B. Z. B. Knitting Co.

In the Matter of B. Z. B. KNITTING Co. and AMERICAN FEDERATION OF HOSIERY WORKERS, LOCAL No. 64, AFFILIATED WITH THE CONGRESS OF INDUSTRIAL ORGANIZATIONS Case No. C-1685.-Decided November 30,1940 Jurisdiction : silk hosiery manufacturing industry. Unfair Labor Practices, Interference, Restraint, and Coercion: employing detectives for surveillance of union activities ; anti-union statements ; interrogation concerning union activi- ties ; threats to close plant in order to disrupt union. Company-Dominated Union: formation after validation of Act of successor organ- ization similar to predecessor-employee's participation in formation of : an- nouncing organization of successor in letter informing employees of disestab- lishment of predecessor-indicia of domination : no provision of general meetings of employees ; recognition granted upon request ; no meetings of committee held with management present. Remedial Orders: order to disestablish company-dominated union; reimburse- ment of employees for dues deducted from wages. Order to refuse recognition to defunct labor organization if it should resume functioning. Practice and Procedure Withdrawal of previously filed charge is not compromise agreement and constitutes no bar to subsequent proceeding involving different unfair labor practices charged to the same employer. Mr. Lester Asher, for the Board. Fyffe cC Clark, by Mr. John Harrington, of Chicago, Ill., for the respondent. - Mr. Carl L. Linker, of Rockford, Ill., for the Union. Mr. Robert George Miller, of Rockford, Ill.,, for the Association. Mr. Martin Giacone, of Rockford, Ill., for the Shop Committee. Mr. Louis Newman,-of counsel to the Board. DECISION AND ORDER STATEMENT OF THE CASE Upon a second amended charge duly filed by American Federation of Hosiery Workers, Local No. 64, affiliated with the Congress of Industrial Organizations, herein called the Union, the National Labor 28 N L. R .B., No. 45. 257 258 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Relations Board, herein called the Board, by the Regional Director for the Thirteenth Region (Chicago; Illinois), issued its complaint dated April 15, 1940, against B. Z. B. Knitting Co., Rockford , Illinois, herein called the respondent , alleging that the respondent -had engaged in and was engaging in unfair labor practices affecting commerce, within-the meaning of Section 8 (1) and (2) and Section 2 (6) and (7) - of the'National Labor Relations Act, 49 Stat. 449, herein called the Act. Copies of the complaint and of notice of hearing thereon were duly served on the respondent and the Union; and also on the B. Z. B. Employees Association , herein called the Association, and the Shop Committee, labor organizations alleged in the complaint to have been formed, supported, and dominated by the respondent. With respect to the unfair .labor practices , the complaint alleged in substance : , (1) that the respondent :-in August 1933 - instigated the formation of the Association and thereafter interfered -with and con- tributed financial and other support to it and fostered and promoted its formation and growth ; (2) that the respondent in November and December 1939 fostered and promoted the formation and growth of an Association grievance committee , and -permitted activity by and in behalf of the grievance committee to take place in the plant during working hours ; (3) that the respondent in December 1939 instigated the formation of the Shop Committee and thereafter dominated and interfered with its administration and contributed financial and other support to it; and (4) that on and after August 19, 1935, the respondent urged and warned its employees not to become or remain members of ,the Union, engaged in surveillance of union activities , and by other acts and conduct interfered with, restrained , and coerced its employees in the exercise of the rights guaranteed by the Act. On April 26, 1940, the respondent filed its, answer to the complaint. In its answer the respondent admitted that it "* * * permitted association meetings on the plant premises during working hours, con- tributed financial and other assistance and support to the Association and engaged in the check-off of association dues from the wages of its employees * * *" and that it "* * * permitted the circulation of an Association petition among the employes on the plant premises during working hours in regard to the formation of an Association Grievance Committee and it permitted the selection of a Grievance Committee to be made on the plant premises during working hours and it permitted the members of the Association Grievance Com- mittee to solicit employes in the plant premises and during working hours to present grievances through the Grievance Committee." In effect, however , the respondent's answer constituted a general denial of the unfair labor practices alleged in the complaint. Affirmatively, the respondent alleged in its answer that "* * * from the time of its organization in 1933 until the fall of 1939, the B . Z. B. Employees B. Z. B. KNITTING CO. 259 Association functioned solely as a social organization and that on December 18, 1939, respondent disestablished the Grievance Commit- tee of the B. Z. B. Employees Association as a collective bargaining agency." Pursuant to notice, a hearing was held at Rockford, Illinois, on - April 29 and 30; and