Arma Engineering Company

National Labor Relations Board - Board Decisions

Aug 17, 1939

14 N.L.R.B. 736 (N.L.R.B. 1939)

In the Matter of ARMA ENGINEERING COMPANY and COMMITTEE FOa' INDUSTRIAL ORGANIZATION In the Matter of • ARMA ENGINEERING COMPANY and UNITED INSTRU- MENT WORKERS, LOCAL INDUSTRIAL UNION No. 238, AFFILIATED. WITH THE COMMITTEE FOR INDUSTRIAL ORGANIZATION Cases Nos. C-605 and R-773, respectively.-Decided August 17, 1939k .Precision Instruments Manufacturing Industry Interference, Restraint, and Coercion: anti-union statements by supervisory - employee ; dissemination of anti-union literature, causing or permitting ; employment of labor spies-Com- pany-Dominated Union: membership solicitation by supervisory employees; permitting organizational activities during working hours contrary to posted notice ; dominance by single employee and absence of general employee partici- pation, characterized by ; hasty recognition as exclusive bargaining agency coincidental with membership campaign by bona fide union ; disestablished, as agency for collective bargaining-Employee Status: keymen without power to hire or discharge held supervisory employees--Contract: exclusive bargaining, with company-favored organization set aside-Discrimination: discharges and lay-offs : for union membership and activity or for hostility to company-domi- nated organization ; allegations of, dismissed as to three employees, sustained as to four-Reinstatement Ordered: of discharged employees-Back - ,Pay. awarded : to employees discharged or laid off ; to employees as to whom Trial Examiner recommended dismissal, not to include period between date of Intermediate Report and date of Decision-Collective Bargaining: with :union not representing majority in appropriate unit; allegation of refusal to engage in, dismissed-Investigation of Representatives: not barred by exclusive bar- gaining contract with company-dominated organization ; controversy concern- ing representation : refusal of recognition by employer because of dominated organization'.; majority membership-Unit Appropriate for Collective Bargain- ing: all hourly paid factory and production employees, including keymen but excluding all other supervisory personnel and all salaried, office, and clerical employees ; contention of company-dominated organization as to, disregarded- Election Ordered: at such time as the Board shall in the future direct; company- dominated organization excluded from ballot. Mr. Christopher W. Hoey, for the Board. Cummings c Lockwood, by Mr. Mark W. Norman and Mr. Walter N. Maguire, of Stamford, Conn., for the respondent. Liebman, Robbins, Pressman d, Leider, by Mr. Harold I. Cammer, of New York City, for the C. I. O. and Local 238. Sweet *.& Sweet, by Mr. Irving Sweet and Mr. Samuel Sweet, of New York City, for the Council. Mr. Louis Newman, of counsel to the Board. 14 N. L. R. B., No. 62. 736 ARMA ENGINEERING COMPANY DECISION ORDER AND DIRECTION OF ELECTION STATEMENT OF THE CASE 737, A charge and amended charge having been duly filed by the Com- mittee for Industrial Organization, herein called the C. I. 0., the National Labor Relations Board, herein called the Board, by its Regional Director for the Second Region (New York City), issued and duly served its complaint dated November 30, 1937, against Arma• Corporation,' Brooklyn, New York, herein called the respondent,. alleging that the respondent had engaged in and was engaging in unfair labor practices affecting commerce, within the meaning of Section 8 (1), (2), (3), and (5) and Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat. 449, herein called the Act. On July 27, 1937, the C. I. 0.2 filed with the Regional Director for the Second Region a petition alleging that a question affecting commerce had arisen concerning the representation of 'employees of the respondent and requesting an investigation and certification of representatives pursuant to Section 9 (c) of the Act. ` On August 10, 1937, the Board, acting pursuant to Section 9'(c) ' of the Act and Article III, Sections 3 and 10 (c) (2), and Article II, Section 37 (b), of National Labor Relations Board Rules and Regula- tions-Series 1, as amended, consolidated the two cases for purposes of hearing and ordered the Regional Director to conduct an investi- gation of representatives and to provide for an appropriate herein' upon due notice., ' lAt the time of the issuance of the complaint , the name of the respondent was Arma Engineering Company, and the proceeding was so entitled. On December 30, 1938, subse- quent to the close of the hearing in these proceedings , the respondent stipulated with counsel ' for the Board ". . . that on or about December 20th, 1938 , a certificate of change of corporate name was filed with the Secretary of State of the State of New York by respondent , Arma Engineering Company ; that the corporate title of respondent now is 'Arma Corporation ." The stipulation is hereby ordered made a part of the record. Hereinafter in our decision , the changed form of the respondent ' s corporate name will be used. 2 The petition for investigation and certification of representatives was filed by the "Committee for Industrial Organization on behalf of the employees of Arma Engineering Company. " At the hearing , on motion of counsel for the C. I. 0. and without any objection , the petition was amended to designate United Instrument Workers, Local In- dustrial Union No. 238 . affiliated with the Committee for Industrial Organization, as the petitioner. The term "C. 1. 0." Is hereinafter used interchangeably to refer to Local No. 238, to the Committee for Industrial Organization , or to both. 3 By Board order dated January 29, 1938, the two cases were severed. Subsequently, on February 10, 1938 , during the progress of the hearing , the Board again ordered the cases consolidated for purposes of hearing . All parties waived notice of the consolidation and consented- to make applicable to both proceedings the evidence which had then already been taken. 738 DECISIONS OF NATIONAL LABOR RELATIONS BOARD On January 12, 1938, there was also filed with the Regional Di- rector, on behalf of the Independent Instrument Makers & Machinists Council, herein called the Council, a .petition alleging that 'a question affecting commerce had arisen concerning the representation of em- ployees of the respondent and requesting an investigation and certification of representatives pursuant to Section 9 (c) of the Act .4 The complaint issued by the Board under date of November 30, 1937, alleged in substance that the respondent had, on and subsequent to July 8, 1937, refused to bargain collectively with the C. I. O. as the exclusive representative of employees of the respondent in a unit appropriate for collective bargaining, although the C. I. O. was on June 30, 1937,. and at all times thereafter, the duly designated repre- sentative of a majority of the employees in such unit; that the respondent initiated, formed, and sponsored the Council and there- after dominated it, interfered with its administration and contributed support to it; that on various dates between June 4 and July 16, 1937, the respondent discharged seven employees named in the complaint 5 because they joined and assisted the C. I. 0.; and that by these acts, and various other acts occurring on and after June 1, 1937, the respondent interfered with, restrained, and coerced its employees in .the exercise of the rights guaranteed in Section 7 of the Act. Thereafter, the respondent filed its answer dated January 14, 1938, in which it admitted the allegations of the complaint as to the nature .of the respondent's' business and its connection with interstate com- merce, denied the allegations of unfair labor practices, and alleged affirmatively that the C. I. O. at no time represented a majority of the respondent's employees and that the respondent "declined to recog- nize" the C. I. O. "as the exclusive representative of all of its em- ployees, because it had no reason to believe that `the Union' did in fact represent the majority of the employees, or that any claim that it did so represent the majority was made in good faith or by a duly authorized agent." The respondent's answer also contained affirma- tive allegations with respect to the seven employees allegedly dis- charged for union activities.- Thereafter, the respondent filed a supplemental answer dated January 27, 1938, containing further affirmative allegations with respect to one of the seven employees alleged to have been discriminatorily discharged.7 ,'No action has been taken on the Council's petition, pending decision on the allega- tion contained in the complaint in this proceeding, that the respondent initiated, formed, and sponsored the Council and thereafter dominated it, interfered with its administra- tion and contributed support to it. 5 Rheinhold Nelson, Edward Fidellow, Eric H. Edholm, Richard Noonan, Emil Raue, Clifton Johnson, John Lovas. ° These allegations will be separately considered below in our discussion of the. individual cases. P The allegations contained in this supplemental answer will be considered in our dis. cussion of the case of Eric H. Edholm. ARM'IA ENGINEERING COMPANY 739 By notice of motion and petition dated December 27, 1937, the Council requested leave to intervene for the sole purpose of contesting the allegations contained in paragraph 4 of the complaint that the C. I. 0. had been designated by a majority of the respondent's em- ployees"as their collective bargaining representative. 'The Council also asked leave to interpose an answer to paragraph 4 of the com- plaint . By subsequent notice of motion and petition dated January 8, 1938, the Council withdrew its prior request and asked 1eave to inter- vene generally and to interpose an answer . This motion to intervene generally was granted at the hearing by the Trial Examiner desig- nated by the Board, who then also granted a request by the Councih that its second petition be regarded as an answer to the complaint. Pursuant to notice duly served on the respondent, the C. I. 0., and'. the Council, a hearing was held at New York City on January 31- and February=1; 2, 3, 4, 8, 9, 10, 11, and 14, 1938, before Harold) Stein, the Trial Examiner duly designated by the Board. The Coun- cil, is stated above, was given leave to intervene. The Board, the' respondent, the C. I. 0., and the Council were all represented by counsel and participated in the hearing. Full opportunity to be heard, to examine and cross- examine witnesses, and to introduce evidence bearing on the issues was afforded all parties. During the hearing, the Council moved to consolidate its petition for investiga- tion and certification of representatives with the proceedings being heard. The motion was denied by the Trial Examiner. At the close of the Board's case, and again at the close of the respondent's case and at the close of the hearing, the respondent and the Council moved to dismiss the complaint or parts thereof on various grounds, including the ground that there was in existence between the re- spondent and the Council a valid contract which had been ratified by the respondent's employees. Decision on these motions was re- served by the Trial Examiner at the hearing, as was decision on a motion made by counsel for the Board at the close of the hearing to' dismiss the allegations contained in the complaint that the re- spondent had engaged in unfair labor practices within the meaning of Section 8 (5) of the Act. A motion by counsel for the Board, made at the close of the Board's case and again at the close of the hearing, to amend the pleadings to conform to the proof with respect to matters such as names, dates, and places was granted without ob- jection. A similar motion by the C. I. 0. to amend its petition for iizvestigation and certification of representatives to conform to the proof ' with respect to formal matters, such as the number of em- ployees involved, was also granted at the hearing. The Trial Exam- iner also made various other rulings during the course of the hearing. including rulings on motions and on objections to the admission of evidence. The Board has reviewed the rulings of the Trial Examiner 740 DECISIONS OF NATIONAL, LABOR RaLATIONS BOARD and finds that no prejudicial error was committed. The rulings are• hereby affirmed. Thereafter , the Trial Examiner filed his Intermediate Report dated May '6 , 1938, copies of which were duly served on . all the parties. He granted the motion to dismiss the allegations of the complaint that the respondent had engaged in unfair labor practices within the meaning of Section 8 (5) of the Act, and denied the general motions to dismiss made.by the respondent and the Council, with certain exceptions . He found that the respondent had engaged in 'unfair labor practices within the meaning of Section S (1), (2), and (3) and recommended that the respondent cease and desist from these practices and from giving effect to its contract of July 9, 1937, with the Council, that it withdraw recognition from and disestablish the Council as a collective bargaining agency, that it offer reinstate- :ment with back pay to one 8 of the seven employees involved in the proceeding , and that it take certain other affirmative action. As to the six other employees involved in the proceeding,!, the Trial Exam- iner recommended dismissal of the complaint. On May 19, 1938, the respondent filed with the Board exceptions to the Intermediate Report and requests for findings and for oral argument, and the C. I. O. filed exceptions to the Intermediate Report. On May 20, 1938, the Council filed with the Board excep- tions to the Intermediate Report and to the record, and requests for findings, for oral argument, and for leave to submit a, brief. Pur- suant to notice duly served on all the parties, oral argument was had before the Board at Washington, D. C., on November.. 1,. 1938. The respondent and the Council were represented by counsel and participated in the argument. Briefs were submitted by the Council and the respondent on October 31 and November 1, 1938, respec- tively. The Board has considered the exceptions and briefs filed by the parties and finds the exceptions without merit except as they are- consistent with the findings, conclusions, and order set forth below. Upon the. entire record in the case, the Board makes the following: FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT The respondent is a corporation organized and existing under the laws of the State of New York, having its office and plant at Brook- 8 The employee who was found by the Trial Examiner to have been discriminatorily .discharged and whose reinstatement with back pay he recommended was,, Ed,, rdVVh Fidell ow.' e Rheinhold Nelson. Eric H. Edholm, Richard V . Noonan , Emll J. Itaue , Clifton John- ,on, John J . Lovas, Jr. ARMA ENGINEERING COMPANY 741 lyn, New York. It is engaged in the manufacture of precision in- struments and related products, over 99 per cent of which are made on order of the United States Navy Department and in accordance with its specifications. The balance of the respondent's products is sold to other concerns who resell to the Navy Department. In filling orders of the Navy Department, the respondent ships its products to naval bases and stations in all parts of the United States and in Hawaii. More than 50 per cent of the materials used by the re- spondent in its operations, mostly metals, are received by it from outside the State of New York, and more than 50 per cent of its products are shipped to points outside the State. The respondent conceded that it causes a substantial amount of materials used and of products manufactured by it to be bought, transported, sold, and delivered in interstate commerce. II. THE ORGANIZATIONS INVOLVED ,United Instrument Workers is a labor organization affiliated with the Committee for Industrial Organization . Local Industrial Union No. 238 of the United Instrument Workers admits to mem- bership, among others, hourly paid production employees of the respondent. Independent Instrument Makers & Machinists Council is an un- affiliated labor organization which admits to membership only hourly paid production employees of the respondent. 1II. THE UNFAIR LABOR PRACTICES A. Irr,terferenice, restraint, and coercion; support and domination of the Council 1. The respondent 's labor relations prior to 1937 Union organization apparently first appeared in the respondent's plant sometime during the period of the National Industrial Re- covery Act, although the precise time is not disclosed by the record. The Mechanics Educational Society of America; probably during 1934, attempted to organize the respondent's employees . The record does not furnish sufficient basis for a finding as to the result of this attempt by the M. E. S. A. Late' in 1934 the respondent became a member of the National Metal' Trades Association . In October of that year the respondent arraned with the Association for the services of two operatives paid -by the Association . The respondent's vice president and chief engi- neer, Arthur P. Davis, testified generally at the hearing that the confidential nature of the work performed by the respondent in man- 742 .DECISIONS' OF NATIONAL LABOR RELATIONS BOARD ufacturing instruments used by the United States Navy made it 'necessary for the respondent to keep a close watch on its employees. 