Electric Steel Foundry

National Labor Relations Board - Board Decisions

Jun 16, 1947

74 N.L.R.B. 129 (N.L.R.B. 1947)

In the Matter of ELECTRIC STEEL FOUNDRY and METAL TRADES COUNCIL
OF PORTLAND AND VICINITY, AFL
In the Matter of ELECTRIC STEEL FOUNDRY and METAL TRADES COUNCIL
OF PORTLAND AND VICINITY, AFL
Cases Nos. 19-C-1406 and 19-B-1567, respectively.Decided June
16,1947
Mr. Daniel R. Dimick, for the Board.
Sabin & Malarkey and Howard H. Campbell, of Portland, Oreg.,
by Mr. Robert L. Sabin, of Portland, Oreg., for the respondent.
Mr. William C. Baisinger, Jr., of counsel to the Board.
DECISION
AND
ORDER
On October 15, 1946, Trial Examiner Irving Rogosin issued his
Intermediate Report in the above-entitled proceeding, finding that
the respondent, Electric Steel Foundry, Portland, Oregon, had en-
gaged in and was engaging in certain unfair labor practices, and rec-
ommending that it cease and desist therefrom and take certain affirma-
tive action, as set forth in the copy of the Intermediate Report
attached hereto. In the Intermediate Report, the Trial Examiner
further found that the respondent had interfered with an election
conducted by the Board on November 9, 1945, among the respondent's
employees to determine their representative for the purpose of col-
lective bargaining, and he recommended that the election be set aside.
Thereafter, the respondent filed exceptions to the Intermediate Report
and a supporting brief. On May 6, 1947, the Board heard oral argu-
ment at Washington, D. C. The respondent.appeared and participated
in the argument; neither union appeared.
The Board has reviewed the rulings made by the Trial Examiner at
the hearing and finds that no prejudicial error was committed. The
rulings are hereby affirmed. The Board has considered the Inter-
mediate Report, the respondent's exceptions and brief, the arguments
advanced at oral argument, and the entire record in the case, and
hereby adopts only those findings of fact of the Trial Examiner that
74 N. L. R. B., No. 30.
129
130 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
are consistent with this decision. For the reasons set forth below,
the Board does not adopt the Trial Examiner's conclusions and
recommendations.
The sole issue in the case is whether the respondent's pre-election
letter of November 8, 1945, standing along, was violative of the Act,
as found by the Trial Examiner, or protected free speech, as con-
tended by the respondent. The Trial Examiner, in concluding that
the letter was coercive per se, gave controlling significance to his
interpretation of the last three paragraphs of the letter relating to
the effect of unionization on the employees' job security. He con-
strued the statements on this point as "tantamount to a threat that,
in the event that either of the unions were selected, the respondent
would not provide the same security of employment as had pre-
vailed theretofore." We do not so construe them. Clearly, as found
by the Trial Examiner, other statements in the letter concerning the
imposition of "senseless restrictions" and the substitution of "dis-
putes" for "cooperation" could reasonably be interpreted not as a
threat of employer reprisal but rather as only a prediction of the
consequences which would flow from the employees' designation of
a union as their collective bargaining representative. We perceive
no different import in the statements contained in the last three para-
graphs of the letter, upon which the Trial Examiner relied in reaching
his conclusion. It may be conceded that the respondent sought to
convince its employees that the unions, or either of them, because of
conduct which might be anticipated, would preclude the respondent
from providing steady employment as it had done in the past, and
that therefore the interests of the employees and the respondent
would best be served by a vote against unionization in the pending
election. But these are matters upon which the employees were able,
equally with the respondent, to exercise reason and judgment, and
the respondent's formulation of the consequences i` prophesied from
unionization carried no connotation that its own economic power
would be used, if necessary, to make its prophecy come true. We are
therefore of the opinion that the respondent's letter of November 8,
1945, to its employees was no more than an exercise of the freedom
to speak guaranteed by the First Amendment to the Constitution.
Accordingly, we hereby reverse the Trial Examiner's unfair labor
practice finding, and we shall therefore dismiss the complaint in
its entirety. Consistent with this ruling, we also find, contrary to
the Trial Examiner, that the record does not sustain the objections
filed by the A. F. of L. and the C. I. 0. to the conduct of the election
of November 9, 1945. We, therefore, overrule the objections to the
election, and we shall dismiss the petition for, investigation and
certification of representatives filed by the A. F. of L. in Case No.
19-R-1567.
ELECTRIC STEEL FOUNDRY
ORDER
131
Upon the entire record in the case, and pursuant to Section 10 (c)
of the National Labor Relations Act, the National Labor Relations
Board hereby orders that the complaint issued herein against the
respondent, Electric Steel Foundry, Portland, Oregon, be, and it
hereby is, dismissed.
IT IS FURTHER ORDERED that the petition for investigation and
certification of representatives of employees of Electric Steel
Foundry, Portland, Oregon, filed by Metal Trades Council of Port-
land and Vicinity, affiliated with the American Federation of Labor,
in Case No. 19-R-1567, be, and it hereby is, dismissed.
INTERMEDIATE REPORT
Mr. Daniel R. Dimick, for the Board.
Sabin & Malarkey and Howard H. Campbell, of Portland, Oreg., by Mr. Robert
L. Sabin, for the respondent.
STATEMENT OF THE CASE
On May 5, 1945 , Metal Trades Council of Portland and Vicinity , affiliated with
the American Federation of Labor, herein called the A. F. of L., filed with the
Regional Director for the Nineteenth Region ( Seattle, Washington ), of the
National Labor Relations Board, herein called the Board, a petition in Case
No. 19-R-1567,3 alleging that a question affecting commerce had arisen concern-
ing the representation of employees of Electric Steel Foundry, herein called the'
respondent , at its plant in Portland , Oregon, and requesting an investigation
and certification of 'representatives , pursuant to Section 9 (c) of the National
Labor Relations Act, 49 Stat. 449, herein called the Act. Pursuant to notice,
duly served on the parties , a hearing was held on May 31 , 1945, at Portland,
Oregon. On October 16 , 1945, the Board issued its Decision and Direction of
Election providing for an election by secret ballot among the production and
maintenance employees , with the conventional exclusions, to determine whether
they desired to be represented for the purpose of collective bargaining by the
A. F. of L., by United Steelworkers of America , affiliated with the Congress of
Industrial Organizations , herein called the C. I. 0., or by neither . The election
was held on November 9, 1945, and a majority of the valid votes cast were for
neither.' On November 19, 1945, the A. F. of L., and on or about the same date,
the C. I. 0. filed objections to the conduct of the election , and, on March 22,
1946, the Regional Director issued a Report on Objections , recommending that
the Board sustain the objections and set aside the election, and direct that a
new election be held.