May 1, 1940, before Gustaf B. Erickson, the Trial Examiner duly designated by the Board. The Board, the respondent, the Union, the Association , and the Shop Committee were represented, at and participated in the hearing. Full opportunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bear- ing upon the issues was afforded all parties. At the close of the hearing, a motion by counsel for the Board to conform , the pleadings to the proof was granted by the Trial Examiner without. objection. Thereafter, the Trial Examiner issued his Intermediate Report dated September 21, 1940, copies of which were duly served upon the respondent, the Union, the Association, and the Shop Committee. In his Intermediate Report, the Trial Examiner found that the respondent had engaged in and was engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (1) and (2) and Section 2 (6) and (7) of the Act. He recommended that the respondent cease and desist therefrom and that it take certain.affirmative action designed to effectuate the policies of the Act. The affirmative action thus recom- mended included withdrawal of recognition from and disestablishment of the Association and the Shop Committee, and reimbursement of the respondent's employees for dues checked off from their wages by the respondent since July 5, 1935. On October 18, 1940, the respondent filed with the Board its ex- ceptions to the Intermediate Report and a request for leave to argue orally before the Board. On October 23, 1940, the respondent with- drew its request for leave to argue orally , and on October 31, 1940, it filed with the Board a brief in support of its exceptions to the Intermediate Report. The Union, the Association , and the Shop Committee filed no exceptions or briefs and made no request for leave to argue orally. . The Board has considered the exceptions and the brief filed by the respondent, 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 : FINDIc GS of FACT I. THE BUSINESS OF THE RESPONDENT B. Z. B. Knitting Co. is an Illinois corporation , having 'its princi- pal office and place of business in Rockford , Illinois . It is engaged 413597-42-vol 28-18 260 DECISIONS OF NATIONAL LABOR RELATIONS BOARD in the manufacture and sale of mercerized and full-fashioned silk hosiery for women. A' sales office is maintained by it in New York City, and it employs five salesmen who cover almost the entire country, three operating out of Rockford and two out of New York -City. Three trade or brand names used by the respondent are reg- istered with the United States Patent Office. The principal raw materials used by the respondent are silk, mercerized cotton, and dyestuffs. During the year 1939 the re- spondent purchased materials valued at approximately $375,000, of which approximately 90 per cent were purchased outside of the State of Illinois. During the same period the respondent sold fin- ished products valued at approximately $775,000, of which approxi- mately 70 per cent were shipped outside the State of Illinois. The respondent's interstate business during the first 4 months of 1940 was in about the same proportion to its total business as during 1939. At the time of the hearing the respondent had approximately 230 employees. II. THE ORGANIZATIONS INVOLVED American Federation of Hosiery Workers, Local No. 64, is a labor organization affiliated with the Congress of Industrial Organizations. It admits to membership all hosiery workers in Rockford, Illinois, and its vicinity, including employees of the respondent. B. Z. B. Employees Association and the Shop Committee are un- affiliated labor organizations admitting to membership employees of the respondent. III. THE UNFAIR LABOR PRACTICES A. Baekgrownd In August 1933 Frank Boehmen, president of the respondent, called a meeting of the respondent's employees in the plant during working hours and read from a letter stating that under the National In- dustrial Recovery Act they could form or join an organization of their own choosing. Afterwards, Boehmen recommended to the assembled employees the formation of "an organization of 'their own," promised them his full assistance, and stated that "we could do better with an organization of our own than we could by going outside and getting someone else to do our thinking for us." Upon concluding his talk,'Boehmen selected Adolph Miller, an employee, to act as''chairman for the remainder of the meeting. With the aid of Martin Giacone and several other employees, Miller subse- quently organized the Association, of which he and Giacone became temporary treasurer and temporary president, respectively., B. Z. B. KNITTING CO. 261 The record establishes beyond a doubt that activities of the Asso- ciation took place in the plant during working hours, that employees were told by foremen to join the Association, and that the respondent in other ways gave the Association its support and assistance.' Association dues of 25 cents a month were checked off by the re- spondent from the wages of its employees, including some who had signed no authorization therefor. Everyone employed by the re- spondent was eligible for membership in the Association, and even the respondent's president, Boehmen, became a member and had Association dues checked off from his salary. The respondent paid employees who organized the Association for working time thus spent, and donated