Bueter Bakery Corp.

National Labor Relations Board - Board Decisions

Apr 13, 1976

223 N.L.R.B. 888 (N.L.R.B. 1976)

888 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Bueter Bakery Corporation and Albert Kelly, Receiver
in Bankruptcy and General Drivers, Warehousemen
and Helpers, Local Union No. 21, affiliated with
International Brotherhood of Teamsters , Chauf-
feurs, Warehousemen and Helpers of America.
Case 14-CA-8893
April 13, 1976
DECISION AND ORDER
By MEMBERS JENKINS, PENELLO, AND WALTHER
On February 5, 1976, Administrative Law Judge
Herbert Silberman issued the attached Decision in
this proceeding. Thereafter, the Respondent filed ex-
ceptions to the Order and the General Counsel filed
a brief in reply to the Respondent's exceptions.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has considered the record and the at-
tached Decision in light of the exceptions and brief
and has decided to affirm the rulings, findings, and
conclusions of the Administrative Law Judge and to
adopt his recommended Order.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board adopts as its Order the recommended
Order of the Administrative Law Judge and hereby
orders that the Respondents, Bueter Bakery Corpo-
ration and Albert Kelly, Receiver in Bankruptcy,
Quincy, Illinois, their officers, agents, successors, and
assigns, shall take the action set forth in the said rec-
ommended Order.
DECISION
STATEMENT OF THE CASE
HERBERT SILBERMAN , Administrative Law Judge: Upon a
charge filed on November 7, 1975, by General Drivers,
Warehousemen and Helpers, Local Union No. 21, affiliat-
ed with International Brotherhood of Teamsters, Chauf-
feurs, Warehousemen and Helpers of America, herein
called the Union, a complaint, dated December 15, 1975,
was issued alleging that Bueter Bakery Corporation,' here-
At the hearing a motion was granted to amend the name of Respondent
in this proceeding by adding Albert Kelly, Receiver in Bankruptcy, as a
named Respondent . On October 14, 1975 , an involuntary petition in bank-
ruptcy was filed against Bueter Bakery Corporation which petition was
granted on December 22, 1975. Albert Kelly was appointed Receiver in
Bankruptcy with respect to the assets of Bueter Bakery Corporation.
in called the Company, has engaged in unfair labor prac-
tices within the meaning of Section 8(a)(1) and (5) of the
Act. In substance, the complaint alleges that the Company
unilaterally and without the consent of the employees' col-
lective-bargaining representative, modified the terms of an
existing collective-bargaining agreement and engaged in
further violations of the Act by attempting to deal directly
with its employees concerning such contract modification.
Respondents' answer to the complaint denies that they
have engaged in the alleged unfair labor practices.2 A hear-
ing in this proceeding was held in Quincy, Illinois, on Janu-
ary 5, 1976.3 A posthearing brief was filed with me by Gen-
eral Counsel.
FINDINGS OF FACT
1. THE BUSINESS OF THE COMPANY
The Company, an Illinois corporation, is engaged in the
preparation, sale, and distribution of bakery products. It
operates plants in the States of Missouri, Iowa, and Illinois.
The only facility involved in this proceeding is the
Company's plant located in Quincy, Illinois. During the 12
months ending November 30, 1975, which period is repre-
sentative of the Company's operations, the Company pur-
chased flour, milk, sugar, and other products valued in ex-
cess of $50,000 which were transported to its Quincy,
Illinois, plant through channels of interstate commerce di-
rectly from points located outside the State of Illinois. Re-
spondents admit, and I find, that the Company is an em-
ployer as defined in Section 2(2) of the Act engaged in
commerce within the meaning of Section 2(6) and (7) of
the Act.
11. THE LABOR ORGANIZATION INVOLVED
The Union is a labor organization within the meaning of
the Act.
III. THE UNFAIR LABOR PRACTICES
The Company and the Union are parties to a subsisting
3-year collective-bargaining agreement entered into as of
April 29, 1974, covering the following unit of employees:
All driver-salesmen, transport drivers, mechanics, me-
chanics helpers, truck foremen, and route supervisors
employed by Respondent, excluding bakery workers,
office clerical employees, professional employees,
guards and supervisors as defined in the Act.
