FWD Corporation

National Labor Relations Board - Board Decisions

Sep 15, 1981

257 N.L.R.B. 1300 (N.L.R.B. 1981)

DECISIONS OF NATIONAL LABOR RELATIONS BOARD
FWD Corporation and Local No. 815 of the Interna-
tional Union, Allied Industrial Workers of
America, AFL-CIO and Office and Profession-
al Employees International Union, Local 515.
Cases 30-CA-6114, 30-CA-6276, and 30-CA-
6305
September 15, 1981
DECISION AND ORDER
BY MEMBERS FANNING, JENKINS, AND
ZIMMERMAN
Upon charges filed on October 23, 1980, and on
January 14, 1981 (the latter being amended on Feb-
ruary 4 and February 11, 1981), by Local No. 815
of the International Union, Allied Industrial Work-
ers of America, AFL-CIO (hereinafter called
AIW), and duly served on FWD Corporation
(hereinafter called Respondent), and upon a charge
filed on January 30, 1981, and amended on Febru-
ary 12, 1981, by Office and Professional Employees
International Union, Local 515 (hereinafter
OPEIU), also duly served on Respondent, the Gen-
eral Counsel of the National Labor Relations
Board, by the Regional Director for Region 30,
issued a consolidated complaint and notice of hear-
ing on April 2, 1981, against Respondent, alleging
that Respondent had engaged in, and was engaging
in, unfair labor practices affecting commerce
within the meaning of Section 8(a)(5) and (1) and
Section 2(6) and (7) of the National Labor Rela-
tions Act, as amended. Copies of the charges, con-
solidated complaint, and notice of hearing before
an administrative law judge were duly served on
the parties to this proceeding.
With respect to the unfair labor practices, the
consolidated complaint alleges, inter alia, that by
virtue of collective-bargaining agreements with
AIW and OPEIU, the most recent contracts each
being effective by their terms for the period from
October 1, 1978, through September 30, 1981, these
Unions have been and are now the exclusive bar-
gaining representatives of all employees in the fol-
lowing respective appropriate units:
AIW-AIl production and maintenance em-
ployees, excluding probationary employees, ex-
ecutives, office clerical employees, engineering
department employees, sales and service train-
ees, field servicemen, and all supervisory em-
ployees with the authority to hire, promote,
discharge, discipline, or effectually recommend
such action, for the purpose of collective bar-
gaining in respect to rates of pay, wages, hours
of employment and all working conditions,
and guards.
257 NLRB No. 159
OPEIU-All salaried office employees, includ-
ing buyers, excluding executives, field repre-
sentatives, office managers, department heads,
professional and confidential employees,
guards and supervisors as defined in the Act.
The complaint, as amended on April 10, 1981, fur-
ther alleges that Respondent has failed and refused,
and continues to fail and refuse, to bargain collec-
tively and in good faith with AIW as the repre-
sentative of the employees in the above-described
unit in violation of Section 8(a)(5) and (1) by: fail-
ing and refusing on or about July 31, 1980, and
thereafter, to pay dental insurance premiums pursu-
ant to the collective-bargaining agreement between
Respondent and AIW and allowing the dental in-
surance policy to lapse; failing and refusing on or
about January 1, 1981, and thereafter, to pay the
cost-of-living adjustments pursuant to the same col-
lective-bargaining agreement; telling AIW on or
about January 13 and 15, and February 6 and 10,
1981, that it would refuse to meet with the AIW
grievance committee unless and until it was re-
duced to three members from the current five
members, and declining to meet with AIW five-
member grievance committee on February 10,
1981, or thereafter, unless said committee was re-
duced to three members; and declining on or about
February 9, 1981, to have grievance meetings with
AIW unless persons designated by AIW were re-
moved from its grievance committee. The com-
plaint, as amended, also alleges that Respondent
has failed and refused, and continues to fail and
refuse, to bargain collectively and in good faith
with OPEIU as the representative of the employees
in the above-described unit in violation of Section
8(a)(5) and (1) by: failing and refusing on or about
January 1, 1981, and thereafter, to pay cost-of-
living adjustments pursuant to the collective-bar-
gaining agreement between Respondent and
OPEIU; and, on or about October 17, 1980, and
thereafter, in violation of the same agreement,
giving substantial amounts of unit work to nonunit
members while unit members were on layoff status.
Subsequently, Respondent timely filed an answer,
and an amendment to its answer, to the consoli-
dated complaint, as amended, admitting in part and
denying in part the allegations contained therein.