various sums of money to the Association from time to time for use in connection with its social activities. In addition, profits realized from the operation in the respondent's plant of Coca Cola, candy, and cigarette vending machines were given to the Association, without any charge to it for the space thus used or for the maintenance of the machines. It is clear from the above facts, as the Trial Examiner found, that the respondent anticipated the exercise by its employees of the newly guarante'ed'right to form labor organizations of their own choice by suggesting the formation of the Association, by coercing employees into joining it, and by giving the Association financial and other support. We find that the respondent dominated and interfered with the formation and administration of the Association and contributed support to it. To the extent that these activities of the respondent in connection with the Association took place prior to July 5, 1935, the effective date of the Act, they do not constitute unfair labor practices within the meaning of the Act; they are, however, material to our consideration of the continued interference and domination and the 'other' alleged unfair labor practices in which the respondent subsequently engaged.2 B. Interference with, domination, and support of the Association subsequent to July 5, 1935 The respondent's conduct with respect to the Association was in no way altered subsequent to the effective date of the Act. Outright contributions of sums of money by the respondent to the Association continued to be made. Meetings of the Association's Board of Direc- ' :9s, we have pointed out above, the respondent in its answer admits that it permitted meetings ,of the Association to beheld in the plant during working hours and that it con- tributed financial and other assistance and support to the Association. 2 N. L. R. B. v. Pennsylvania Greyhound Lines, 303 U. S. 261 , 268-70 ; N. L. R. B. v. Pacific Greyhound Lines, 303 U. S. 272, 273 ; N. L R. B. v. Newport News Shipbuilding d Dry Dock Co , 308 U. S. 241 ; N. L. R. B. v. The Falk Corp ., 308 U S..453. 262 DECISIONS OF ,NATIONAL LABOR RELATIONS BOARD tors continued to be held in the respondent's plant.3 The profits realized from the operation of the Coca Cola, candy, and cigarette vending machines in the respondent's plant continued to go to the Association. The check-off of Association dues from the wages of the respondent's employees continued in effect. - On January 13, 1939, an employee named Earl Latour was elected president of the Association, succeeding Adolph Miller in that po- sition. During Latour's tenure in office, the respondent put a wage cut into effect and also speeded up the rate of production. Its em- ployees became dissatisfied with their working conditions, and began discussing them and the Union. Latour and Miller' were aware of this dissatisfaction and unrest among the respondent's employees and of the resulting union talk among them.' Latour testified that he was unwilling at the time to have any "outside factions coming in and taking' my troubles on their shoulders." There can be no ques- tion that, by "outside factions", Latour meant the Union. He there- fore decided to consult with Boehmen to see if the latter could "iron out the unrest that was prevalent." Accordingly, Latour and Miller called on Boehmen either late in October or some time in November 1939.5 Following his discussion with Latour and Miller, Boehmen addressed the employees on each floor of the respondent's plant. He told them, among other things, that he understood there was some unrest among them and that he would like to settle it. He asked the employees to come to him with their grievances rather than to go to an outsider, pointing out, "If you have trouble at- home, you don't go next door to your next door neighbor and have them settle it for you." Shortly afterwards Boehmen suggested to some of the employees that a committee be established for the purpose of handling griev- ances. An appropriate petition was promptly prepared with the aid of Adolph Miller, who was regarded by some of the other employees -as skilled in such matters, and was then circulated throughout the respondent's plant during working hours with the knowledge 'and consent of Boehmen, Yalden, and the foremen." The petition was drafted- in the office of Gallagher, a supervisory employee, and was 8 There were no membership meetings of the Association. * The record also shows that Giacone and the respondent's president, Boehmen, were cognizant of the feeling of unrest among the respondent's employees. 6 Latour and Miller took this responsibility upon themselves without consulting the Association's Board of Directors which , under the Association' s constitution , is its "gov- erning body." There is some indication in the record that the call made by Latour and Miller on Boehmen came just after the Union' s organizer, Linker, had addressed a group of the respondent's employees outside the respondent's plant. 