'The explanation most strongly pressed by the respondent, 'however, is that the operatives were engaged for the purpose of detecting and 'stopping pilferage of tools in the plant. One operative, who was known as' Frank Shults but whose name was A. J. Wagner, was em- ployed by the respondent on October 8, 1934, and was discharged December 7, 1934. The other operative, Fred Saake, was employed by the respondent from April 10, 1933, until November 21, 1936. The 'respondent's plant superintendent, Nelson, testified at the hear- ing that Saake was a legitimate employee of the respondent prior to the beginning of the detective service furnished by the Association, that lie ' continued as such after the respondent discontinued the service in January 1936, and that his name was unknown to Nelson as other than one of the respondent's regular employees during that entire period and until publication of the report of the Senate com- mittee investigating violations of civil liberties 10 A third operative of the Association, Harry Worth, was also employed by the respond- ent during the fall of 1934, but Nelson testified that Worth was not one of the men for whose services the respondent was paying. the Association, and that Nelson became aware of Worth's connection with the Association only when the report of the Senate committee became public. ' The respondent's president, David M. Mahood, testified that weekly typewritten reports were mailed by the Association to him per- sonally and were then turned over by him to Nelson. Mahood also testified that these reports contained no information of any im- portance and that they made no reference to union activities of the men in the plant. The reports were not produced or put in evidence to support Mahood's testimony. For this service, the Association made an additional charge dis- tinct from membership ' fees. The total cost of the 'service to the' respondent for the entire period was between $2,600 and $2,700. Upon cross-examination as to the alleged pilferage of tools which caused the respondent to engage the operatives, Nelson was able to remember only two or three instances of such pilferage, involving tools worth less than $50. Nelson further testified that the respondent discon- tinued this service in 1936, because the pilfering stopped and be- cause the respondent then began hiring its own watchmen. Davis testified that the respondent withdrew from membership in the 10 Report of the Committee on Education and Labor pursuant to S. Res. ' 266 .(74th Congress). A Resolution to Investigate Violations of the Right of Free Speech and As- sembly and Interference with the Right of Labor to Organize and Bargain Collectively. Senate Report No. 6, Part '4 (76th Congress, 1st Session). ARMA ENGINEERING COMPANY 743: 'National Metal Trades Association because of the Association's anti labor policy; Mahood and Nelson testified that the respondent with. drew from membership because the cost was not justified by the benefits received. We.'find. the respondent's explanation of its employment of these. operatives completely unconvincing. The incredibility of the ex- planation given by the respondent gives rise to the inference, entirely- reasonable under the circumstances, that the operatives were in fact. labor spies and were employed as such, and we so find.1Y Though; begun in 1934, the respondent's use of operatives concededly con- tinued beyond the effective date of the Act and until early in 1936.. It was publicized by the report of the Senate committee and, was referred to by the organizer, Lifshitz, and others in talking to:'the C. I. O. members among the respondent's employees after publication of the committee's report. We find, that the respondent,. by employing these operatives for the purpose of maintaining sur- veillance of its employees' union activities, interfered with, restrained, 'and coerced its employees in their exercise of the rights' guaranteed in Section 7 of the Act. 2. Organization of the C. I. O. and of the Council; interference, restraint and coercion; support of the Council In May 1937 a small group of the respondent's employees began, discussing the question of union organization. On Saturday, May 22, five of them 12 called on Allan S. Haywood, C. I. O. Regional. Director in New York City, to request the help of the C. I. O. in organizing the respondent's employees. Haywood requested the com- mittee to return the following Monday. On Monday, May 24, when the committee again called on him, Haywood introduced a C. I. O. .organizer, Benjamin Lifshitz, who had been assigned by Haywood to the task of organizing the respondent's employees and the em- 'ployees at the nearby plant of the Ford Instrument Company. Within 10 days after the conferences of May 22 and May 24, one of- the committee, . Young, and another employee, Schulte, were trans- ferred by the respondent to the third shift . starting at midnight, that being the most undesirable of the three shifts at the respondent's, .plant.'-, On Thursday; May 27, a mass meeting of the respondent's em- ployees was sponsored by the C. I. O. At this meeting temporary "Cf. Matter of Kansas City Power cL Light Company and International Brotherhood or Electrical Workers, Local Union B-412, 12 N. L . R. B. 1414. i2 McCarthy, Raue, Young, Murray, and Bell. 13 Schulte was interested In organization and had discussed it with Ilaue at the plant. We make no finding as to whether these transfers were discriminatory, since neither the charge nor the complaint so alleges and the issue was not raised at the hearing- 190935-40-vol. 14--48 744 DECISIONS OF NATIONAL LABOR RELATIONS BOARD or provisional officers were elected for the period of organization. Raue was elected temporary chairman, Thomas Murray temporary secretary , and McCarthy temporary treasurer . On June 7 Raue, Murray, and McCarthy conferred with the respondent 's plant super- intendent , Robert F. Nelson. The conference was arranged by Mur- ray, whose purpose in doing so is obscure. Whatever his purpose, Murray made the arrangements without the prior knowledge. or consent of Raue and McCarthy , who nevertheless agreed to keep the appointment as a courtesy to Nelson . The testimony as to what occurred at that conference is conflicting , Nelson testifying that the only question raised was whether or not the respondent would favor the formation of an independent union among its employees, while Raue testified that the men attempted to get some expression of opinion from Nelson as to the respondent 's attitude toward organi- zation of its employees by the C. I. O. We deem it unnecessary to resolve this conflict , since we regard the conference as significant only in that : ( 1) it served notice on Nelson of the beginning of a movement toward union organization among the. men : in the plant, even if he had not already been informed of this movement through other channels, and ( 2) it indicates the importance to the respond- ent's employees of its attitude towards their self-organization. Organizing activities of the C. I. O. were vigorously pushed through June and early July. On June 3 the C. I . O. held another meeting of the respondent 's employees . Some C. I. O. members having been transferred to less desirable shifts, the C. I. O. on June S distributed a handbill 14 stating that "the management of the Armaa Engineering Company is intimidating some of the employees because of their union activities in the plant ." At least two other handbills, to which we shall refer more specifically below, were distributed by the C. I. O. during June outside the respondent 's plant. Organi-ra- tion of the employees at. the nearby plant of the Ford Instrument Company was proceeding along parallel lines and was of importance in the drive at the respondent 's plant because "informal certification" of the C. I. O. as -collective ` bargaining representative of -the Ford employees early in June and the negotiation and execution of a con- tract with the Ford Instrument Company at the end of June were used as arguments by the C. I. O. in persuading the employees of the respondent to join . Lifshitz and Raue testified that the peak point in C . I. O. membership among the-respondent's employees was reached at the end of June or during the first week in July. Addi- 1' This handbill and others which followed. it, as will appear below, apprised the re- spondent of the activities of the C. I. O. among the respondent 's employees and of the C. I. O.'s later claim of majority representation. .AR_MIA ENGINEERING COMPANY 745 lional handbills were circulated by the C. I. 0. among the respond- ent's employees during July, and on July 13 a meeting of C. I. 0. 'members was held at which it was voted to join Local No. 238 of United Instrument Workers. The preceding month, United Instru- ment Workers had become affiliated with the Committee for Industrial Organization. Literature other than the C. I. 0. handbills to which we have .referred was also distributed outside the respondent's plant, includ- ing a pamphlet entitled "Join the C. I. 0. and Help Build a Soviet America." This was a small-size, 60-page, paper-bound pamphlet attacking the C. I. 0. as a communist organization whose leadership ,and policies are inimical to the best interests of American working ,men. The copies of this pamphlet which were distributed outside the. respondent's plant were stamped on the front and back "Amer- ican Association Against Communism, Incorporated, 44 Court Street, Brooklyn, N. Y." 15 In addition to the stamped copies distributed .outside the plant, however, unstamped copies were found: (1) by McCarthy, iii a vashrooni used by the milling-machine department; (2) by.Neug>+en, on his workbench; (3) by. Edward Fidellory, another employee, on an inspection bench in the assembly department and in the washroom; and (4) by John Sadowski, still another employee, in a pigeonhole of a workbench in the. stockroom. An employee in the stockroom, Rheinhold Nelson, early in June saw three copies of a reprint of an anti-C. I. 0. article or editorial from the Chicago Tribune in one of the washrooms; Fidellow saw a number of copies of similar newspaper items in the washrooms; and Sadowski found a Chicago Tribune reprint in a workbench pigeonhole along with a copy of the pamphlet to which we have referred above. The respond- ent contends that all of this anti-C. I. 0. literature was received by the men outside the plant and was brought in by them. The record shows, however, that the anti-C. I. 0. pamphlets which were dis- tributed outside the plant bore the. stamp of the American Associa- tion Against Communism, Inc., whereas those found inside the plant by , 1cC(i.rthy, Neugren, Fidellow, and, Sadowski were unsta.mped. It also seems to us unlikely that copies of the pamphlet received by the men outside the plant and read and discarded by them in the plant would have appeared in the places at which the unstamped copies were found. As to the anti-C. I. 0. reprints, there is nothing to indicate distribution of such material outside the plant, and the places at which reprints were found in the plant by Rheinhold Nel- son-. Fidellow, and Sadowski are as questionable as those at which the unstamped copies of the' pamphlet were found. We infer and find "The record does not show any connection between the respondent and the American Association Against Communism, Inc. '746 DEOISIONS OF NATIONAL LABOR RELATIONS BOARD that the anti-C. I. 0. pamphlets and reprints were placed in the plant by the respondent or with its knowledge and consent. Nor was this the only indication the respondent's employees had of its opposition to the C. I. 0. After a C. I. 0. membership meeting on June 23, p `bablyAhe following day; I aue met•Walicki, machine department supervisor and assistant to Nielsen, the respondent's as- sistant plant superintendent, on the street and had a talk with him.. Walicki urged Raue to leave the C. I. 0., suggesting the American. Federation of Labor as a more suitable organization. He also men- tioned loyalty to the company, communism, and racketeering, and. intimated that the respondent's plant would be closed if the C. I. 0. was successful in organizing the men. Walicki was not called to. testify at the hearing, and Raue's testimony as to their conversation is uncontradicted. On June 18, William Neugren was accused by his foreman, Carl- son, of soliciting members for the C. I. 0. on company time. Neugren denied at the hearing.that he had used working time as charged'by' Carlson. Since Carlson did not take the stand, we find that Neugren did not solicit on company time and that Carlson's unfounded ac- cusation was simply another manifestation of the respondent's hos- tility to the C. I. 0. Further discouragement by the respondent; of the organizing cam- paign of the C. I. 0. appears in.the.discharges and lay-offs consitl- ered by us below in Section III B of our decision. Our finding is that several of these discharges and lay-offs were due to C. I. 0. membership and activities. A further deterrent to the organizing efforts of the C. I. 0. was the formation of the Independent Instrument Makers & Machinists Coun- cil. The moving spirit in.the formation of the Council was Arthur H. Wise, an electrical inspector employed by the respondent. The record leaves no doubt as to Wise's dominant part in initiating the Council and obtaining its membership. ' He testified at the hearing that the idea of an independent labor organization at the plant first suggested itself to him after he became aware of the beginning of the C. I. O.'s activities and, that the primary purpose in forming the Council was to prevent the C. I. 0. front becoming the collective bargaining representative of the men in the plant. Wise began organization of the Council by forming a group of 9 or- 10 n-men who acted as an executive committee. Wise was either un- able or unwilling to give an exact chronology of events during June and July 1937, but it appears that he recruited his Council committee- during the first or second week of Juhe. On June 14, Wise had Coun- cil membership cards printed for which, he testified at the hearing, be paid out of his own funds. On June 15 distribution of the cards. ARMA ENGIiNEERING COMPANY 747, through the committee of the Council was begun. Three days later, •on June 18, Wise wrote a letter to the respondent in which he claimed that the Council represented a majority of the respondent's produc- tion employees. The almost complete lack of general employee participation in the early and crucial stages of the Council's. administration and opera-' r^l tion is significant. Wise, acted as chairman of the Council until early in October of 1937. Despite the allegedly warm welcome which the Council received from the men, it was not until June 28 that the. Council had its first membership meeting. Prior to that meeting, and even subsequent thereto, Wise acted for the Council without ap- parent control by the members or by the committeemen. The original committee was selected by Wise. The letter of June 18 from the Council to the respondent, in which majority representation was claimed, was written without the knowledge or explicit consent of the membership or even of the Council committee. Willard Sears, though a member of the Council committee, revealed by his testimony at the hearing that he knew little, if anything, about the affairs of the Council or about the manner in which decisions were made. At eetings with representatives of, the. respondent and at the general meeting held by the Council the evening of June 28, Wise "seemed to run the show." Indeed, Wise admitted at the hearing that when Raue, who was known as a C. I. O. man, attempted to speak at the Council meeting of June 28, the meeting was abruptly adjourned. The only opportunity given the membership of the Council to select their own officers and governing body was a motion made by 'Wise at the meeting of June 28 to retain the original committee. .Even then, it was only upon motion -by Noonan, who was a mem- ber both of the Council and of the C. I. 0., that selection of rep- resentatives of the various departments was made by secret ballot, rather than by open vote on the proposed blanket adoption of the then existing. committee. - Given .this opportunity 'to express their choice, the membership ousted two members of the then committee, 'Theodore R. Krause and Edward J. Farley, even though Krause and Farley had had their names publicized by means of the Council ,membership cards. Despite this secret-ballot election at the meet- ing of June 28, the names of all the original committeemen con- tinued to appear on Council membership cards which were there- after circulated. As to the selection of officers for the group, it was testified by the Council's secretary, S. Howard Wedlake, that at one of the Council's general meetings the executive committee was authorized to select the officers for 1938. The record does not -reveal what men were chosen to act as officers, and Wedlake at the hearing "hesitated" to state when officers were selected. 