1 64 N. L. R. B. 262.
The results of the election , according to the tally of ballots were:
Approximate number of eligible voters 1----------------------- 295
Void ballots------------------------------------------------- 1
Votes cast for A. F. of L------------------------------------- 18
Votes cast for C. I. 0---------------------------------------- 14
Votes cast against participating labor organizations------------ 228
Valid votes counted------------------------------------------ 260
Challenged ballots-------------- ----------------------------- 10
Valid votes counted plus challenged ballots--- ----------------- 270
132 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The A . F. of L. filed an unfair labor practice charge, ands on April 11, 1946,
the Board issued an order, directing that a hearing be held on the objections
to the election , authorizing the issuance of a complaint upon the charge filed
by the A. F. of L ., consolidating the said cases, and directing that a hearing
be held on the said objections and complaint . Upon an amended charge duly
filed on June 19, 1946 , by the A. F. of L ., the Board on July 12, 1946, through its
Regional Director , issued a complaint alleging that the respondent had engaged
in and was engaging in unfair labor practices affecting commerce within the
meaning of , Section 8 ( 1) and Section 2 (6) and ( 7) of the Act. Copies of the
complaint , accompanied by notice of hearing in the consolidated cases, were
duly served upon the respondent , the A. F. of L ., and the C. I. 0.
With respect to the unfair labor practices , the,complaint alleged, in substance,
that the respondent , from on or about November 8, 1945, by (1) delivering to
its employees a written statement on the eve of an election conducted by the
Board; ( 2) vilifying, disparaging , and expressing disapproval of the A. F. of L.
and the C. I. 0.; (3) threatening to close down its plant , and threatening the
future jobs of its employees in the event they voted to be represented for pur-
poses of collective bargaining by a labor organization ; ( 4) directing and order-
ing its employees to vote against both the A . F. of L. and the C. I. 0. in the
said election ; and (5 ) threatening its employees with temporary employment,
disharmony in the plant , decreased standards of employment , senseless re-
strictions , and disputes , for the purpose of discouraging membership in or
assistance to the A. F. of L . and the C. I. 0., and, unlawfully affecting the
outcome of the election of its employees , has interfered with, restrained, and
coerced its employees in the exercise of the rights guaranteed in Section 7 of
the Act.
The respondent , in its answer dated July 22, 1946 , admitted the allegations
in the complaint regarding the corporate organization , the nature and extent
of the respondent 's operations , and the status of the A. F. of L. and the C. I. 0.
as labor organizations . The respondent further admitted that it had delivered a
written statement to its employees on or about November 8, 1945, prior to the
election conducted by the Board, but generally denied the commission of any
unfair labor practices . Affirmatively , the respondent pleaded that a written
agreement entered into by the respondent with the A. F. of L., and with the
International Molders and Foundry Workers Union of North America, ' herein
called the Molders, on September 2, 1941, in effect , constituted a bar to the
representation proceedings initiated by the A. F. of L.
Pursuant to notice, a hearing was held on July 23, 1946 , at Portland, Oregon,
before Irving Rogosin, the undersigned Trial Examiner duly designated by the
Chief Trial Examiner . The Board and the respondent were represented by
counsel, and participated in the hearing .' Full opportunity to be heard, to
examine and cross-examine witnesses , and to introduce evidence bearing upon
the issues was afforded all parties . At the conclusion of the Board's case , counsel
for the Board moved to strike from the respondent's answer those paragraphs
setting forth its affirmative defenses on the ground, in substance , that the mat-
ters set forth had been fully considered and decided adversely to the respondent
in the Board's Decision and Direction of Election in connection with the repre-
sentation proceeding . Ruling on the motion was reserved. The motion is hereby
8 Not a party to these proceedings.
' Although duly served with notice of the proceedings, neither the A. F. of L., nor the
C. I. 0. entered an appearance or participated through representatives at the hearing.
ELECTRIC STEEL FOUNDRY 133
denied! The respondent thereupon rested, and orally moved to dismiss the
complaint upon substantially the same grounds relied upon for its affirmative
defenses. Ruling on this motion was also reserved. It is disposed of hereinafter
in this report. Motion of counsel for the Board, made before the close of the
hearing, to conform the pleadings to the proof in formal matters, not affecting
the substantive issues, was granted by the undersigned without objection. The
parties availed themselves of the opportunity afforded them to argue orally
upon the record. Although granted the opportunity to do so, none of the parties
has filed a brief with the undersigned.
Upon the entire record in the case, and from his observation of the witnesses,
the undersigned makes the following:
FINDINGS OF FACT
1. THE BUSINESS OF THE RESPONDENT
Electric Steel Foundry, an Oregon corporation, having its principal office and
plant in Portland, Oregon, where it operates a steel foundry, and with sales
offices in various States of the United States, and in Honolulu, Territory of
Hawaii , and warehouses in Los Angeles and San Francisco, California; Seattle,.
Washington; Eugene, Oregon , and Honolulu, is engaged in the manufacture,
sale, and distribution of steel castings, contractors' excavating equipment, and
logging specialties, and in the purchase and sale of wire rope and rolling steel
stock.6 The principal raw materials used in the respondent's business consist
of scrap steel, silica sand, ferro alloys, and rolling mill steel products.
