ceased being an employee. There is no indication that the Company commented unfavorably upon these delinquent accounts, either at the time they were transferred to the Company, or at the time the Company wrote to -the Wendells, or ,at the time the deductions were made from the Wendells' pay checks. 108 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The Company does not seriously contend that the' work of the Wendell brothers was unsatisfactory nor, indeed, could it so contend on the basis of the present record. Riley, their-farm boss, testified at the hearing that both Robert and Richard were "pretty good workers" and that he would not have recommended their discharge because of their obligations to Lynch. It also appears the Riley gave both Wendells letters of recommendation shortly after they had been discharged. We have pointed out,- above, that Robert and Richard Wendell joined the Union on October 4, 1938, wore union buttons, and were active in soliciting union members among the Company's employees. On December 5,' 1938, the day before the Company and the Union signed the consent election agreement to which we have previously referred, there was an extended conference of Company and union representatives at which -a substantial part of the time was spent in preparation of a list of those employees of the Company who were eligible to participate in the election. One of the union representa- tives who participated in that conference was John Wendell, brother of Robert and Richard. When 'the conferees, in examining a list of the Company's employees, came to the names of Robert and Richard Wendell, the Company's vice president, Dunn, on each occa- sion noted the name and inquired of John Wendell whether Robert and Richard were his brothers. Immediately after the conference, and on the same day, Dunn instituted inquiries with respect to Robert and Richard and consulted with his production superintendent, -Clover, and the Company's attorney, Clay. Both Clover and Clay made some 'investigation of the Wendells and reported back to Dunn .with respect to the garnishee orders, the grocery bill, the Lynch ac- counts, and the arrests of the Wendells for drunkenness or disorderly conduct. The Trial Examiner, in his Intermediate Report, has found that the Company's alleged reasons for the discharge of the Wendells are not supported by the evidence, and that the Wendells were actually discharged because of their activities on behalf of the Union. We agree 'with him that the evidence does not establish the reasons ad- vanced by the Company. In view of the Wendells' open union mem- bership and activities and of their relationship to another of the Company's employees who acted as a representative of the Union in its negotiations with the Company, we agree with the Trial Ex= aminer's finding as to the reason for their discharge. We find that the Company, by discharging Robert Wendell and Richard Wendell, discriminated in regard to their hire and tenure of em- ployment, and thereby discouraged membership in the Union and interfered with,, restrained, and coerced its employees in the exercise .of the rights guaranteed in Section 7 of the Act. _11. F. WILCOX OIL AND. GAS COMPANY - . 109 At the time of his discharge, Robert Wendell was being paid by the Company at the rate of 87 cents an hour and was working 40 hours per week. Since his discharge, he has been employed in the State of Illinois as a. tool dresser on a part-time basis, and he has earned not more than, $150. He has also received unemployment insurance payments at the rate of $15 a week for 15 weeks and at the rate of $12 a week for 1 week. Richard Wendell, at the time he was discharged, was earning 97 cents and hour and was working 42 hours per week. Subsequent to his discharge, he received unemployment insurance payments in the total amount of approximately $167. In July 1939 he obtained em- ployment on a part-time basis, and he has earned a total of approxi- mately $600 since his discharge. 2. Eunice W. Vanmeter Vanmeter was first employed by the Company ins 1923," and was thereafter apparently continuously employed by it as a, pumper until his discharge on November 2, 1938. For more than 10 years prior to his discharge he worked as a pumper on the Company's Lindsay lease in the Bristow area.37 Vanmeter joined the Union in 1934. After having been inactive for a time, he renewed his union membership in 1937 and acted as the Union's recording secretary for 6 or 7 months. On October 7, 1938, after having again dropped out of the Union for a while, he rejoined, began wearing a union button, and solicited new members for the Union. His union membership was known to his immediate superior, J. J. Denton, farm boss in charge of a number of the Company's leases. On November 1, 1938, Denton called at the Hope lease to deliver a drum of gasoline for Vanmeter's use and to answer a question which Vanmeter had raised with respect to the Fair Labor Standards Act of 1938. Vanmeter was away when Denton called, having gone- to a neighboring town to have his automobile repaired. Denton left the gasoline and also told Mrs. Vanmeter to, advise her husband that the Fair Labor Standards Act was not applicable to him. On the following day, November 2, Denton returned to Vanmeter's lease and discharged him. At the hearing Vanmeter testified that on November 2, 1938, Denton told him he was being discharged because he had been "off the job" on November 1 and because he was "not dependable." Vanmeter further testified that, after he had protested to Denton on November 2, 1938, that Mrs. Vanmeter had told Denton 37 Early in 1915 Vanmeter was also assigned by the Company to the Hope lease, which adjoins the Lindsay lease, and he subsequently moved his living quarters from the Lindsay lease to the Hope lease . He handled both leases thereafter until his discharge. 