Diamond International Corp.

National Labor Relations Board - Board Decisions

Jun 7, 1977

229 N.L.R.B. 1314 (N.L.R.B. 1977)

DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Diamond International Corporation, Calmar Division
and United Paperworkers International Union,
AFL-CIO and Printing Specialties and Paper
Products Union, District Council No. 2, affiliated
with the International Printing and Graphic Com-
munications Union, AFL-CIO, Party to the
Contract. Case 9-CA- 10052
June 7, 1977
DECISION AND ORDER
BY CHAIRMAN FANNING AND MEMBERS
JENKINS AND WALTHER
On October 28, 1976, Administrative Law Judge
John M. Dyer issued the attached Decision in this
proceeding. Thereafter, the Respondent and the
Party to the Contract filed exceptions and a
supporting brief, and the Charging Party filed an
answering brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and
briefs and has decided to affirm the rulings, find-
ings,' and conclusions of the Administrative Law
Judge and to adopt his recommended Order, as
modified herein.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge, as
modified below, and hereby orders that the Diamond
International Corporation, Calmar Division, Wash-
ington Court House, Ohio, its officers, agents,
successors, and assigns, shall take the action set forth
in the said recommended Order, as so modified:
1. Substitute the following for paragraph l(c):
"(c) Performing, enforcing, or giving effect to the
collective-bargaining agreement of October 8, 1975,
and the preceding addenda between P.S.U. and
Respondent by applying or enforcing said agreement
with respect to any employees in the appropriate
unit, or by entering into or enforcing an extension,
renewal, modification, or supplement thereof, or any
superceding collective-bargaining agreement with
said labor organization, by applying and enforcing
any of said extensions, renewals, modifications,
supplements, or superceding collective-bargaining
agreements to any employees in said appropriate
unit."
229 NLRB No. 185
2. Substitute the following for paragraph 2(b):
"(b) Reimburse each of the present and former
Washington Court House employees for all initiation
fees, dues, and other moneys, if any, exacted
pursuant to the terms of the union-security agree-
ment between Respondent and P.S.U. on and after
October 8, 1975, as set forth in The Remedy section
of this Decision."
I In agreeing that this proceeding is not time-barred by the 6-month
statute of limitations set forth in Sec. 10(b) of the National Labor Relations
Act, we note several factors: (I) Respondent admitted that on May 29, 1975,
the Printing Specialties and Paper Products Union (P.S.U.) was a minority
union as no unit was then even in existence. (2) There is no evidence to show
that P.S.U.'s minority position had changed when Respondent signed the
contract with P.S.U. on October 8, 1975. (3) There is evidence that a
representative complement of employees did not exist on October 8, 1975.
(The contract was made effective December 1. 1975, and production did not
begin until January 26, 1976.) Therefore, we conclude that when Respon-
dent and P.S.U. signed a contract on October 8, 1975, P.S.U. was a minority
union and there did not exist a representative complement of employees.
Further. while it is questionable whether the 10(b) period even began to run
on October 8, 1975, we need not pass upon that question because, even
assuming that it did begin to run on that date, the charge was in any event
timely filed on February 12, 1976.
In light of the foregoing, we deem it unnecessary to rely on the finding of
the Administrative Law Judge that unit employees began working at
Respondent's new plant on December 10, 1975. Although the stipulation of
the parties does not clearly set forth the date that employees first began
working at the new plant, it is clear that the October 8 signing of the
contract (which is well within the 10(b) period) preceded the employment of
a representative complement.
DECISION
STATEMENT OF THE CASE
JOHN M. DYER, Administrative Law Judge: United
Paperworkers International Union, AFL-CIO, herein
called Paperworkers or Charging Party, filed a charge on
February 12, 1976,1 against Diamond International Corpo-
ration, Calmar Division, herein called Respondent or the
Company, alleging that Respondent had interfered with
the formation and administration of a labor organization
by entering into and enforcing an unlawful prehire, union-
security, collective-bargaining agreement for a plant of
Respondent in Washington Court House, Ohio. It was
alleged that Printing Specialties and Paper Products
Union, District Council No. 2, affiliated with the Interna-
tional Printing and Graphic Communications Union,
AFL-CIO, herein referred to as Printing Specialties Union
or P.S.U. was the unlawfully assisted organization.