During the year ending December 31, 1945, the respondent purchased raw mate-
rials valued in excess of $2,000,000, which were shipped to the respondent's plant
from States other than the State df Oregon. A small percentage of the raw
materials was purchased and shipped to the respondent's plant from sources
outside the continental limits of the United States. During the same period,
the respondent manufactured, processed, or handled, products valued at approxi-
mately $6,000,000, of which more than 50 percent was transported from said plant
in interstate commerce to States other than the State of Oregon, and a small
percentage, in foreign commerce to the countries of England, South America,
and Mexico. The respondent concedes that it is engaged in commerce within
the meaning of the Act.'
II. THE ORGANIZATIONS INVOLVED
Metal Trades Council of Portland and Vicinity, affiliated with the American
Federation of Labor, and United Steelworkers of America, affiliated with the
Congress of Industrial Organizations, are labor organizations admitting to mem-
bership employees of the respondent.
5 The undersigned has discovered nothing in the opinion of the Court or the Board's
Decision and Order in N. L. R. B. v. Botany Worsted Mills, 133 F. (2d) 876 (C. C. A. 3),
enf'g 41 N. L. R. B. 218, cert. denied 319 U. S. 751, relied upon by counsel for the Board,
requiring the granting of this motion.
6 In addition, the respondent owns 50 percent of the stock in Hyster Company, manu-
facturer of caterpillar tractor hoists, lumber carriers, and lift trucks, and is part owner
of Peerless Pattern Works, both of Portland, Oregon.
I The findings in this section are based upon the admissions in the respondent 's answer
to the allegations in the complaint, the findings in the Decision and Direction of Election
in the representation proceedings, as supplemented by the testimony of C. W. Swigert, Jr.,
president of the respondent, at the instant hearing, and the concession of counsel for the
respondent on the record.
134 DECISIONS OF NATIONAL LABOR RELATIONS BOAR])
III. THE UNFAIR LABOR PRACTICES
A. The alleged interference, restraint, and coercion
1. Introduction B
In the late summer of 1941, when the A. F. of L. undertook to organize the
respondent's production and maintenance employees, the respondent was already
engaged in the production of war material for the Allies under Lend-Lease.
Although the respondent had never entered into a collective bargaining agreement
with any labor organization up to that time, and had rejected the demand of the
A. F. of L. for recognition, in order to avoid threatened interruption in production,
and at the intercession of representatives' of various governmental agencies, it
met with representatives of the Metal Trades Council, International Molders and
Foundry Workers Union of North America, herein called the Molders' Union,
and the Patternmakers' Union, as well as the representatives of the various
governmental agencies involved. As a consequence of this meeting, the respon-
dent, the A. F. of L., and the Molders' Union executed a written agreement, dated
September 2, 1941, effective for the duration of "the present National Funergency."
The agreement was signed by the representatives of the interested agencies as
witnesses.
By the terms of this document, it was agreed, among other things, that the
respondent's name would be removed from the A. F. of L.'s "Unfair List" ; that
there would be no picketing at the respondent's plant, boycotting of its products,
or interference with the movement of its products or supplies to or from the
plant, as long as the A. F. of L. did not "represent a majority of the [respondent's]
employees." It was further agreed that the A. F. of L. would continue its efforts
to organize the employees "in a peaceful manner and . . . [would] not . . .
intimidate nor coerce employees into its membership," nor request the right to
"act as bargaining agent for any of its members unless its membership [should
include] a majority of the [respondent's] employees, nor . . . request a change
in existing wage scales unless it [should become] the bargaining agent for the
whole plant."
The respondent, on its part, agreed to issue a written statement announcing
its policy regarding union membership ; to admit the Business Agent of the
A. F. of L. to the plant at stated times during the lunch periods of the day and
night shifts for the purpose of soliciting union membership ; and to make no
wage adjustments "with the deliberate intention of influencing employees against
joining the Union" until January 1, 1942. All proposed wage adjustments dur-
ing this period were to be submitted for approval to the representative of the
Office of Production Management before being put into effect. Any claim that
either party had violated "the letter or spirit" of the agreement was also to be
submitted to the said representative for final decision.
On September 3, 1941, at a meeting of the respondent's employees held at the
plant, President Swigert, in the presence of representatives of the A. F. of L.
and the agencies concerned, read a prepared speech in which he outlined the cir-
cumstances culminating in the execution of the agreement. According to the
® The events in this section occurred prior to the unfair labor practices alleged in the
complaint, and are not relied upon by the Board. Evidence concerning them was offered
by the respondent as background for the subsequent events,•upon which the Board relies,
and is based upon the testimony of President C. F. Swigert , Jr., at the instant , as well
as at the representation hearing, the record of which was incorporated by reference in the
present proceeding , and upon the documents adverted to, received in evidence without
objection . The evidence concerning the earlier events was received , and has been consid-
ered, merely as background for the subsequent events.
ELECTRIC STEEL FOUNDRY 135
printed pamphlet, entitled, "Talk to Employees of Electric Steel Foundry on
September 3, 1941", which purportedly reproduced this speech, copies of which
were mailed to all employees, Swigert read the agreement, and, in accordance
therewith announced :
The Company recognizes the right of each employee to join or not to join
a union of his own choosing and pledges that no employee will lose his job
because he has joined or has not joined any union.
In concluding his speech, Swigert stated :
That is the agreement. We hope it will end once and for all the misunder-
standings which have existed for years, and the constant threat of inter-
ference with our business. During the time the Union officials are allowed
in the plant we hope you will all treat them courteously whether you wish
to talk with them or not. The purpose of this agreement should be clear to
everyone. Every man is to be allowed to make up his own mind, without
coercion or threats from anyone. We are agreeing not to discriminate in
any way against any of you who wish to join the Union. The unions are
agreeing not to picket the plant or interfere with our business unless a
majority of you do join the Union.
-This is the policy of 'the Company : No man shall suffer in his relations
with the Management of this Company or lose his job due to the fact that
he may now belong to the Union or if he shall at any time join the Union.
Neither shall any man suffer in his relations with the Management of this
company or lose his job because he prefers not to join the Union.
2. The events preceding the election
a. The letter of March 26, 1945
The record discloses no further organizational activity on the part of any
union, until about March 10, 1945, when the A. F. of L. renewed its campaign at
the respondent's plant. During the campaign, on about March 26, 1945, the
respondent mailed to 'all employees on the pay roll, mimeographed copies of a
letter, reiterating its policies regarding the organizational rights of its employees.
