Charles Schaefer Sons, Inc.

National Labor Relations Board - Board Decisions

Aug 27, 1987

285 N.L.R.B. 409 (N.L.R.B. 1987)

CHARLES SCHAEFER SONS 409
Charles Schaefer Sons, Inc. and Local 462 of the
International Brotherhood of Teamsters , Chauf-
feurs, Warehousemen and Helpers of America.
Case 22-CA-14408
27 August 1987
DECISION AND ORDER
BY CHAIRMAN DOTSON AND MEMBERS
JOHANSEN AND CRACRAFT
On 21 October 1986 Administrative Law Judge
Joel P. Biblowitz issued the attached decision. The
Respondent and the General Counsel filed excep-
tions and supporting briefs.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the decision and the
record in light of the exceptions and briefs and has
decided to affirm the judge's, rulings, findings,' and
conclusions and to adopt the recommended
Order.2
ORDER
The recommended Order of the administrative
law judge is adopted and the complaint is dis-
missed.
MEMBER CRACRAFT, dissenting.
Because I disagree with my colleagues' conclu-
sion that there was no meeting of the minds about
the terms of a collective-bargaining agreement, I
dissent from the dismissal of the complaint allega-
tion that the Respondent violated Section 8(a)(5) of
the Act by refusing to execute a written agreement.
Since around 1967 the Respondent and the
Union have been parties to a series of collective-
bargaining agreements, recognizing the Board-cer-
tified Union as bargaining representative for a unit
' The Respondent has excepted to some of the judge's credibility find-
ings The Board's established policy is not to overrule an administrative
law judge's credibility resolutions unless the clear preponderance of all
the relevant evidence convinces us that they are incorrect. Standard Dry
Wall Products, 91 NLRB 544 (1950), enfd. 188 F.2d 362 (3d Cir 1951)
We have carefully examined the record and find no basis for reversing
the findings.
2 The General Counsel's motion to strike the Respondent's brief in sup-
port of the Respondent's exceptions to the decision of the administrative
law judge and in answer to the General Counsel's exceptions to the deci-
sion of the administrative law judge and motion to reopen the record to
receive evidence is denied
The Respondent's statement in opposition to the General Counsel's
motion to strike the Respondent's brief in support of the Respondent's ex-
ceptions to the decision of the administrative law judge and in answer to
the General Counsel's exceptions to the decision of the administrative
law judge; statement in support of the General Counsel's motion to
reopen the record to receive evidence; request for official notice of
posthearing judicial proceedings and the Respondent's motion to reopen
the record to receive evidence is granted to the extent we take judicial
notice of the posthearmg arbitration proceedings and is denied in all
other respects.
of production and maintenance' employees. In Oc-
tober 1985 the parties commenced bargaining for a
contract to replace the one about to expire. In No-
vember the parties, according to the judge,
"reached full agreement on all the terms to be in-
corporated into the contract" and signed a memo
of understanding. Later, the Respondent refused to
execute a written agreement because of a dispute
over the number of employees the contract cov-
ered.
Under the circumstances of this case, I would
conclude, contrary to the judge, the inquiry does
end with the finding that the parties reached agree-
ment on the terms to be included in a contract.
The Respondent mistakenly believed it could take
advantage of the Union's statement that the upper
wage tier applied to the three employees then em-
ployed in order to avoid a meeting of the minds.
But, neither party sought to modify the unit de-
scription or bargained about unit size.' Thus, on
the facts of this case, I would find the parties bar-
gained to agreement on contract terms to cover a
unit both parties accepted, 3 and the Respondent
violated Section 8(a)(5) by thereafter refusing to
execute a written agreement.4 Cutter Laboratories,
265 NLRB 577 (1982).
' By no later than the 1982 contract, called production and warehouse.
2 Had the parties bargained about unit size or whether specific individ-
uals were covered, this might be a different case . The parties' discussion
about the two-tier wage system, in which the Union expressed concern
that it not affect three currently working employees, does not constitute
bargaining about unit size, particularly given the judge's finding that Re-
spondent was aware the Union would insist unit size could vary depend-
ing on the outcome of arbitration.