Thereafter, on April 29, 1981, the General Coun-
sel filed with the Board in Washington, D.C., a
motion for partial summary judgment, with at-
tached exhibits. The General Counsel requested
summary judgment only on its allegations that Re-
spondent failed to pay dental insurance premiums,
allowed the dental insurance policy to lapse, and
required employees to pay the costs of dental treat-
ment which would otherwise have been paid by
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FWD CORPORATION
the dental insurance carrier, all in violation of the
AIW collective-bargaining agreement, and failed to
pay the cost-of-living adjustments provided for in
both the AIW and OPEIU agreements, thus violat-
ing Section 8(a)(5) and (1) of the Act.' On May 7,
1981, the Board issued an order transferring the
proceeding to itself in Washington, D.C., and a
Notice To Show Cause why the General Counsel's
Motion for Summary Judgment should not be
granted. Respondent filed a response to the Notice
To Show Cause. 2
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
Upon the entire record in this proceeding, the
Board makes the following:
Ruling on the Motion for Summary Judgment
In Respondent's answer to the consolidated com-
plaint, as amended, it admits the allegations that it
failed to pay contractually required dental insur-
ance premiums on behalf of employees represented
by AIW, that it allowed the dental insurance
policy to lapse, and that it failed to pay cost-of-
living increases to employees represented by AIW.
Respondent further admits the alleged failure to
pay contractually required cost-of-living increases
to employees represented by OPEIU. Respondent
seeks to excuse its conduct by stating that such
action was "due to financial difficulties which later
resulted in the filing of a petition under Chapter 11
of the Bankruptcy Code." This argument is repeat-
ed in Respondent's response to the Notice To
Show Cause. It is well established, however, that
an employer acts in derogation of its bargaining ob-
ligation under Section 8(d) of the Act, and thereby
violates Section 8(a)(5) and (1) of the Act, when,
during the life of a collective-bargaining agreement
between it and a union, it unilaterally modifies or
otherwise repudiates terms and conditions of em-
ployment contained in the agreement. 3 It is equally
well established that economic necessity is not cog-
nizable as a defense to the unilateral repudiation of
monetary provisions in a collective-bargaining
agreement. 4 We therefore find that no material
'Inasmuch as the General Counsel has not sought summary judgment
on the other allegations contained in the consolidated complaint, as
amended, they will not be considered herein.
2 On June 19, 1981, the General Counsel filed an opposition to Re-
spondent's response. The opposition was rejected by the Office of the Ex-
ecutive Secretary by letter dated June 25, 1981 Thereafter, on July 8.
1981, the General Counsel iled a motion for reconsideration of the
Board's rejection of its opposition. We hereby deny the motion for the
reasons given in the letter of June 25. 1981. from the Executive Secre-
tary.
a Morelli Construction Company, 240 NLR B 1190 (1979).
Nassau County Health Facilities Aociation. Inc.. et al., 227 NLRB
1680 (1977).
issues of fact exist regarding the allegations con-
tained in paragraphs 8(a)(i), 8(b), and 13(a) and (b)
of the consolidated complaint, as amended, which
would warrant a hearing. Accordingly, we grant
partial summary judgment as to the allegations
contained in these paragraphs.
However, we deny the General Counsel's
Motion for Summary Judgment in regard to para-
graph 8(a)(ii) of the consolidated complaint as
amended, which alleges that Respondent, since on
or about July 1980, has required employees in the
above-described AIW unit to pay their costs of
dental treatment which would otherwise have been
paid for by the dental insurance carrier. Respond-
ent, in its amended answer to the consolidated
complaint, as amended, denied this allegation, and,
accordingly, it is clear that this is an issue which
can only be resolved at a hearing.
On the basis of the entire record, the Board
makes the following:
FINDINGS OF FACT
I. THE BUSINESS OF RESPONDENT
Respondent, a Wisconsin corporation, with an
office and place of business in Clintonville, Wiscon-
sin, is engaged in the manufacture and sale of fire-
trucks. During the calendar year ending December
31, 1980, a representative period, Respondent sold
and shipped products valued in excess of $50,000
directly to points outside the State of Wisconsin.
We find, on the basis of the foregoing, that Re-
spondent is, and has been at all times material
herein, an employer engaged in commerce within
the meaning of Section 2(6) and (7) of the Act, and
that it will effectuate the policies of the Act to
assert jurisdiction.
II. THE LABOR ORGANIZATIONS INVOLVED
Local No. 815 of the International Union, Allied
Industrial Workers of America, AFL-CIO, is a
labor organization within the meaning of Section
2(5) of the Act.
Office and Professional Employees International
Union, Local 515, is a labor organization within
the meaning of Section 2(5) of the Act.