748 DECISIONS OF NATIONAL LABOR RELATIONS BOARD' After the meeting of June 28, general membership meetings of the Council were held July 8, September 1, and during the middle of October 1937, and January 14 or 15, 1938. It was testified at the hearing that the Council then contemplated having a general meeting once every other month. It appears from the record that, at the Council meeting of July 8, the membership approved the terms of a proposed contract with the respondent. Aside from that, the record contains no specific evidence as to business transacted at general meetings of the Council. A constitution and bylaws were not adopted by the Council until either the meeting of September 1 or the meeting held in the middle of October. The record does not include a copy of the constitution and bylaws which are said to have been then adopted, so that we have no information as to the internal structure of the Council. After the membership campaign of the Council began, the co- operation of the respondent appeared clearly. Sometime late in June, Richard V. Noonan, an employee, was approached at the plant during working hours by Edward J. Farley, keynian in the electrical department, who asked Noonan to sign a Council mem- bership card. Noonan saw Farley approach approximately 10 other employees with Council membership cards and spend from 10 min- utes to half an hour with each. While this was going on, the elec- trical-department foreman, Prince, and his assistant, Charles Nelson,. brother of the respondent's plant superintendent, were present but did nothing to stop Farley's activity. Noonan was laid off July 2, 1937, but, after having been recalled to work by the respondent. on September 14, 1937, was again approached by Farley on behalf of the Council. More than corroborating Noonan 's testimony as to Farley's ac- tivity for the Council is the testimony of another employee, Andrew C. Sorenson, who was approached by Farley at the plant and during working hours approximately a. hundred times between June 1937 and the date of the hearing. A third employee, Clifton Johnson, was approached by Farley during working hours at the plant in June, and saw Farley hand Council membership cards to all of the men in Johnson's section. Johnson testified, without con- tradiction, that the foreman and assistant foreman, Prince and Charles Nelson, were there. but said nothing to Farley. The respondent, through its plant superintendent, Robert F. Nel- son, contended at the hearing that Farley is not a keyman, but Nelson conceded that Farley may have acted as "leader" on a job and the respondent did not call Farley as a witness or otherwise attempt to controvert the testimony as to his activities on company time and property. ARMA ENGINEERING COMPANY 749;' Sometime in June 1937, Peter Hansen, an employee in the grinding department,. was given a Council membership card by Arthur J. Schwebins who, Hansen testified, is his foreman. Schwebins told Hansen that it would be a good thing for him to sign the card and that, if he did, everything would be "quiet." Hansen also saw Schwebins hand Council membership cards to two other employees,. Farrell and Stein. The respondent, at the hearing, denied that Schwebins was a foreman at the time involved in Hansen's testimony,. although it was conceded that Schwebins had once been a foreman and that in June 1937 he was a keyman. Upon examination by counsel for the respondent, Hansen persisted in his position that Schwebins was still his foreman and that, in any event, regardless of Schwebins' technical position, Hansen still regarded Schwebins as his superior and still took orders from him. Schwebins was not called to testify at the hearing. We do not, however, think it neces- sary to determine this conflict in the testimony or to decide whether' Schwebins' technical status was that of foreman or of keyman at the time in question, since we are convinced and we find that in. either event he occupied a supervisory position. Rheinhold Nelson, an employee in the assembly-department stock- room, was discharged on Friday, June 18, 1937. Shortly before his discharge, his superior, John Lundquist, asked Nelson whether he had joined the Council and said that, if he did not join, he could not stay with the respondent. Lundquist was not called to testify at the hearing, and Nelson's testimony in this regard is undenied. • Another employee, John Sadowski, just after his return from, vacation in the latter part of July 1937, was approached at the plant by Rudolph Anderson, keyman in the assembly department, who asked Sadowski to join the Council and told him that, if he did, he, would get along with the company much better. Sadowski refused,. whereupon Anderson reminded him of the discharges and lay-offs that were occurring and advised him to think it over. The respond- ent's plant superintendent, Robert F. Nelson, admitted at the hear- i'ng' that Anderson often acts as a keyman, though perhaps not as frequently as some others. Anderson was not called to testify at the. hearing. The respondent has taken the position that keymen are not super- visory employees and that the respondent is, therefore, presumably not responsible for what is said and done by them. The plant super- intendent, Robert F. Nelson, testified that "as soon as a job requires more than one man, one is put as a leader for the other," and that the leader is known as a keyman. It is the function of the keyman: to see that the job ' on which he is working moves according to schedule and that each of the men employed on the job does his part, of it properly. As a specific example, Nelson stated that Carlson 750 DECISIONS OF NATIONAL LABOR RELATIONS BOARD and Grunlan, who are in charge of the assembly department, have discretion "to delegate such duties as in their judgment and efficiency, ;.[sic] would be the operating of the department, they delegate those. duties and responsibilities to others to see that jobs are moving." The men to whom such delegation is made "would be called leaders or they would be called keymen, or just not designated 'at all." Some keymen, such as Schwebins and others, are permanent keymen, .Nelson testified, and spend all or practically all of their time in that kind of work. Others are designated from time to time and for varying periods of time, as the respondent's work requires. There is testimony in the record, such as that given by John Sadowski, an employee, to the effect that the men themselves regard keymen as their immediate superiors from whom they take orders, though key- men do not have the power to hire and discharge. Keymen were, nevertheless eligible for membership both in the C. I. O. and in the, `Council. On all the facts, we hold that a keyman is a supervisory, employee whose position enables him effectively to coerce employees and to interfere with their right to self-organization, and whose acts, when he does so interfere or coerce, are properly deemed to be the acts of the respondent.,"' Aside from the supervisory character of the employees who solicited Council membership, as above described, it is evident that no em-: ployee, supervisory or otherwise, could have taken the time required, for a campaign such as that conducted by Edward J. Farley,, for example, without its coming to the attention of the respondent's supervisory personnel and without the respondent's tacit approval. The respondent's failure to curb the activities of Council organizers in the plant during working hours appears equallyi clear in the case.: ,of employees occupying non-supervisory positions. - Neugren - saw Joseph Duncan, an employee and a member of the Council, away from his bench during working hours and soliciting Council member- ships. Several times during the months of June and July 1937 Ericson saw Duncan talking to other employees during working hours, and was told by these employees that Duncan urged them. to become members of the Council. Ericson complained to Krause about this solicitation during working hours, but without result. John Sadowski saw Duncan on July 19 or 20, 1937, talk to another employee, Sonderman, for an hour or an hour and a half during working hours, and Sonderman later told Sadowski that Duncan had "'Cf. Matter of Semet-Solvay Company and Detroit Coke Oven Employees Association, -et al., 7 N. L. R. B. 511; Matter of The Electric Auto-Lite Company, Bay Manufacturing Division and International Union, United Automobile Workers of America, Local No. 526, 7 N. L. R. B. 1179; Matter of McKaig-Hatch, Inc. and Amalgamated Association of Iron, Steel and Tin Workers of North America, Local No. 1149, 10 N. L. R. B. 33. ARM. A., COMPANY 751 been discussing Council membership with him. Sadowski also saw Duncan approach and speak to several other employees. Ericson was approached during working hours by Arthur H. Wise,. who asked him not only to join the Council but also whether he would not be a representative for his department on the Council committee. Though Wise was an electrical. inspector and not an assembly- de-partment employee, he was at one time seem by Ericson in the as- sembly department almost continuously for 2 or 3 days, during which time he was talking constantly to various employees. .Several times during June and July 1937 Ericson also saw Willard. Sears talking to other employees during working hours, and these employees later told him that Sears was discussing Council member- ship with them. Ericson complained to his foreman, Carlson, about Sears' activities on company time, each such complaint being followed by a short lull in Sears' activities. Andrew C. Sorenson, the employee who testified that he had been approached by Edward J. Farley approximately a hundred times during the summer and fall of 1937, was also approached by Arthur- H. Wise during working hours. It is claimed that employees who spent working time in obtaining: Council members were acting contrary to the respondent's established' and announced policy and contrary to the instructions issued by the, respondent to its foremen. Shortly after the decisions of April 12,. 1937, in which the Supreme Court of the United States upheld the validity of the Act,17 Mahood, Davis, and Robert F. Nelson had a conference at which a labor relations policy was formulated for the- respondent and Nelson was instructed to see that the policy was followed. No written statement of this policy, prepared at the time- of its formulation, was produced at the hearing; but a memorandum prepared for the respondent after Robert F. Nelson's conference of June. 7 or.9 .with Raue, McCarthy, and Murray includes a statement of the company's labor policy. This policy included the following: points : 1. No interference by the company with any labor organiza- tion. 2. Maintenance by the company of "its policy of dealing with, its men on an individual basis or a group basis." 3. Union membership not a condition of employment by the company. "National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U. S. 1; Na- tional Labor Relations Board v. Fruehauf Trailer Co ., 301 U. S. 49; National Labor Relations Board v. Friedman-Harry Marks Clothing Co., 301 U. S. Z8; The Associated- Press V. National Labor Relations Board, 301 U. S. 103; Washington, Virginia & Maryland Coach Co. v. National Labor Relations Board, 301 U. S. 142. 752 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 4. No discrimination against any man because of his joining or refusing. to join any labor organization. 5. "No organization activity whatsoever will be allowed in the plant or during working hours." The statement of policy also included a clause referring, to the con- , fidential nature of the work performed by the respondent for the Navy Department. Early in May, Robert F. Nelson called a general conference of all his foremen, at which he read the respondent's statement of policy. Sometime during May, Nelson also ordered the foremen to suppress all "intimidation and coercion" in the plant. Despite these instruc- tions to the respondent's foremen, a substantial amount of member- ship solicitation for the Council took place at the plant during work- ing hours, as above described. We have held before that an em- ployer who instructs his supervisory personnel to avoid interference with union activities of employees or reprimands them for such inter- ference does not thereby absolve himself of responsibility for sub= Sequent activities in his plant.- Failure on the part. of, an employer affirmatively to, deny or repudiate the legitimate inference of, em= ployer support or approval which arises in the minds of employees when the representatives of a labor organization are permitted openly and without interference to solicit members in the plant during work= ing hours encourages and fosters the growth of that labor organiza- tion as effectively as a positive statement of support by the employer. No serious argument is made either by the respondent or by the Council that such solicitation of membership on company time and property did not take place. It is contended, however, that the C. I. 0. was guilty of the same practice and to the same extent, and that the respondent, if it permitted solicitation during working hours, did so even-handedly and without discriminating either; against the C. I. 0. or in favor of the Council. As the brief sub= mitted in behalf of the Council states : "The truth of the matter is that both sides were actively soliciting, whether the company de- 'sired it or not, and that the company in fact was powerless to pre- 'vent the same though it did make some attempt at so doing." 19 In ,support of the contention that the C. I. 0. was as active in the plant .as was the Council, testimony was introduced tending to show that Willard Sears was approached during working hours by an uniden- 18 Matter of Ingram Manufacturing Company and Textile Workers Organizing Com- mittee, 5 N. L. R. B. 908; Matter of Swift R Company, a Corporation and Amalgamated Meat Cutters and Butcher Workmen of North America. Local No. 6i1, and United Packing House Workers, Local Industrial Union No. 300, 7 N. L. R. B. 269. 1D This statement concedes, so far as the Council is concerned, the absence of any effective restraint by the respondent of membership solicitation in its plant. ARMA ENGINEERING COMPANY 753 tified person who asked him to join the C. I. 0. Sears also stated in general terms that he saw C. I. 0. "pusher"" talking to other em- ployees during working hours. Joseph Duncan was approached on behalf of the C. I. 0.: (1 ) by McCarthy in a restaurant while at lunch; (2) by McCarthy, again, one evening while Duncan was leav- ing the plant; and (3) by Raue one' day while Duncan was in the testing department . With respect to the last of these three, Duncan's testimony indicates that his conversation with Raue was quite brief. It also appears from the record that Duncan and Ericson , at a time not specifically fixed by Duncan, discussed with each other during working hours the relative merits of the C. I. 0. and the Council. Joseph Person , a third employee, was approached in the plant by Raue for the C. I. 0. one morning late in June or early in July 1937. Person stated that he cut the conversation short, after Raue had asked him to join ' the C. I. 0., by telling Raue that he was not interested and that he could not "stand and talk to you because I am liable to lose my job." Person also was twice approached for the C. I. 0. by an unidentified electrical inspector in the assembly department at the plant; both these conversations were abruptly terminated by Person's saying that he was not interested in joining the C. I. 0. It was stipulated that eight other employees of the respondent present at the hearing, all of them members of the Council and including Fred E. Hansley, Council president, Farley, and Krause, if called as witnesses , would testify to the same general effect as did Duncan and Person. The testimony given by Sears, Duncan, and Person is almost com- pletely lacking in convincing detail. Even if taken at its face value, however, their testimony does not tend to establish the kind of sus- tained and continuous effort during working hours at the plant which characterized the Council's membership campaign . The ab- breviated conversations which Duncan and Person testified they had with C. I. O. adherents, and which it was stipulated the other eight Council members present at the hearing would have testified they had, are hardly comparable with the extended campaigns conducted, for example, by Farley, Sears, and Duncan for the Council. Farley's persistence with Sorenson , Duncan's importunate conversation with Sonderman lasting an hour to an hour and a half, and the impunity with which Farley and other Council supporters carried on their proselytizing within sight and even perhaps earshot of foremen and assistant foremen, go far beyond the utmost attributed to any C. I. 0. supporter. If the respondent's failure to restrain organizing activi- ties in its plant was an attempt to maintain neutrality as between the competing labor organizations , it was a neutrality which it was evident redounded primarily and overwhelmingly to the benefit of 754 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the Council. . The respondent may not avoid responsibility for the inference of Council support which any reasonable person would have foreseen would result from its failure to intervene.20 In support of the position that the respondent had shown no par- tiality as between Council and C. I. O. members, the. Council intro- duced testimony to the effect that 16 employees who had joined the Council were subsequently either laid off or discharged. Of the 16 names given, 2 were Clifton Johnson and Rheinhold Nelson, who were members both of the C. 1. O. and of the Council and whose cases are considered in detail below in Section III B of this Decision.. The discharge or lay-off of the 14 other Council members whose names were given is far from conclusive proof of impartiality, in view of the fact that more than 100 employees of the respondent were separated from employment during and subsequent to June in 1937, and that Council membership cards were signed by a sub- stantial percentage of the respondent's employees. 3. Negotiations with and recognition of the Council; the contract of July 9, 1937 The evening of June 14, 1937, after he had assembled his com- mittee, Wise had membership application cards for the Council printed at his own expense. On June 15, distribution of these appli- cation cards was begun by Wise and his committee. Just 3 days later, on June 18, Wise wrote the letter to the respondent to which we have already referred. In this letter, which requested a meeting with the management for the purpose of "making our committee known" and discussing "several conditions which we feel is of impor- tance to the men in our Council," Wise characterized the committee as "representing the majority of the men in your company and chosen by those men as a representative body...." The letter was personally delivered to the respondent by the Council's secretary, Wedlake, and the respondent's plant superintendent,. Robert F. Nel- son; immediately on receipt of the letter, arranged orally with Wise for a conference that same afternoon. The conference was attended by a group of 18 or 20 employees for whom Wise acted as spokesman. Nothing of importance to the present proceeding took place at the conference, except that, so far as the record shows, the Council's claim of majority representation passed unquestioned by any repre- sentative of the management. 2D Cf. Matter of Swift & Company, a Corporation, and Amalgamated Meat Cutters and Butcher Workmen of North America, Local No . 