9 There is evidence that the petition was prepared and circulated shortly after a group of the respondent's employees had met at the home of one of them to discuss unionaction B. Z. B. IKNITTING CO. 263 also typewritten in the plant.' After a sufficient number of sig- natures had been obtained, the petition was given to Boehmen and an election was held in the plant. The grievance committee thus created consisted of approximately 20 employees of the respondent, many of whom were or had been officers or directors of the Association. The same night the committee met as a group, with Boehmen and Gallagher present. Boehmen found that a committee as large as the one selected was unwieldy, and suggested that it be reduced in size. This was done. The committee members then, at Boehmen's request, questioned em- ployees in the plant about their grievances and reported back to Boehmen. Since, in Boehmen's estimation, the report of the com- mittee indicated that most of the employees' grievances centered about the question of wage rates, he granted an increase in wages. He also changed the system of fines previously used by the respondent. The employees who circulated the petition requesting the creation of a grievance committee were paid for the time thus spent by them, and employees who were elected members of the grievance committee were paid for time spent by them in the committee's work. On November 18, 1939, the Union wrote to the respondent, protesting the part played by it in establishing the grievance committee and requesting leave for the Union to solicit members in the plant during working hours in the same manner that signatures for the grievance commit- tee petition had been solicited. This request by the Union was denied by the respondent. Our findings as to the activities of the respondent with respect to the Association subsequent to July 5, 1935, are substantially the same as those made by the Trial Examiner. The respondent, in its brief, makes no serious attempt to attack the accuracy of the Trial Ex- aminer's findings, but contends rather that they are immaterial be- cause the Association was merely a social or fraternal organization and not a labor organization. The record does not sustain this con- tention. In 1933, when the, respondent suggested the formation of the Association, its action was linked in the minds of the employees with the guarantee in the National Industrial Recovery Act of the, freedom of employees in forming or joining labor organizations. The constitution of the Association recited that its object was, in part, to promote better understanding between employer and em- ployee. Express provision was made in the Association's constitution ' The, petition requested that "a committee from each floor be elected immediately" ;^ stated that "this is necessary now because of a growing feeling of unrest" ; and pointed out that "the management has agreed to go over such matters with this committee in order to settle all questions promptly", and that "the management desires to have a committee representing all Doors and departments that will be permanent , to meet with the manage- ment regularly." 264 DECISIONS OF NATIONAL--LABOR RELATIONS BOARD for establishment of a committee to take up grievances with the man- agement. As the minutes of the Association show, grievance com- mittees were actually selected and established in 1933 and 1934. Individual and group grievances were thereafter considered by the Association from time to time; and Aferwyn Livingston, president of the Association during 1937, admittedly took up some grievances with the managements Certainly there can be no question that the Association, in promoting the formation of a grievance committee in October or November 1939, was discharging the functions of a labor organization, although under the domination and with, the support of the respondent.. We find that the Association is a labor organization within the meaning of Section 2 (5) of the Act. We further find that the respondent has, since July 5, 1935, dominated and interfered with the administration of the Association and has contributed financial and other support to it, thereby interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act. C. Domination of and interference with the formation and administration of the Shop Committee On, December 18 or December 19, 1939, Boelunen summoned the members of the Association grievance committee to his office.9 Boeh- men or the respondent's labor relations adviser, Lynn W. Beman,10 who was also present at the lneeting, read to the committee members a- letter addressed to the Association's president, Earl LaTour, stating in part that there was some question as to the validity of the formation of the Association's grievance committee and that the" respondent 8The respondent, in its brief, concedes that Livingston discussed guevances pith the management and that working conditions were considered by the Association on two occa- sions, March 21, 1938, and June 6, 1939 The minutes of the Association reveal consid- el•ation of other grievances on August 15, 1938, October 3, 1938, and January 21, 1939 9 There is conflicting testimony in the record as to whether this took place on December 18 or December 19 The record indicates that tuuo or three of the employees who-were particularly active in the Association and its grievance committee, notably Adolph Miller and Martin Giacone, were aware prior to the meeting in Boehmen's office of the respond- ent's reason for holding the meeting and were then already preparing to form an organiza- tion to succeed the Association grievance committee If the meeting in Boehmen's office did not take place until December 19, 1939, the