Ill. THE UNFAIR LABOR PRACTICES
A. The Representative Status of the Unions
The following employees of Respondent consti-
tute a unit appropriate for the purposes of collec-
tive bargaining within the meaning of Section 9(b)
of the Act:
All production and maintenance employees,
excluding probationary employees, executives,
1301
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
office clerical employees, engineering depart-
ment employees, sales and service trainees,
field servicemen, and all supervisory employ-
ees with the authority to hire, promote, dis-
charge, discipline, or effectually recommend
such action, for the purpose of collective bar-
gaining in respect to rates of pay, wages, hours
of employment and all working conditions,
and guards.
Since 1962, and at all times material herein, AIW,
by virtue of Section 9(a) of the Act, has been, and
is, the exclusive collective-bargaining representa-
tive of the employees in this unit. AIW and Re-
spondent have been parties to successive collective-
bargaining agreements, the most recent of which is
effective by its terms for the period from October
1, 1978, through September 30, 1981.
The following employees of Respondent consti-
tute a unit appropriate for the purposes of collec-
tive bargaining within the meaning of Section 9(b)
of the Act:
All salaried office employees, including
buyers, excluding executives, field representa-
tives, office managers, department heads, pro-
fessional and confidential employees, guards
and supervisors as defined in the Act.
Since 1973, and at all times material herein,
OPEIU, by virtue of Section 9(a) of the Act, has
been, and is, the exclusive collective-bargaining
representative of the employees in this unit.
OPEIU and Respondent have been parties to
successive collective-bargaining agreements, the
most recent of which is effective by its terms for
the period from October 1, 1978, to September 30,
1981.
B. The Unilateral Changes
Since on or about July 31, 1980, and continuing
to date, Respondent, without first giving notice to
and bargaining with AIW, unilaterally modified the
terms of the collective-bargaining agreement with
AIW by failing to pay dental insurance premiums
pursuant to the contract and allowing the dental in-
surance policy to lapse. Further, since on or about
January 1, 1981, and continuing to date, Respond-
ent, without first giving notice to and bargaining
with the Unions, has unilaterally modified the
terms of the collective-bargaining agreements with
AIW and OPEIU by failing to pay the cost-of-
living increases due under the terms of its respec-
tive contracts with each Union. Accordingly, we
find that Respondent, by the foregoing conduct,
has violated Section 8(a)(5) and (1) of the Act.
IV. THE EFFECT OF THE UNFAIR L.ABOR
PRACTICES UPON COMMERCE
The activities of Respondent, set forth in section
III, above, occurring in connection with its oper-
ations described in section 1, above, have a close,
intimate, and substantial relationship to trade, traf-
fic, and commerce among the several States and
tend to lead to labor disputes burdening and ob-
structing commerce and the free flow of com-
merce.
V. THE REMEDY
Having found that Respondent has engaged in,
and is engaging in, unfair labor practices within the
meaning of Section 8(a)(5) and (1) of the Act, we
shall order that it cease and desist therefrom, and
that it take certain affirmative action designed to
effectuate the purposes and policies of the Act. We
shall order Respondent to make whole employees
in the AIW-represented collective-bargaining unit
by reimbursing unit employees for any dental ex-
penses ensuing from Respondent's failure to pay
dental insurance premiums. This shall include reim-
bursing employees for any premiums they may
have paid to third-party insurance companies to
continue dental coverage in the absence of Re-
spondent's payment of dental insurance premiums
under its policy, and for any dental bills they have
paid directly to dental care providers that the con-
tractual policy would have covered. Further, we
shall order Respondent to make whole employees
in the AW-represented and OPEIU-represented
collective-bargaining units involved herein by
paying them their respective cost-of-living in-
creases pursuant to their respective collective-bar-
gaining agreements, which were not paid as a
result of Respondent's unfair labor practices. All
payments to employees shall be made with interest
thereon computed in accordance with the formula
set forth in Florida Steel Corporation, 231 NLRB
651 (1977), and Isis Plumbing & Heating Co., 138
NLRB 716 (1962). 5
The Board, upon the basis of the foregoing facts
and entire record, makes the following:
CONCLUSIONS OF LAW
I. FWD Corporation is an employer engaged in
commerce within the meaning of Section 2(6) and
(7) of the Act.
2. Local No. 815 of the International Union,
Allied Industrial Workers of America, AFL-CIO,
is a labor organization within the meaning of Sec-
tion 2(5) of the Act.
s Member Jenkins would modify the Order to require the interest due
to the employees to be computed in the manner set forth in his partial
dissent in Olympic Medical Corporation. 25) NLRB 146 (1980).