The letter, admittedly prompted by the revival of the A. F. of L.'s activities, re-
viewed the history of the events in 1941, and enclosed a copy of the pamphlet
dated September 3, 1941, already mentioned, in an effort, according to the re-
spondent, to reply to misstatements alleged to have been circulated by the A. F.
of L. Specifically, the letter referred to the provision in the agreement whereby
the A. F. of L. had agreed that it would not ask recognition as bargaining agent
until it represented a majority of the respondent's employees. The letter con-
tinued with a recital of the respondent's attempts to obtain War Labor Board
approval for wage increases in succeeding years, and closed by advising the
employees that the letter and enclosed pamphlet were the only accurate state-
ments of management's position.'
b. The letter of November 8, 1945
It will be recalled that the A. F. of L. filed its petition for investigation and
certification on May 5, 1945, and that hearing was held thereon on May 31, 1945.
From then until October 16, 1945, when the Board issued its Decision and Di-
rection, the momentum of the organizational campaign, according to the A. F.
of L. representative, slackened. Thereafter, it was resumed with increased vigor.
9 The letter is fully set forth in "Appendix All annexed hereto. The complaint does not
allege, nor does counsel for the Board contend, that this letter constitutes interference.
136 DECISIONS OF NATIONAL LABOR RELATIONS BOARD,
The election was scheduled for November 9, 1945, and, in preparation therefor,
in accordance with the Board's usual practice, notices of the election, containing
specimen ballots, were posted throughout the plant.
On November 8, f945, the day before the scheduled election, C. F. Swigert, Jr.,"
the respondent's president, drafted and prepared a letter to his employees. Ap-
proximately 500 copies of the letter, bearing the facsimile signature, Fred S'wi-
gert, were prepared on a duplicating machine in the respondent's office. That
afternoon, Swigert summoned Harry Stout, the head timekeeper, and directed
him to distribute the letters to all employees. In accordance with instructions,
Stout, with the aid of Charles Goodwin, his assistant timekeeper, distributed
copies of the letter to employees on the first and second shifts at 4: 30 p. in.,
during the change of shifts. Distribution to the 12 or 14 employees on the third,
or "graveyard" shift, was made by stapling copies of the letter to their time
cards. The full text of the letter follows :
The coming election will be the most important event in the career of
ESCO employees. Its outcome can seriously affect the future of your job.
Indifference can result in a decision you may later regret.
This election is being held to determine whether the employees wish to
be represented by the CIO, the AF&L (sic) or by neither. If you wish the
shop to continue operating as it has in the past you should vote for neither.
Even if you are a member of a Union you still have the right to vote neither.
It is your right to join a Union and the company has no desire to inter-
fere with that right. It is also your right not to join a Union and not to
be represented by a Union. I want to be sure you understand that you can-
not be forced to join a Union.
ESCO employees have worked for the past 25 years without the need
of an outside labor organization. During this period there has been the
closest cooperation between workers and management. It is this coopera-
tion that has enabled the company to provide the steadiest employment over
good years and bad of any steel foundry on the Coast.
If the election is won by a Union you will have lost your freedom of
action. Decisions affecting your employment will be made by others,
not by you. Efficient production will be handicapped by senseless restrictions.
Cooperation will be replaced by disputes. Your daily newspaper tells
the story.
It is my honest belief that under a Union contract we would not be
able to maintain the past standard of employment that has made ESCO
a good place to work.
Failure to vote is equivalent to a vote for a Union. If you want to keep
this shop on the same successful, job producing basis it has been for
the past 25 years, go to the voting booth and mark your ballot with an
X in the middle square, under the word NEITHER.
3. The issues ; contentions ; conclusions
The facts related are not in substantial dispute. Although the complaint
alleges interference by the respondent, independent of the pre-election letter
of November 8, no evidence was adduced at the hearing apart from that re-
lating to the letter. It is, in fact, conceded, that the Board's case rests entirely
upon this letter. Thus, the issue squarely posed is whether.the letter, standing
alone, is, as contended by the respondent, protected as within the permissive
area of free speech, or, as contended by counsel for the Board, is deprived of
'*Also sometimes called Fred Swigert.
ELECTRIC STEEL FOUNDRY 137
that constitutional protection by reason of such a' clear, though implicit, threat
of reprisal, apparent upon its face, as to render it coercive, and hence, prescribed
by the Act.
Whatever may have been the holdings in the early cases touching upon the
subject;' it is now no longer open to question that an employer need not maintain
a strictly neutral attitude, to the extent, at least, of being required to abstain
from expressing his views concerning the self-organization of his employees
(especially where competing labor organizations are not involved), provided
these views are unaccompanied by threats of reprisal or other forms of coercion.
Any doubt on this score was allayed by the line of cases originating with the
Virginia Electric & Power Co. case" and the American Tube Bending Co. case
which followed it's
In the recent Clark Bros. case," the Board said,
It is unquestionably true that an employer in the exercise of the freedom
of speech protected by the First Amendment is privileged to entertain and
express his opinion on labor policies and problems. [Cases cited.] But
this privilege is not an absolute one. . . . Where the utterances themselves,
viewed against the background of the employer's total activities, take on
the character of coercion, or where, in conjunction with the speech, the
employer otherwise makes use of his economic power over his employees to
influence their action, the employer exceeds the protected limits of the right
of free speech .. .
That is not to say that any show of bias or departure from neutrality is
sufficient to amount to coercion. Much depends on the surrounding cir-
cumstances. Where the circumstances disclose that the statements made
by the employer are designed not merely to persuade to action but form
part of a course of conduct which is deliberately calculated to and has
the effect of restraining or coercing employees in their free choice, then
"pressure exerted vocally by the employer may no more be disregarded than
"pressure exerted in other ways." [Citing Virginia Electric.] And in deter-
mining whether a course of conduct attains the stature of restraint or
coercion, the manner and degree [measured both in terms of quality and
quantity] in which the employer departs from neutrality and manifests
his opposition to a union are relevant considerations.