110 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the reason for Vanmeter's absence on November 1, Denton replied that he had to protect his job. Sometime after his discharge Van- meter attended a meeting of the Independent Employees Associa- tion, the labor organization described above. Also present at this meeting was Ralph Hockett, a minor supervisory employee of the Company and an active member of the Association.38 Vanmeter tes- tified that during this meeting Hocket told him that, if he would "get loose from Bill Bush and that damned C. I. 0.," Hockett could get his job back for him. Hockett was not called as a witness at the hearing, and Vanmeter's testimony in this respect stands uncontradicted. The Company's position is that it discharged Vanmeter, and was justified in doing so,'because: (1) Vanmeter did not keep his leases or tanks clean; (2) he was frequently absent from duty without warrant; (3) his use of gasoline was excessive; and (4) when pro- duction of oil on his leases fell off, Vanmeter was unable to determine which particular well had ceased flowing and had to have its rods `'pulled." With respect'to the claim that Vanmeter did hot keep his tanks and leases clean : (a) the record shows that Vanmeter did not refuse to clean his tanks but merely asked for help in the task, and that this was not an unreasonable request; and (b) the testimony as to Vanmeter's alleged failure to keep his leases clean is not convincing and is; in any event, contradicted by substantial testimony directly to the contrary from witnesses who, ,so far as the record shows, are completely disinterested in the proceeding. With respect to the claim that Vanmeter was frequently absent from duty without war- rant, the evidence is similarly unconvincing: Vanmeter's absences are explained by uncontradicted testimony that it is customary for pumpers, particularly on somewhat isolated leases like those oper- ated by Vanmeter, to leave their leases in order to have their auto- mobiles repaired and to attend to other matters, personal as well as business.39 With respect to the claim that Vanmeter's use of gasoline was excessive, there is no showing that he used more gasoline than either his predecessor or his successor at the Hope and' Lindsay leases 31 In its brief, the Company asserts that there is no evidence that Hockett was either supervisory or an active member of the Association . The minutes of the Association's meetings show that Hockett was one of the small group of 13 employees of the Company, many of them supervisory, who participated in the very first meeting of the Association, and that he was subsequently appointed sergeant at arms of the organization. At the hearing, Fraser testified that Hockett handles and supervises all of the electrical work on the private telephone lines connecting the Company 's Tulsa office with the refinery and the leases, and that Hockett hires and discharges men from time to time as needed in his work or at least recommends men for hiring and discharge 39 Indeed , it appears that Vanmeter used his automobile for personal as well as Company business with the Company 's full knowledge and consent and that the Company, as a mat- ter of fact, provided -Vanmeter with gasoline, oil, tires , and even repairs required in connection with his use of the automobile. - H. F. WILCOX OIL AND GAS COMPANY 111 or than other pumpers at comparable leases, or that he used more gasoline toward the end of his employment than he had prior thereto. The charge most earnestly urged by the Company' against Van- meter is his alleged inability to determine which of several wells had to be "pulled" when production of oil on the Lindsay lease fell off. The pumper who succeeded Vanmeter at the Lindsay and Hope leases, Cordell, testified at the hearing that the manner in which the wells at the Lindsay lease are connected with each other and with the stock tanks makes it difficult, when production drops, to deter- mine which of the wells is responsible. In any case, the testimony as, to this alleged inability on Vanmeter's part is conflicting, Cordell testifying that the daily gauge reports or tickets for 1938 covering the Lindsay lease contained no notation of wells which had been incorrectly "pulled." 40 There is also conflicting testimony as to the preliminary question of whether even a good pumper can always choose correctly the well responsible for a decrease in the production of a group of wells. In view of this conflict in the testimony as to whether Vanmeter was really at fault, in view of the admission by Production Superintendent Clover that he had received no criticism of Vanmeter's work during 1937 or the first 10 months of 1938, and in view of Denton's admission that he never spoke either to his superiors or to Vanmeter himself about the alleged shortcomings in Vanmeter's -work, we believe that the doubt created by the record as to Vanmeter's efficiency in this respect should be solved in his favor. We are supported in thus resolving the doubt by the length of Van- meter's employment by the Company. At the time of his discharge he had worked for the Company, apparently continuously, for 15 years, of which more than 10 had been spent by him on the Lindsay and Hope leases. There is testimony in the record that the Lindsay and Hope leases were difficult to operate and were, therefore, regarded as undesirable. One or two other employees were offered Vanmeter's job upon his discharge, but refused it, before it was given to Cordell. Even Cordell accepted the job only when faced with the alternative of discharge." The deficiencies from which the Company now claims 41 The contradictory testimony of the Company's witnesses is not based upon written records, and no contention is made that the gauge reports to which Cordell referred did contain notations showing that wrong wells were "pulled ." These gauge reports are pre- pared,daily by each pumper , employed by the Company as part of his regular duties, and show in detail the amount of oil produced by each/lease and the reason for any deviation from normal production. 