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FWD CORPORATION
3. Office and Professional Employees Interna-
tional Union, Local 515, is a labor organization
within the meaning of Section 2(5) of the Act.
4. All production and maintenance employees,
excluding probationary employees, executives,
office clerical employees, engineering department
employees, sales and service trainees, field service-
men, and all supervisory employees with the au-
thority to hire, promote, discharge, discipline, or
effectually recommend such action, for the purpose
of collective bargaining in respect to rates of pay,
wages, hours of employment and all working con-
ditions, and guards, constitute a unit of employees
appropriate for the purposes of collective bargain-
ing within the meaning of Section 9(b) of the Act.
5. All salaried office employees, including
buyers, excluding executives, field representatives,
office managers, department heads, professional
and confidential employees, guards and supervisors
as defined in the Act, constitute a unit of employ-
ees appropriate for the purposes of collective bar-
gaining within the meaning of Section 9(b) of the
Act.
6. At all times material herein, AIW has been the
exclusive representative of all the employees in the
appropriate unit described in paragraph 4, above,
for the purposes of collective bargaining within the
meaning of Section 9(a) of the Act.
7. At all times material herein, OPEIU has been
the exclusive representative of all the employees in
the appropriate unit described in paragraph 5,
above, for the purposes of collective bargaining
within the meaning of Section 9(a) of the Act.
8. By failing and refusing on or about July 31,
1980, and continuing to date, to pay dental insur-
ance premiums on behalf of its unit employees and
allowing the dental insurance policy to lapse, and
by failing and refusing on or about January 1, 1981,
and continuing to date to pay cost-of-living in-
creases to unit employees pursuant to its contact
with AIW, Respondent has refused to bargain col-
lectively in good faith, and is refusing to bargain
collectively in good faith, with AIW as the exclu-
sive representative of Respondent's employees in
the appropriate unit, described in paragraph 4,
above, and thereby has engaged in, and is engaging
in, unfair labor practices within the meaning of
Section 8(a)(5) and (1) of the Act.
9. By failing and refusing on or about January 1,
1981, and continuing to date, to pay cost-of-living
increases to its unit employees pursuant to its con-
tract with OPEIU, Respondent has refused to bar-
gain collectively and in good faith, with OPEIU,
as the exclusive representative of Respondent's em-
ployees in the appropriate unit described in para-
graph 5, above, and thereby has engaged in, and is
engaging in, unfair labor practices within the mean-
ing of Section 8(a)(5) and (1) of the Act.
10. By the acts and conduct described in para-
graphs 8 and 9, above, Respondent has interfered
with, restrained, and coerced, and is interfering
with, restraining, and coercing, its employees, in
the units described in paragraphs 4 and 5, above, in
the exercise of the rights guaranteed them in Sec-
tion 7 of the Act, and thereby has engaged in, and
is engaging in, unfair labor practices within the
meaning of Section 8(a)(1) of the Act.
11. The aforesaid unfair labor practices are unfair
labor practices affecting commerce within the
meaning of Section 2(6) and (7) of the Act.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board hereby orders that the Respondent,
FWD Corporation, Clintonville, Wisconsin, its offi-
cers, agents, successors, and assigns, shall:
I. Cease and desist from:
(a) Unilaterally refusing to pay dental insurance
premiums and the cost-of-living increase provided
for in the collective-bargaining agreement entered
into with Local No. 815 of the International Union,
Allied Industrial Workers of America, AFL-CIO,
effective by its terms from October 1, 1978, to Sep-
tember 30, 1981, covering employees in the follow-
ing appropriate unit:
All production and maintenance employees,
excluding probationary employees, executives,
office clerical employees, engineering depart-
ment employees, sales and service trainees,
field servicemen, and all supervisory employ-
ees with the authority to hire, promote, dis-
charge, discipline, or effectually recommend
such action, for the purpose of collective bar-
gaining in respect to rates of pay, wages, hours
of employment and all working conditions,
and guards.
(b) Unilaterally refusing to pay cost-of-living in-
creases provided for in the collective-bargaining
agreement entered into with Office and Profession-
al Employees International Union, Local 515, ef-
fective by its terms from October 1, 1978, to Sep-
tember 30, 1981, covering employees in the follow-
ing appropriate unit:
All salaried office employees, including
buyers, excluding executives, field representa-
tives, office managers, department heads, pro-
fessional and confidential employees, guards
and supervisors as defined in the Act.
(c) In any like or related manner interfering
with, restraining, or coercing employees in the ex-
1303
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ercise of the rights guaranteed them in Section 7 of
the Act.