Thus, standing alone and in the absence of other evidence, the presenta-
tion of an argument, temperate in form and containing no intimations of
reprisal . . . may not support an inference of coercion sufficient to out-
weight the employer right of free expression... .
In the absence of any evidence of employer misconduct, apart from that which
may be inferred from the letter, it becomes necessary to determine whether any
of the statements there contained, expressly or by implication, constitute
coercion.
11 See, e. g., N. L. R. B. v . Norman H. Stone, 125 F. (2d) 752 ( C. C. A. 7 ) ; N. L. R. B. V.
Sunbeam Electric Manufacturing Co., 133 F. ( 2d) 856 (C. C. A. 7) ; N. L. R. B. v. Burry
Biscuit Corp ., 123 F. ( 2d) 540 ( C. C. A. 7 ) ; N. L. R. B . v. Federbush Co., 121 F. (2d)
954 (C. C. A. 2).
11 N. L . R. B. v. Virginia Electric & Power Co., 314 U. S. 469; see also Thomas v. Collins,
323 U. S. 516.
N. L . R. B. v. American Tube Bending Co., Inc., 134 F . ( 2d) 993 (C. C. A. 2).
14 Matter of Clark Bros . Co., Inc., 70 N. L. R. B. 802, in which the leading decisions of
the Court and the Board , dealing with the subject of free speech in relation to the Act,
are collected . See, also, Chairman Herzog's address , "Words and Acts : Free Speech and
the NLRB," delivered at the Annual Convention of the Industrial Relations Sections of
Printing Industry of America , Atlantic City, N. J., 18 LRR 338.
138 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
In construing a letter of this type, it must be recognized at the outset that it
cannot be judged in the abstract, but must be considered in the light of the
economic realities of the employer-employee relationship. The most temperate
arguments of an employer, under these circumstances, even though protected by
the doctrine of free speech, "so far as they disclose his wishes . . . have a force
independent of persuasion." "' It would be wholly unrealistic, for example, to
deny that such a letter, received on the eve of an election, is read and evaluated
by the employee with an inescapable awareness of his economic dependence upon
his employer. It is therefore essential that such a letter be subjected to careful
scrutiny to ascertain that it does not extend beyond the permissible limits of
free speech and attain the stature of coercion 1II• For it is indispensable to the
preservation of the guarantee of free. speech that it shall not be subverted so as
to become an instrument of coercion, and thus frustrate the purposes of the Act.
A cursory examination of the letter reveals that it is patterned largely
after its prototype in the American Tube Bending case. Indeed, it is not im-
probable that the letter in question was drafted with the deliberate purpose of
bringing it within the protection extended the former letter by the Court. Thus,
it will be seen that both letters begin by stressing the importance of the forth-
coming election and its outcome upon the employees. The letters continue with
a statement of the purpose of the election; the right of employees to join or
refrain from joining a union ; a reminder of the satisfactory relations and work-
ing conditions which have existed in the past ; and an appeal, perhaps more
subtly stated in the. American Tube Bending letter than in the letter here in
question, to the gratitude of the employees. So much for similarities between
the letters.
Recognizing the undesirability, "in so highly charged a subject matter [of
drawing] fine-spun distinctions . . . [or making] insubstantial refinements," 16
between two superficially similar situations, it is of compelling necessity to de-
termine whether the letter in question, realistically appraised, justifies the con-
clusion that it contains an implicit threat of retaliation to the employees ; or
whether the employer's right of free speech outweighs any "actual prejudice to
the employees' right of collective bargaining." Returning to the letter in the
instant case, it is apparent upon closer analysis, that it is neither as objective,
impartial nor as temperate as the American Tube Bending letter. It can hardly
be disputed that the letter in its entirety is anti-union in tenor. If it went no
further, it would be clearly protected under the doctrine of free speech 17
The dominant note in this letter, however, is the emphasis on the effect upon
the employees' economic security of the outcome of the election. Thus, at the
very outset the respondent sounds a disquieting note by stating that the out-
come of the election "can seriously affect the future of your job." After per-
functory acknowledgment of the right of employees to join a union, the letter
See N. L. it. B. v. Federbush Co., Inc., supra.
^a "No one may be required to obtain a license in order to speak. But once he uses
the economic power which he has over other men and their jobs to influence their action,
he is doing more than exercising the freedom of speech protected by the First Amendment."
Mr. Justice Douglas, in his concurring opinion in Thomas v. Collins , 323 U. S. 516.
iO See Matter of American Tube Bending Co., Inc., supra.
37 See, e. g., Matter of Libbey-Owens-Ford G lass Company, 63 N. L. R. B. 1, where the
Board said :
Although the letter in its entirety is anti-union in tenor and is relevant in evaluating
the respondent 's other conduct, the statements therein do no transcend the limits of
free expression . Nor do we feel that the unfair labor practices found above are of
such a nature as to lead employees to interpret the statements of the letter , otherwise
privileged , as coercive . Compare Peter J. Schweitzer, Inc. v. N. L. it. B., 144 F. (2d)
520 (79 App. D. C. 178).
63 N. L. R. B. 1, 3 (footnote 5).
ELECTRIC STEEL FOUNDRY 139
commends the close cooperation between the employees and management over
the past 25 years, which has flourished without the intrusion of an outside labor
organization . The letter stresses that this cooperation has been responsible
for the continuous employment which the respondent has provided.
The respondent then continues,
Efficient production will be handicapped by senseless restrictions. Co-
operation will be replaced by disputes . Your daily newspaper tells the
story. ( Italics added.)
Although counsel for the Board contends that these statements amount to a
threat that the employer will impose "senseless restrictions", and will replace
cooperation with disputes , it is more reasonable to assume that this is intended
as an argument that the selection of a labor organization by the employees would
result in the imposition of senseless restrictions , and the substitution of disputes
for cooperation , by the union , rather than by the employer , an argument not
infrequently resorted to in labor-management disputes . Assuming this to be
the more reasonable inference , it is significant that the employer , here, does not
suggest, or pose for the employees ' consideration, as has been done in similar
speeches and letters , the issue of whether this may result , but clearly and cate-
gorically states that such a result is inevitable . Lest such a construction be
criticized as captious , two things should be borne in mind . First, it must be
presumed that the letter was not spontaneously or hastily conceived ; nor that
the author did not intend the words used in their natural sense . Secondly,
inasmuch as it is apparent that much of the letter was adapted from its proto-
type, it may be assumed that the choice of expression was deliberate rather than
fortuitous . Otherwise , the writer of the letter would have been more apt to
employ language which had already received the sanction of the Court. His
failure to use more temperate language suggests that he was not content with
that language to accomplish effectively his purpose.