3 Because the Union was the certified representative, there was no dis-
pute over the unit description Unit size, of course, may vary due to sub-
sequent events Apparently, the judge believed discharging employees
was a material subsequent event, even though the parties did not discuss
it, and so the judge characterized the Union's reference to three currently
working employees as a mistake on which the Respondent sought to cap-
italize In my -view, however, the mistake was the Respondent's to be-
lieve that the discussion about the two-tier wage system could be con-
verted into a misunderstanding that would be fatal to an agreement That
mistake was unilateral and deliberate A mistake by one party to an
agreement, when not induced by acts of the other party, will not consti-
tute grounds for relief Skyline Corp. v. NLRB, 613 F 2d 1328, 1334 (5th
Cir. 1980)
' I need not decide whether, the discharged employees are "present"
employees, "new" employees, or in the unit Under the facts of this case,
those questions are simply not relevant to the inquiry_____
Gary A. Carlson, Esq., for the General Counsel.
Lawrence Henderson,-Esq., for-dre-Respondent.
David Grossman, Esq. (Schneider, Cohen, Solomon, Leder
& Montalbano), for the Charging Party.
DECISION
STATEMENT OF THE CASE
JOEL P. BIBLOwLTz, Administrative Law Judge. This
case was heard by me on 30 July 1986 in Newark, New
Jersey. The complaint, which issued on 13 June 1986,
285 NLR]B No. 78
410 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
and was based on an unfair labor practice charge filed on
29 April 1986 by Local 462 of the International Brother-
hood of Teamsters, Chauffeurs, Warehousemen and
Helpers of America (the Union), alleges that Charles
Schaefer Sons, Inc. (Respondent), violated Section
8(a)(5) of the Act by refusing to execute a collective-bar-
gaining agreement with it, although the parties reached
full and complete agreement on all the terms of the col-
lective-bargaining agreement . Respondent, while denying
that it refused to execute the agreement or that it has
violated the Act by its conduct, admits that full agree-
ment was reached by the parties on the terms and condi-
tions to be incorporated, in the collective-bargaining
agreement.
On the entire record, including my observation of the-
demeanor of the witnesses, and after consideration of the
briefs filed, I make the following
FINDINGS OF FACT
1. JURISDICTION AND LABOR ORGANIZATION STATUS
There being no dispute, I find that Respondent is an
employer within the meaning of Section 2(2), (6), and (7)
of the Act and the Union is a labor organization within
the meaning of Section 2(5) of the Act.
II. FACTS AND ANALYSIS
In 1967 the Board certified the Union as the collec-
tive-bargaining representative for Respondent's employ-
ees in the following unit: All production and mainte-
nance ) employees employed at its Elizabeth, New Jersey
location, excluding all office clerical employees, profes-
sional employees, guards, and supervisors as defined in
the Act. Raymond DeMilia, secretary treasurer of the
Union since February 1982, negotiated the above-men-
tioned collective-bargaining agreement effective 13 Octo-
ber 1982 through 12 October 1985.2
On 29 March Respondent discharged 7 of its 10 regu-
lar employees pursuant to information gathered by a se-
curity employee hired to serve as an undercover employ-
ee to investigate the employees. The reasons given for
the discharges of these employees were,, principally, the
use of alcohol and drugs on the job, timecard abuse, and,
in one case, threatening a fellow employee with a knife.