record would support the-inference that the respondent had consulted with at least these two or three employees and had given them advance notice of its proposed action before making any public announcement of it, and that the respondent was responsible for or connected with their preparations to form a new organization lieu ever, we regard the other evidence in the record as to the part played by the respondent in the formation of the successor organization as sufficiently clear to make it unnecessary to resolve the conflict in the evidence as to the date on which the meeting in Boehmen's office took place. w Beman had been the Board 's Regional Director in Chicago in 1936 , at the time the Union filed the charge to which we refer below and which it later withdrew. B. Z. B. KNITTING CO. 265 would therefore not recognize this or any other committee of the Association "on grievance matters." The letter continued as follows : In taking this action I have not forgotten my promise to the employees of this Company that I would recognize a permanent committee to act on any matters of grievance, working conditions, or any other questions that may come in the minds of the employees. It is perfectly legal for the employees of this Company to select a committee to -meet with the management on grievance or any other matters. The only change over your present method of handling such matters is: 1. That, if desired by the employees, a committee would have to be selected by the employees. 2. Neither this Company or the B. Z. B. Employees Association or any -of their officers or agents should have anything to do with such action or such selection. Boehmen told the committee that the' letter was to be read by Beman to all the employees in,the plant, but that he had called in the com- mittee to read the letter to them first because : You boys have been pretty fair to me and I thought instead of giving you an awful shock when we read this letter' out there and throw this committee out in the cold, I thought I would call you in here a few minutes before Mr. Beman gave this talk to all the employees?1 In accordance with the suggestion contained in the letter which was thus read first to the Association grievance committee and then to all'the respondent's employees, Giacone and Miller promptly set about forming "a committee to meet with the management." Giacone drafted a form of ballot which Miller arranged to have mimeographed. For use as ballot boxes, Giacone obtained several shoe boxes which he brought to the plant that same evening in preparation for the ballot- ing to be held the next day. The mimeographed ballots were distrib- uted; the voting was conducted, and the votes were counted in the plant. The election was superintended for the most part by employees who had been active in the Association or were members of the Asso- ciation grievance committee. The group thus selected, upon which Giacone then bestowed the name Shop Committee, included several of the same employees. Giacone was promptly selected to act as chair- man of the Shop Committee, and he at once notified Boehmen of its 11 Giacone testified more succinctly at the hearing that Boehmen explained to the com- mittee at the time that the reason for his calling them in was that he didn 't want them to feel-"like a bunch of dummies" when the letter was read to the employees as a group. -266 DECISIONS OF NATIONAL LABOR RELATIONS BOARD formation. On the same day Boehmen agreed to meet with the Shop Committee once a month 'to discuss grievances, and such meetings have since been held. It is clear, as the Trial Examiner found in his Intermediate Report, that the Shop Committee, like its predecessor, the grievance committee of the Association, is the creation of the respondent. The formation of just such an organization was suggested to the respondent's em- ployees by its president and its labor relations adviser, Boehmen and Beman, in the same letter in which they announced the disestablish- ment of, the company-dominated Association grievance committee. Formation of the Shop Committee was immediately begun by, em- ployees who had previously demonstrated their willingness to submit to the respondent's wishes in connection with the Association and its _ grievance committee.12 The election of the Shop Committee was held in the respondent's plant and obviously could not have taken place without the knowledge and consent of the respondent's supervisory employees. Recognition of the Shop Committee was granted by Boehmen immediately upon request. At the time of the hearing the Shop Committee still had no constitution or by-laws, though Giacone and Miller were allegedly "working on them." Giacone stated at the hearing that nothing important had been discussed at the 'regular monthly meetings of the Shop Committee and the management. Aside from the meeting at which it selected Giacone as its chairman, the Shop Committee has never held a meeting of its own without a management representative present. -There is no provision either for membership or for payment of dues on the part of the respondent's -employees, and • consequently no general meetings of the employees have been held and no funds have been obtained by the Shop 'Committee. The respondent contends in its brief that it has not formally rec- ognized the Shop Committee, has entered into no agreement with it, and