Continuing, with the reading of the letter , one senses a growing awareness of
its cumulative effect until in the final two paragraphs the, message , hinted at
from the outset , is driven home with telling effect . So, the letter concludes,
It is my honest belief that under a Union contract we would not be able
to maintain the past standard of employment that has made ESCO a good
place to work.
Failure to vote is equivalent to a vote for a Union. If you want to keep
this shop on the same successful , job producing basis it has been for the
past 25 years , go to the voting booth and mark your ballot with an X in
the middle square, under the word NEITHER . ( Emphasis added.)
Here on the final , and most telling note, the employer presages the doom to
the employees ' economic security in the event they exercise their right to select
a bargaining representative.
Resort to the device of stating that what may come to pass is based upon the
employer 's "honest belief", cannot avail to neutralize the covert threat, if it is
otherwise implicit . The clear intimation that the respondent would not be able
to maintain the past standard of employment , coupled as it is in the succeeding
paragraph with the advice to the employees to vote for neither hnion , if they
desired to keep the shop on the same successful job producing basis, is tanta-
mount to a threat that, in the event that either of the unions were selected, the
respondent would not provide the same security of employment as had prevailed
theretofore . It may be argued that these statements are no more than an appeal
to the loyalty and gratitude of employees by an employer who has been able to
provide steady employment over a long period of time. This, however, is not
the clear connotation of the utterance . If the respondent had only that purpose
140 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
in mind, it could have been stated clearly and without ambiguity. To para-
phrase, and put an extreme case, if the employer had said, "If you vote for either
union your job will be in jeopardy," or, to put it negatively, "If you do not want
to keep this shop on the same successful, job producing basis it has been for
the past 25 years, vote for a union," the implication in this statement becomes
readily apparent. True, it is a matter of emphasis, but that is precisely the
vice of the situation.
Words are not pebbles in alien juxtaposition; they have only a communal
existence ; and not only does the meaning of each interpenetrate the other,
but all in their aggregate take their purport from the setting in which they
are used, . . . What to an outsider will be no more than the vigorous
presentation of a conviction, to an employee may be the manifestation of
a determination which it is not safe to thwart.1s
Moreover, as the Supreme Court has said :
Slight suggestions as to the employer's choice between unions may have a
telling effect upon men who know the consequences of incurring that em-
ployer's strong displeasure.19
But, above and beyond the above considerations, two striking and significant
factors stand out from the letter itself. First, it is evident that the entire
emphasis in the letter has been upon persuading the employees to vote against
both unions. Unlike the letter in the American Tube Bending case, except for
token observance of the right of the employees to join a union, the remainder
of the letter is devoted to a vigorous appeal to the employees to vote against
both unions. Even this perfunctory recognition of the rights of the employees
is immediately neutralized by the statement, "It is also your right not to join a
Union and not to be represented by a Union," and is further emphasized by the
statement, "I want to be sure you understand that you cannot be forced to
join a Union." No such meticulous attention is devoted to the correlative right
to join a union . l;n the second place, and most significant, in contrast to the
letter in the American Tube Bending case, and others following this,pattern,
which have been held not to violate the Act,20 there is a complete and utter ab-
sence of any profession of willingness to abide by the result of the election, or
any assurance to the employees that they need fear no reprisal or retaliation
from the employer. Although this may not be a sine qua non in determining
whether a statement exceeds the permissible bounds of free speech, it is a most
significant factor in evaluating the respondent's motives. The omission of this
language in the letter in question is apparently no mere accident. As has al-
ready been noted, in view of the striking similarity of certain aspects of this
letter to that in the American Tube Bending case, it is apparent that the respon-
dent was not unaware of the significance of this reassurance. The omission,
therefore, must be considered to have been deliberate, and gives rise to the
inference that the respondent, while attempting to remain within the permissive
area of free speech, purposely couched the letter in such language as would
subtly, but nevertheless effectively, convey the intimation that the election of
either union as a bargaining representative would jeopardize the job security
162Y. L. R. B. V. The Federbush Co., Inc., supra . Although this case was decided prior
to the American Tube Bending case, in the same Circuit Court, with opinion by Hand, C. J.,
in each, the logic of this dictum remains unimpaired
19 See N. L. R. B. v. Virginia Electric and Power Co., 314 U. S. 469, citing International
Association of Machinists v. N. L. R. B., 311 U. S. 72, 78.
20 Cf . e. g., N. L. R. B. v. American Tube Bending Co., Inc., supra ; Matter of Oval Wood
Dish Corporation, 62 N. L. R. B. 1129; Matter of Arkansa8 -Missouri Power Corporation,
68 N. L . it. B. 805.
ELECTRIC STEEL FOUNDRY 141
of its employees. Under these circumstances, the omission of such reassurance
to its employees appears to the undersigned to be decisive of the respondent's mo-
tives. It is apparent, therefore, that the letter considered in its entirety, reas-
onably interpreted, is coercive upon its face and therefore outside the protection
of the constitutional guarantee of free speech.