2 In their answer Respondents asserted that the National Labor Relations
Board should yield jurisdiction in this matter to the Bankruptcy Court.
However, subject to the limited exception contained in Sec . 10(a), thejuris-
diction of the National Labor Relations Board to prevent any person from
engaging in any unfair labor practice affecting commerce is exclusive and
the Bankruptcy Court has no jurisdiction to determine whether the bank-
rupt had engaged in alleged unfair labor practices prior to the date a peti-
tion in bankruptcy is granted. Compare: Shopmen's Local Union No. 455,
International Association of Bridge, Structural and Ornamental Iron Workers,
AFL-CIO and N. L. R. B. v. Kevin Steel Products, Inc., 519 F.2d 698 (C.A. 2,
1975).
J General Counsel's motion, dated January 23, 1976, to correct the tran-
script of record is granted.
223 NLRB No. 128
BUETER BAKERY CORPORATION 889
The agreement, among other things, in article I, section 2,
provides that "[t]he Company will neither negotiate nor
make collective bargaining agreements for any of it's [sic]
employees in the bargaining unit covered hereby unless it
be through duly authorized representatives of the Union."
This proceeding arises from the efforts of the Company
to effect a 10-percent reduction in the wages of its driver-
salesmen . On April 24, 1975, General Manager Pete What-
ley asked union steward Loren Wellman to read the fol-
lowing communication to the driver- salesmen:
We are running a large profit loss each week.
This has come about for a no. of reasons. Purity
Baking Co. being in town with their Fresh Bread Store
has reduced our stale recovery around $1500.00 per
week.
They have also taken some sales away from our
salesman.
During the calendar year of 1974, the overall selling
price of our product increased 12-1/2%. Our ingre-
dient cost went up 25% and wrapping material cost
went up 20%.
This profit loss has been rather large each week.
We have reduced this loss some by reducing the
work force wherever possible. We have rescheduled in
the production dept. and are producing with consider-
ably less hours worked.
The wage raises that are scheduled for around May
I will wipe out most of the gains we have made.
We have an informal agreement with the Bakers to
forego the raise they have coming up, if we can make
it a blanket deal on everyone.
We are asking for your cooperation on the same
basis.
We have no plans for an immediate plant closing.
But the facts are simple and clear, we cannot stay in
business permanently if our profit loss worsens. .
Wellman read the letter to the driver-salesmen on April 26
and thereafter reported to Whatley that the driver-sales-
men were opposed to accepting any reduction in their wag-
es. Whatley responded that "he did not know how they
could keep on operating if we did not co-operate with the
company and give them . . . 10 percent back."
In the late spring General Manager Pete Whatley met
with Charles A. McGee, president and assistant business
agent of the Union and the individual on behalf of the
Union who negotiated the 1974 collective-bargaining
agreement , and Morris Leasen, the representative of the
Company's bakery workers. Whatley told McGee and
Leasen that the Company was having financial problems
and wished to reduce the wages of its employees. McGee
and Leasen informed Whatley that they could not agree to
any wage reduction unless the Company produced busi-
ness records to substantiate its claimed financial distress.
In late July or early August at another meeting with Mc-
Gee and Leasen the Company again solicited an agreement
which would permit it to reduce the wages of its employees
and specifically asked the Union to agree to a 10-percent
reduction in the wages of the driver-salesmen . McGee re-
fused the request. He also informed the Company's repre-
sentatives that the Union would give no consideration to
any such proposal without first being permitted to conduct
an independent audit of the Company's financial records.
On August 2, 1975, a meeting was called by the then
general manager of the Company, Albert Kelly, at which
were present McGee, the Company's driver-salesmen and
its bakers. Kelly informed the group that unless the em-
ployees accepted a 10-percent reduction in their wages the
plant would be closed within a week or 10 days and that
the bakers had already agreed to such reduction. McGee
asked for and was given permission to caucus with the em-
ployees represented by the Union. The sentiment of the
group was to oppose the reduction and McGee informed
Kelly that the Union was opposed to any wage reduction
for the employees it represented. According to McGee,
Kelly `just threw his hands up and said, `We will just be
closed in a week or 10 days because we can't operate.' "
Subsequently, on September 9, 1975, at the Company's
semiannual meeting with its driver- salesmen , the driver-
salesmen were polled by ballot as to whether they would
accept a 10-percent reduction in wages. The vote was
against accepting such reduction.