By telegram to Respondent dated 3 April, DeMilia
wrote: "this telegram represents a grievance on behalf of
the 7 employees whom you terminated last Friday,
March 29, 1985. I will be in touch with you to discuss
this matter." DeMilia also spoke to Respondent's execu-
tive vice president , James Barbour, about the discharges,
telling him that he had no choice but to proceed in the
matter to arbitration. Barbour told him that he under-
stood the Union's position, but he had an extensive file
on the seven discharged employees. These discharged
employees applied for unemployment benefits; Respond-
3 At a certain point, no later than the collective -bargaining agreement
between the parties dated 24 November 1982 , the word "maintenance"
was changed to "warehouse " Other than that, and the change in location
from Elizabeth to Union, New Jersey, the unit remains the same and ap-
propriateness of it is admitted by Respondent
2 Unless indicated otherwise, all dates are for the year 1985
ent contested the claims. Their claims were granted on
19 June. ,
In May the Union sent Respondent a notice of its in-
tention to arbitrate these seven discharges; the arbitrator
was designated by the New Jersey State Board of Media-
tion on 11 June. Procedural matters and witness difficul-
ties delayed the opening of the arbitration until 19 No-
vember; after that, the remaining hearing dates were 5
December, 12 December, 9 and 29 January 1986, on
which date the hearing concluded. On 13 March 1986
the arbitrator issued his opinion and award in which he
ordered that six of the seven discharged employees be
reinstated and "be placed on the same status that he
would have been as of" 1 August and 1 September. He
found further that the discharge of the seventh employee
was for just cause because he had threatened a fellow
employee with a knife. As stated, supra, the principal
justification given by Respondent for the discharges was
the use of alcohol and drugs during working time and
timecard abuse. The principal reason the arbitrator gave
for ordering the reinstatement of six of the seven dis-
charged employees was that Respondent had been aware
of these activities for a long period and the activities had
been condoned by Respondent: "The activities of the
grievants had been condoned for years and management
never gave them a clear, convincing and unequivocal
warning that what had been condoned in the past would
no longer be acceptable." Respondent is contesting this
award and has not yet complied with it.
Respondent is engaged in the nonretail sale of rock
salt, which is used, primarily, on the road system in the
State of New Jersey. Obviously this is a seasonal oper-
ation, one where Respondent hired temporary employees
during its busiest period from about December through
March to supplement its regular work force.
On 9 October the Union and Respondent met for the
first time to negotiate a collective-bargaining agreement
to replace the one set to expire 3 days later. In that
meeting, the parties entered into an extension of agree-
ment extending the collective -bargaining agreement
through 15 November. DeMilia was the principal spokes-
man for the Union, Barbour for the Respondent. At this
negotiating session, and the two that followed, Respond-
ent alleged that it needed a two-tier wage system and a
lesser wage rate to remain competitive ; DeMilia said: "as
long as it doesn't affect the three people that we have
there at the premises now, and if we could get the
Apocalypse peoples that we would agree to it." Both
3 There was abundant testimony regarding the Apocalypse operation.
DeMilia testified that Apocalypse supplies drivers and warehouse em-
ployees to Respondent He is not interested in the drivers , but as the
Apocalypse warehouse employees work side-by-side with Respondent's
employees whom he represents, and perform the same tasks, he requested
that those employees be made part of the unit and he testified that Bar-
bour agreed to this Barbour testified that he and another individual are
the sole owners of Apocalypse; because it is not owned or controlled by
Respondent, he rejected DeMilia's request that the Apocalypse employ-
ees be added to his unit He testified that he and his co-owner originally
established Apocalypse to supply drivers to Respondent and any other
business entity. Shortly thereafter, Apocalypse began supplying Respond-
ent and other employers with a seasonal operation with temporary em-
ployees, including warehouse employees Apocalypse employees are gen-
Continued
CHARLES SCHAEFER SONS
DeMilia and Barbour testified that during negotiations,
when asked, DeMilia said that the upper level of the
two-tier system would apply only to the three employees
then employed, although he did not specifically say that
the seven discharged employees would be excluded; in
fact, during the negotiations nothing was said about the
seven discharged employees . Barbour testified that
during negotiations DeMilia was agreeable to the two-
tier system "as long as it excluded the three people that
remained in the unit at the time."
At a meeting with the FIVI [CS mediator the parties
signed a four-page "Memo of Agreement ," dated 18 No-
vember, handwritten by the mediator .4 The agreement
provides, inter alia, for a new title: "New Hires Only."
The agreement also provides : "Co. to contribute $200
per year on behalf of the present employees , the employ-
ees having the option to contribute on their own if need
arises. The Co. will meet with employees involved
before 15 April , to discuss ." Although the language in
this memo of agreement is not crystal clear, it deletes
Martin Luther King's birthday and the employee's birth-
day for new hires only . In addition it provides the wages
for "New Hires" will range from $4 . 50 (warehousemen)
to $4.90 in 1985 with 50-cent-an-hour increases in each of
the following 2 years. Counsel for Respondent said that
he would prepare the agreement.