41 Denton denied at the hearing that Cordell , in 1938, gave any indication of not want- ing Vanmeter 's job and leases . It seems to us, however, that an employee who is shifted from one job to another is much more directly and intimately affected thereby than is his superior and is, therefore , more likely to retain a clear and accurate recollection of the change. We therefore accept Cordell 's testimony in this respect , as did the Trial Examiner ' 112 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Vanmeter's work suffered were of a kind which should have been dis- coverable within a comparatively short time, unless they all developed suddenly in the fall of 1938. Nevertheless, the Company retained Vaiuneter on its pay roll for 15 years and in the job from which he was discharged for 10 years. The sudden discovery that his work was un- satisfactory followed shortly upon Vanmeter's rejoining the Union and the beginning of an organizing campaign by the Union among the Company's employees. The Trial Examiner has found that the reasons advanced by the Company for Vanmeter's discharge are not supported by the evidence. In view of Vanmeter's long employment by the Company. the com- plete absence prior to his discharge of any complaint or warning as to the quality of his work, the disparity between the reasons for Van- meter's discharge given by Denton at the time and the reasons now ad- vanced by the Company, the remark made by Hockett shortly after Vanmeter's discharge, and the close connection in time between the re- newal of union activity and the discharge, we sustain the findings of the Trial Examiner. We find that the Company, by discharging Eunice W. Vanmeter, discriminated-in regard to his hire and tenure of employment, and thereby discouraged membership in the Union and interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. At the time he was discharged by the Company, Vanmeter was being paid,$145 per month. Since his discharge, he has received a total of $225 in unemployment insurance benefits. He has also, since. May 1939, been employed as a pumper at a salary of $70 a month, in addi- tion to which he has earned approximately $60 at other pumping jobs. At the time of the hearing, his total earnings since his discharge were, therefore, approximately $,690. IV. TIME EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE We find that the activities of the respondents set forth in Section III Al B, and C above, occurring in connection with the operations of the respondents described in Section I above, have a close, intimate, and substantial' relation to trade, traffic, and commerce among the several States and tend to, lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. TIIE REMEDY - Having found that the respondents have engaged in unfair labor practices, we shall order them to cease and desist therefrom and to take such affirmative action as will dissipate the effects thereof and effectuate the policies of the Act. H. -F. WILCOX OIL AND GAS COMPANY - 113 We have found that the respondents refused to bargain -collectively with the Union as exclusive representative of all the Company's em- ployees in an appropriate unit. We shall therefore order the respond- ents, upon request, to bargain collectively with the Union as such rep- resentative with respect to rates of pay, wages, hours of employment, and other conditions of employment. We have found that the Company discharged Eunice W. Vanmeter, Robert Wendell, and Richard Wendell because of their union member- ship and activities. To effectuate the policies of the Act, we shall order the Company to offer these employees immediate and full rein- statement to their former or substantially equivalent position, without prejudice to their seniority and other rights and privileges, and to make them whole for any losses of pay they have suffered by reason of their discharges by paying to each of them a sum of money equal to the amount which-he normally would have earned as wages during the period from the date-of his discharge to the date of the offer of rein- statement, less his net earnings 42 during said period. - - - 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. Oil Workers International Union, Local 257, is a labor organiza- tion, within the meaning of Section 2 (5) of the Act. 2. All production, refinery, pipe-line, bulk plant, drilling crew, and construction employees of the Company in the Bristow, Stroud, and Oklahoma City areas in the State of Oklahoma, excluding supervisory, clerical', office, and temporary or extra employees, at all times material herein constituted, and they now constitute, a unit appropriate for the purposes of collective bargaining with respect to rates of pay, wages, hours of employment, and other conditions of employment, within the meaning of Section 9 (b) of the Act. 3. Oil Workers International Union, Local 257, was on December 29 and 31, 1938, and on January 4 'and 10, 1939, and thereafter, the 42 By "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 his unlawful discharge and the consequent necessity of his seeking employment elsewhere . See Matter of Crossett Lumber Company and United Brotherhood of Carpenters and Joiners of Amer- ica, Lumber and Sawmill Workers Union, Local 2590, 8 N. L. R B. 440 . Monies received for work perfoimed upon federal , state, county , municipal, or other work-relief projects shall be considered as earnings. See Republic Steel Coi poration v N. L. R. B., decided by United States Supreme Court , November 12, 1940 Direct relief or home-relief payments ate not to be considered as "earnings" and hence are not deductible. Matter of Vegetable Oil Products Company, Inc ., a Corporation and Soap and Edible Oil Workers Union, Local No. 18409, 5 N. L. R. B. 52, amending 1 N. L. it. B. 989 . Unemployment compensation bene- fits are similar in purpose and effect to home-relief payments, and therefore are not deduct- ible. Matter of Pennsyluanea lee,naee and Iron Coinpany and Lodge No 1328, International Association of Machinists, 13 N. L. R B 49. 