The undersigned has related in some detail, at the outset of the report, evi-
dence adduced by the respondent that, as early as 1941, it announced a policy
of complete neutrality which it published in pamphlet form and circulated among
its employees. It has also been noted that in 1945, at about the time the A. F.
of L. renewed its organizational campaign, the respondent reiterated its policy
in writing and, in addition, furnished its employees with copies of the pamphlet
published earlier. This evidence has been considered in evaluating the re-
spondent's conduct and, while normally such a background, and the absence
of any other coercive conduct or manifestation of hostility toward unions in
general, is entitled to some weight, the absence of this evidence has been out-
weighed by other persuasive evidence. It should be noted that the last pro-
nouncement of neutrality by the respondent to its employees occurred some 6
months before the pre-election letter. Even apart from the possibility of turn-
over among the personnel of the respondent between March 1945, when the
letter and pamphlet were circulated, and the date of the pre-election letter,
it is extremely significant that the tenor of the pre-election letter manifests
a departure from the policy announced at a time when no election was in im-
mediate prospect. The inference is warranted that the respondent was content
to maintain a policy of strict neutrality, so long as the union appeared to be
making no substantial progress. On the eve of the election, however, it dropped
its role as neutral observer, and engaged in the strategem of the pre-election
letter to frustrate the employees in their right to self-organization. °
-Upon the basis of the foregoing and upon the entire record, the undersigned
concludes and finds that the statements in the pre-election letter, considered in
their entirety, were not only designed to "persuade to action" but were deliber-
ately calculated to and had the necessary effect of restraining and coercing
the employees in their free choice of representative.
The undersigned therefore finds, upon the basis of the foregoing and upon
the entire record, that by the statements in the pre-election letter of November
8, 1945, the respondent has interfered with, restrained, and coerced its em-
ployees in the exercise of the rights guaranteed in Section 7 of the Act, thereby
violating Section 8 (1) thereof. In view of the findings herein made the re-
spondent's motion to dismiss is hereby denied Z'
The undersigned further finds that, by the statements in the pre-election letter,
the respondent has interfered with its employees' freedom of choice in the elec-
tion of November 9, 1945, and will therefore recommend that the objections to
the election be sustained, and that the results thereof be set aside.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
The activities of the respondent set forth in Section III, above, and 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.
" The respondent 's contention that the contract of September 2, 1941, constitutes a bar
to the representation proceedings herein has already been decided by the Board adversely
to the respondent for reasons stated in its Decision and Direction of Election.
142 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
V. THE REMEDY
Having found that the respondent has engaged in certain unfair labor practices,
the undersigned will recommend that it cease and desist therefrom and take
certain affirmative action designed to effectuate the policies of the Act.
It has been found that the respondent, by the statements contained in the pre-
election letter, interfered with, restrained and coerced its employees in the
exercise of the right to self-organization guaranteed under the Act. It will,
therefore, be recommended that the respondent be ordered to cease and desist
from said conduct or any related conduct. Inasmuch, however, as the unfair
labor practices found are based upon the construction of the letter, which the
respondent contends is protected under the constitutional guarantee of free
speech, and since no showing has been made of any other coercive conduct,
hostility toward unionization, or other indication that real danger of the com-
mission of any unfair labor practices is to be anticipated from the respondent's
conduct in the past, it will not be recommended that the respondent be ordered
to cease and desist from in any manner infringing upon the rights guaranteed
in Section 7 of the Act.
Upon the basis of the foreging findings of fact and the entire record in the
case, the undersigned makes the following :
Coi cIusIoNs of LAW
1. Metal Trades Council of Portland and Vicinity, affiliated with the American
Federation of Labor, and United Steelworkers of America, affiliated with the
Congress of Industrial Organizations, are labor organizations within the mean-
ing of Section 2 (5) of the Act.
2. By interfering with, restraining, and coercing its employees in the 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.
3. The aforesaid unfair labor practices are unfair labor practices affecting
commerce within the meaning of Section 2 (6) and (7) of the Act.
RECOMMENDATIONS
Upon the basis of the above findings of fact and conclusions of law, the under-
signed recommends that the respondent, Electric Steel Foundry of Portland,
Oregon, its officers, agents, successors, and assigns shall:
1. Cease and desist from :
(a) Stating orally or in writing, expressly or by implication, that the hire and
tenure of employment or other terms or conditions of employment of its
employees will be jeopardized in the event that they vote for a labor organization
in any election, to determine the bargaining representative of such employees for
the purpose, and with the reasonable effect, of interfering with, restraining or
coercing its employees in the exercise of their right to self-organization, to form,
join, or assist Metal Trades Council of Portland and Vicinity, affiliated with
the American Federation of Labor, United Steelworkers of America, affiliated
with the Congress of Industrial Organizations, or any other labor organization,
and to select a bargaining representative of their own choosing ;
(b) Engaging in any like or related conduct, for the purpose, and with the
reasonable effect, of interfering with, restraining and coercing its employees in
the exercise of their right to self-organization, to form, join, or assist Metal
Trades Council of Portland and Vicinity, affiliated with the American Federation
of Labor, United Steelworkers of America, affiliated with the Congress of
ELECTRIC STEEL FOUNDRY 143
Industrial Organizations, or any other labor organization, and to select a bar-
gaining representative of their own choosing.
2. Take the following affirmative action which the undersigned finds will
effectuate the policies of the Act :
(a) Post at its plant in Portland, Oregon, copies of the notice attached hereto
marked "Appendix B." Copies of said notice, to be furnished by the Regional
Director for the Nineteenth Region, after being signed by the respondent's rep-
resentative, shall be posted by the respondent immediately upon the receipt
thereof and maintained by it for sixty (60) consecutive days thereafter, in
conspicuous places, including all places where notices to employees are cus-
tomarily posted. Reasonable steps shall be taken by the respondent to insure
that said notices are not altered, defaced, or covered by any other material;
(b) Notify the Regional Director for the Nineteenth Region, in writing
within ten (10) days from the date of the receipt of this Intermediate Report,
what steps the respondent has taken to comply therewith. ^
It is also recommended that the election held by the Board on November
9, 1945, be set aside.
It is further recommended that unless on or before ten (10) days from the
date of the receipt of this Intermediate Report, the respondent notify said
Regional Director in writing that it will comply with the foregoing recommenda-
tions, the National Labor Relations Board issue an order requiring the re-
spondent to take the action aforesaid.
