Sterling Electric Motors, Inc.

In the Matter of STERLING ELECTRIC MOTORS, INC. and INTERNATIONAL BROTHERHOOD #OF ELECTRICAL WORKERS, LOCAL No. 83 Case No. C-415.-Decided February 17, 1941 Unfair Labor Practices Coinpany-Dominated union: in view of supplemental findings -based upon evi- dence 'adduced at a supplemental hearing held pursuant to an order of the Ninth Circuit Court of Appeals, the Board recommended to the Court that it set aside the Board's order directing the respondent to disestablish a labor organization found in the original decision to be company-dominated. Mr. William R. Walsh and Mr. James A. Cobey, for the Board. Mr. Jack W. Hardy and Mr. Leonard Horwin, of Los Angeles, Calif., for the respondent. Mr. Brice L. Worley and Mr. George E. Ellicott for the I. B. E. W. Mr. George Turitz, of counsel to the Board. SUPPLEMENTAL FINDINGS OF FACT AND RECOMMENDATION STATEMENT OF THE CASE On July 9, 1938, the National Labor Relations Board, herein called the Board, issued a Decision and Order in this case.' In its Decision the Board found that Sterling Electric Motors, Inc., herein called 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, in that the respondent had dominated and interfered with the formation and administration of Sterling, Electric Motors, Inc., Employees Association, herein called the Association, and had contributed support to the Association, and that the respondent had thereby interfered with, restrained, and coerced its employees in the exercise of their rights guaranteed in Section 7 of the Act.'- The Board ordered the respondent to cease and desist (a) from dominating or interfering with the administra- 18 N. L. R B 173 'The Board dismissed the complaint insofai as it alleged that the respondent had engaged in unfair labor practices Nrithin the meaning of Section 8 (3) of the Act by the discharge of C. C. Summers. 29 N. L. R. B , No. 122. 778 - STERLING ELECTRIC MOTORS, INC. 779 tion of the Association or with the formation or administration of any other labor organization of its employees, and from contributing support to the Association or any other labor organization of its employees; (b) from recognizing the Association as the repre- sentative of any of its employees for the purposes of collective bar- gaining; and -(c) from in any other manner interfering with, restraining, or coercing its employees in the exercise of the rights guaranteed in Section 7 of the Act. As affirmative action which the Board found would effectuate the policies of the Act, the Board ordered the respondent to withdraw all recognition from the Associa- tion as a representative of any, of its employees for the purposes of collective bargaining and completely to disestablish said Association as such representative, and ordered the posting of appropriate notices in the respondent's plant.3 On June 14, 1939, the Board petitioned the United States Circuit Court of Appeals for the Ninth Circuit, herein called the Circuit Court, for enforcement of its said Order, and on or about July 5, 1939, the respondent filed its answer to the Board's petition. The Cir- cuit Court heard argument on the Board's petition on November '30, 1939, and on January 9, 1940, entered an order, which was accom- 8 The Board 's order, insofar as pertinent , is as follows : 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 the respondent, Sterling Electric Motors Company , Inc , Los Angeles, California, and its agents , successors , and assigns, shall 1. Cease and desist (a) From dominating or interfering with the administration of Sterling Electric Motors, Inc , Employees Association or with the formation or administration of any other labor organization of its employees , and from contributing support to said organization or to any other labor organization of its employees. (b) From recognizing Sterling Electric Motors, Inc, Employees Association as representative of any of its employees for the purpose of dealing with the respondent concerning grievances , labor disputes, wages, rates of pay , hours of employment, or other conditions of employment ; (c) From in any other manner interfering with , restraining, or coercing its em- ployees 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 purpose of collective bargaining or other mutual aid or protection 2. Take the following affirmative action which the Board finds will effectuate the policies of the Act : (a) Withdraw all recognition from the Sterling Electi le Motoi s , Inc , Employees Association as a representative of any of its employees for the purpose of dealing with the respondent concerning grievances , labor disputes , wages, rates of pay , hours' of employment, or other conditions of employment, and completely disestablish said Association as such representative ; (b) Immediately post notices in conspicuous places throughout its plant and main- tain such notices for a period of thirty ( 30) consecutive days , stating: (1) that the respondent will cease and desist as aforesaid , ( 2) that the respondent withdraws and will refrain from all recognition of the aforesaid Association as a representative of any of its employees for the purpose of dealing with the respondent concerning grievances , labor disputes , wages, rate of pay, hours of employment , or other condi- tions of employment , and that said Association is disestablished as such representative ; (c) Notify the Regional Director for the Twenty-first Region in writing within ten (10 ) days from the date of this order what steps the respondent has taken to comply herewith. 