Gaedke Cutlery Manufacturing Co.

National Labor Relations Board - Board Decisions

Sep 29, 1975

220 N.L.R.B. 843 (N.L.R.B. 1975)

GAEDKE CUTLERY MFG. CO.
Gaedke Cutlery Manufacturing Co. and Teamsters
Union Local No. 844, Over-the-Road and City Car-
tage Drivers, Helpers and Dock Workers, and Con-
struction Drivers and Helpers, affiliated with Inter-
national Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America. Cases
18-CA-4429 and 18-RC-10268
September 29, 1975
DECISION , ORDER , AND CERTIFICATION
OF RESULTS OF ELECTION
BY CHAIRMAN MURPHY AND MEMBERS FANNING
AND PENELLO
On June 30, 1975, Administrative Law Judge Alvin
Lieberman issued the attached Decision in this pro-
ceeding . Thereafter, the Charging Party filed excep-
tions accompanied by a supporting brief, and Re-
spondent filed an answering brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has considered the record and the Ad-
ministrative Law Judge's Decision in light of the ex-
ceptions and briefs and has decided to affirm the
Administrative Law Judge's rulings , findings, and
conclusions I and to adopt his recommended Order.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board hereby orders that the complaint here-
in be, and it hereby is, dismissed in its entirety.
CERTIFICATION OF RESULTS OF ELECTION
As we find that all the challenges in the election
conducted on January 3, 1975, in Case 18-RC-10268
should be sustained, and as the tally of ballots in that
election shows that the Petitioner has received less
than a majority, it is hereby certified that a majority
of the valid ballots have not been cast for Teamsters
Union Local No. 844, Over-the-Road and City Car-
tage Drivers, Helpers and Dock Workers, and Con-
struction Drivers and Helpers, affiliated with Inter-
national Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America, and that
1 Member Fanning , in accordance with his dissenting view in Swift Tex-
tiles, 214 NLRB No. 10 (1974), would find that Respondent 's letter to em-
ployees on December 14, 1974, constituted an 8(a)( 1) violation and would
provide an appropriate remedy therefor.
843
said labor organization is not the exclusive represen-
tative of all the employees, in the unit herein in-
volved, within the meaning of Section 9(a) of the Na-
tional Labor Relations Act, as amended.
DECISION
STATEMENT OF THE CASE
ALVIN LIEBERMAN, Administrative Law Judge: Pursuant
to a petition filed in Case 18-RC-10268 by Teamsters
Union Local No. 844 (herein the Union) I and a Decision
and Direction of Election issued by the Regional Director
for Region 18 of the National Labor Relations Board, a
representation election was held on January 3, 1975,
among certain employees of Gaedke Cutlery Manufactur-
ing Co. (herein Gaedke). At the election 9 votes were cast
for the Union, 12 against the Union, and 7 ballots, suffi-
cient in number to affect the election's result, were chal-
lenged by Gaedke.
The challenge to one ballot was sustained by the Region-
al Director. The ground for challenging the remaining six
ballots, those cast by Mariann Nelson, Conroe Miles, Mar-
lene Halligan , Mary Frost, Vickie Crew, and Sandra Ack-
erson, (herein the Six) was that these voters had been per-
manently laid off before the election.
On February 10, 1975, a complaint issued in Case
18-CA-4429, alleging that Gaedke had engaged in unfair
labor practices within the meaning of Section 8(a)(1) and
(3) of the National Labor Relations Act, as amended? The
allegations of the complaint dealing with the violations of
Section 8(a)(3) are founded, in part, on Gaedke 's discharge
of 12 employees, including the Six.
In view of the similarity of the basis upon which Gaedke
challenged the ballots cast by the Six and the averments of
the complaint relating to their discharge, the Regional Di-
rector concluded that "the matter of the eligibility [of the
Six to vote in the election] must await the dispositon of the
pending unfair labor practice proceeding." Accordingly,
the Regional Director ordered that "a hearing be held .. .
for the purpose of taking evidence relevant to the issues
with respect to the challenges to the ballots of [the Six]."
The Regional Director further ordered that "Cases Nos.