By letter dated 6 January 1986 , counsel for Respond-
ent wrote to DeMilia that he had not been successful in
obtaining a copy of the 18 November memo of agree-
ment from FMCS , but "in an effort to get the contract
signed as soon as possible , I have prepared a draft agree-
ment based on my notes." Shortly after receiving this
letter, DeMilia called counsel for Respondent and in-
formed him of some items in the draft that he felt were
in error . By letter dated 17 January 1986 , counsel for Re-
spondent informed DeMilia that he received the 18 No-
vember memo of agreement and, on the basis of that he
wished to add some items to the draft he had previously
sent him . One of those items was Martin Luther Kings'
birthday, about which he felt "that our agreement was to
include this holiday for new hires , only if required by
federal law ."5 Shortly thereafter, while DeMilia was dis-
erally skilled with a construction industry background, their pay ranges
from $7 50 an hour to $26,000 a year salaried employees DeMilia alleges
and Barbour denies that Respondent agreed to DeMilia's demand that the
Apocalypse employees be added to the unit in exchange for DeMiha's
agreement to a two-tier pay system ]However, the General Counsel's
opening statement alleged that the sole reason for Respondent 's refusal to
execute the agreement was due to Respondent 's insistence that the seven
employees discharged on 29 March be considered as new employees
under the two tier system In addition , the evidence establishes that it
was solely the disposition of these seven employees, rather than the
Apocalypse employees that caused the dispute here. Therefore, the fail-
ure to accrete the Apocalypse employees to the instant unit will not be
considered. _
4 Due to the absence of a functioning copying machine , the parties did
not receive a copy of this agreement until 2 months later.
5 Included in the draft agreement proposed by Respondent, and the 18
November memo of agreement , was a 120-day union-security provision
as well as a 120-day probationary period ("the first one hundred twenty
days of employment of an employee") during which an employee may be
discharged for any reason and without just cause
411
cussing some of these changes with counsel for Respond-
ent, he asked DeMilia if he ' would agree to name the
three individuals, then on the payroll, in the contract.
DeMilia said that he could not do that because by doing
so he would erase the rights and privileges of the seven
individuals in arbitration should they win the arbitration,
There have been no further discussions between the par-
ties regarding contract terms and the parties have never
executed a new contract. Barbour testified that Respond-
ent is prepared to sign the new agreement providing
only the three existing employees were covered by the
upper tier of the contract.
Barbour testified that during negotiations DeMilia "re-
peatedly kept saying" that the higher benefits would
only apply to the three employees, and on that basis, he
determined Respondent 's costs for the new agreement.
These costs were $200 yearly for each IRA, or a total of
$600 two holidays and a 25-cent yearly increase for each
of the three. "Otherwise I obviously would not have
given away more of the store, if you will, knowing that
there might have been other people involved." In an-
swers to questions of counsel for the General Counsel,
Barbour testified that during negotiations he was aware
of the pending arbitration of the seven individuals,6 but
stated:
My feeling at the time we were going through this
negotiation was that we had an absolute, ironclad
case and that there was no chance that any of those
men were coming back. They had already been, if
you will, wiped from my memory for purposes of
negotiation and I was not considering having to
take them back at all. It never even entered my
mind . . . . It never entered my mind so I never
thought about it.
Barbour also testified that he was aware that the arbitra-
tor "had that power" to order the seven individuals rein-
stated by Respondent, but there was only a "slim possi-
bility" of Respondent losing the arbitration- "We
thought it was more like one in a million." He testified
that because he felt the chance of losing the arbitration
was so slim, it did not play any part in the negotiations.
The sole issue is whether Respondent unlawfully failed
and refused to excute a written agreement . Respondent
admits that it and the Union reached full agreement on
all the terms to be incorporated into the contract. Re-
spondent alleges that Barbour relied on DeMilia's com-
mittment that only the three employees working at that
time would be in the upper tier of wages and benefits in
calculating what Respondent could afford to offer in a
new agreement; if he were told that the seven discharged
employees would also be in this category (if returned to
work by an arbitrator) he would not have agreed to the
benefits contained in the 18 November memo of agree-
ment. Therefore, Respondent alleges, there was no viola-
tion when they refused to execute the contract after the
Union informed them that they would not specifically
limit the upper tier to the three named individuals. The
6 The discharged employees had been employed by Respondent for up
to 10 years and were earning between $8 and $8 25 an hour.