780 DECISIONS OF NATIONAL LABOR RELATIONS BOARD panied by a majority opinion and a concurring and dissenting opui- ion,4 setting aside the Board's order. On March 9, 1940, the Circuit Court, on its own motion, set aside its order of January 9, 1940, and on April 9, 1940, heard reargument. On April 22, 1940, upon appli- cation made by the respondent pursuant to leave, the Circuit Court made the following order : On the consent of petitioner, respondent's application to ad- duce additional evidence on the issue of fact concerning the alleged absence of a submission to the company by the Committee of the Employees Association of the proposition of a 40-hour week and time and, a half overtime, in the period between the meeting of the management with, the employees association on June 6, 1937, and the posting of the Company's notice on June 14, 1937, is granted. Revieiv 'submitted to Denman, Mathews and Healy, Circuit Judge, oh all matters save those which may be affected by any' additional ej,id'ence hereafter adduced. On April 27, 1940, the Board moved the Circuit Court to modify the above order by adding thereto the following language : and that evidence likewise may be adduced by either party of any circumstances surrounding the origin, announcement, or effect of said proposition, if any, or of said notice; pertinent to the charges of unfair labor practices alleged in the complaint. On May 6, 1940, the Circuit Court made an order (a) denying the Board's motion of April 27, 1940; (b) denying the Board's petition for a decree enforcing its) Order to the respondent to cease and desist from recognizing the Association as representative of any of its employees for the purposes of collective bargaining, and to with- draw all recognition from the Association as a representative of any of the respondent's employees for such purposes and completely to disestablish said Association as such representative; and (c) reserving decision on the Board's said petition, in so far as concerns other portions of the Board's said Order. On May 7, 1940, the Circuit Court issued its opinion in connection with the said order of May 6, 1940, and a dissenting opinion by Circuit Judge Healy.' On July 14, 1940, the Board petitioned the Supreme Court of the United States that a writ of certiorari issue to review the Circuit Court's order of May 6,-1940. The Circuit Court, one judge dissent- ing, thereafter vacated its order of May 6; 7 and on October 28, 4109 F. (2d) 194. 5 The leave for such application was granted by the Circuit Court by its orders of April 9 and April 15, 1940. °112 F. (2d) 63. 7114 F. (2d) 738. STERLING ELECTRIC MOTORS, INC. 781 1940, the Supreme Court dismissed the Board's petition for certiorari and denied the Board's application for other relief.8 Pursuant to stipulation, a supplemental hearing to adduce addi- tional evidence pursuant to the order of the Circuit Court of April 22, 1940, was held on May 8, 1940, at Los Angeles, California, before Thomas H. Kennedy, the Trial Examiner duly designated by the Board. The Board and the respondent were represented by counsel, and the I. B. E. W. by its representative. Full opportunity to be -heard, to examine and cross-examine witnesses, and to introduce evidence bearing on the issue of fact set forth in the said order of April 22, 1940, was afforded all parties. The Board has con- sidered the rulings of the Trial Examiner on motions and the ad- mission of evidence and finds that no prejudicial errors were committed. The rulings are hereby affirmed.9 Upon the entire record in the case the Board makes the'following : SUPPLEMENTAL FINDINGS OF FACT At the supplemental hearing various witnesses gave testimony re- lating to the issue of the submission to the respondent by the Associa- tion of the proposition of a 40-hour week and time and a half for overtime in the period between the meeting of the management of the respondent with the Association on June 7, 1937,10 and the posting of the respondent's notice on June 14, 1937. Bueter," the chairman of the temporary committee which met with the respondent on June 7, 1937, testified that when the employees in the plant heard that the' Association