18-CA-4429 and 18-RC-10268 be . . . consolidated for
purposes of hearing, ruling and decision by an Administra-
tive Law Judge and that thereafter, Case No. 18-RC-10268
shall be transferred to and continued before the Board
f> 3
The hearing in this consolidated proceeding, with all
parties represented , was held before me in Waterloo, Iowa,
on March 18 and 19 , 1975. In general , the issues litigated,
as raised by the complaint and answer in Case
18-CA-4429 and by the Regional Director 's order in Case
18-RC-10268 , were whether Gaedke violated Section
1 The Union's full designation appears in the caption.
2 The complaint was based upon a charge filed by the Union on January
3, 1975.
3 G.C. Exh. 1(e).
220 NLRB No. 128
844 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
8(a)(1) and (3) of the Act ° and whether the ballots cast by
the Six should be opened and counted. More particularly,
the questions for decision are as follows:
1. Do Gaedke and Rada Manufacturing Co. constitute a
single employer for the purposes of the Act?
2. Did Gaedke violate Section 8(a)(1) of the Act by
threatening employees with reprisals for engaging in union
activity?
3. Did Gaedke violate Section 8(a)(3) of the Act by dis-
charging 12 employees, including the Six?
4. Were the Six, whose ballots were challenged by Gaed-
ke, employees of Gaedke on the date of the election and,
therefore, entitled to vote?
Upon the entire record,' upon my observation of the
witnesses and their demeanor while testifying, and having
taken into account the arguments made and the able briefs
submitted by the General Counsel and Gaedke,6 I make
the following:
FINDINGS OF FACT
1. JURISDICTION
Gaedke, an Iowa corporation, is engaged in Waterloo
and Waverly, Iowa, in the manufacture and sale of cut-
lery.' During 1974, a representative period, Gaedke
shipped goods valued at more than $50,000 to customers
located outside the State of Iowa. Accordingly, I find that
Gaedke is engaged in commerce within the meaning of the
Act and that the assertion of jurisdiction over this matter
by the Board is warranted.
tive-bargaining representative of employees of Gaedke
pursuant to which a representation election was conducted.
These included an explosion rendering unusable Gaedke's
finishing plant in Waterloo and the establishment of a sim-
ilar facility in Waverly by Rada Manufacturing Co.; a let-
ter sent by Gaedke to its employees urging them to vote
against the Union; Gaedke's discharge of 12 employees
shortly before the election; and Gaedke's challenge to the
ballots cast at the election by 6 discharged employees.
The General Counsel argues that Gaedke's letter to its
employees contained a threat to their job security and,
hence, violated Section 8(a)(1) of the Act. Contending also
that, as alleged in the complaint, the discharges were viola-
tive of Section 8(a)(3), the General Counsel suggests that
the challenged ballots be opened and counted. Finally, the
General Counsel asserts that Gaedke and Rada Manufac-
turing Co. are a single employer for the purposes of the
Act.
Although admitting a relationship between it and Rada
Manufacturing Co., Gaedke denies that it and Rada Man-
ufacturing Co. are a single employer for the purposes of the
Act. Gaedke denies, also, that the discharges were motivat-
ed by union considerations. Gaedke argues, in this connec-
tion, that the discharges resulted from its inability after the
explosion to reopen its finishing plant in Waterloo and oc-
curred at a time when it did not know how many jobs
would be available at the Waverly facility. Concerning the
letter, Gaedke claims that it was privileged by Section 8(c)
of the Act.8
IV. PRELIMINARY FINDINGS AND CONCLUSIONS 9
11. THE LABOR ORGANIZATION INVOLVED
The Union is a labor organization within the meaning of
the Act.
III. INTRODUCTION
Briefly, this case is concerned with events following the
Union's filing of a petition for certification as the collec-
4 In pertinent part these sections provide:
Sec. 8(a). It shall be an unfair labor practice for an employer-
(1) to interfere with, restrain , or coerce employees in the exercise of
the rights guaranteed in section 7 ....
(3) by discrimination in regard to hire or tenure or employment or
any term or condition of employment to encourage or discourage mem-
bership in any labor organization ...
Sec. 7, insofar as relevant , states:
Sec. 7. Employees shall have the right to self-organization , to form,
,loin, or assist labor organizations , to bargain collectively through repre-
sentatives of their own choosing , and to engage in other concerted
activities for the purpose of collective bargaining or other mutual aid or
protection ....
Issued simultaneously in a separate order correcting obvious inadvertent
errors in the stenographic transcript of this proceeding.