641, et at ., 7 N. L. R. B. 269; Matter of Burnside Steel Foundry Company and Amalgamated Association of Iron, Steel and Tin Workers of North America , Lodge No. 1719, 7 N. L. R. B. 714; Matter of The Serriek Corporation and International Union, United Automobile Workers of America, Local No. 459, 8 N. L. R. B. 621. AR-MA ENGINEERING COMPANY 755 Thereafter events moved quickly. On June 22 the C. I. O. dis- tributed a handbill.21 On June 23 the C. I. O. held a meeting of the respondent's employees. On June 28 the Council held its first gen- eral meetilig of members, to which reference has already been made. On June 30 the C. I. O. distributed another hand.bill.22 The same day, June 30, Wise addressed two letters to the respondent. One of these letters requested a conference with Nelson or any person selected by him on Thursday, July 1, at 5:00 p. in. for the purpose .of discussing wage rates and vacations. The other informed Nelson that the Council committee "presented to you and accepted by you as a bargaining group have met at a. general meeting of all employees at Sunset Hall and concluded ..." to ask for an increase in wages of 20 cents per hour, a two-week vacation with pay, and "a progressive program" for apprentices. The second letter also re- quested an appointment with the management, but (lid not suggest any date. The request for a conference on July 1 was granted. On the afternoon of that day, after the end of the day shift in the plant, a Council committee considerably smaller than the group which had Inet--with Nelson on June 18 appeared in Nelson's office and was taken by him to the office of the president, David M. Mahood. The respondent was represented by Mahood, Nelson, and Arthur P. Davis, vice president and chief engineer. Wise was spokesman for the Council committee. The conferees briefly reviewed the requests con- tained in the two letters of June 30, but the record does not show that any definite agreement was reached. Mahood indicated for the respondent that the requested increase in wages was exorbitant and probably would not be met, but asked for time in which to consider the requests and suggested another meeting between the conferees in exactly a week unless notice to the contrary was given. At the same time that the respondent and the Council representa- tives were meeting on the evening of July 1, the C. I. O. was holding a general meeting of the respondent's employees as called in the hand- bill of June. 30, to which reference has already been made and of -which Robert F. Nelson was fully aware. Despite Nelson's knowledge of the C. I. O. campaign, he posted a "Special Notice" on a bulletin board in the plant the day following the conference with the Council =This handbill plainly implied ' that the Council was dominated by the respondent, and called a mass meeting of the respondent 's employees for the following day, June 23. A copy of this handbill which was introduced into evidence at the hearing by the respondent bore at the top the date June 22, in pencil. This . handbill directly , accused the Council of being company dominated , and called another C . I, o, nieetipg fo•r, July 1. , :Upon cross -exami .natioail, at, the hearing , the respond= ent'ai.ryplant superintendent , Robert F. Nelson , admitted that the copy of this handbill which was introduced into evidence at the hearing by the respondent had had the date June 30 , 1937, stamped at the top by the company when it received the copy. 756 DECISIONS OF NATIONAL LABOR RELATIONS BOARD committee. This notice stated that "The Management met with your Committee of representatives of employees last night, July 1st, and discussed matters of wages and vacation conditions. For the knowl- edge of all concerned, further discussion will take place shortly with this committee." Nelson testified .at the hearing that he posted. this notice over his own name for the purpose of reassuring the men in the plant, so that their fears as to possible future events in the plant and their discussion of union activities might be stopped. Nelson did not explain why he characterized the Council committee as the "rep- resentatives" of the employees in a manner tending to discount com- pletely the efforts of the C. I. O. to persuade the men to designate it as their collective bargaining representative. On July 2, the same day that Nelson posted his "Special Notice," Allan S. Haywood, New York regional director for the C. I. 0., wrote to the respondent requesting a conference for the purpose of discuss- ing wages, hours, and working conditions. This letter stated that "A substantial number of your employees in conformity with the Wagner Labor Act have associated themselves as a union with'the Committee for Industrial Organization," and advised the respondent of the contract between the C. I. O. and the Ford Instrument Com- pany which had already been negotiated. The letter was received by Robert F. Nelson the afternoon of July 2, the Friday preceding the 4th of July. The respondent's plant did not operate oil the following day, Saturday, nor on Sunday or ',Xfonday, July 5. The afternoon of Tuesday, July 6, counsel for the C. I. 0., Harold I. Cammer, tele- phoned Nelson. Nelson had, on July 6, informed Mahood, the re- spondent's president, of Haywood's letter of July 2, but no attempt had been made by the respondent to reply and Mahood gave Nelson no instructions to do so. Cammer and Nelson arranged over the telephone for a conference between Haywood and Nelson the follow- ing Thursday afternoon, July 8, at 3 o'clock. Despite Nelson's knowledge of the C. I. O. membership campaign among the respond- ent's employees, he did not inform Cammer during their telephone conversation on July 6 of the pending negotiations between the re- spondent and the Council or of the meeting between representatives of the respondent and the Council scheduled for the evening of July 8. Prior to July 8, the C. I. O. distributed a handbill 23 stating in The copy of this handbill introduced in evidence by counsel for the Board bears a typewritten notation at the top indicating that it was distributed Wednesday, July 7. The copy of this same handbill which was introduced in evidence by the respondent Is dated in pencil at the top July 5, 1937, and Nelson concedes that this date was written in by him. Monday, July 5, was a holiday, and it is therefore not unlikely that Nelson's penciled notation of the date was inaccurate. In any event, the handbill was distributed and came to the notice of the respondent prior both to Nelson's conference of July 8 with a C. I. 0. representative and to the respondent's conference later the same day with the Council committee. ARMA ENGINEERING COMPANY 757 part that it already had "a substantial majority in the plant," that it had requested the respondent to bargain collectively with it, and that the men could properly be suspicious of the posted notice of the respondent 's meeting with the Council committee. On Thursday, July '8, Haywood was out of New York City, and his appointment with Nelson was kept instead by Benjamin Lifshitz, the organizer appointed by Haywood to organize the employees of the Ford Instru- ment Company and of the respondent. There is a sharp conflict between the testimony given by Nelson and the testimony given by Lifshitz as to what occurred at their conference that afternoon. The Trial Examiner , in his Intermediate Report, accepts Lifshitz's ver- sion of the conference, and we are reluctant to override a judgment based upon personal observation of the witnesses on the stand. Our conclusion in this regard is buttressed by the respondent' s failure to call to the stand either its personnel manager, C. G. Rosewall, or another employee, Miss Boland, both of whom were present at the conference between Nelson and Lifshitz. Accepting Lifshitz's testi- mony', we find that he requested the respondent to bargain collectively with the C. I. O. as the duly designated representative of the re- spondent's employees, that he claimed to have C. I. O. membership cards signed by a majority of the men in the plant, and that he offered to have the question of representation determined by the Board if Nelson so desired. It is possible also that Lifshitz said something to Nelson about filing with the Board charges that the respondent had engaged in unfair labor practices. While the record discloses that the C. I. O. at no time represented a majority of the respondent's employees in an appropriate unit, Nelson could not at the time have known it because no attempt was made during the conference to compute the C. I. O.'s membership. A request by Lifshitz during the course of the conference that two employees, Fidellow and Moessner , be permitted to attend as employee repre- sentatives, and his request that the respondent bargain collectively with the C. I. O. as representative of the men, were both denied by Nelson on the ground, as he himself put it at the hearing, that he had already met and was still meeting with a committee which, in his opinion, represented a majority of the men. Nelson's refusal to permit Fidellow and Moessner to attend the conference was also based on the ground that their attendance would tend to lead to "disrup- tion of production" and that Nelson's appointment "was with Mr. Haywood and not with any committee." The weakness of Nelson's position and, incidentally, the general unreliability of his testimony is perhaps pointed by the fact that Fidellow had been discharged by the respondent on June 11, almost a month before this conference. Nelson denied a substantial part of Lifshitz's testimony as to the con- 758 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ference, but he conceded on cross-exa.niinatioh;that' on-July 8 h0 laiew that the Board conducted elections for ` the purpose' of. determining collective bargaining representatives. ` He testified -that. this,did -tot,, at the time, concern him because the respondent was then already dealing with a group which claimed to represent a majority. Nelson also admitted that on July 8, 1937, he not only knew that the C. I.. O. had some members among the respondent's employees but realized from the C. I. O. handbill of July 5 or July 7 that the C. I. O. was claiming a substantial majority; Nelson's defense, at the hearing, for his having disregarded this information as to the C. I. O.'s member- ship among the respondent's employees was that the information had not been formally conveyed to the respondent but came to its atten- tion solely through general distribution of the handbill. to which we have referred.24 The record is not entirely clear, but Nelson apparently did not, prior to the respondent's meeting with the Council committee on the evening of July 8, inform Mahood or Davis of what occurred at the afternoon conference with Lifshitz. At the appointed time,. the re- spondent's officers received the Council committee as had been ar- ranged the week before. It had been the understanding of the parties that the meeting of July 8 was to serve as an opportunity for the respondent to reply to the requests made by the Council. Robert F. Nelson testified at the hearing that., at the meeting of July 8, there was a great deal of discussion between the parties before an agree- ment was reached. On the other hand, the respondent's president, Mahood, testified generally that the Council "made some requests, and we practically agreed to all the requests." Upon cross-examina- tion by counsel for the Council. Mahood insisted that all important demands of the Council were g-,-anted, that no important compromise was made, and that the men felt they got what they asked for. In any event, it was conceded by Nelson that the conference of July 8 did not last more than one-half to three-quarters of an hour, after which the Council committee stated that it would be necessary for,.them. to present the proposed terms to their membership at a meeting to be held that same night. It was understood that, if the terms were accepted at the membership meeting, a contract embodying them would be signed by the parties the following night.25 The following morning Wise reported to Nelson that approval had been given and that he would, therefore, proceed with the prepara- tion of a written contract to be signed by the parties. Wise then left ", We discuss below, in Section III C of our Decision, whether the respondent: engaged in unfair labor practices within the meaning of Section S (5) of the Act. 2' Robert F. Nelson testified vaguely that, though no proof of majority representation by the Council was requested by the respondent during the meeting of July 8, " some one" did say that such proof would be required before any contract was signed. ARMA 'ENGINEERING COMPANY 759 the plant and proceeded to have the contract drawn in final form by a lawyer. This was done by Wise during working hours, although the record does not disclose whether he was paid for the time so spent. The lawyer employed by, him for the purpose of drawing the contract did so on the basis of penciled notes taken by Wedlake, the Council's secretary, during the conference of July 8. Wise testified that it was not more than approximately an hour and one-half from the time he left the plant until he returned with the typewritten contract.26 Pursuant to the understanding of the night before, the conferees again convened in Mahood's office at the end of the day shift, July 9, for the purpose of executing the contract. When the contract was presented for signature the evening of July 9, Mahood told the Council representatives that it would be necessary for the Council to present proof of its majority representation'before the contract was signed. The Council committee immediately produced the Council's membership application cards. These were then checked against the respondent's pay roll. This check did not purport to verify in any way the signatures appearing on the Council membership cards. The Council's secretary, Wedlake, merely read the names on the Council membership cards and the respondent's secretary, Frederick. J. Wit- son, determined whether the names being read appeared also oil the company's pay roll. Two hundred and twenty cards were thus checked against the pay roll. Not satisfied, however, with this comparison of names, the respondent also requested and received from the Council a "certification" 27 which was signed by eight Council committeemen present at the conference. Upon cross-examination, Nelson stated at the hearing that the "certification" was written either by Mahood or by Nelson and was typewritten by a stenographer employed by the respondent. After the "certification" had been submitted, Ma- 26 We find it impossible to believe that the contract was drafted and typewritten in the comparatively short space of time left after deduction of Wise's traveling time from the period he claims to have spent outside the respondent 's plant. An examination of the contract convinces us that wise must have been absent from the respondent 's plant considerably more than an hour and ore-half while the contract was prepared, and we so find. In this, as in other respects , Wise's testimony is not credible. 27 Jury 9th. 1937. ARMA ENGINEERING CO., INC., 254 36th St.. Brooklyn, N. Y. GENTLEMEN : We hereby represent and certify to you that the "Independent Instru- ment Maker' s & Machinists ' Council" through its committee composed of the under- signed , have been designated and. selected •by, 220 number of employees , employed in the various , production and maintenance departments of your Company to represent and act for them for the purpose of Collective Bargaining with you in respect to gates of pay, wages, hours of employment and all other conditions of employment. Such Employees do not include any general office, and other office and clerical employees, executives , and those in supervisory capacity having the right to hire or discharge, time- keepers and employees . of the Engineering and Drafting Departments. Respectfully submitted. 190935-40-vol. 14-49 760 DECISIONS OF NATIONAL LABOR RELATIONS BOARD hood, Davis, and Nelson signed the contract for the respondent and the eight Council committeemen signed for. the Council. The contract as signed was exactly as submitted by the Council to the respondent. It recognized the Council as sole and exclusive agency for collective bargaining purposes. It provided for a blanket 10-per cent raise in pay of all hourly paid employees, an additional increase in rates of pay of employees on the night shift, and reten- tion'of the then existing practice as to vacations. Certain provisions were included covering apprentices, as was also a general statement of a modified form of seniority. Paragraph "NINTH" of the contract provided that "this agreement shall not be assigned, transferred or conveyed to any group, person, corporation or organization by either of the parties hereto without the written consent of the other." The contract by its terms became effective July 12, 1937, and was to re- main in effect through September 30, 1938. On July 10, the day fol- lowing the signing of the contract, Nelson posted a "Special Notice" announcing the contract and summarizing its terms. Despite the execution of the contract between the respondent and the Council, the C. I. O. continued to function. A general member- ship meeting was held on July 13, 1937, at 'which the men voted to join Local No. 238 of the United Instrument Workers, affiliated with the C. I. O. On July 24, 1937, counsel for the C. I. O. wrote to the respondent claiming majority representation for the C. I. 0., charg- ing the respondent with fostering a company union and with refusing to bargain collectively with the C. I. 0., and requesting a conference for collective bargaining purposes before charges were filed with the Board. At least one conference attended by representatives of both the C. I. O. and the respondent was held at the Regional Office of the Board. On August 27, 1937, counsel for the C. I. O. again wrote to the respondent charging it with discriminatory failure to reinstate employees who had allegedly been laid off because of lack of work. On July- 27, 1937, the C. I. O. filed with the Board its petition for investigation and certification of representatives, and on July 30 it filed with the Board the amended charge upon which the present unfair practice proceeding against the respondent is based. 