On October 28 General Manager Kelly again met with
the driver-salesmen and other employees. He informed
them that the Company had put into effect a 10-percent
reduction in their wages and asked them to vote on wheth-
er they would work under the new wage scale.' A majority
voted in favor of the proposition. Union Representative
McGee later was informed of what had happened. On Oc-
tober 29 he wrote the following letter to the Company:
It has been brought to my attention that on October
28, 1975, you had a meeting with our members in re-
gards to a Ten Percent (10%) pay reduction. I under-
stand the vote was (11) in favor and (9) against, this
also included office personnel.
If you will look at our current Agreement, Article I,
Section #2, you will find you are in direct violation of
the above Article. Further, the contract was negotiat-
ed in good faith by this Local Union No. 21, and we
thought also Bueter Bakery Corporation negotiated in
good faith.
This is your notice that in the event that any deduc-
tions made by the Company on Local No. 21's mem-
bers, we shall take every step necessary to see that our
negotiated contract is abided by.
As the employees, including the driver-salesmen, had
been informed on October 28, a 10-percent reduction in
their wages was put into effect beginning with the pay peri-
od ending on November 1, 1975. The Union, on November
6 and December 5, 1975, wrote letters to the Company
protesting the wage reductions.
The complaint alleges that the Company has violated
Section 8(a)(5) and derivatively Section 8(a)(1) by:
An employer who by polling its employees, or otherwise, solicits em-
ployee sentiment with regard to a subject of collective bargaining instead of
leaving such effort to the employees' representative tends to undermine the
union's status as the employees' exclusive representative and thereby vio-
lates the Act. Obie Pacific, Incorporated, 196 NLRB 458 (1972).
5 See Oak Cliff-Golman Baking Company, 202 NLRB 614 (1973). See also
N.L.R.B. v. George E. Light Boat Storage, Inc., 373 F.2d 762 (C.A. 5, 1967).
890 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(1) Unilaterally reducing the wages of the employees in
the unit represented by the Union and thereby modifying
the existing collective-bargaining agreement: (a) without
serving the written notice required by Section 8(d)(1); (b)
without offering to meet and confer with the Union as re-
quired by Section 8(d)(2); without notifying the Federal
Mediation and Conciliation Service and the appropriate
state agencies as required by Section 8(d)(3); and by failing
to continue the terms of the contract in effect as required
by Section 8(d)(4).
(2) Seeking to negotiate directly with its driver-salesmen
a reduction in their wage rates instead of dealing exclusive-
ly with the Union about the subject.
Conclusions
"[T]he obligation [to bargain collectively with the em-
ployees' chosen representative] being exclusive . . . it ex-
acts the negative duty to treat with no other." Medo Photo
Corp. v. N.L.R.B., 321 U.S. 678, 683-684 (1944). Thus
"[t]he National Labor Relations Act does not countenance
negotiating with individual employees when they have bar-
gaining representatives." Lion Oil Company v. N.L.R.B.,
245 F.2d 376, 378, (C.A. 8, 1957). It follows that an em-
ployer violates the Act when it "go[es] over the head of the
[Union] to deal individually with the employees," for such
actions "tend inevitably to weaken the authority of the
[Union] and its ability to represent the employees in deal-
ing with the Company." Utica Observer-Dispatch v.
N.L.R.B., 229 F.2d 575, 577 (C.A. 2, 1956); N.L.R.B. v.
U.S. Sonics Corp., 312 F.2d 610, 615 (C.A. 1, 1963).6 Ac-
cordingly, the Company's conduct on September 9 and Oc-
tober 28, 1975, in seeking to deal directly with its driver-
salesmen about a reduction in their wage rates constituted
a violation on the part of the Company of its statutory
collective-bargaining obligations.