A. The Union's Organization of Gaedke's Employees
During the summer of 1974,10 Gaedke's production em-
ployees became interested in being represented by a labor
organization. Accordingly, in early September, 23 employ-
ees out of a total of 28 who worked in Gaedke's casting
and finishing departments met with a representative of the
Union. All those in attendance at this meeting signed
union cards.
6 Although all the arguments of the parties and the authorities cited by
them, whether appearing in their briefs or made orally at the hearing, may
not be discussed in this Decision , each has been carefully weighed and
considered . It is noted , in this connection , that no brief was filed by the
Union
I The Waverly plant is owned and operated by Rada Manufacturing Co
Although Gaedke and Rada are separate corporations , they are, as will be
demonstrated below, a single employer for the purposes of the Act.
8 Sec . 8(c) of the Act is as follows.
The expressing of any views, argument , or opinion, or the dissemina-
tion thereof, whether in written , printed , graphic, or visual form, shall
not constitute or be evidence of an unfair labor practice under any of
the provisions of this Act, if such expression contains no threat of
reprisal or force or promise of benefit.
9 The purpose of these findings is to furnish a frame of reference within
which to consider the facts relating to Gaedke 's alleged unfair labor practic-
es and to the conclusions to which they may give rise . To the extent that the
contentions of the parties relate specifically to the findings made here, they
will be treated here , although they, as well as the findings , may again be
considered in other contests.
10 All dates hereinafter mentioned without stating a year fall within 1974.
GAEDKE CUTLERY MFG. CO. 845
B. The Explosion and the Establishment of the Waverly
Facility
As already noted Gaedke is engaged in the manufacture
of cutlery. Aluminum-handled knives, Gaedke's principal
products, were sold by Gaedke to women's clubs and re-
sold by them for fund-raising purposes.
Before October 28, 1974, Gaedke's production work was
carried on in two adjoining buildings in Waterloo, Iowa. In
one building the knives were cast and made ready for the
finishing process which was performed in the other build-
ing.
On October 28 an explosion occurred in the building in
which the knives were finished, injuring six employees,
three very seriously. In addition, the explosion severely
damaged the finishing department building and rendered
inoperative some of the equipment located there , including
machines referred to during the hearing as "automatics."
It was the consensus of all persons and agencies investi-
gating the explosion that it had been caused by the ignition
of aluminum dust generated by the automatics. Because of
this, Walter Rada, Gaedke's president, who for several
months after the explosion was mainly occupied with ex-
plosion-related problems, determined that he would not
again jeopardize the safety of people working in Gaedke's
premises or risk the destruction of Gaedke's property by
operating with dust-creating equipment.
Accordingly, Walter Rada decided to replace the auto-
matics with Clair machines . Although the Clair machines
perform the same function as the automatics , they do not
create dust.
For several reasons, however, the Clair machines could
not be accommodated in Gaedke's building in Waterloo
which had housed the finishing department. Nor, although
a search was made , could an adequate available building
be located for this purpose in Waterloo.
Widening his search, Walter Rada found a suitable
building in the city in which he lived, Waverly, Iowa, some
20 miles distant from Waterloo. To take possession of this
building and to perform the knifefinishing operations pre-
viously done by Gaedke in Waterloo, Walter Rada activat-
ed what he called "a shelf corporation" and had its name
changed to Rada Manufacturing Co. (herein Rada).
On December 4, Rada leased the Waverly building. Dur-
ing the next 3 or 4 weeks the Clair machines, which had
been ordered on November 13, and undamaged machinery
and equipment formerly used in finishing knives at
Gaedke's Waterloo facility were installed there. On Janu-
ary 14, 1975, the Waverly plant became operative and
turned out its first finished knife.
C. The Relationship Between Gaedke and Rada
Rada was activated to take possession of, and operate,
the Waverly finishing plant because Gaedke was not in a
position to obtain financing which would have enabled it
to do so. A further reason for having taken Rada off the
"shelf" was to limit Gaedke's liability for damages in the
event of litigation based upon the explosion.