had been recognized by the respondent at that meeting as their exclusive collective bargaining representative, a number asked what would be clone about obtaining a 40-hour week and time and a half for overtime; 12 that he and Reuben Manes, an employee who had assisted him in organizing the Association, thereupon determined t 61 S. Ct. 69 At the close of the supplemental hearing the respondent moved to dismiss the complaint with respect to the alleged violation by the respondent of Section 8 (2) of the Act in so far as the allegations of such violation were based upon the matters dealt with at the supplemental hearing, on the ground, first, that the complaint contained no allegation that the respondents notice of June 14 , 1937, was false and specified no particulars in which it was false ; and, second , that the evidence showing submission of the Association's proposal for a 40-hour week and time and a half for overture and the acceptance thereof by the respondent was virtually undisputed, wherefore, the respondent contended, the foundation of the Board 's conclusions as'to the domination of the forrihatidn or adnums- tration of the Association was destroyed . The respondent also moved "to -dismiss the general charges of the Board . . . with relation to Respondent's violation of Section 8 (1) of the Act " The Trial Examiner made no ruling on the motions. • The motions are hereby denied 11 In our Decision of July 9, 1938, we found that the conference at ivhich the Associatibn obtained recognition from the respondent took place on June 6, 1937, but at the supple- mental hearing the evidence showed that it took place on June 7, 1937. 11 Bueter's name was incorrectly written as Beuter in our Decision of July 9, 1938 12 At that time the respondent's plant operated 44 hours per week 782 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to call a special meeting to consider that matter ; that,- such -a -special- meeting was held by the Association on about June 8, 1937: and was attended by 45 or 50 of the approximately 60 persons then em- ployed; 13 that after discussion those present at the meeting voted almost unanimously to submit to the respondent the proposition of a 40-hour week and time and a half for overtime; that, the temporary committee was directed by the assemblage to meet with the.inanage- ment to present the request and that the task of arranging an ap- pointment was delegated to Bueter; that Bueter informed Harder, the respondent's superintendent, of the meeting, and that, `Rueter told him we took a vote on 40 hours aiicl time and a half : that the men would like to have it in the shop, being they were working so much overtime and stra;ght time, and such as that.. . . ; that Harder stated he would see Mendenhall or Johnson..the respond- ent's general manager and president, respectively ; that several days later Harder informed Bueter that the request has been granted; that thereupon Bueter requested the posting of a notice informing the employees that the Association had obtained what it asked for; and that the notice of June 14 was posted in compliance with that request.14 Harder testified that Bueter had informed him of the action taken by the special meeting of the Association and-requested a meeting between the committee and the respondent. He also testified that he communicated the proposal to Mendenhall; that Mendenhall stated that he would take the matter up "further"; that after 1 or 2 days Mendenhall informed him that the proposed change was granted; and that Harder, at Bueter's request, posted a notice stating that the request had been granted. Mendenhall testified at the supplemental hearing : Mr Harder came in and said that the employees had gotten to- gether and had discussed the question of 40-hour week and time and a half for overtime, and wanted to know if they could have that concession from the management. I told him, "Well, if that was their desire, as far as I was concerned I thought it was allright, but I wanted to discuss it with Mr. Johnson, the presi- dent ..." 1,113ueter testified that the meeting was held after work on a lot adjoining the plant 14 Reuben Manes, Thompson , and Gray gave testimony- as to the special meeting of the employees substantially the same as Bueter 's in all important respects , and counsel for the Board stipulated that eight other named employees , if called , would testify to the same effect. STERLING ELECTRIC MOTORS, 'INC. 783 He further testified : . I went into his [Johnson 's] office and explained to him that Mr. Harder had come to me about the 40-hour week and time and a half ; and he said, "Well, if it is all right with ,you, why it is all right with me" . . . Then I got ahold of Mr. Harder and told him that as far as we were concerned , it was all right for the fellows to have 40 -hour week and time and a half for overtime. Mendenhall