4. Conclusion It is our conclusion, based on the findings set forth above, that the respondent,.. by interfering with, restraining, and coercing its em- ployees in their attempt to organize and by dominating, interfering with, and supporting the Council, forced upon its employees a col- lective bargaining representative not of their own choosing. The respondent's use of the operatives furnished by the National Metal Trades Association was not only publicized by the La Follette ARMA ENGINEERING COMPANY 761 Committee but was brought to the attention of the C. I. O. adherents among the respondent's employees by the organizer, Lifshitz, and by others after publication of the Committee's report. The lay-offs and discharges considered by us below in Section III B of our Decision did nothing to dispel but must have served rather to strengthen the impression , gained by the respondent's employees from its espionage, that it was opposed to their forming or joining a bona fide labor organization . Walicki's remarks to Raue anent the C. I. 0., and the anti-C. I. O. pamphlets and reprints found by the men in the plant, removed any doubts that might have remained as to the respondent's position. Almost immediately after the beginning of C. I. O. activity in the respondent's plant, the Council suddenly came into existence. Once its formation had been begun, the men were not long left in doubt as to the favor with which the respondent regarded the Council. Admittedly supervisory employees, such as Lundquist, head of the stockroom, and Schwebins, formerly electrical-department foreman and concededly a permanent keyman, unmistakably indicated their preference for the Council to employees. In addition to this exertion of the prestige and authority of supervisory employees, the, respond- ent assisted the Council in its organizing efforts in what was, from the practical point of view, one of the most effective ways possible : it closed its eyes to intensive and persistent solicitation of Council mem- bership on company time and property. This not only gave the Council the kind of access' to the men which was indispensable to a rapid increase in members, but also served to indicate again to the respondent's employees, in the strongest terms, the respondent's desire t hat the men choose the Council as their collective bargaining repre- sentative. We find it impossible to believe that the active supporters of the Council, such as Farley, Duncan, and Sears, could have con- centrated their efforts on .obtaining Council members as they did or could have been as successful in their efforts as it is claimed they were between June 15 and June 18, 1937, if the respondent had not given them its tacit support and cooperation. Having thus prepared the way for the Council, and having fur- nished it with the aid and support necessary to build up at least ostensibly the membership required by the Act before it could be recognized, the respondent proceeded as quickly as possible to confer recognition on the organization of its choice, in order to consolidate' the position it had gained with the respondent's help. The contract of July 9, 1937, between the respondent and the Council is invalid,. however, not only because it accorded recognition as exclusive bar- gaining representative to a labor organization which had not been freely chosen or designated as such by the employees for whom the organization purported to speak, but also. because the contract itself 762 DECISIONS OF NATIONAL LABOR RELATIONS BOARD was merely the culminating step in the respondent's interrelated pro- gram of stifling the growth of the C. I. O. and establishing the Coun- cil as- the organization which would deal with the respondent for the men.28 Our conclusion that the Council is not an organization freely formed and utilized by the respondent's employees as their agency for collective bargaining is further" supported by 'characteristic signs of employer interference and domination. Its formation coincided with the C. I. O.'s campaign to organize the respondent's employees; its membership was obtained with the cooperation and aid Qf the re- spondent; its first general membership meeting was not held until June 28, 1937, and its infrequent membership meetings thereafter were apparently so unimportant that even its leading officers and members were unable at the hearing to state definitely the dates on which these meetings were held; its functioning was so completely dominated by one man, Arthur H. Wise, as to create serious doubt whether it ever mirrored the concerted desires and decisions of its membership ; its members were given no opportunity to nominate candidates for office, and were permitted to vote on the personnel of the governing body only upon a motion to retain as a group the committee selected by Wise when organization began; and its officers for 1938 were not elected but were appointed by the executive com- mittee, pursuant to blanket authority granted at a general meeting. These are not the indicia of a bona fide labor organization. The apathetic acceptance by the respondent's employees of the looseness of the Council's organization, of the casual manner in which the governing group and officers were selected, of Wise's dominant role, and of the lack of employee participation in the Council's activities may reasonably be attributed to a belief on their part that the Council was the respondent's and not their own creation. We find that the respondent, by the expressed approval of its supervisory employees and by their organizing efforts on behalf of the Council, by permitting untrammeled solicitation of Council mem- bers by both supervisory and non-supervisory employees on its prop- erty during working hours, and by its precipitate recognition of the Council as exclusive collective bargaining representative when the C. I. 0., to the respondent's knowledge, was claiming to represent a majority of the respondent's employees, has dominated and interfered with the formation ap.d administration of the Council and has con- 28 Cf. Matter of C. A. Lund Company and Novelty Workers Union, Local 1866 (A. F. of L.), successor, 6 N. L. R . B. 423, aff'd. and in part remanded , National Labor Relations Board v. Lund, 103 F. ( 2d) .815; Matter of Idaho -Maryland Mines Corporation and International Union of Mine, Mill and Smelter Workers of America, Local 283, 4 N. L. R. B. 784, enforcement denied on other grounds, National Labor Relations Board v. Idaho- Maryland Mines Corporation , 98 F. (2d) 129. ARMA ENGINEERING COMPANY 763 tributed support to it, and that the respondent has thereby interfered with, restrained, and coerced its employees in their exercise of the rights guaranteed in Section 7 of the Act. We further find that the respondent, by employing labor spies furnished by the National Metal Trades Association, by discouraging membership in the C. I. 0., and by encouraging membership in the Council, has thereby also inter- fered with, restrained, and coerced its employees in their exercise of the rights guaranteed in Section 7 of the Act. B. The discharges and lay-offs 1. John J. Lovas, Jr. The amended charge which was filed by the C. I. 0. on July 30, 1937, and on which the present proceeding is, in part, based, included Lovas among the men alleged to have been laid off or discharged by the respondent because of their union membership and activities. The complaint alleged that Lovas was discharged on or about June 11, 1937, because he joined and assisted the C. I. 0., but that he was reemployed by the respondent on or about September 20, 1937. Lovas did not appear or testify at the hearing, and a motion by counsel for the Board to dismiss on the merits the allegations contained,'in. the complaint with respect to Lovas was granted by the Trial Examiner. No exception to this ruling has been taken by the C. I. 0., and there is no evidence in the record to support the allegations of the complaint as to Lovas. We find that the respondent,, in discharging or laying off John J. Lovas, Jr., did not discriminate in regard to the tenure of his em- ployment or any term or condition of his employment, and thereby discourage membership in a labor organization. 2. Clifton Johnson Johnson was laid off by the respondent on July 1, 1937, after he had been employed for 3 years and 3 months. At the time he was laid off, he was an inspector in the electrical department, a job which he had had for approximately 11/2 years. He had joined the C. I. 0. early in June 1937, but by his own admission was not particularly active. Indeed, he did not attend any of the C. I. 0. general meetings until after he had been laid off. There had never been any complaint about his work, and the respondent's assistant plant superintendent, Nielsen, testified at the hearing that Johnson did satisfactory work and that Johnson's foreman, Prince, had no complaint to make about him. The reason given for his lay-off was lack of work,, and Johnson admitted at the hearing that on July 1, 1937, work in his department 764 DECISIONS,OF NATIONAL LABOR RELATIONS BOARD had slowed down somewhat. On the other hand, Johnson had never before been laid off during slack periods, and he testified that after 'he was laid off on July 1 his place was taken by another employee, Lazarowitz, who had then been with the respondent only about 1 year. Johnson also admitted upon cross-examination at the hearing that the, preliminary testing which he had been engaged in doing just prior to-his lay-off has been eliminated by the respondent,:though lie insisted that Lazarowitz is doing the same kind of work that he did. On December 28, 1937, Johnson received a telegram from the re- spondent recalling him to work, and he actually returned to work the following day, December 29. He was still employed by the re- spondent at the time of the hearing. Upon his return, Johnson was made a helper to one of the men working on relays, a class of work less desirable than that which he was doing at the time he was laid off. Because of a general raise in wages granted by the re- spondent, however, Johnson receives more for his new work than he did for the preliminary testing he was doing on July 1, 1937. Johnson had no employment or earnings between July 1 and De- cember 28, 1937. The Trial Examiner found that Johnson's lay-off was not due to his joining or assisting the C. I. 0.,. and recommended dismissal of the complaint as to him. Upon all the facts, we agree with the Trial Examiner's conclusion that Johnson's lay-off was not dis- criminatory. We find that the respondent, in laying off Clifton Johnson, did not discriminate in regard to his tenure of employment or any term or condition of his employment, and thereby discourage membership in a labor organization. 3. Eric H. Edholm Edholm was first employed by the respondent about April 1930, and worked as a lathe operator almost continuously until he was laid off on June 4, 1937. During that entire 7-year period, he worked on the first shift from 8: 00 a. in. to 4: 30 p. in. Shortly before he was first employed by the respondent, Edholm had learned that he had diabetes and that a special diet would be necessary. It was because of this diabetic condition, which Edholm claims was known to the respondent, that he worked the first shift continuously until his lay-off. Edholm joined the C. I. 0. in the latter part of May 1937, but he testified at the hearing that he was not active and that he at- tended only "about two" general C. I. 0. meetings prior to his lay- ARMA ENGINEERING COMPANY 765 off. This is contradicted by another employee, James F. McCarthy, who testified that Edholm's lay-off came directly after the C. I. O. meeting of June 3, 1937, which Edholm attended and at which he was elected representative for the lathe department. In- its answer, the respondent alleged that Edholm voluntarily left his employment. because he did not want to work on the night shift, and that the respondent was -willing to employ him as and where possible. The respondent further alleged, in its supplemental answer dated January 27, 1938, that Edholm obtained regular and substantially equivalent employment after he left the respondent's employ, and that he was subsequently reemployed by the respondent after a medical examination. The respondent's assistant plant superintendent, Nielsen, testified at the hearing that, while Edholm's work was satisfactory, he had seemed to lose interest in it and Nielsen decided to try him on an- other shift in the hope that his work would then improve. On June 4, therefore, Nielsen informed Edholm that he was to be trans- ferred to the third shift, starting at midnight. Edholm claims that he then. told , Nielsen that the midnight shift was impossible for him because of his diabetic condition and that, if Nielsen insisted, Edholm would be compelled to leave. Nielsen claims that, when he informed Edholm of the proposed transfer to the third shift, Edholm simply refused to accept the transfer and resigned, with- out giving any reason. Nielsen also denies knowledge either of Edholm's diabetic condition or of his union activities at the time he decided that Edholm should be transferred. After leaving the respondent, Edholm was employed by the Pre- cise Instrument Company at a rate of pay approximately the same as that he received from the respondent. His employment with the Precise Instrument Company continued until his reemployment by the respondent on January 27, 1938, and he makes no claim for back pay. The rate of pay at . which Edholm was rehired by the respondent is higher than that which he was receiving in June 1937, in part because of a general raise given by the respondent and in part because of a differential in rate of pay incidental to Edholm's reemployment on the second shift from 4: 45 p. m. to 1: 15 a. in., rather than the day shift. Work on this shift was offered by the respondent and accepted by Edholm after he had been examined by the respondent's physician, who found that Edholm could safely work those hours. The Trial Examiner, in his Intermediate Report, ,found that the proposed transfer of Edholm to the third shift was not due to his union activities or affiliation, and recommended dismissal of the complaint as to him. No exception was taken to the finding and 766 DECISIONS OF NATIONAL LABOR RELATIONS BOARD recommendation. While the case is not entirely free from doubt, we are of the opinion that the conclusions of the Trial Examiner should be sustained. On the basis of all the evidence, we find that the respondent did not discriminate in. regard to Edholm's tenure of employment or any term or condition of his employment, and thereby discourage mem- bership in a labor organization. 4. Richard V. Noonan Noonan was laid off on Friday, July 2, 1937, after he had been employed by the respondent for 31/2 years. He had had a number of raises in rate of pay during the period of his employment, includ- ing an individual raise of 5 cents an hour the week before he was laid off, and on July 2 he was receiving 70 cents an hour for a 40-hour week, or $28 per week. It was admitted by the respondent that his work was satisfactory, the alleged reason for his lay-off being lack of work. His foreman, Prince, so informed him at the time he was laid off, and suggested that he call on the respondent's personnel manager, Rosewall, in about 4 or 5 months to see whether work was available. In its answer, the respondent alleged that Noonan, along with many other. employees,, had. been, discharged,,because..of, lack..of work, that his name had been placed on a list of employable men, and that he was subsequently reemployed by the respondent. Noonan had joined the C. I. O. late in May or early in June and was active enough to be generally identified as a supporter of the C. I. O. However, when his membership in the Council was solicited late in June by Edward J. Farley, a keyman, he signed a membership application card. He attended the first general membership meeting of the Council on June 28, 1937, and it was upon his motion that departmental representatives on the Council committee were elected by secret ballot rather than by open vote. As a result of the secret ballot, Edward' J. Farley and Theodore R. Krause, two of the group of men as- sembled by Arthur H. Wise as the original governing committee of the Council, were voted out and were replaced with other men. At the time he was laid off, Noonan was the . senior man on the. assembly line in the electrical department. He had worked at that. job for 3 of his 31/2 years of employment with the respondent. He testified that the Monday 29 following his lay-off a new man took his place. He admitted that, while there was work to be done in his department on July 2, 1937, there probably was less than the normal amount of work on hand. On cross-examination, he also admitted' 21 Monday, July 5, was a holiday , so that Noonan must have meant Tuesday , July 6. ARMA ENGINEERING COMPANY 767 .that the number of men working in the electrical department at the respondent's plant varies considerably from time to time, from as many as 130 to as few as 30 or 40. It appears from the record that Noonan's vacation was to have begun July 9, 1937, the Friday fol- lowing his lay-off and, further, that Miller and Whitney, two other 'employees in the same department, were laid off at about the same time. On September 14, 1937, Noonan received a telegram from the re- 'spondent's personnel manager, Rosewall, recalling him to work, and the following day, September 15, Noonan was again employed by the respondent. He was still so employed at the time of the hearing. The Trial Examiner found that Noonan's lay-off was not due to his joining or assisting the C. I. 0., and recommended dismissal of the complaint as to him. Upon consideration of all the evidence, we cannot agree with the Trial Examiner's conclusion. It is more than a mere coincidence that Noonan was laid off the day following his attendance at a C. I. O. meeting and only a few days after he had insisted at a membership meeting of the Council that election of de- partmental representatives to the Council committee be by secret ballot.30 As we have already pointed out, this election by secret ballot resulted in unseating Farley and Krause, two keymen origi- nally selected by Wise to act as members of the Council committee and both very active in the intensive membership campaign carried on by the Council on the company's premises and during working hours. Noonan's testimony that his place was filled by a new man the next working day after he was laid off was not specifically con- tradicted on behalf of the respondent, and we therefore find that he was so replaced. We find that the respondent discriminated in re- gard to the tenure of employment of Richard V. Noonan by laying him off on July 2, 1937, and by failing to reemploy him prior to September 15, 1937, thereby encouraging membership in the Council and discouraging membership in the C. I. 0., and thereby also inter- fering with, restraining, and coercing its employees in their exercise ,of the rights guaranteed in Section 7 of the Act. While employed by the respondent, Noonan had usually earned :additional compensation during summer months by playing profes- sional baseball week ends and holidays. During the period following his lay-off by the respondent, Noonan played 4 weeks of professional SQ Discrimination against an employee because he attempts to free a labor organization from domination or interference by an employer is as much an unfair labor practice within the meaning of Section 8 (3) of the Act as discrimination against an employee because he joins and assists a bona fide labor organization . Matter of American Potash f Chemical Corporation and Borax & Potash Workers ' Union No. 20181, 3 N. L. R. B. 140, order enforced in National Labor Relations Board v. American Potash & Chemical Corpo- ration, 98 F. (2d) 488, cert, den . 