As provided in Section 203.39 of the Rules and Regulations of the National
Labor Relations Board, Series 4, effective September 11, 1946, any party or
counsel for the Board may, within fifteen (15) days from the date of service of
the order transferring the case to the Board, pursuant to Section 203.38 of said
Rules and Regulations, file with the Board, Rochambeau Building, Washington
25, D. C., an original and four copies of a statement in writing setting forth'such
exceptions to the Intermediate Report or to any other part of the record or pro-
ceeding (including rulings upon all motions or objections) as he relies upon,
together with the original and four copies of a brief in support thereof ; and any
party or counsel for the Board may, within the same period, file an original
and four copies of a brief in support of the Intermediate Report._ Immediately
upon the filing of such statement of exceptions and/or briefs, the party or counsel
for the Board filing the same shall serve a copy thereof upon each of the other
parties and shall file a copy with the Regional Director. Proof of service on the
other parties of all papers filed with the Board shall be promptly made as
required by Section 203.65. As further provided in said Section 203.39, should
any party desire permission to argue orally before the Board, request therefor
must be made in writing to the Board within ten (10) days from the date
of service of the order transferring the case to the Board.
IRVING ROGOSIN,
Trial Examiner.
Dated October 15, 1946.
APPENDIX A
3/26/45
To Electric Steel Foundry Employees:
War conditions have made it impossible for us to keep in as close touch
with our employees as we did in normal times. This fact and the renewed
activities of the Union lead as to believe that a re-statement of our attitude
and policies will be of value.
It is your right to join or not to join a Union and we have no desire to
interfere with the exercise of your own uncontrolled judgment. We only
755420-48-vol. 74-11
144 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
wish to make sure that you have all the facts. When you have them, it is
for you, not us, to make the decision.
In 1941 the Union tried to organize the employees of this plant and went so
far as to establish a picket line. At the request of the Government an agree-
ment was reached which set forth the rights of the Union and the Company.
It was approved by the Oregon State Federation of Labor, the U. S. Department
of Labor and the Office of Production Management. A pamphlet dated Sep-
tember 3, 1941, containing the agreement and our statement of policy, is
enclosed.
We are advised that current activities of the Union have renewed rumors
and misunderstandings. Most of them are answered by our former statement
of policy, but there are some points which merit specific comment.
In a circular that has probably been handed to you by the Union it is stated
that "the card you will be asked to sign will not in any way cost you one cent."
In a recent notice the Union stated that the Company has agreed to bargain
with the Union just as soon as fifty-one per cent (51%) sign the cards. This
is a misstatement. The fact is the Union agreed not to request to act as
bargaining agent unless its Membership includes a majority of the Company's
employees. Signing a card may not cost you anything but it will not make
you a member of the Union. Can you join the Union without paying "one
cent" or does Union membership mean paying dues?
The Union's circulars are filled with insinuations that the Union can raise
your pay. The fact is that the WLB has set minimum rates for foundry occu-
pations in this area and the Union cannot get WLB approval of raises to above
these minimum rates. Our rates are already at or above these minimums.
Most of the dissatisfaction of our plant is among men already above the
minimum rates. We agree with these men and think the present wage differ-
entials for skill and experience are inadequate. In 1943 we applied to the
WLB for a blanket increase of wages, which would have given relief to all
men, in the plant. The WLB denied the application. Later the WLB raised
some of its minimum rates and granted us permission to apply for increases
to the new minimum rates We immediately applied and got permission to
raise our minimum rates. This, of course, further reduced existing differen-
tials.
In July 1944 we again made a vigorous effort to get raises for our experienced
men and the Board again turned us down. By this action the Board confirmed
its policy that it will approve applications from anyone up to its minimums
but will reject all applications for raises that would bring rates above these
minimums.
The 1941 agreement permits the Union to continue its efforts to organize the
employees of the Company in the manner set forth in the agreement and not
otherwise. It has been reported to us that Union organizers have violated the
agreement by threatening that an employee who does not sign up now will not have
another chance and will eventually lose his job. You Will Note at the Bottom
of Page 4 of the Agreement That the Union Specifically Agreed Not to Make This
Threat. On the Last Page of the Pamphlet We Stated That no Man Will Lose
His Job Because He Has Not Joined a Union. We Repeat That Statement.
In one of its circulars the Union promises to "Protect" anyone who signs a
card. We resent the suggestion that anyone needs protection and again state
that it is for you to decide whether you wish to join. All we can ask is that you
get the facts straight, both as to the present situation and as to the history of the
Company's relations with its employees.
ELECTRIC STEEL FOUNDRY 145
Please give this letter and the enclosed pamphlet your most careful attention.
They, and not loose remarks and rumors going the rounds of the plant, state the
position of the management.
ELECTRIC STEEL FOUNDRY,
By C. F. SWIGERT , JR., President.
APPENDIX B
NOTICE TO ALL EMPLOYECs
Pursuant to the recommendations of a Trial Examiner of the National Labor
Relations Board, and in order to effectuate the policies of the National Labor
Relations Act, we hereby notify our employees that :
We will not state orally or in writing, expressly or by implication, that
the hire and tenure of employment or other terms or conditions of em-
ployment of our employees will be jeopardized in the event that they vote
for a labor organization in any election to determine the bargaining rep-
resentative of such employees for the purpose , and with the reasonable
effect, of interfering with, restraining or coercing our employees in the
exercise of their right to self-organization , to form, join , or, assist Metal
Trades Council of Portland and Vicinity, affiliated with the American Fed-
eration of Labor, United Steelworkers of America, affiliated with the Con-
gress of Industrial Organizations or any other labor organization, and to
select a bargaining representative of their own choosing, to bargain col-
lectively through such representative, and to engage in concerted activities
for the purpose of collective bargaining or other mutual aid or protection.
We will not engage in any like or related conduct, for the purpose, and
with the reasonable effect, of interfering with, restraining and coercing
our employees in the exercise of their right to self-organization , to form,
join, or assist Metal Trades Council of Portland and Vicinity, affiliated
with the American Federation of Labor, United Steelworkers of America,
affiliated with the Congress of Industrial Organizations, or any other
labor organization , and to select a bargaining representative of their own
choosing, to bargain collectively through such representative, and to engage
in concerted activities for the purpose of collective bargaining or other
mutual aid or protection.
All our employees are free to become or remain members of these unions, or
any other labor organization.
ELECTRIC STEEL FOUNDRY,
Employer.
By ------------------------------
(Representative ) (Title)
Dated --------------------
This notice must remain posted for 60 days from the date hereof , and must
not be altered , defaced, or covered by any other material.