The same individuals are officers, directors, and stock-
holders of Gaedke and Rada. Thus, Walter Rada is presi-
dent of both corporations. His wife, Sandra Rada , is assis-
tant secretary and assistant treasurer of Gaedke and vice
president of Rada. Max Guernsey is secretary and treasur-
er of Gaedke and secretary of Rada. His wife, Helen
Guernsey, is vice president of Gaedke and treasurer of
Rada.11
Walter and Sandra Rada each own 25 percent of
Gaedke's stock. The ownership of the remaining 50 percent
is divided between Max and Helen Guernsey. The former
owns 33-1/3 percent and the latter 16-2/3 percent. The
Radas and Guernseys each own an equal amount of stock
in Rada.
As already noted, Rada performs finishing work on
knives. It bought the Clair machines from their manufac-
turer. Much of the other machinery and equipment used by
Rada was purchased from Gaedke at book value, a price
which, Walter Rada testified, was "probably three times
[higher than] the actual value."
The casting of the knives and other preparatory work to
make the knives ready for finishing is done by Gaedke in
Waterloo. Gaedke sells and delivers the unfinished knives
it produces to Rada in whose plant at Waverly they are
finished. Since its establishment, Rada has been Gaedke's
only customer and Gaedke is Rada's only supplier of un-
finished knives.
Pursuant to a license issued to it by Gaedke, Rada holds
itself out as the "Maker of the Original Gaedke Aluminum
Handle Cutlery." 12 Rada's customers, as were Gaedke's,
are women's clubs, "the vast percentage" of which, Walter
Rada stated, are the same customers who dealt with Gaed-
ke before the explosion. In this regard, orders received by
Gaedke are turned over to Rada.
Walter Rada is the chief executive officer and, as already
noted, the president of both Gaedke and Rada. His salary
is paid entirely by Rada.
Walter Rada spends most of his time at Gaedke 's plant
in Waterloo. However, he visits Rada's plant in Waverly
twice each day. While there he discusses problems requir-
ing his attention with Rada's production manager and of-
fice manager.
Before the explosion Herb Jones, Rada's production
manager, was a Gaedke supervisor. All employees in
Rada's shipping department and office, including Rada's
office manager, formerly worked for Gaedke.
Jones oversees Rada's day-to-day affairs including the
hiring of employees in accordance with instructions given
him by Walter Rada. In the hiring area Walter Rada di-
rected Jones to give preference in employment at Rada to
persons who were discharged or laid off by Gaedke after
the explosion. Jones followed this directive. In this connec-
tion, as will be seen , Walter Rada, himself, referred three
former employees of Gaedke for employment at Rada and
they were hired by Jones.
The Board treats separate corporations as one employer
where they are commonly owned, have interlocking offi-
cers and directors, and engage in an integrated operation
to produce a saleable product. Sakrete of Northern Califor-
nia, Inc., 137 NLRB 1220, 1222 (1962), enfd. 332 F.2d 902
11 The Guernseys are Mrs Rada's parents
^Z G.C Exh 5.
846 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(C.A. 9, 1964); Royal Oak Tool & Machine Company, et al.,
132 NLRB 1361, 1362 (1961), enfd . 320 F.2d 77 (C.A. 6,
1963). There can be no gainsaying the common ownership
and interlocking officers and directors of Gaedke and
Rada . A more integrated operation between two corpora-
tions than that presented by the record in this case is most
difficult to conceive.
Accordingly, I conclude that Gaedke and Rada consti-
tute a single employer for the purposes of the Act.
D. The Representation Hearing and the Challenges
On November 14, 1974, a hearing was held upon the
Union 's petition for certification in Case 18-RC-10268.
Among those present were Sandra Ackerson , an employee
of Gaedke, and Walter Rada, its president.
Testifying as a witness at the hearing , Ackerson stated
that at a meeting on November 4 attended by all Gaedke
employees who worked in the casting and finishing depart-
ments they "agree[d] to go along with the union." Appar-
ently seeking clarification of this statement , Gaedke's law-
yer asked Ackerson whether, in fact, everyone at the
meeting was in favor of the Union . Ackerson's reply was "I
mean everyone."