On April 20, 1976, the Regional Director for Region 9
issued a complaint and notice of hearing alleging in
addition to the normal jurisdictional and service allega-
tions that Respondent began its operation in Washington
Court House, Ohio, on January 26, 1976, and that
Respondent assisted P.S.U. or contributed unlawful sup-
port to it by recognizing it as the exclusive collective-
bargaining representative of Respondent's employees at
the Washington Court House plant when P.S.U. did not
represent an uncoerced majority of Respondent's employ-
ees at that location. It was further alleged that, beginning
around October 8, Respondent violated the Act by
I Unless expressly stated otherwise, all events herein occurred in 1975.
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DIAMOND INTERNATIONAL CORP.
entering into and thereafter maintaining a collective-
bargaining agreement with P.S.U. which provided that
membership in P.S.U. was a condition of employment for
all employees who were members in good standing of
P.S.U. on the execution date of that contract and that those
employees who were not members on the effective date of
the contract would become so by the 31st day following
that time or that those hired thereafter would become
members within 31 days of their hiring date. The complaint
alleged that these actions violated Section 8(a)(1), (2), and
(3) of the Act.
Respondent's original answer admitted the commerce
and jurisdictional information and the status of the two
Unions and of the officers of P.S.U. but denied the balance
of the complaint. P.S.U. filed an answer which denied the
unfair labor practice allegations.
The parties were afforded full opportunity to appear, to
examine and cross-examine witnesses, and to argue orally
at the hearing held in this matter on July 8, 1976, in
Washington Court House, Ohio. All parties have filed
briefs which have been carefully considered.
The principal question in this case is whether Section
10(b) of the Act bars the finding of a violation. I find that it
does not and that General Counsel has sustained the
burden of proof and that Respondent has violated Section
8(a)(1), (2), and (3) of the Act.
On the entire record in this case, which consists of the
pleadings, stipulations, and exhibits, I make the following:
FINDINGS OF FACT
I. COMMERCE FINDINGS AND THE STATUS OF THE
UNIONS
Respondent is a Delaware corporation whose Calmar
Division has a plant in Washington Court House, Ohio,
where it is engaged in the manufacture of childproof safety
closure devices and fine-mist sprayers. Since it began
manufacturing operations there on January 26, 1976,
Respondent purchased goods valued in excess of $50,000,
from suppliers located outside the State of Ohio, which
suppliers shipped said goods directly in interstate com-
merce to the Washington Court House, Ohio, plant.
Respondent admits, and I find, that Respondent is
engaged in commerce within the meaning of Section 2(6)
and (7) of the Act.
Respondent admits, and I find, that the Unions herein
are each labor organizations within the meaning of Section
2(5) of the Act.
1. THE UNFAIR LABOR PRACTICES
A. Background and Facts
The parties agree that since about 1967 P.S.U. represent-
ed a bargaining unit at Respondent's plant in California
where Respondent, among other things, produced fine-mist
sprayers. Around 1973, Respondent began looking for a
plantsite east of the Mississippi River in order to expand its
production and trim shipping costs since a number of its
customers were located in the midwestern area. Respon-
dent surveyed some 10 or 15 sites, one of which was
Washington Court House, Ohio. In July 1974, during its
search of plantsites, Respondent placed ads for employees
seeking work in Washington Court House, Ohio, for a
possible plant to be placed there. At that time it took
applications from some 120 people, offering them preferen-
tial hiring if the plant was actually constructed there.
On May 5, 1975, Respondent announced to its California
plant employees that a plant would be built at Washington
Court House, Ohio. Shortly thereafter P.S.U., believing
that erection of this new plant would entail movement of
machinery from the California plant to Washington Court
House with the consequent loss of up to 200jobs in the unit
in California, requested bargaining with Respondent on
that problem.