also testified that he authorized Harder to prepare and post a notice on the bulletin board, as requested by Bueter, and that that was done. We have considered the evidence hereinabove set forth, which was not controverted , in connection with the testimony given by Bueter, Warner, Harder, Mendenhall , and-Johnson at the first hearing and in connection with the prior contentions of the respondent before both the Board and the Court with respect to the notice published on June 14, 1937. , At the original hearing Bueter testified as follows : Q. Now, following this first meeting with the management, what did the employees do , or what did you do with reference to the employees' Association? A. The first thing we did we got busy and looked up a hall and had a meeting ... They had a meeting on the 25th day of June . . . He- also testified : Q. When, with relation to the first meeting, or the second meeting, of the membership in the Employees' Association, did you meet with the management to negotiate certain changes in working conditions? A. I don't think we met until after the third meetin . .. I would say it was along the latter part of September. At the supplemental hearing Bueter stated that he did not consider. the special meeting a "meeting . . . of the Association ," since it was not held in a hall and there was no "routine under elected officers," and that he simply had not thought of it when asked the first question quoted above. ' Harder testified at the first hearing, in effect,'that the only changes in the plant resulting from negotiations between "these employees and the management" were changes in the wage rates of several employees and the installation of lockers for the employees. At the supplemental hearing he explained his failure to mention the Associations's alleged request by stating: "I didn't think of it, possibly,." 784 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Mendenhall testified at the first hearing to the effect that he had not heard of a conference between the 4ssociation and any official of the respondent between June 7. and 14. 1937;15 and Warner, a witness for the respondent, when asked by counsel for the respond- ent what the Association did following its recognition by the respondent, stated that it, then held its meeting of June 3n.11 In is brief to the Circuit Court the respondent argued: that they posting of the notice of June 14, 1937, while consistent with the inference made by the Board that the respondent wris thereby at- tempting to aid the Association by giving it misleading credit, was also subject to the equally plausible inference that the respondent's management was aware ' that the Association's demand of June 7, 1937, for collective bargaining was merely one A)-ay of indicating a request for improved wages and working conditions. The re- spondent made" a similar argument in its brief to the Board. - This argument implies that tine respondent made an independent deter- mination that the employees' desires for improved wages and work- ing conditions could be met by the 40-hour `week and time and one- -half for overtime, and it excludes the possibility that any request therefor was made by the Association, as the respondent 'now maintains. While our consideration of the testimony adduced at both hear- ings 17 and the position taken by the respondent in its briefs leaves us with serious doubt regarding the accuracy of the testllnony ad- duced at the supplemental hearing, in view of the absence pf any direct denial of the latter testimony, particularly as to the special meeting, we find that the events took place as recounted in the testi- mony of witnesses at the supplemental hearing. 16 Mendenhall testified Q . how often, since the meeting at which the petition was presented to you, has a'committee representing the Association met-with you ,1 Just once Q Do you know if there have been and meetings between a committee of the Asso- ciation and any other official or plant superintendent or general manager of the company, at which you were not present? A I don't think so. ' - if Warner's testimony was, in pact: Q After that meeting with the management, did the management agree to recognize you as bargaining agent? A. They did. - Q Then what did the Association do? A The Association had a meeting . . We met at a hall at Ford and Hubbard Boule%aid It is clear that Warner was referring to a meeting held on June 25 and not the special meeting "It should be noted that the original hearing was held,-less than 41/ months, after the events'occuited while the supplemental hearing was heldualmost 3 years after such events. STERLING ELECTRIC MOTORS, INC. 785 RECOMMENDATION • The evidence at the first hearing did not establish that the respond- ent initiated the inside organizational movement tunong its employ- ees 18 or that the designation of the Association