306 U. S. 643. 768 DECISIONS, OF NATIONAL LABOR RELATIONS BOARD baseball, earning $30 a week or a total of $120. If he had been employed by the respondent, he would probably have earned a total of $36 playing professional baseball week ends and holidays-during the same 4-week period. In addition, Noonan earned $35 as an ele- vator operator between September 1 and September 14, 1937. 5. Rheinhold Nelson Rheinhold Nelson was first employed by the respondent December 1, 1936. He' worked first in ' the synchro . department for about 3 weeks , and then very briefly in the clock department , after which he was made clerk in the stockroom of the assembly department where he remained for the last 5 or 51/2 months of his employment. On June 3, 1937, Rheinhold Nelson joined the C. I. O. On Thurs- day, June 17, he was approached by Willard Sears, a scraper hand in the assembly department, who asked him to join the Council. Nelson testified that Sears at that time told him that the company preferred the independent union to the C. I. O. and that "the bosses" would keep an eye on Nelson for future advancement if he would join; Sears denied having made any promises of advancement. Nelson at first refused to join, and Sears twice again spoke to him that same day, each time during working hours and on the respondent's - prem- ises . That evening Rheinhold Nelson told William Neugren of what Sears had done, and Neugren in turn told the story to Albert J. Ericson. Apparently disapproving strongly of membership solici- tation during working hours, Ericson took the matter up with either Robert F. Nelson, the plant superintendent, or Hans D. Nielsen, the assistant plant superintendent. The following morning, June 18, Sears again approached Rheinhold Nelson, and was followed by Joseph Duncan, another employee, and by John Lundquist, head of the stock- room and Rheinhold Nelson's immediate superior. Lundquist asked Nelson if he had joined the Council, and told him that the company knew he was a C. I. O. organizer 81 and that he could not stay with the company if he did not join the Council. Rheinhold Nelson there- upon signed a Council membership application card, following the advice given him the evening before by Neugren, who had told him to join if that would enable him to keep his job. The afternoon of June 18, Carlson, the assembly-department fore- man, Neugren, Sears, and Rheinhold Nelson were brought together by Nielsen, the assistant plant superintendent, apparently because of the complaint which had been made by Ericson. After discussing briefly Sears' alleged activities, Nielsen informed Rheinhold Nelson that he was being laid off that evening because of lack of work. ffi There is no evidence that Rheinhold Nelson was very active as a member of the C.I.O. ARMA ENGINEERING COMPANY 769 Nelson testified that Nielsen at the same time said that he had no criticism of Nelson's work and that, in fact, Nelson was down for a raise of 3 cents an hour. Nelson further testified that his foreman, Carlson, at that time also said that he had no criticism of Nelson's, work. Since Carlson was not called to testify and since Nelson's testimony as to Nielsen's commendatory remarks was corroborated by William Neugren, we accept Nelson's testimony as stating the facts. Neugren also testified that, during the conference on the afternoon of June 18, Nielsen expressed surprise, that Neugren, occupying a supervisory position as he did, should talk about such things as union organization and activity. Though he thus reprimanded Neugren, Nielsen did not, according to Rheinhold Nelson's testimony, express any disapproval of Sears' taking working time to speak to Nelson about the Council. In view of point 5 in the respondent's statement of labor policy, forbidding all organization activity in the plant dur- ing working hours, we cannot but regard this disparate treatment of the two men as indicative of the respondent's preference for the Council over the C. I. 0. The respondent takes the position that Rheinhold Nelson was dis- charged primarily because of lack of work, but also because of general incompetence, laziness, and refusal to attend a school for apprentices. The testimony as to Rheinhold Nelson's alleged incompetence and lazi- ness was given by Robert F. Nelson and Hans D. Nielsen, who stated that their information as to Rheinhold Nelson was obtained from the latter's foreman, Carlson, and who claimed to have acted on Carl- son's recommendation in discharging Rheinhold Nelson. Neither Carlson nor Lundquist, Rheinhold Nelson's immediate superior, was called to testify at the hearing. Despite the laudatory remarks attributed to Nielsen and Carlson the afternoon that Rheinhold Nelson was discharged, and despite Rheinhold Nelson's testimony that he was told by Nielsen on June 18 that he would receive a card calling him back probably some- time in September, counsel for the respondent stated at the hear- ing that "... all of the employees whom the company has any intention of calling back have been called back already and were called back prior to the 1st of January, 1938. We very definitely state that we would not take back Fidellow, Rheinhold Nelson or Raue, so that the increase or decrease in work had nothing to do with it. Those men were disposed of for two reasons : first, a shortage of work; and they were men whom it was appropriate to lay off by reason of that shortage, and without any intent to reemploy them, because of what the employer thought was war- ranted to dispense with them entirely." 32 22 Record, p. 1183. 770 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The record is at least ambiguous on the question of whether, on June 18, 1937, Rheinhold Nelson was discharged or only, laid off. .The testimony as to Nelson's incompetence and laziness' is uncon- vincing because of Nelson's and Neugren's testimony as to the re- marks made by Nielsen and Carlson the afternoon of June 18, and also because of the respondent's failure to call Carlson and Lund- quist-as witnesses. Rheinhold Nelson's refusal to attend apprentice classes at the Brooklyn Technical High School, a further ground given by the respondent for Nelson's 'discharge, occurred during the first month of Nelson's employment by the respondent, and we cannot believe that this refusal was one of the respondent's reasons for discharging Nelson approximately 5 months later. The im- plausibility of the reasons given for Nelson's discharge is height- ened by the fact that Lundquist, the only man employed in the stockroom of the assembly department in addition to Nelson, was scheduled to leave for a 2-week vacation at the close of business June 18, the same day Nelson was discharged. That afternoon, after he had been notified of his lay-off or discharge by Nielsen, Nelson reminded his foreman, Carlson, that, with Lundquist on vacation and Nelson discharged, there would be no one in the stockroom the following Monday. Another employee, John Sadowski, was there- upon assigned to the stockroom, where he worked with the assist- ance of two other employees, Rasmussen and Sheimer, until Lund- quist's return from vacation 2 weeks later. The Trial Examiner, though he found the case "difficult," con- cluded that the evidence was not sufficient to warrant a finding that Rheinhold Nelson was discharged for joining or assisting the C. I. O. One reason for this decision by the Trial Examiner was the testimony given by Robert F. Nelson and Nielsen as to Rhein- hold Nelson's inefficiency-testimony which the Trial Examiner re- garded as convincing. We have already stated above that these witnesses admitted at the hearing that they were acting entirely upon the recommendation of the foreman, Carlson, in discharging . Rheinhold Nelson. No reason appears for the respondent's having failed to produce the direct testimony of Carlson, the foreman, Grunlan, the assistant foreman, or Lundquist, the head of the stock- room, and no explanation has been given by the respondent for the commendatory remarks made by Nielsen and Carlson on June 18. The testimony of Robert F. Nelson and Nielsen as to Rheinhold Nelson's inefficiency is, in our opinion, unconvincing. The Trial Examiner also found it difficult to understand the re- spondent's choice of Rheinhold Nelson, "an inconspicuous appren- tice," for discharge if its purpose was to discourage membership in the C. I. O. This disregards Nelson's repeated refusal to join the ARMA ENGINEERING COMPANY 77.1. Council when he was approached the afternoon of June 17 and the morning of June 18, 1937, by Willard Sears, by Joseph Duncan, and by his immediate superior, John Lundquist. Nelson finally signed a Council membership card on June 18, but it was not until shortly before he was notified of his discharge and then only with reluc- tance. It is our conclusion that Rheinhold Nelson was discharged by the respondent on June 18, 1937, because he had joined the C. I. 0. and thereafter unmistakably indicated his unwillingness 'to join the Council. We find that the respondent discriminated in regard to Rheinhold Nelson 's, tenure of employment by discharging him on June 18, 1937, and refusing thereafter to reemploy him, thereby discouraging membership in the C. I. 0. and encouraging member- ship in the Council, and thereby also interfering with, restraining, and coercing its employees in their exercise of the rights guaran- teed in Section 7 of the Act. At the time of his discharge, Rheinhold Nelson was earning 32 cents an hour for a 40-hour week, or $12.80 per week. He did not apply for reemployment because he had been led to believe by Nielsen' that he would be recalled by the respondent. At the time of the hearing lie had had no employment since June 18, 1937, and he stated that lie wanted his job with the respondent. 6. Edward Fidellow Fidellow was discharged by the respondent on June 11, 1937, after he had been employed approximately 6 months as an electrical in- spector assigned to the preliminary testing and inspection of syn- chro-motors. Prior to his employment by the respondent, he had been an assistant in the research laboratory of the Brooklyn Edison Company. Fidellow testified and we find that his superior, Samuel Caunter, the respondent's chief inspector, had never complained about the quality of his work and that Caunter told him on June 11 that he was being laid off because of lack of Work. Caun' ter did not testify at the hearing. The respondent alleged in its answer and insisted at the hearing'that, while lack of work was the primary reason for terminating Fidellow's employment, it will not reemploy him and is justified in refusing to do so because Fidellow had from time to time neglected his work in order to write plays and short stories during working hours. As in the case of Rheinhold Nelson and Emil- Raue, it is not clear from the record whether Fidellow's separation from employment was at the time intended to be temporary or permanent, although there is no doubt that the respondent now intends not to reemploy him. Fidellow admitted at the hearing that he had at 772, DECISIONS OF' NATIONAL LABOR RELATIONS BOARD times brought with him to the plant manuscripts on which. lie was working, and that for lack of another place he kept them on his desk. He also admitted that his foreman , Caunter , had once cautioned him against mingling manuscripts with his inspection reports, but stated that this caution was given him a substantial period of time prior to termination of his employment . He denied , however , having spent any working time on his manuscripts , and his testimony in this regard is corroborated by A. C. Sorenson , another electrical inspector employed by the respondent who worked closely with Fidellow. The record contains conflicting testimony as to whether Fidellow's work was or was not extraordinarily good. Fidellow testified that he designed and built a device for the testing of differential syn- chro-motors and a wiring guide for use in inspecting duplicate controls and follow-up panels , and that these instruments saved a considerable amount of time in both those jobs and were used by others besides himself. Fidellow's testimony in this regard is sup- ported by Sorenson and Neugren, both of whom worked in the same department and both of whom agreed as to the usefulness of the labor-saving devices built by Fidellow. On the other hand, Robert F. Nelson testified for the respondent that his attention had never been called to any such device made by Fidellow, and Nielsen testi- fied that no such device had ever been made by Fidellow. Both Robert F. Nelson and Nielsen, however, went on to say that assem- bling jigs and other testing devices was part of Fidellow's job. Rob- ert F. Nelson also testified that Caunter had several times reported to him that Fidellow was incompetent and that Fidellow had had to be cautioned two or three times about writing short stories on company time. As stated above, Caunter, himself, was not called by the re- spondent as a witness ; and Sorenson, who was in a position to judge and whose competence is conceded by the respondent, testified that Fidellow's work in testing and inspecting equipment was entirely satisfactory. Another employee, John Sadowski, testified not only that Fidellow was in his opinion a very valuable man but also that Fidellow had been with the respondent longer than some of the other men, despite the fact that he had been employed only about 6 months. The respondent also claims. that the preliminary testing and inspecting which had been Fidellow's job was gradually transferred from the production department, under Robert F. Nelson's super- vision, to the test department, which is not regarded as a part of the production department, and that preliminary testing and inspecting were gradually eliminated during the summer and fall of 1937 and had at.the time of the hearing been completely discontinued. On. ARMA ENGINEERING COMPANY 773' the other hand, Sorenson, whose work was substantially similar to that of Fidellow, has continued in the respondent's employ; after Fidellow's discharge on June 11, the work which he had been doing piled up until it created, to use Neugren's phraseology, " a general disorder"; the respondent finally assigned an apprentice, G. H. Munch, and another young employee to the work which Fidellow had been doing ; Munch was , in Sorenson's estimation, lacking in the technical training requisite for the job; and, shortly prior to the termination of his employment, Fidellow had arranged with Gaun- ter and Sorenson for his 2-week vacation to start June 16, indicating that at least Caunter and Sorenson did not know of Fidellow's impending discharge. At the beginning of June 1937, Fidellow joined the C. I. 0. upon solicitation by Theodore R. Krause and at once began to take an active part in its work. His interest in and work for the C. I. 0. were known not only to Krause 'but also to Arthur H. Wise and to Sorenson. Shortly after he had solicited Fidellow's membership in the C. I. 0., Krause transferred his allegiance from the C. I. 0. to the Council and evinced his unfriendliness to the C. I. 0. by refusing to turn over a number of membership application cards obtained by him prior thereto. In view of our finding as to the respondent's domination of and interference with the Council, we are of the opinion that Fidellow's activities on behalf of the C. I. 0. must also have been known to the respondent's supervisory employees. After his discharge, Fidellow continued his C. I. 0. activities. The Trial Examiner found that Fidellow was discharged on June 11, 1937, and has since been refused reemployment by the respondent because he joined and assisted the C. I. 0. The testimony offered by the respondent to establish Fidellow's alleged use of working time for his own purposes is indirect, Caunter not having been called as a witness. It is directly contradicted by Fidellow, whose denial is, supported by the testimony given by Sorenson. The one occasion on which Caunter admittedly cautioned Fidellow against keeping manu- scripts on his desk occurred a substantial period of time prior to June 11, 1937, and does not explain Fidellow's subsequent discharge when there was work for him to do and when no new occasion for discipline had arisen. The absence of any contradiction of the evi- dence that it became necessary to replace Fidellow with two other men supports our conviction that the elimination of preliminary testing and inspecting was not at the time responsible for Fidellow's discharge. We' find that Edward Fidellow was discharged on June 11, 1937, and has since been refused reemployment by the respondent because of his membership in and activities- for the C. I.'0., and that the respondent thereby discouraged membership in the C. I. 0. and 1 774 DECISIONS OF NATIONAL LABOR RELATIONS BOARD also interfered with, restrained, and coerced its . employees in theii exercise of the rights guaranteed in Section 7 of the Act. On the basis of the present record, it is impossible for us to deter- mine when, if at all, Fidellow's employment would have been termi- nated because of the respondent's elimination of preliminary test work, had he not been discharged on June 11 because of his union affiliation. From September 13 until the latter part of December 1937, Fidellow was temporarily employed by the Pilot Radio Corn- . pany as supervisor of mechanical and electrical inspection. 