2. Take the following affirmative action which
the Board finds will effectuate the policies of the
Act:
(a) Upon request, bargain collectively with AIW
as the exclusive bargaining representative of em-
ployees in the unit described in paragraph l(a),
above, regarding any payment of dental insurance
premiums and payment of cost-of-living increases.
(b) Upon request, bargain collectively with
OPEIU as the exclusive bargaining representative
of employees in the unit described in paragraph
l(b), above, regarding payment of cost-of-living in-
creases.
(c) Make whole the employees in the unit de-
scribed in paragraph l(a), above, in the manner set
forth in the section of this Decision entitled "The
Remedy," for Respondent's unlawful failure to pay
dental insurance premiums and cost-of-living in-
creases as required by its contract with AIW, ef-
fective by its terms from October 1, 1978, to Sep-
tember 30, 1981.
(d) Make whole the employees in the unit de-
scribed in paragraph l(b), above, in the manner set
forth in the section of this Decision entitled "The
Remedy," for Respondent's failure to pay cost-of-
living increases as required by its contract with
OPEIU, effective by its terms from October 1,
1978, to September 30, 1981.
(e) Post at its Clintonville, Wisconsin, facility
copies of the attached notice marked "Appendix." 6
Copies of said notice, on forms provided by the
Regional Director for Region 30, after being duly
signed by Respondent's representative, shall be
posted by Respondent immediately upon receipt
thereof, and be maintained by it for 60 consecutive
days thereafter, in conspicuous places, including all
places where notices to employees are customarily
posted. Reasonable steps shall be taken by Re-
spondent to insure that said notices are not altered,
defaced, or covered by any other material.
(f) Notify the Regional Director for Region 30,
in writing, within 20 days from the date of this
Order, what steps Respondent has taken to comply
herewith.
IT IS FURTHER ORDERED that the issues raised by
paragraphs 8(a)(ii), 9, and 3(a) of the amended con-
solidated complaint be litigated at hearing before
an administrative law judge.
IT IS FURTHER ORDERED that the Regional Di-
rector for Region 30 arrange for such hearing and
6 In the event that this 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 Pursu-
ant to a Judgment of the United States Court of Appeals Enforcing an
Order of the National Labor Relations Board."
that said Regional Director be, and he hereby is,
authorized to issue notice thereof.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILL NOT unilaterally refuse to pay
dental insurance premiums and the cost-of-
living increase provided for in the collective-
bargaining agreement entered into with Local
No. 815 of the International Union, Allied In-
dustrial Workers of America, AFL-CIO, ef-
fective by its terms from October 1, 1978, to
September 30, 1981, covering employees in the
following appropriate unit:
All production and maintenance employees,
excluding probationary employees, execu-
tives, office clerical employees, engineering
department employees, sales and service
trainees, field servicemen, and all supervi-
sory employees with the authority to hire,
promote, discharge, discipline, or effectually
recommend such action, for the purpose of
collective bargaining in respect to rates of
pay, wages, hours of employment and all
working conditions, and guards.
WE WILL NOT unilaterally refuse to pay
cost-of-living increases provided for in the col-
lective-bargaining agreement entered into with
Office and Professional Employees Interna-
tional Union, Local 515, effective by its terms
from October 1, 1978, to September 30, 1981,
covering employees in the following appropri-
ate unit:
All salaried employees, including buyers, ex-
cluding executives, field representatives,
office managers, department heads, profes-
sional and confidential employees, guards
and supervisors as defined in the Act.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce employees in
the exercise of rights guaranteed them in Sec-
tion 7 of the Act.
WE WIL., upon request, bargain collectively
with AIW as the exclusive bargaining repre-
sentative of employees in the first unit de-
scribed above, regarding any payment of
dental insurance premiums and payment of
cost-of-living increases.
WE WII.L, upon request, bargain collectively
with OPEIU as the exclusive bargaining repre-
sentative of employees in the second unit de-
1304
1305
scribed above, regarding payment of cost-of-
living increases.
WE WILL make whole, with interest, the
employees in the first unit described above for
our unlawful failure to pay dental insurance
premiums and cost-of-living increases as re-
quired by our contract with AIW, effective by
its terms from October 1, 1978, to September
30, 1981. WE WILL reimburse employees for
any premiums they may have paid to third-
party insurance companies to continue dental
coverage in the absence of our payment of
dental insurance premiums under our policy,
and for any dental bills they have paid directly
to dental care providers that our contractual
policy would have covered.
WE WILL make whole, with interest, the
employees in the second unit described above
for our unlawful failure to pay cost-of-living
increases as required by our contract with
OPEIU, effective by its terms from October 1,
1978, to September 30, 1981.
FWD CORPORATION