114 DECISIONS OF NATIONAL LABOR RELATIONS BOARD exclusive representative for the purposes of collective bargaining of all the employees in the appropriate unit, within the meaning of Section 9 (a) of the Act. 4. By refusing on December 29 and 31, 1938, and on January 4 and 10, 1939, and thereafter, to bargain collectively with Oil Workers In- ternational Union, Local 257, as the exclusive representative of all the employees in the appropriate unit, the respondents have engaged in and are engaging in unfair labor practices, within the meaning of Section 8 (5) of the Act. 5. By discriminating in, regard to the hire and tenure of employ- ment of Eunice W. Vaiuneter, Robert Wendell, and Richard Wendell, and thereby discouraging membership in the Union, the Company has engaged in and is engaging in unfair labor practices, within the mean- ing of Section 8 (3) of the Act. 6. By interfering with, restraining, and coercing their employees in the exercise of the rights guaranteed in Section 7 of the Act, the respondents have engaged in and are engaging in unfair labor practices, within the meaning of Section 8 (1) of the Act. 7. The aforesaid unfair labor practices are unfair labor practices affecting commerce, within the meaning of, Section 2 (6) and (7) of the Act. - ' ORDER Upon the -basis of the above findings of fact and conclusions of law, and pursuant to Section 10 (c) of the National Labor Relations Act, the National Labor Relations Board hereby orders that H. F. Wilcox Oil and Gas Company, and its officers, agents, successors, and assigns, including William M. Fraser, shall: 1. Cease,and desist from : - (a) Refusing to bargain collectively with Oil Workers Interna- tional Union, Local 257, as the exclusive representative of 'all pro- duction, refinery, pipe-line, bulk plant, drilling crew, and construc- tion employees of the Company in the Bristow, Stroud, and Oklahoma City areas in the State of Oklahoma, excluding super- visory, clerical, office, and temporary or extra employees; (b) Discouraging, membership in Oil Workers International Union, Local 257, or any other labor organization of its employees, by discharging or refusing to reinstate any of its employees or in any other manner discriminating in regard to their hire or tenure of employment or any term or condition of their employment; (c) In any other manner interfering with, restraining, or coercing its employees in the exercise of the rights to self-organization, tO form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in H. F. WILCOX OIL AND GAS COMPANY 115 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) Upon request, bargain collectively with Oil Workers Inter- national Union, Local 257, as the exclusive representative of all pro- duction, refinery, pipe-line, bulk plant, drilling crew, and construction employees of the Company in the Bristow, Stroud, and Oklahoma City areas in the State of Oklahoma, excluding supervisory, clerical, office, and temporary or extra employees, with respect to rates of pay, wages, hours of employment, and other conditions of employment ; (b) Offer to Eunice W. Vanmeter, Robert Wendell, and Richard Wendell immediate and full reinstatement to their former or sub- stantially equivalent positions, without prejudice to their seniority and other rights and privileges; (c) Make whole Eunice W. Vanmeter, Robert Wendell, and Rich- ard Wendell for any losses of pay they have suffered by reason of their discharges, by, paying to each of them a sum of money equal to the amount which he normally would have earned as wages during the period from the date of his discharge to the date of the offer of reinstatement, less his net earnings during said period; (d) Post immediately in conspicuous places on all, properties owned or operated by the Company in or about Bristow, Stroud, and Oklahoma City,-Oklahoma, including its refinery, bulk plant, and pipe-line system, and maintain for a period of at least sixty (60) consecutive days from the date of posting, notices to its employees stating: (1) that the Company and its officers and agents, including William M. Fraser, will not engage in the conduct from which they are ordered to cease and desist in paragraphs 1 (a), (b), and (c) of this Order; (2) that the Company and its officers and agents, including William M. Fraser, will take the affirmative action set forth in paragraphs 2 (a), (b), and (c) of this Order; and (3) that the Company's employees are free to become or remain members of Oil Workers International Union, Local 257, and that there will be no discrimination against any employee because of membership or activity in that organization; (e) Notify the Regional Director for the Sixteenth Region in writing, within ten (10) days from the date of this Order, what steps have been taken to comply therewith. CHAIRMAN HARRY A. MILLrs took no part in the consideration of the above Decision and Order. 413597-42-vol 28-9