has taken no other action which can be regarded as binding its employees to representation by the Shop Committee for any specific 12 The significance of such duplication of personnel, coupled with substantial continuity of existence between a dominated labor organization and its successor, was noted in Inter- national Association of Machinists v. N. L. R. B, 110 F (2d) 29 (App D C.), enf'g Matter ,of The Serrick Corporation and International Union, United Automobile Workers of America, Local No. 459, 8 N. L. R. B. 621, in which the Court of Appeals said (at p. 43) Acme Welfare was a company union. It follows necessarily that its leading pro- moters were company representatives. Men accustomed to such submission seldom regain independence overnight. The interval, if there was one, required for the trans- fer of allegiance by Byroad, Fouts, Shock and Bolander from Acme Welfare and the company to I. A. M. was too brief for disruption of the old and basic loyalty. The evidence supports the conclusion that It was not disrupted, but continued, though manifested in less obvious but more effective form. All that they did, therefore, is imputable to the company. [Italics supplied ] - The decision of the Court of Appeals has been affirmed by the Supreme Court In Interna- tional Ass'n of Machinists v. N. L. R. B., decided November 12, 1940. B. Z. B. KNITTING CO. 267 period of time or as foreclosing any other organization from seeking to represent the respondent's employees. There is no fixed formula which must be followed in extending recognition to a labor organi- zation, and there can be no question but that the respondent's will- ingness to discuss grievances and working conditions with the Shop Committee and its periodic meetings with the Shop Committee for that, purpose constitute recognition, .whether or not exclusive in na- ture. That the respondent'and the Shop Committee have not entered into a contract or otherwise crystallized the relationship between them for any particular period of time does not mitigate the effect of the respondent's domination and support. The mere existence of such a dominated labor organization among the respondent's em- ployees is an effective obstacle to their free selection of a collective bargaining representative. We find that the respondent has dominated and interfered with the formation and administration of the Shop Committee and has contributed support to it, thereby interfering with, restraining, and coercing its employees in 'the, exercise of the rights guaranteed in Section 7 of the Act. ` D. Interference, restraint, and coercion In August 1935 the Union held a mass meeting in Rockford. Some of the respondent's employees attended this meeting, and several of them signed membership application cards. Within a day or two thereafter George Yalden, a foreman, asked several employees in the plant whether they had joined the Union. His conversation with one of these employees, Carl Verbeski, was in part as follows : Carl, I want to talk to you ringleaders separately. I think you ought to give this thing up; you are fighting a losing battle; we have got the winning hand and ,you can't beat us out. If this mill was organized one hundred per cent we would shut it down for eleven months and we would freeze you out ..,. We have been treating you swell, but now it is just like you come around and stick a• knife in our back. A little later Yalden had the machines on the fourth floor shut down and told the employees that Boehmen was to address them. Boeh- men then appeared and said in part, as one employee testified without contradiction, that : ... the reason the B. Z. B. had steady work was because they were not a union mill, they can undersell union mills, and that it would be much better for all of us if we would forget about the union and go along under him. 268 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Boehmen asked that those employees "who would go along with him" raise their right hands. One of the few employees who did not raise their hands was Ben Maher, who had previously been questioned by Yalden as to his union membership. Boehman asked Maher if he would i'go along" with him, and Maher replied : "From the looks of things, I guess I will have to." Shortly after this meeting of the respondent's employees, Maher and a few others were summoned to Boehmen's office. They were told by Boehmen that their union activity was known, were asked to promise- that they would cease this activity, and were put "on probation" to observe the promise. A few days thereafter, Yalden told Maher that he thought Boehmen would like it if Maher induced some of the union members to destroy their membership cards. Maher accordingly shut down his machine and went about the plant persuading some of his fellow employees to discard their union mem- bership cards. For the time thus spent by Maher he was given credit by Yalden for the equivalent of what lie would have earned for producing 2 dozen stockings. During September 1935 the respondent engaged the services of the Bargren Detective Agency, and from October 1935 until August 1936 it employed detectives furnished by the G. A. Seagrove Com- pany, a Chicago detective agency. For the services of these agen- cies the respondent admits that it paid approximately $1600, although it refused to produce at the hearing the vouchers showing the