On May 29, an addendum to a 1974 3-year contract
between Respondent and P.S.U. was concluded which
recited that: P.S.U. was the duly certified representative of
the unit in California; certain work of that unit was to be
relocated in Washington Court House; and the Union
demanded to bargain on the effect of such transfers and
insisted that the Company offer the California employees
the opportunity or option of relocating at the Ohio location
rather than being laid off, but with the Company not
responsible for any relocation expenses. The addendum
provided that employees who wished to transfer to Ohio
would retain their company seniority with a right to
transfer back to California. Additionally, the addendum
stated that the Union recognized the Company's right to
install wage rates prevalent and competitive in the new
area and that such rates would be established only after
agreement by the Union and, if there should not be
agreement, the lower rate would be in effect until it was
arbitrated between the Company and P.S.U. The adden-
dum also provided for such further negotiation as would be
made necessary by any facts applicable at the new location
and stated that all other terms and conditions of employ-
ment set forth in the 1974-77 contract were, by this
addendum, included at the new location.
On June 25, Respondent issued a press release stating
that it was going to break ground for a new plant in
Washington Court House, Ohio. The press release did not
mention anything about P.S.U. or any contract, but stated
that the new plant would eventually employ approximately
400 employees.
On July 15, a second addendum was signed between
P.S.U. and Respondent which set forth a wage scale and
hourly rates for the Washington Court House, Ohio, plant
and included scheduled general increases and pension, and
welfare plans. Included in this July 15 addendum was a
memorandum of agreement in regard to continuous
operations which was applicable only to the Washington
Court House plant. P.S.U. in this July 15 document
retained the right to transfer its rights under this agreement
to any local union or district council affiliated with its
international union.
At the beginning of the hearing in this matter, Respon-
dent and P.S.U. amended their answers to admit that the
Company had recognized P.S.U. on May 29, 1975, as the
exclusive representative for a unit at the Wasington Court
House, Ohio, plant, at a time when there was a minority of
employees employed there, and added as an affirmative
defense that Section 10(b) of the Act barred finding a
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DECISIONS OF NATIONAL LABOR RELATIONS BOARD
violation in that the "contract" of May 29, 1975, was
beyond the 10(b) period since the charge was filed on
February 12, 1976. The Company offered no evidence and
did not aver any accretion theory but merely based its
defense on Section 10(b), plus the statement that no 8(a)(3)
violation could be found since there was no literal wording
of an 8(a)(3) violation in the charge. P.S.U. took the same
positions.
The parties stipulated that construction of the Washing-
ton Court House, Ohio, plant began on July 6, 1975.
On October 8, a complete contractual agreement of some
17 pages and 32 sections between Respondent and P.S.U.
was signed. In this agreement, Respondent recognizes
P.S.U. as the collective-bargaining agent for the bargaining
unit which the contract defines at the Washington Court
House plant. The contract also provides for union security
as noted previously and the payroll deduction of union
dues.
The parties stipulated that the Company had no
employees at the Washington Court House plant as of July
15 when the second addendum was signed but that, around
that date, certain employees in Respondent's City of
Industry, California, plant expressed a preference to move
to the Washington Court House plant and arrived in the
area about that date, and that nine of them have since
returned to California. The parties also stipulated that,
around December 10, both those who had transferred from
California and those who were recruited and employed at
Washington Court House who would be included in the
bargaining unit began work at the Washington Court plant
and on January 26,1976, actual production began in the
unit. The number of employees in the unit increased
gradually to approximately 250 at the time of the hearing in
this matter. Some 2 weeks prior to the hearing, the
Company permanently laid off 175 unit employees at its
California plant.