412 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
General Counsel argues that even though DeMilia as-
sured Barbour during the negotiations that the upper-tier
rates and benefits only applied to the three individuals,
Barbour knew that what DeMilia meant was that it ap-
plied to the three, plus the other seven if an arbitrator or-
dered them back to work. Therefore, there was no mis-
understanding, there was a meeting of the minds, and
Respondent should be ordered to execute the agreement.
Admittedly, during negotiations, DeMilia informed
Barbour that the upper-tier benefits in the proposed
agreement would apply only to the three employees.' I
find, as argued by the General Counsel, that although
DeMilia said three employees, Barbour was aware that
he meant from 3 to 10 depending on the Union's success
in the arbitration proceeding. Barbour was aware of the
Union's grievance involving the discharges, its subse-
quent demand for arbitration and the notice of arbitra-
tion . I assume that he assisted Respondent's attorney in
the procedural matters that delayed the opening of the
hearing from June until 19 November and in the 5 hear-
ing days of the arbitration. Respondent also filed a posth-
earing brief. The arbitration commenced on the day fol-
lowing the 18 November memo of agreement. Such pro-
ceedings would not justify a person to conclude (as Bar-
bour testified):
My feeling at the time we were going through this
negotiation was that we had an absolute, ironclad
case and that there was no chance that any of those
men were coming back. They had already been, if
you will wiped from my memory for purposes of
negotiation and I was not considering having to
take them back at all. It never even entered my
mind.
Being aware of the scope of the arbitration, and the
possibility of losing it, I find that Barbour was also
aware that if the arbitrator returned the discharged em-
° Should it be relevant on appeal, I would credit DeMilia's testimony
over that of Barbour He appeared to be testifying in a honest and truth-
ful manner , and readily admitted telling Barbour that the higher benefits
would only apply to the three employees On the other hand, as dis-
cussed infra , I found Barbour's downplay of the arbitration proceeding
and his testimony that "there was no" chance that the employees would
come back , and that the issue had been wiped from his memory , disin-
genuous Barbour was an experienced savvy businessman , he must have
been aware of the seriousness of the matter
ployees to work, it would not be as new employees; any
other result would be ludicrous. They were longtime em-
ployees earning $8 or $8.25 an hour. It is totally unrea-
sonable to believe that after being successful in an arbi-
tration, they would be returned to work at half their
prior salary, as probationary employees, subject to dis-
charge by Respondent without just cause.
The inquiry, however, does not end there; rather, the
ultimate question is whether the parties reached a meet-
ing of the minds on 18 November and thereafter. It is
not enough to say that Respondent, in its answer, admit-
ted that the parties reached agreement with respect to
the terms and conditions of employment of the employ-
ees. In arriving at those terms and conditions, Respond-
ent calculated his costs based on three existing employ-
ees, rather than nine, the result of DeMiha's mistake and
Barbour's attempt to take advantage of that mistake. The
bottom line is Respondent based its cost on its attempt to
limit the unit to three people; Barbour tried to "pull a
fast one" on the Union, and when the Union finally
made it clear to Respondent that the unit was possibly 10
it became clear that there was never a meeting of the
minds here. I therefore find that Respondent did not vio-
late Section 8(a)(1) and (5) of the Act when it refused to
execute the agreement.
CONCLUSIONS OF LAW
1. The Respondent is an employer within the meaning
of Section 2(2), (6), and (7) of the Act.
2. The Union is a labor organization within the mean-
ing of Section 2(5) of the Act.
3. Respondent has not engaged in any conduct in vio-
lation of the Act as alleged.
On these findings of fact and conclusions of law and
on the entire record, I issue the following recommend-
ed"
ORDER
It is recommended that the complaint be dismissed in
its entirety.
8 If no exceptions are filed as provided by Sec 102 46 of the Board's
Rules and Regulations , the findings, conclusions , and recommended
Order shall, as provided in Sec 102 48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all pur-
poses