precise amount involved and the purposes for which the detective agencies were engaged. Boehmen testified that the detectives were hired to investigate suspected Communist activity among the respondent's employees, and to "avoid any possible violence." On the other hand, it was testified by Homer Read, administrator of the Bargren Detec- tive Agency, that Boehmen had informed him at the time that the detectives were wanted because the respondent was "having some trouble with some of their men that were agitating, trying to get the rest of them to walk out on a strike." So far as the record shows, the only activity of the detectives who were thus engaged was to shadow union organizers and employees of the respondent who were active union members.13 Boehmen testified at the hearing that he received only oral reports from the detectives, but Read testified that written reports were submitted to him and were in turn trans- mitted in typewritten form to Boehmen. We are convinced by the evidence, as was the Trial Examiner, that the respondent engaged the services of the Bargren and Seagrove detective agencies for the ' Indeed, it appears from the record that one of these detectives was actually employed in the respondent's plant for some time. B. Z. B. KNITTING CO. 269 purpose of 'keeping the union activities of its employees under surveillance. We find that the respondent, by the acts and conduct above de- scribed, has interfered with, restrained, and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act .14 IV. THE EFFECT OF THE UNFAIR LABOR PRACTIGES UPON COMMERCE The activities of the respondent set forth in Section III B, C, alid D above, occurring in connection with the operations of the respondent described In Section I above, have a close, intimate, and substantial relation to trade, traffic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that the respondent has engaged in unfair labor practices within the meaning of the Act, we shall order it to cease and desist therefrom and to take certain affirmative action designed to dissipate the effects of the unfair labor practices and thereby to effectuate the policies of the Act. We have found that the respondent has dominated and interfered with the formation and administration of the Shop Committee, and has contributed support to it. The continued existence of the Shop Committee as a collective bargaining representative would not only constitute a continuing obstacle to the free exercise by' the respond- ent's employees of the rights guaranteed to them by the Act, but would 14 The respondent does-not controvert the facts which we have found above It does contend in its brief , however, that these events of 1935 and 1936 were " the subject of charges filed with the Board and settled and disposed of by the then Regional Director of the Thiiteenth Region in the fall of 1936" The record does not suppoit this assertion The most that the record can be said to show is that the Union or its predecessor, in August 1936 , filed with the Regional Director for the Thirteenth Region a charge alleging the discriminatory discharge of an employee by the same respondent ; that the regional office investigated the charge and the Regional Director , in the course of the investigation, consulted with the respondent ' s president ; that , upon the Regional Director ' s recommen- dation , the respondent subsequently reinstated the employee involved in the charge and also ceased its employment of the detective agencies described in this decision , and that the Union withdrew its charge It seems to us clear , and we ,find , that the 1,936 charge filed by the Union did not involve any of the unfair labor practices with which the present proceeding is concerned, and that in any event there was no compromise or settlement agreement made at the time which can now be said to bar a Board proceeding with respect to unfair labor practices on the part of the respondent during and prior to 1936. But even if, contiaiy to oui finding, a compioniise or settlement agreement had been made with the respondent in 1936, it would still constitute no defense in the present pro- ceeding unless, as we have held before, " , the employer did not thereafter continue to engage in unfair labor practices ' See Matter of J. Dunit;, doing business under the firni name and style of Gloiay Knitting Mills and Joint Council of Knit Goods Workers Union, International Ladies Garment Workers Union, Local # 155, 19 N. L R B 712, at p 6, and cases .therein cited Cf Matter of Howl, R Buck Company, Inc. and United Garment 1Vm kegs of America, Local No 229, 25 N L R B. 837. 