B. Analysis and Conclusions
P.S.U. and Respondent defend their actions on the
basis that, from the knowledge that the Washington Court
House Plant would be built and that there would be a
concurrent cut in employment in the City of Industry,
California, plant, P.S.U. in an effort to represent its
employees on the effects of such a relocation bargained
with the Company to minimize those effects and guarantee
jobs at the Washington Court House plant if the employees
desired to relocate there. Respondent and P.S.U. main-
tained that the contract is beyond the reach of the Board
since it was, in effect, executed prior to the 10(b) date; that
there were employees in California who were interested in
applying for a transfer to Ohio; and that therefore those
employees would be affected by the contract and that the
10(b) time was not tolled but began running in May 1975.
General Counsel maintains that the agreement signed in
May constituted the first illegal assistance to P.S.U. and
that this was enlarged upon by the succeeding addendum
and the October contract, which spelled out in detail union
security and all the other elements and the recognition of
P.S.U. by Respondent for the Washington Court House,
Ohio, plant. While the Charging Party does not agree that
the addenda constitute a contract but suggests that they are
merely provisions for the California employees, both
General Counsel and the Charging Party take the position
that neither the execution of the addenda nor the contract
started the running of the 10(b) 6-month statutory period.
They state that since there were no unit employees at the
Washington Court House plant until around December 10,
that there were no employees who could be affected by the
contract and therefore the 10(b) period would have to start
in December rather than at any earlier date. For this
proposition they refer to N.L R.B. v. R. L Sweet Lumber
Company, 207 NLRB 529 (1973), enfd. 515 F.2d 785 (C.A.
10, 1975), cert. denied 423 U.S. 986, which held that
Section 10(b) had not begun to run and that the contract
execution date was not controlling because the substantial-
ly active conduct adversely affecting those involved
occurred at a later date. In that case there were some
employees who had been employed doing nonunit work
outside of the 10(b) period but the production work
commenced and the production workers were employed at
that plant and were affected by the contract within the
10(b) period.
In the instant case it is clear that there were no
production unit employees at the Washington Court House
plant, as the stipulations provide, until around December
10, 1975. Although employees at Respondent's City of
Industry, California, plant may have been aware of the
addenda and the contract at the time they were executed,
those employees were then employees in Respondent's
California plant and were not Washington Court House
employees. The fact that some of them had indicated an
interest in transferring to Washington Court House and
becoming employed there at a later date did not make
them Washington Court House employees as of that time
since they were then still employed in Respondent's
California plant.
Washington Court House employees became such when
they were actually employed there and began unit work
there in December 1975. It is only at that time that
Washington Court House employees might become aware
of the contract which affected them at that location. Until
that contract became effective for those employees, there
would be no one in a position to express opposition to the
imposition of this contract on them. Without knowledge of
the agreement as it affected them, Washington Court
House employees could not be barred by Section 10(b)
since if an unfair labor practice is hidden then Section
10(b) cannot run. In the instant case a contract was signed
between P.S.U. and Respondent. There was nothing
published or publicized about this contract which Wash-
ington Court House employees could have been aware of,
since there were no Washington Court House employees
until December 1975. P.S.U.'s statement that the Charging
Party was guilty of negligence is erroneous. To have
knowledge of these addenda and the October agreement it
would have been necessary for the Charging Party to have
presumed illegality on behalf of Respondent and P.S.U.
and go searching for and find it. That is not required.
Under all the facts and circumstances here, I hold that
Section 10(b) does not bar finding violations of the Act in
this case since it would not start running until December
10, 1975. Further I find that the charge itself, in its
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DIAMOND INTERNATIONAL CORP.
language, spells out the essentials of an 8(aX3) violation in
that the charge alleges as violative of the Act the
enforcement of this unlawful prehire union-security agree-
ment which is the essence of the 8(a)(3) violation. If one
were to consider this as an unlawful prehire agreement,
which in effect it is, then the contract would be a nullity
under Section 8(f) of the Labor Management Relations
Act.
In any event I conclude and find that Respondent
violated Section 8(aXl), (2), and (3) of the Act by entering
into the addenda and contract herein and by thereafter
enforcing those agreements, and I will make appropriate
recommendations to remedy these violations.