Also, it is well settled that good-faith compliance with
Section 8(a)(5) of the Act presupposes that an employer
will not make unilateral changes in wages or working con-
ditions without affording the employees' statutory repre-
sentative an opportunity to bargain collectively with the
employer about such changes. N.L.R.B. v. Benne Katz,
d/b/a Williamsburg Steel Products Co., 369 U.S. 736
(1962); N.L.R.B. v. Crompton-Highland Mills, Inc., 337 U.S.
217, 221, 225 (1949). Such unilateral action "tends to sub-
vert the union's position as the representative of the em-
ployees," N.L.R.B. v. Insurance Agents' International Union,
AFL-CIO [Prudential Ins. Co.], 361 U.S. 477, 485 (1960).
Accordingly, by reducing the wages of its driver-salesmen,
who are covered by the contract referred to above, effec-
tive during the payroll period ending on November 1, 1975,
6 The Union is an entity separate from the employees it represents. The
Company does not fulfill its statutory collective -bargaining obligations "to
meet and confer" with the representative of its employees by dealing with its
employees as a group in the absence of their representative . Compare: Unit-
ed Mine Workers of America, District No. 6 and its Local No. 1638 (Consoli-
dation Coal Company), 217 NLRB No. 88, In. 35 (1975).
without the consent of its employees ' representative who is
party to the agreement and without fulfilling its collective-
bargaining duties as set forth in Section 8(d), the Company
has further violated Section 8(a)(1) and (5) of the Act.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON
COMMERCE
The activities of the Company set forth in section III,
above, occurring in connection with its operations de-
scribed in section I, above, have a close, intimate, and sub-
stantial relationship to trade, traffic, and commerce among
the several States and tend to lead to labor disputes bur-
dening and obstructing commerce and the free flow of
commerce.
V. THE REMEDY
Having found that Respondents have engaged in unfair
labor practices, I shall recommend that they cease and de-
sist therefrom and take certain affirmative action designed
to effectuate the policies of the Act.
Having found that Respondents unlawfully reduced the
wages of the employees covered by their subsisting collec-
tive-bargaining agreement with the Union, I shall recom-
mend that Respondents restore the wage rates in effect
prior to such unilateral action and make whole the employ-
ees covered by the 1974 agreement between the Company
and the Union for all loss of earnings suffered by them
since the beginning of the payroll period ending November
1, 1975, together with interest thereon at the rate of 6 per-
cent per annum as set forth in Isis Plumbing & Heating Co.,
138 NLRB 716 (1962).
Upon the basis of the foregoing findings of fact and
upon the entire record in this case, I make the following:
CONCLUSIONS OF LAW
1. By attempting to effect the modification of a subsist-
ing collective-bargaining agreement by dealing directly
with the employees covered by the terms of such agreement
instead of by engaging in negotiations with the employees'
duly designated representative, the Company has engaged
in, and is engaging in, unfair labor practices within the
meaning of Section 8(a)(1) and (5) of the Act.
2. By unilaterally reducing the wages of its employees
covered by a subsisting collective-bargaining agreement
without complying with the obligations imposed by Section
8(d) of the Act, the Company has further violated Section
8(a)(1) and (5) thereof.
3. The aforesaid unfair labor practices are unfair labor
practices affecting commerce within the meaning of Sec-
tion 2(6) and (7) of the Act.
Upon the foregoing findings of fact, conclusions of law,
and the entire record in this proceeding and pursuant to
Section 10(c) of the Act, I hereby issue the following rec-
ommended:
BUETER BAKERY CORPORATION 891
ORDER7
Respondents , Bueter Bakery Corporation and Albert
Kelly, Receiver in Bankruptcy, Quincy, Illinois, their offi-
cers, agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Making or effecting any change in the wages, hours,
or other terms or conditions of employment of employees
in the collective-bargaining unit described below without
first giving notice to their collective-bargaining representa-
tive and affording such representative an opportunity to
engage in collective bargaining with respect to any such
change and without complying with all other provisions of
Section 8(d) of the Act. The appropriate collective-bargain-
ing unit is:
All driver-salesmen, transport drivers, mechanics, me-
chanics helpers, truck foremen, and route supervisors
employed by the Company, excluding bakery workers,
office clerical employees, professional employees,
guards and supervisors as defined in the Act.