'He was also so employed for a few days during January of 1938. His total earnings since June 11, 1937, have been approximately $350. Fidel- low was unemployed at the time of the hearing and would like to be reinstated by the respondent. At the time of his discharge, he was earning 70 cents an hour for a 40-hour week, or $28 per week. 7. Emil J. Rain Raue had been employed by the respondent more than 2 years when his employment was terminated on Friday, July 16, 1937.33 His rate of pay at the time he began working for the respondent-was 50. cents: an, hour, and during his employment he received five raises, including, one of 5 cents an hour late in March or early in April 1937, and one of 8 cents an hour just a week before the termination of his employ-. ment. All of these except the last one of 8 cents an hour were indi- vidual, not general, raises. During the course of his employment by the respondent, Raue worked in the milling-machine department, the assembly department, the grinding department and the test depart- ment. Raue's comparatively. frequent transfers, despite Robert F. Nelson's general explanation at the hearing that they were due to the fact that Raue was not a very good mechanic, cannot be taken as indicative of incompetence, in view of the unusual series of raises in pay which Raue received. Raue was an active adherent of the C. I. O. from the very start, he being one of the respondent's employees who first called on Hay- wood, C. I. O. regional director in New York, for the purpose of enlisting the support and interest of the C. I. O. Prior to the selec- tion of officers of the C. I. O. organization at the respondent's plant, Raue acted as leader of the C. I. O. group. He was subsequently se= lected as the provisional chairman of the organization, and he con- tinued to direct C. I. O. activities at the respondent's plant even after the membership had, at the meeting of July 13, 1937, voted to '4. become a part of Local 238 of the United Instrument Workers. At' ffi The date of Raue's discharge is stated in the record both as July 16 and as July 18, 1937. The discharge took place on a Friday , and the correct date is undoubtedly July 16. ARMA ENGINEERING COMPANY 775 the hearing, he estimated that about 40 signed membership applica- tion cards had been obtained by him personally. It is evident that Raue's interest in and activities for the C. I. 0. were known to the respondent. His role in the C. I. 0. was certainly known to Arthur H. Wise and other employees of the respondent who took an active part in organizing the Council, and there is also the uncontradicted testimony as to Raue's conversation with Walicki, the respondent's machine superintendent, the day after the C. I. 0. meeting of June 23. Robert F. Nelson's knowledge of Raue's ac- tivities is indicated by his conversation with Raue the Monday or Tuesday following Raue's discharge, when both of them agreed that it was too bad, in view of their friendly relationship, that they were on opposite sides of the fence so far as the question of unionization was concerned. Raue testified that late in the afternoon of Friday, July 16, he was told by his foreman to report to Robert F. Nelson's office, and that Nelson then informed him that he was being laid off for a month or two because of lack of work. Nelson stated at the hearing that Raue was not a very good mechanic and was laid off for lack of work com- mensurate with his ability. As in the case of Rheinhold Nelson and Fidellow, however, the respondent took the position both in its answer and at the hearing that, while Raue was laid off for lack of work, it is justified in refusing to reemploy him and does not intend to re- employ him because his work was unsatisfactory.34 To support its position, the respondent adduced evidence tending to establish : (1) that at the end of May, a day or two prior to Raue's transfer from the milling-machine department to the test department, he spoiled three castings by failing to read his instruments accurately; (2) that one day early in June, while Raue was spending his lunch time in the plant, he smoked a cigarette though he knew that smoking was forbidden in the plant, and that this provoked an unpleasant ex- change between Raue and Miss Van Fleet, secretary to the head of the department, Paul Schmidt; (3) that, on another occasion early in June, Raue reported for work about 11: 00 a. m. instead of 8: 15 a. m.; and (4) that, on still another occasion, while Raue was testing an instrument which required the reading of a compass, he left his post to go to another department. In answer to these charges, Raue explained at the hearing, without contradiction : (1) that his mistake as to the castings was caused by his using a micrometer different from the type ordinarily used by him; (2) that it was customary for men who stayed in the plant during lunch time to smoke, despite the gen- u The respondent also alleged in wits answer that Raue at once obtained regular and substantially equivalent employment elsewhere and was therefore no longer an employee of'the respondent. 190935-40-vol. 14--50 776 DECISIONS OF NATIONAL LABOR RELATIONS BOARD eral prohibition against smoking in the plant, and that he did not argue with Miss Van Fleet when she found him violating the rule; (3) that sickness of his child caused him to be late that one morning early in June, and that he at the time explained the reason for his lateness to Paul Schmidt, his superior in the test department; and (4) that, at the time the respondent claims he improperly left his depart- ment, he was not testing any instrument and he felt safe in leaving the department because Miss Van Fleet was in the office where she could see anybody who came or left. In any event, all four of the incidents of which the respondent now complains occurred a month or more prior to termination of Raue's employment on July 16, 1937. It was also testified by Raue that his immediate superior in the test de- partment, Bishop, had commended his work. This testimony was not contradicted. That Raue's work was highly regarded also appears from the series of raises in pay received, by him, despite his frequent transfers from one department to another during his 2 years of em- ployment by the respondent. Raue's 3-week vacation was scheduled to start at the end of the working day on Friday, July 16, the day he was discharged, and the necessary arrangements had already been made. Indeed, when Raue was told by his foreman late that afternoon to report to Nel- son's office, he had already received his vacation check without any intimation that he was not to return to work when his vacation was over. The transfer of preliminary testing and inspecting from the inspection department to the test department could have had no effect on the respondent's need for Raue's services, because during June and July Raue was working in the test department. Complete elimination by the respondent of preliminary testing and inspecting was a gradual process not accomplished until sometime in December 1937. The Trial Examiner in his Intermediate Report states that Raue "was not single-minded in his adherence" to the C. I. 0. We fail to see what bearing this would have on our decision of the case, even if it were supported by the record. The evidence, however, seems to us to establish that Raue was consistent from the start in his desire to form a labor organization free from the respondent's influence, and that his overtures to Wise and his willingness to consider affili- ating with the American Federation of Labor expressed only his anxiety to avoid, as far as possible, dissension among the men and friction between the men and the respondent in the course of union organization of the respondent's plant. His objection to affiliation. with the A. F. of L. and to the formation of the Council was that he regarded them, though for different reasons, as ineffective instru- ments for realizing the men's wishes as to wages, hours, and working conditions. ARMA ENGINEERING COMPANY 777 The Trial Examiner concluded that there was not sufficient evi- dence for a finding that Raue was discharged for union affiliation and activities. The C. I. O. excepted to the Trial Examiner's find- ings and conclusions as to Raue, solely on the ground that they did not "include a finding and recommendation that the respondent, by discharging Emil J. Raue, discouraged membership in the Union and engaged in unfair labor practices affecting commerce within the meaning of Section 8 (1) of the National Labor Relations Act." We are of the opinion that the Trial Examiner's conclusion as to the weight of the evidence was incorrect. Raue was the moving spirit behind the attempt to organize the respondent's employees under the C. I. O. It was he who led the respondent's employees to obtain the interest and support of the C. I. O. regional director, Haywood. He was largely instrumental in maintaining the C. I. O. organization at the respondent's plant after the Council had begun to be formed, and himself obtained a substantial. number of C. I. O. membership applications from among the respondent's employees. He acted as provisional head of the organization prior to its absorp- tion by Local 238, and remained active thereafter as head of the informal organization of the respondent's employees within the struc- ture of the local. We are convinced by the evidence that Raue's work was neither unsatisfactory nor regarded as such by his supe- riors. We find that the respondent discharged Emil J. Raue on Friday, July 16, 1937, and thereafter refused to reemploy him be- cause he joined and assisted the C. I. O. By thus discharging Raue, the respondent discriminated with regard to his tenure of employ- ment, thereby discouraging membership in the C. I. O. and interfer- ing with, restraining, and coercing its employees in their exercise of the rights guaranteed in Section 7 of the Act. At the time of his discharge, Raue was earning 83 cents an hour for a 40-hour week, or $33.20 per week. On Tuesday or Wednesday, July 20 or 21, 1937, Raue obtained employment at the Ford Instru- ment Company. His rate of pay at the Ford Instrument Company was approximately the same as that which he received from the re- spondent, but he worked only a 4-day week. At the time of the hearing, he was still employed in instrument assembly work at the Ford Instrument Company. C. The refusal to bargain collectively The amended charge filed by the C. I. O. on July 30, 1937, alleged that the respondent, on July 19, 1937, and immediately prior thereto and at all times thereafter, refused to bargain collectively with the representatives of its employees. Paragraphs 4, 5, and 11 of the com- 778, DECISIONS OF NATIONAL LABOR RELATIONS BOARD plaint alleged that on or about June 30, 1937, the C. I. 0. was desig- nated by a majority of the respondent's employees in an appropriate unit as their collective bargaining representative ; that the C. I. 0. at all times thereafter was the exclusive collective bargaining repre- sentative of these employees; that on or about July 8, 1937, the C. I. 0. requested the respondent to bargain collectively with it as such exclusive collective bargaining representative; that the respond- ent then and at all times thereafter refused so to bargain with the C. I. 0.; and that the respondent thereby engaged in an unfair labor practice within the meaning of Section 8 (5) of the Act. At the hearing, it was testified that the C. I. 0. achieved its maxi- mum membership among the respondent's employees at the end of June or during the first week of July 1937. It was admitted that the membership of the C. I. 0. among the respondent's employees at no time exceeded 195. By testimony and by stipulation, the record shows that, in July 1937, the respondent had approximately 500 employees, of whom 394 might properly have been included in the appropriate unit upon which the C. I. 0. and the council agreed at the hearing. At the time of the hearing, the respondent had ap- proximately 600 employees, of whom about 445 could properly be included in the same unit. The record, therefore, fails to establish that the C. I. 0. at any time had as members a majority of the re- spondent's employees in a unit appropriate for collective bargaining .3 11 We have frequently held that an employer is not com- pelled by the Act to bargain collectively with a labor organization which does not represent a majority of the employees in an appro- priate collective bargaining unit, and that his refusal to deal with such a labor organization does not constitute an unfair labor prac- tice within the meaning of Section 8 (5) of the Act. It is therefore unnecessary for us to consider the circumstances under which the respondent's alleged refusal to bargain collectively with the C. I. 0. took place. At the close of the hearing, counsel for the Board moved to dis- miss the allegations of the complaint that the respondent had en- gaged in unfair labor practices within the meaning of Section 8 (5) of the Act. The Trial Examiner reserved decision on this motion at the time, but granted it in his Intermediate Report. The C. I. 0. took no exception to this action by the Trial Examiner. We have af- firmed this ruling, and we shall dismiss the allegations of the com- plaint charging unfair labor practices on the part of the respondent within the meaning of Section 8 (5) of the Act. as The question . of the appropriate unit is discussed below in Section VIII of our Decision. ARM'A'ENGINEERING COMPANY D. Conclusion 779 In conclusion, we find that the respondent used the services of the operatives obtained by it from the National Metal Trades Associa- tion for the purpose of maintaining surveillance over the union activities of its employees; that it discouraged, membership in the C. I. 0. through the acts and conduct. of supervisory employees and by distribution of pamphlets and other printed anti-C. I. 0. mate- rial ; that it encouraged membership in the Council, dominated and interfered with its formation and administration, and otherwise furnished support to it through solicitation of Council, membership by supervisory employees and by permitting untrammeled solicita- tion of Council membership by both supervisory and non-supervisory employees during working hours at the respondent's plant; that it further encouraged the growth of the Council by means. of the con- tract of July 9, 1937, precipitately according the Council recognition as exclusive collective bargaining representative though the Council did not then represent the free choice of a majority of the respond- ent's employees and though the C. I. 0. was then claiming to repre- sent a majority; and that the respondent discriminated as to the tenure of employment of Richard V. Noonan, Rheinhold Nelson, Ed- ward Fidellow, and Emil J. Raue because of their C. I. 0. member- ship and activities, thereby discouraging membership in the C. I. 0. By all of these acts and by each of them the respondent interfered with, restrained, and coerced 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 and other. mutual aid and protection,. as guaranteed in Section 7 of the Act. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the respondent set. forth in subsections A and B of Section III 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 interfered with, restrained, and coerced its employees in their exercise of the rights guaranteed in Section 7 of the Act, we shall order it to cease and desist there- from and to take certain affirmative action designed to effectuate the policies of the Act and to restore as nearly as possible the conditions 780 DECISIONS OF NATIONAL LABOR RELATIONS BOARD which existed prior to the commencement of the unfair labor practices. We have found that the respondent dominated and interfered with the formation and administration of the Council and otherwise con- tributed support to it. To remedy the situation thus produced, to effectuate the policies of the Act and to free the respondent's em- ployees from such domination and interference and the effects thereof, we shall order the respondent to withdraw all recognition from the Council as a representative of any of the respondent's em- ployees for the purposes of collective bargaining with respect to grievances, labor disputes, rates of pay, wages, hours of employment, and other conditions of employment, and to disestablish the Council as such representative.- Since the contract of July 9, 1937, has been found by us to have been a part of the respondent's program of domination and support of the Council, and since the contract gave the Council recognition as exclusive collective bargaining representa- tive of the respondent's employees when the Council had not freely been chosen as such by the employees, the contract is invalid and void, and we shall order the respondent to cease giving effect thereto and to post appropriate notices in its plant advising its employees that the contract is invalid and void and is no longer in effect. We have also found that the respondent laid off Richard V. Noonan and discharged Rheinhold Nelson, Edward Fidellow, and Emil J. Raue because of their membership and activities in the C. I. 0., thereby discouraging membership in the C. I. 0. and interfering with, restraining, and coercing its employees in their exercise of the rights guaranteed in Section 7 of the Act. We shall therefore order the respondent to offer Nelson, Fidellow, and Raue 37 immediate and full reinstatement without prejudice to their • seniority and other rights and privileges, and to make them whole for any loss of pay they have suffered by reason of their discharge by payment to each of them of a sum equal to the amount which he normally would have earned as wages from the date of his discharge to the date of the offer of reinstatement less his net earnings 38 during said period. In ea National Labor Relations Board v. Pennsylvania Greyhound Dines, Inc ., 303 U. S. 261; National Labor Relations Board v. Pacific Greyhound Lines, Inc., 303 U. S. 272. 87 Noonan was voluntarily reinstated by the respondent September 15, 1937. 