111. THE EFFECT OF THE UNFAIR LABOR PRACTICES
UPON COMMERCE
The activities of Respondent set forth in section 11,
above, have been found to constitute unfair labor practices
in violation of Section 8(aX)(), (2), and (3) of the Act and,
occurring in connection with Respondent's business opera-
tions as described in section 1, above, have a close,
intimate, and substantial relationship 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.
IV. THE REMEDY
Having found that Respondent violated Section 8(aX)(I),
(2), and (3) of the Act by rendering unlawful support and
assistance to P.S.U. at the Washington Court House, Ohio,
plant and enforcing that labor organizations's union-
security agreement, I recommend that Respondent with-
draw recognition from P.S.U. as the representative of the
bargaining unit at the Washington Court House, Ohio,
plant unless and until P.S.U. is certified by the Board as the
exclusive bargaining representative of the employees in the
unit.
I shall also recommend that Respondent cease applying
the provisions of the P.S.U. contract to said employees but
not so as to deprive them of any benefits they now enjoy.
Having found that Respondent unlawfully applied and
enforced the union-security provisions of said contract to
the said employees, in violation of Section 8(a)(1), (2), and
(3) of the Act, I further recommend that Respondent
reimburse the present and former employees for all
initiation fees, dues, or other moneys exacted from them in
favor of P.S.U., including interest at 6 percent per annum
computed in the manner set forth in Seafarers International
Union of North America, etc., 138 NLRB 1142 (1962), J.
Howard Jenks, d/b/a Glendora Plumbing, 165 NLRB 101,
103 (1967); 172 NLRB 1700 (1968). And it will be
recommended that Respondent cease giving effect to any
P.S.U. checkoff authorizations of said employees.
It is recommended that Respondent preserve and, upon
request, make available to the Board, for examination and
copying, all payroll records, social security payment
records, timecards, personnel records and reports, and all
2 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.
other records necessary and useful to determine the
amount of moneys due under the terms of the foregoing
recommendations.
I further recommend that Respondent be ordered to
cease and desist from violating the Act in the same manner
or any manner similar to these violations.
On the basis of the foregoing findings and the entire
record, I make the following:
CONCLUSIONS OF LAW
I. Diamond International Corporation, Calmar Divi-
sion, is an employer engaged in commerce within the
meaning of Section 2(6) and (7) of the Act.
2. Paperworkers and Printing Specialty Union are
labor organizations within the meaning of Section 2(5) of
the Act.
3. By the conduct set forth in section I, above,
Respondent has rendered unlawful assistance and support
to P.S.U. and thereby has engaged in, and is engaging in,
unfair labor practices within the meaning of Section 8(aX2)
and (1) of the Act.
4. By enforcing the provisions of the union-security
agreement of the P.S.U. contract at Respondent's Wash-
ington Court House, Ohio, plant, thereby encouraging
membership in P.S.U. and discouraging membership in
Paperworkers or any other union, Respondent on and after
December 10, 1975, has engaged in, and is engaging in,
unfair labor practices within the meaning of Section 8(aX3)
and (I) of the Act.
Upon the foregoing findings of fact, conclusions of law,
and the entire record, and pursuant to Section 10(c) of the
Act, I hereby issue the following recommended:
ORDER2
The Respondent, Diamond International Corporation,
Calmar Division, Washington Court House, Ohio, its
officers, agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Assisting P.S.U. or any other labor organization and
from otherwise interfering with the representive of their
employees through a labor organization of their own
choosing.
(b) Recognizing P.S.U., or any successor thereto, as the
representative of any of the employees in the appropriate
collective-bargaining unit at the Washington Court House
plant or dealing with them with respect to rates of pay,
wages, hours of employment, or any other terms and
conditions of employment, unless and until P.S.U. has
been certified by the Board as the exclusive representative
of the employees in an appropriate unit.
(c) Performing, enforcing, or giving effect to the
collective-bargaining agreement of October 8, 1975, and
the succeeding addenda between P.S.U. and Respondent
by applying or enforcing said agreement with respect to
any employees in the appropriate unit, or by entering into
or enforcing an extension, renewal, modification, or
supplement thereof, or any superseding collective-bargain-
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.