(b) Negotiating directly with employees who are repre-
sented by a collective-bargaining representative duly rec-
ognized by the Company or duly certified by the Board.
(c) In any like or related manner interfering with, re-
straining, or coercing employees in the exercise of rights
guaranteed them in Section 7 of the Act.
2. Take the following affirmative action which is
deemed necessary to effectuate the policies of the Act:
(a) Restore to the employees in the above-described unit
the wage rates in effect prior to the reduction in wage rates
unilaterally instituted by the Company and make whole
their employees who are covered by the 1974 collective-
bargaining agreement with the Union for all loss of earn-
ings they may have suffered by reason of the Company's
unlawful reduction in their wage rates together with inter-
est thereon at the rate of 6 percent per annum.
(b) Preserve and, upon request, make available to the
Board or its agents , for examination and copying, all pay-
roll records, social security payment records, timecards,
personnel records and reports, and all other records neces-
sary to analyze the amounts of backpay due under the
terms of this recommended Order.
(c) Post at their place of business in Quincy, Illinois,
copies of the attached notice marked "Appendix." 8 Copies
of said notice, on forms provided by the Regional Director
for Region 14, after being duly signed by Respondents,
shall be posted by them immediately upon receipt thereof,
and be maintained by them for 60 consecutive days there-
7 In the event no exceptions are filed as provided by Sec. 102 .46 of the
Rules and Regulations of the National Labor Relations Board, the findings,
conclusions, and recommended Order herein shall, as provided in Sec.
102.48 of the Rules and Regulations , be adopted by the Board and become
its findings , conclusions , and Order , and all objections thereto shall be
deemed waived for all purposes.
8In the event that the Board's Order is enforced by a Judgment of a
United States Court of Appeals, the words in the notice reading "Posted by
Order of the National Labor Relations Board" shall read "Posted Pursuant
to a Judgment of the United States Court of Appeals Enforcing an Order of
the National Labor Relations Board."
after, in conspicuous places, including all places where no-
tices to employees are customarily posted. Reasonable
steps shall be taken by Respondents to insure that said
notices are not altered, defaced, or covered by any other
material.
(d) Notify the Regional Director for Region 14, in writ-
ing, within 20 days from the date of this Order, what steps
Respondents have taken to comply herewith,
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILL NOT make or effect any changes in the wag-
es, hours, or other terms or conditions of employment
of the employees in the collective-bargaining unit rep-
resented by General Drivers, Warehousemen and
Helpers, Local Union No. 21, affiliated with Interna-
tional Brotherhood of Teamsters, Chauffeurs, Ware-
housemen and Helpers of America, without first giv-
ing notice to their collective-bargaining representative
and affording such representative an opportunity to
engage in collective bargaining with respect to any
such proposed change and without complying with all
conditions of Section 8(d) of the National Labor Rela-
tions Act, The appropriate unit is:
All driver-salesmen, transport drivers, mechanics,
mechanics helpers, truck foremen, and route super-
visors employed at our Quincy, Illinois, plant, ex-
cluding bakery workers, office clerical employees,
professional employees, guards and supervisors as
defined in the Act,
WE WILL NOT avoid complying with our statutory
obligations to bargain collectively with the aforesaid
Union as the representative of the employees in the
described appropriate bargaining unit by directly
dealing with or negotiating with the employees in said
unit so long as the Union constitutes their lawful rep-
resentative.
WE WILL restore to the employees in the above-de-
scribed unit the wage rates in effect prior to our unila-
teral reduction in wage rates.
WE WILL make whole all the employees in said col-
lective-bargaining unit for the loss of wages suffered
by them by reason of our unlawful modification of our
collective-bargaining agreement with the Union to-
gether with interest thereon at the rate of 6 percent per
annum.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce employees in the exercise of
the rights guaranteed them in Section 7 of the Act.
BUETER BAKERY CORPORATION AND ALBERT KELLY,
RECEIVER IN BANKRUPTCY