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 elsewhere 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 America, Lumber and Sawmill Workers Union, Local 2590, 8 N. L. R . B. 440. Monies received for work performed upon Federal, State , county, municipal, or other work-relief projects are not considered as earnings, but, as provided in the Order, shall be deducted from the sum due the employees , and the amount thereof shall be paid over to the appropriate fiscal agency of the Federal , State, county , municipal , or other government or governments which supplied the funds for said work -relief projects. ARMA ENGINEERING COMPANY 781 accordance with our usual practice, the period from the date of the Intermediate Report, May 6, 1938, to the date of the Order herein will be excluded in computing the back pay of Nelson and Raue, since the Trial Examiner found that their discharges did not constitute unfair labor practices and recommended dismissal of the complaint as to them.39 We shall also order the respondent to make Noonan whole for any loss of pay he has suffered by reason of his lay-off by payment to him of a sum equal to the amount which he normally would have earned as wages from the date he was laid off to the date of his reinstatement, less his net earnings 40 during said period. VI. THE QUESTION CONCERNING REPRESENTATION In Section III A above, we have found that on July 8, 1937, the respondent's plant superintendent, Robert F. Nelson, refused the request made by Lifshitz, the C. I. 0. organizer, that the respondent recognize the C. I. 0. as the representative of the respondent's pro- duction employees and deal with it as such. This request was re- fused. by Nelson on the ground that he was already dealing with an organization which claimed to represent and which, in his opinion, represented a majority of the employees, and that it would therefore be illegal for him to deal with the C. I. 0. on the same basis at the same time. The C. I. 0. claims that a majority of the respondent's employees desire to be represented by the C. I. 0. for the purposes of collective bargaining. We therefore find that a question has arisen concerning represen- tation of the respondent's production employees. VII. THE EFFECT OF THE QUESTION CONCERNING REPRESENTATION UPON COMMERCE We find that the question concerning representation which has arisen, occurring in connection with the operations of the respondent described in Section I above, has a close, intimate, and substantial relation to trade, traffic, and commerce among the several States and tends to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. VIII. THE APPROPRIATE UNIT The C. I. 0.41 drew its membership from among the hourly paid factory and production employees of the respondent, excluding all 81 Matter of Sheilabarger Grain Products Company and Flour and Cereal Workers Union, No. 20765, 8 N. L. R. B . 336; Matter of The Serrick Corporation and International Union, United Automobile Workers of America , Local No. 459, 8 N. L. R. B. 621. 40 See footnote 38, supra. 41 Since we have found the Council to be a company -dominated labor organization, its position does not enter into nur consideration and determination of the unit appropriate for collective bargaining purposes. ,782 . DECISIONS OF NATIONAL LABOR RELATIONS BOARD salaried and supervisory personnel, foremen and assistant foremen, office and other clerical employees, and all employees in departments not classified as production departments and not under the supervi- sion of the respondent's plant superintendent, Robert F. Nelson 42 The C. I. 0. contended at the hearing that the employees above de- scribed constitute an appropriate unit for the purposes of collective bargaining. The respondent took no position on this =question, but stated through its counsel that it had no objection to the unit above described. The C. I. 0. admitted to membership keymen or strawbosses em- ployed by the respondent. We have held above, in Section III A of ,our Decision, that these keymen or strawbosses are supervisory em- ployees whose encouragement or discouragement of union member- ship is the act of the respondent. This does not mean that they are thereby excluded from the protection offered by the Act or that they are not employees who may be represented by a labor organization duly designated as their collective bargaining representative. We have held before that certain supervisory personnel may be included in a unit designated' as appropriate for collective bargaining pur- poses, though they may not interfere with other employees in the appropriate unit in their selection of a representative.43 We shall therefore include the respondent's keymen in the appropriate unit, .:along with all. of the other hourly paid factory and production employees. We find that the hourly paid factory and production employees of the respondent, including keymen, but excluding ether supervisory personnel and all salaried employees, foremen and assistant foremen, office and other clerical employees, and all employees in departments not classified as production departments and not under the supervi- sion of the respondent's plant superintendent, Robert F. Nelson, con- stitute a unit appropriate for the purposes of collective bargaining, and that said unit will insure to employees of the respondent the full ,benefit of their right to self-organization and to collective bargain- ing and will otherwise effectuate the policies of the Act. 42 The C. I. 0., in its petition , alleged the appropriate unit to be the "Plant unit of factory and production employees . " and among the employees whom the C. I. 0. in its petition claimed to represent were the "porters and maintenance men." Paragraph "3" of the complaint alleges that all of the respondent's "factory and production employees ," with certain exceptions , constitute an appropriate unit for collective bar- gaining purposes . while the testimony is not entirely clear, it gives no reason for believing that the parties desired to change the unit alleged in the petition so as to exclude maintenance employees . For the purposes of this Decision , therefore , mainte- nance employees will be deemed to fall within the meaning of the term "factory and production employees." 42 Matter of Consumers' Power Company , a corporation and Local No . 1 740, United Electrical, Radio & Machine Workers of America ., 9 N. L. R. B. 701; Matter of Consumers Power Company and International Brotherhood of Electrical Workers, Local 876, 9.N. L. R. B. 742; cf. Matter of Tennessee Copper Company and A. F. of L. Federal Union No. $1,164, 8 N. L. R . B. 575, 9 N. L. R. B. 117. ARMA ENGINEERING COMPANY IX. DETERMINATION OF REPRESENTATIVES 783: At the hearing, the Council moved to consolidate its petition for- investigation and certification of representatives with the present proceeding. This motion was denied by the Trial Examiner, and. we have affirmed the ruling.44 At the close of the hearing, the Trial Examiner reserved decision on a motion by the Council that the, C. I. O.'s petition be dismissed, that the petition of the Council -be, substituted therefor, and that the Council be certified as exclusive, collective bargaining representative. That motion is hereby denied.. Since we have held that the Council's membership among the respondent's employees was not a result of their free choice, and since we shall order withdrawal of recognition from the Council and its disestablishment, the membership cards submitted by the Council at the hearing furnish no basis for determining the question of repre- sentation. It is obvious from the number of cards submitted by both the Council and the C. I. O. that there is, in any event, a substantial duplication of membership. The membership cards submitted by the C. I. O. do not establish representation by the C. I. O. of a ma- jority of the employees in the appropriate unit. We find, therefore,. that the question which has arisen concerning the representation of' employees of the respondent can best be resolved by the holding of an election by secret ballot.45 We shall accordingly direct that such' an election be held among employees in the unit found to be appropriate. In view of our finding as to the respondent's interfering with, re- straining, and coercing its employees in their exercise of the rights. guaranteed in Section 7 of the Act, we shall provide for the election. to be held at a time to be hereafter fixed by us after we are satis- fied that the effects of the respondent's unfair labor practices have- been dissipated and that a free choice of representatives can be made.. Upon fixing the date upon which the election is to be held, we shall. also determine and fix the date as of which will be determined the. eligibility of employees to participate in the election. Upon the basis of the foregoing findings of fact and upon the- entire record in the proceeding, the Board makes the following : 4A The Council also moved at the hearing for leave to file a petition under Section 9 (c) of the Act. As we have already stated , such a petition was filed by the Council with the Regional Director on January 12, 1938, prior to the hearing in the present proceeding, but no action has been taken thereon pending this decision . We can see no purpose to be served by the granting of the Council 's motion , and it is therefore denied. 46 The contract of July 9, 1937 , since it has been found by us to be invalid and since we'shall direct the respondent to cease giving effect thereto , does not affect our decision to direct the holding of an election. "_ " 784 DECISIONS OF NATIONAL LABOR RELATIONS BOARD CONCLUSIONS OF LAW 1. Committee for Industrial Organization, Independent Instru- ment Makers & Machinists Council, and United Instrument Workers, Local Industrial Union No. 238, are labor organizations, within the meaning of Section 2 (5) of the Act. 2. By dominating and interfering with the formation and. adminis- tration of Independent Instrument Makers & Machinists Council, 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. 3. By discriminating in regard to the tenure of employment of Richard V. Noonan, Rheinhold Nelson, Edward Fidellow, and Emil J. Raue, and thereby discouraging membership in the C. I. 0., the respondent has engaged in and is engaging in unfair labor practices, within the meaning of Section 8 (3) of the Act. 4. By interfering with, restraining, and coercing its employees in their 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. 6. The respondent has not engaged in any unfair labor practices within the meaning of Section 8 (5) of the Act. 7. A question affecting commerce has arisen concerning the repre- sentation of employees of Arma Corporation, Brooklyn, New York, within the meaning of Section 9 (c) and Section 2 (6) and (7) of the Act. 8. All hourly paid factory and production employees of the re- spondent, including keymen, but excluding other supervisory per- sonnel and all salaried employees, foremen and assistant foremen, office and other clerical employees, and all employees in departments not classified as production departments and not under the super- vision of the respondent's plant superintendent, Robert F. Nelson, constitute a unit appropriate for the purposes of collective bargain- ing, within the meaning of Section 9 (b) of the Act. ORDER Upon the basis of the foregoing findings of fact and conclusions of law and pursuant to Section 10 (c) of the National Labor Rela- tions Act, the National Labor Relations Board hereby orders that the ARMA ENGINEERING COMPANY 785 respondent, Arma Corporation, and its officers, agents, successors, and :assigns shall : 1. Cease and desist from : (a) Discouraging membership in Committee for Industrial Organ- ization or in United Instrument Workers, Local Industrial Union No. 238, and encouraging membership in Independent Instrument Makers &. Machinists. Council, or any other labor -organization of its employees, by discharging, laying off, 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; (b) In any manner dominating or interfering with the formation or administration of Independent Instrument Makers & Machinists 'Council or of any other labor organization of its employees, and contributing financial or other support thereto or to any other labor organization; (c) Recognizing Independent Instrument Makers & Machinists Council as the representative of any of the respondent's employees for the purpose of dealing with the respondent with respect to grievances, labor disputes, wages, rates of pay, hours of employment,. or conditions of employment; (d) Giving effect to its contract of July 9, 1937, with Independent Instrument Makers & Machinists Council, or to any modification, continuation, extension, or renewal thereof; (e) Maintaining surveillance upon the activities of its employees in connection with Committee for Industrial Organization, United Instrument Workers, Local Industrial Union No. 238, or any other labor organization; (f) Distributing or placing in its plant or causing or permitting to be so distributed or placed anti-C. I. O. or other literature indicat- ing to its employees the respondent's judgment of particular labor organizations; (g) In any other manner interfering with, restraining, or coercing its employees in the exercise of their rights to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in con- certed 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) Instruct all of its keymen or strawbosses and other super- visory employees that they shall not in any manner approach em- ployees concerning, or discuss with employees, the question of their labor affiliations, or attempt to persuade or induce employees either to join Independent Instrument Makers & Machinists Council or not 786 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to join Committee for Industrial Organization or United Instrument Workers, Local Industrial Union No. 238, or any other labor organization ; (b) Withdraw all recognition from Independent Instrument. Makers & Machinists Council as a representative of any of its em- ployees for the.purpose of dealing with the respondent with respect to grievances, labor disputes, rates of pay, wages, hours of employ. ment, or conditions of work,' and completely disestablish Independent. Instrument Makers & Machinists Council as such representative; (c) Offer to Rheinhold Nelson, Edward Fidellow, and Emil J. Raue immediate and full reinstatement to their former or substan- tially equivalent positions without prejudice to their seniority and other rights and privileges; (d) Make whole Richard V. Noonan, Rheinhold Nelson, Edward Fidellow, and Emil J. Raue for any losses of pay they have suffered by reason of the respondent's discriminatory actions, by paying to- Richard V. Noonan a sum of money equal to that which he would normally have earned as wages during the period from the date he- was laid off to the date of his reinstatement by the respondent, less his net earnings during said period, by paying to Edward Fidellow- a sum of money equal to that which he would normally have earned as wages during the period from the date of his discharge to the- date of the respondent's offer of reinstatement, less his net earnings during said period, and by paying to Rheinhold Nelson and Emil J. Raue, respectively, a sum of money equal to that which he would normally have earned as wages during the period from the date of' his discharge to the date of the Intermediate Report herein (May 6, 1938) and during the period from the date of this Order to the date of the respondent's offer of reinstatement, less his net earnings dur- ing said periods; deducting, however, from the amount otherwise due. each of these employees monies received. by him during said period. or periods for work performed upon Federal, State, county, muni- cipal, or other work-relief projects and paying over the amount so, deducted to the appropriate fiscal agency of the Federal, State, county, municipal, or other government or governments which sup- plied the funds for such work-relief projects; (e) Immediately post notices in conspicuous places in each depart- ment of the respondent's plant stating : (1) That the respondent will cease and desist as provided in. paragraphs 1 (a), (b), (c), (d), (e), (f), and (g) of this Order,, and that the respondent will take the affirmative action set forth in paragraphs 2 (a), (b), (c), and (d) of this Order; (2) That the respondent withdraws and will refrain from all recognition of Independent Instrument Makers & Machinists Council as a representative of any of its employees for the purpose of dealing ARMA ENGINEERING COMPANY 787 with the respondent with respect to grievances, labor disputes, rates .of pay, wages, hours of employment, or conditions of work, and completely disestablishes it as such representative; and (3) That the contract of July 9, 1937, or any modification, con- tinuation, extension, or renewal thereof is void and of no effect; (f) Maintain such notices for a period of at least sixty ( 60) con- secutive days from the date of posting; . (g) Notify the Regional Director for the Second Region in writing within ten (10) days from the date of this Order what steps, the respondent has taken to comply therewith. AND IT IS FURTHER ORDERED that the allegations of the complaint (1) as to the employees, John J. Lovas, Jr., Eric H. Edholm, and Clifton Johnson, and (2) as to the alleged unfair labor practices within the meaning of Section 8 (5) of the Act, be, and they hereby are, dis- missed. DIRECTION OF ELECTION By virtue of and pursuant to the power vested in the National Labor Relations Board by Section 9 (c) of the National Labor Re- lations Act, 49 Stat. 449, and pursuant to Article III, Section 8, of National Labor Relations Board Rules and Regulations-Series 2, it is hereby DIRECTED that, as part of the investigation directed by the Board to ascertain representatives for the purposes of collective bargain- ing with Alma Corporation, an election by secret ballot shall be conducted at such time as the Board shall hereafter direct, under the direction and supervision of the Regional Director for the Sec- ond Region (New York City), acting in this matter as agent for the National Labor Relations Board and subject to Article III, Section 9, of said Rules and Regulations, among those employees of Arma Corporation described below who were employed by Arma Corpora- tion within a period to be determined by the Board in the future, to determine whether or not they desire to be represented by United Instrument Workers, Local Industrial Union No. 238, affiliated with the Committee for Industrial Organization, for the purposes of col- lective bargaining : All hourly paid factory and production em- ployees, including keymen, but excluding other supervisory personnel and all salaried employees, foremen and assistant foremen, office and other clerical employees, and all employees in departments not classi- fied as production departments and not under the .supervision of the respondent's plant superintendent, Robert F. Nelson. MR. WILLIAM M. LEISERSON took no part in the consideration of the above Decision, Order, and Direction of Election.