prior to June 7 by a majority of the employees resulted froze interference by the re spondent. The Board's ultimate findings were.based primarily-upon its opinion that acts of the respondent at the June 71conference and thereafter furnished impetus for the completion of the formal organ- ization of the Association which, as yet, was organized on a tempo- rary and tentative basis. In view of our supplemental findings herein, we are of the opinion that the record in its entirety does not establish that the respondent dominated or interfered with the forma- tion and administration of the Association or contributed support to it. We therefore recommend to the Circuit Court that the Board's ot;der of July 9, 1938,,be set aside MR. EnwiN S. SMITH, dissenting: I do not, thank that the supplemental findings justify any modifica- tion of the ultimate finding in the Board's Decision of July 9, 1938, that the respondent dominated and interfered with the formation and administration of the Association and contributed support to it.19 In the said Decision the Board stated, by way of summary of the facts relating to the respondent's dopnnatiou and support of the Association : We shall briefly analyze the respondent's course of conduct, as revealed by the rcord, with respect to the organization pf its employees. During the latter part of April and the early part of May 1937, the respondent's employees were joining the I. B. E. W. From May 3 to May 26, the respondent ignored all the I. B. E. W.'s biweekly efforts to arrange a meeting.' When a meeting was at;- ranged on May 27, through the intervention of the Board's agent, the respondent completely disregarded the I. B. E.-W.'s' claim to represent 90 per cent of its employees. While the evidence does not establish that the respondent directly initiated the inside or- ganizational movement among its employees, it is plain that the respondent's hostility to the I. B. E. W. propelled the employees into an alternative form of organization acceptable to the respond- ent. Upon the appearance of the employee committee, the re- spondent openly recognized and adopted the projected inside organization and proceeded to further its interests among the See 8 N L R B 173, 183. 1 While the incompatibility of the testimony adduced at the supplemental hearing with that adduced at the first hearing and the position taken by the respondent in its biiefs leads nee to disbelieve the testimony at the supplemental hearing in spite of the absence of denial, I do not place my dissent upon this ground 786 DECISIONS OF NATIONAL LABOR RELATIONS BOARD employees by word and action. Thus, the respondent authorized the committee to proceed with an inside organization at the June 6 meeting. The respondent also expressly stated its preference for the inside organization at this meeting and finally gratuitously posted the notice of June 14 attributing the concessions therein to the collective bargaining efforts of the committee. Through the impetus furnished, in part, by the respondent, the.. formal organization of the Association was thereafter completed. Under these circumstances, we find that the respondent has dominated and interfered with the formations and administration of the Association and has contributed support to it and has thereby interfered with, restrained, and coerced its employees in the exer- cise of their rights guaranteed by Section 7 of the Act. The pother acts of the respondent in its dealings with the employees set forth in the said. Decision were, in my opinion, sufficient to in- fluence them to choose the Association as their permanent bargain- ing representative and thus constituted support of the Association and domination and interference with its formation and adminis' tration.20 Especially important were the respondent's approval of the Association's form of organization in the notice of June 14,21 and Mendenhall's previous statement to the employee committee that he liked "this company union idea," and that it was "a splendid way for the men and the office to get together in their understandings." These expressions of approval, particularly in the light of the re- spondent's hostile attitude towards the I.B. E. W., were not cal- 20 The iespondent's claim that the Board , in arguments of its counsel before the Circuit Court , in ellect "admitted that the crucial issue in its mind so far as proving Respondent's domination of the Employees' Association and engaging in wrongful activities was con- cerned, was the issue whether or not the Committee of the Employee 's Association had in fact submitted to Respondent 's management the proposal mentioned in Respondent's notice of June 14th ", appears to be based upon a misunderstanding The Board's biief to, the Circuit Court clearly takes the position that , apart from the notice , certain ". . expiessions of respondent 's