270 DECISIONS OF •NATIONAL LABOR RELATIONS BOARD also detract from the remedial effect of the cease and desist pro- visions of our order. We -shall therefore direct the respondent to withdraw all recognition from the Shop' Committee as the repre- sentative of any of the respondent's employees for the purposes of collective bargaining, and to disestablish the Shop Committee as such representative. We have also found that the respondent dominated and interfered with the administration of the Association subsequent to July 5, 1935, and contributed financial and other support to it. It appears, however, that the respondent, in December 1939, voluntarily ter- minated its recognition of the Association as a collective bargain- ing representative of its employees. It will therefore be unnecessary for us to order the disestablishment of the Association. It is not clear, however, whether the Association has been dissolved or whether it has merely suspended activities for the time being. We shall, ' therefore,, include in our order an appropriate cease and desist pro- vision barring future support of the Association by 'the respondent, and we shall affirmatively order the respondent to refuse hereafter to extend recognition to the Association as a collective bargaining agency if it should seek to resume functioning in that capacity. _ The check-off of Association dues- by the respondent from the wages of its employees was, as we have found, a part of the respond- ent's support of the Association. These deductions for the benefit of a dominated labor organization may not, even in those cases in which authorization was given, be regarded as voluntary on the part of the employees affected. To restore the status quo in this respect, we shall order the respondent to reimburse its employees for all amounts deducted from their wages as dues for the Association since July 5, 1935.15 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. B. Z. B. Employees Association, the Shop,Committee, and Amer- ican Federation of Hosiery Workers, Local No. 64, affiliated with the Congress of Industrial Organizations, are labor organizations within the meaning of Section 2 (5) of the Act. 2. By dominating and interfering with the administration of the Association subsequent to July 5, 1935, and by contributing financial and other support to it, the respondent engaged in unfair labor practices within the meaning of Section 8 (2) of the Act. 15 Matter of The Heller Brothers Uompany of Newcomerstown and International Bother • hood of Blacksmiths, Drop Forgers, and Helpers, 7 N. L. R. B. 646. B. Z. B. KNITTING Co., 271 3. By dominating and interfering with the formation and admin- istration of the Shop Committee and by contributing support to it, the respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (2) of the Act. 4. By interfering with, restraining, and coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act, the respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8 (1) of the Act. 5. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2 (6) and (7) of the Act. ORDER Upon the basis of the above findings of fact and conclusions of law, and pursuant to Section 10 (c) of the National Labor Relations Act, the National Labor Relations Board hereby orders that the respondent, B. Z. B. Knitting Co., Rockford, Illinois, and its officers, agents, successors, and assigns shall: 1. Cease and desist from : (a) In any manner dominating or interfering with the administra- tion of the B. Z. B. Employees Association and from contributing financial or other support to it; (b) In any, manner dominating, or interfering with the admin- istration of the Shop Committee or the formation or administration of any other labor organization of its employees, and' from contrib- uting support to the Shop Committee or to any other labor organization of its employees ; (c) Recognizing the Shop Committee as the representative of any of its employees forthe purpose of dealing with the respondent con- cerning grievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work; (d) Maintaining surveillance upon the activities of its employees in connection with the Union or any other labor organization; (e) In any other manner interfering with, restraining, or coercing its employees in the exercise of their right to self-organization, to form, join or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purposes of collective bargaining or other mutual air or protection, as guaranteed in Section 7 of the Act. 2. Take the following affirmative action, which the Board finds will effectuate-the policies of the Act : (a) Withdraw all recognition from the Shop Committee as the representative of any of the respondent's employees for the purpose of dealing with the respondent concerning grievances, labor disputes, 272 DECISIONS OF NATIONAL LABOR RELATIONS BOARD wages, rates of pay, hours of employment, or conditions of Work, and completely disestablish the Shop Committee as such representative; (b) Refuse hereafter to recognize the Association as the representa- tive for collective bargaining purposes of any of the respondent's em- ployees, if the Association should at any time resume functioning in that capacity; (c) Reimburse all employees for any dues deducted by the respond- ent from their wages since July 5, 1935, on behalf of B. Z. B. Employees Association; (cl) Post immediately, in conspicuous places throughout its plant at Rockford, Illinois, and maintain for a period of at least sixty (60) consecutive days from the date of posting, notices to its employees stating that the respondent will not engage in the conduct from which it is ordered to cease-and desist in paragraphs 1 (a), (b), (c), (d), and (e),of this Order, and that the respondent will take the affirmative action set forth in paragraphs 2 (a), (b), and (c) of this Order; (e) Notify the Regional Director for the Thirteenth Region, in writing, within ten (10) days from the date of this Order, what steps the respondent has taken to comply therewith. CHAIR3IAN HARRY A. MILLIS took no part in the consideration of the above Decision and Order.