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DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ing agreement with said labor organization, by applying
and enforcing any of said extensions, renewals, modifica-
tions, supplements, or superseding collective-bargaining
agreements to any employees in said appropriate unit.
(d) Giving effect to any checkoff authorizations in favor
of P.S.U. by Respondent's Washington Court House
employees.
(e) In any like or related manner interfering with,
restraining, or coercing employees in the exercise of rights
guaranteed in Section 7 of the Act, except to the extent
such rights may be affected by an agreement requiring
membership in a labor organization as authorized in
Section 8(a)(3) of the Act, as amended.
2. Take the following affirmative action designed to
effectuate the policies of the Act:
(a) Withdraw and withhold all recognition from P.S.U.
as the collective-bargaining representative of the Washing-
ton Court House employees unless and until P.S.U. is
certified by the Board as the exclusive representative of the
appropriate unit.
(b) Reimburse each of the present and former Washing-
ton Court House employees for all initiation fees, dues, and
other moneys, if any, exacted pursuant to the terms of the
union-security agreement between Respondent and P.S.U.
on and after December 10, 1975, as set forth in "The
Remedy" section of this Decision.
(c) Preserve and, upon request, make available to the
Board or its agents all payroll and other records as set forth
in "The Remedy" section of this Decision.
(d) Post at the Washington Court House plant copies of
the attached notice marked "Appendix." 3 Copies of this
notice, on forms provided by the Regional Director for
Region 9, after being duly signed by the appropriate
representative of Respondent, shall be posted immediately
upon receipt thereof, and be maintained by it for 60
consecutive days thereafter, in conspicuous places, includ-
ing all places where notices to employees are customarily
posted. Reasonable steps shall be taken to insure that said
notices are not altered, defaced, or covered by any other
material.
(e) Notify the Regional Director for Region 9, in writing,
within 20 days from the date of this Order, what steps
Respondent has taken to comply herewith.
3 In 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."
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
After a hearing in which all parties participated and offered
evidence, the National Labor Relations Board has found
that we violated the law and has ordered us to post this
notice; we intend to carry out the order of the Board and
abide by the following:
The National Labor Relations Act gives you, as
employees, certain rights, including the right to self-
organization, to form, join, or help unions, and to
bargain collectively through a representative of your
choosing. Accordingly, we give you these assurances:
WE WILL NOT recognize Printing Specialties Union
as the collective-bargaining representative of our
Washington Court House employees for the purpose of
dealing with us concerning grievances, labor disputes,
wages, rates of pay, hours of employment, or other
terms and conditions of employment of these employ-
ees or give Printing Specialties Union any other
assistance or support with respect to the representation
of these employees.
WE WILL NOT apply, enforce, or give effect to the
Printing Specialties Union's collective-bargaining
agreement with us, or any modification, extension, or
renewal of such agreement.
WE WILL NOT encourage membership in Printing
Specialties Union or any other labor organization by
applying, maintaining, or enforcing the union-security
provisions of the collective-bargaining agreement be-
tween us and Printing Specialties Union upon our
Washington Court House employees or by discriminat-
ing in any like or related manner proscribed by the
National Labor Relations Act in regard to the hire or
tenure of employment or any other term or condition of
employment of these employees.
WE WILL no longer give effect to Printing Specialties'
checkoff authorizations by our Washington Court
House employees.
WE WILL NOT in any like or related manner interefere
with our employees in the exercise of any rights
guaranteed in the National Labor Relations Act.
WE WILL withdraw and withhold recognition from
Printing Specialties Union unless and until that union
is certified by the National Labor Relations Board as
the exclusive bargaining representative of our Washing-
ton Court House employees.
WE WILL reimburse with interest each of the present
and former employees of our Washington Court House
plant for all initiation fees, dues, and other moneys, if
any, exacted from them pursuant to the union-security
provisions of the collective-bargaining agreement be-
tween us and Printing Specialties Union.
DIAMOND INTERNATIONAL
CORPORATION, CALMAR
DIVISION
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