hostility to the Union [ the I B E W ] and support of the Association appear adequate to influence the employees into rounding out the Associa- tion " ( p 27). zi The notice stated in part The Company at-this time desires to express its admiration for the commendable method and manner which the employees chose to bring about an amicable solution of their pioblems and also hope that your organization will be a means of a better understanding of the problems of both the compan y and its employees They also expi ess their willingness to deal with its employees in the future as it has in the past wheneier a question arises peitaining to remuneration , hours, conditions, etc The "Round Table" has always been and always will be considered the best place to gather aiound and arbitrate questions which might be viewed from different snares While the company does not want to be quoted as saying that they can always concur on everything that might be proposed , they feel that with the right attitude and cooperation on the part of all concerned they can and will be willing at all times io meet Four committee and iron out all questions to a satisfactory conclusion STERLING ELECTRIC MOTORS , INC.- 787 culated to indicate to the employees-their employer's mere willingness to deal with the organization chosen by them, but were bound, rather; to -instill- in their milids the notion of a marked favoritism on the part of their employer- for an inside' union as distinguished from one affiliated with an outside body. By- these actions the respondent greatly strengthened the idea of placing the employer-favored or- ganization, as yet established only tentatively, on a permanent basis. In addition, accepting the testimony adduced at the supplemental hearing, it shows, at most, that the 'respondent's 'consent to the Association's proposition was given after bargaining of a sketchy nature. The notice, of June 14, however, by stating that the propo- sition had been "submitted to the company by the committee," and had been "duly considered by the management and passed upon favorably," and by referring to "an amicable solution of their [the employees'] problems," and to the "Round Table," had the purpose and effect of creating the impression that the Association had carried to a successful conclusion bargaining of a more involved and difficult kind. In this manner the respondent, notwithstanding the sub- mission of the proposition by the Association, gave the Association credit to which it was not entitled. Furthermore, I am convinced that the respondent granted the 40- hour week and time and one-half for overtime for the purpose of lend- ing prestige to the Association as a collective bargaining agency, and thus giving it further support.22 I am impelled to this conclusion by several considerations. First, the speed with which the respond- ent consented to this, substantial increase in its pay roll 23 is in marked contrast to the respondent's attitude prior to the advent among its employees of the competing labor organizations, at which time a request for an increase in piece-work rates by a relatively small number of employees in the winding department was followed by several months of investigation and negotiations.24 Second, as pointed out above, the respondent had previously manifested pref- erence for the Association and hostility to the I. B. E. W. and 22 See N L R B. v. Falk Corp , 308 U. S. 453, reversing modification of Board 's order in 106 F. (2d) 454 (C. C A. 7), modifying 102 F. (2d) 383, enforcing 6 N.-L R B. 654; N L R. B v. Christian Board of Publication, 113 F. (2d) 678 (C. C. A 8 ), enforcing 13 N. L. R B. 534 , M. H. Ritzwoller Co v. N. L R. B., 114 F. (2d) 432 (C. C. A. 7), enforcing as modified , 15 N. L. R B. 15. 23 The notice stated that the respondent would continue to operate its plant 44 hours a week as formerly, but that the employees would receive time and one-half for the extra 4 hours. 24 The final granting of that wage increase between May 15, and 20, 1937, took place during the period when the I. B. E. W. was attempting twice each week to arrange a meeting with the respondent. 413602-42-vol. 29-51 788 DECISIONS OF NATIONAL LABOR RELATIONS BOARD, coupled, the announcement of the granting , of the Association's re- quest with an expression of approval of that form of organization. Upon the basis of the entire record in the case I think the Board should affirm its finding that the respondent has dominated and-inter- fered with the formation and administration of the Association and has contributed support to it and has thereby interfered with, re- strained, and coerced its employees in the exercise of their rights guaranteed by. Section 7 of the Act, and that- the Board should recommend to the Circuit Court that the Order issued by the Board on July 9, 1938, be enforced in full, without modification.