On December 3, the Regional Director issued his Deci-
sion and Direction of Election. The unit he found to be
appropriate for purposes of collective bargaining included
..all . . . production and maintenance employees at the
Employer's Waterloo, Iowa, facility." 13
Pursuant to this direction an election was held on Janu-
ary 3, 1975, at which ballots cast by Mariann Nelson, Con-
nie Miles, Marlene Halligan , Mary Frost, Vickie Crew, and
Sandra Ackerson (the Six) were challenged by Gaedke on
the ground that the Six had been permanently laid off be-
fore the election . These challenges were sufficient in num-
ber to affect the results of the election.I4
V. THE ALLEGED UNFAIR LABOR PRACTICES
A. Facts, Contentions, and Conclusions Concerning
Gaedke's Alleged Violations of Section 8(a)(1) of the Act
In support of the complaint's allegation that Gaedke vio-
lated Section 8(a)(1) of the Act, the General Counsel of-
fered in evidence a letter dated December 14, 1974,15 in
which Gaedke urged its employees to vote against the
Union in the forthcoming election. The last several para-
graphs of this letter are as follows:
There are a lot of layoffs in the country right now.
On paper, out-of-work employees and these compa-
nies have a good wage scale and good benefits , howev-
er, notwithstanding their hourly rate or anything else,
all they are getting in most instances is their unem-
ployment check. We hope this will not happen here
and, absent the unusual circumstances we are in now,
layoffs are not usually a problem . The point is that a
'3 G.C. Exh. 10.
14 Although the findings in this paragraph appear earlier in this Decision,
the' have been repeated here for ready reference.
' G.C. Exh 14.
union card alone can 't keep your job.
One of our main concerns about this union and the
reason we feel that it is a real threat to your job securi-
ty is the idea which has been expressed by many em-
ployees that individuals can rely on the union to take
care of them so that they can slow down and get more
pay.
This is an erroneous assumption.
Our whole merchandising practice and what success
we have had is based upon low per unit costs. If our
per unit costs go up two or three times , which well
could be the result of this type of thinking, there
would be no market for our product-and as a result
no jobs for anyone.
This is not an easy or simple thing to understand
but I do feel that I particularly owe a truthful explana-
tion to those persons who have been with us for some
period of time . I foresee very real problems if this
union is successful-and quite frankly none of us need
any more problems than we have right now.
Pointing to the mention of layoffs in the first paragraph
of the letter set forth above and especially to the letter's
last sentence , the General Counsel argues on brief that the
letter "constitutes a thinly veiled threat that [Gaedke]
would react to the Union by reducing the scope of [its]
business and that layoffs would result if the employees se-
lect a union to represent them ." Gaedke, on the other
hand, contends that Section 8(c) of the Act privileges the
letter . In my opinion , Gaedke has the better of the argu-
ment.
In N.L. R.B. v. Gissel Packing Co ., Inc., 395 U .S. 575,
617-618 (1969), the Court observed that "Section 8(c) [of
the Act] merely implements the First Amendment ." It then
had this to say concerning the privileges and limitations of
employer conduct under Section 8(c):
[A]n employer is free to communicate to his employ-
ees any of his general views about unionism or any of
his specific views about a particular union , so long as
the communications do not contain a "threat of repri-
sal or force or promise of benefit ." He may even make
a prediction as to the precise effects he believes union-
ization will have on his company . In such a case, how-
ever , the prediction must be carefully phrased on the
basis of objective fact to convey an employer 's belief
as to demonstrably probable consequences beyond his
control . . . . If there is any implication that an em-
ployer may or may not take action solely on his own
initiative for reasons unrelated to economic necessities
and known only to him , the statement is no longer a
reasonable prediction based on available facts but a
threat of retaliation based on misrepresentation and
coercion , and as such without the protection of the
First Amendement.
In Swift Textiles, Inc., 214 NLRB No. 10 (1974), the
Board had for determination the question of whether Sec-
tion 8(a)(1) of the Act was violated by words spoken by an
employer "in the context of, and in response to, a union's
GAEDKE CUTLERY MFG. CO.
promise to obtain" higher wages for its employees . Within
this framework the employer stated , as noted by the Board,
that "'if . . . the Union were able to force [it] to pay this
type of wage, . . . its cost would have to go up to sustain
that type of increase ,' which would `impair the plant's com-
petitive position and cause the mill to close .' " Relying
upon the teaching of Gissel, the Board held that this state-
ment did not entrench upon Section 8(a)(1). The Board
said , in this regard , "These remarks, in our view , were sus-
ceptible of recognition by the employees as economic ar-
guments rather than threats of plant closure in reprisal for
the employees' union activities . Consequently, we conclude
that such remarks were privileged as free speech."
As in Swift, the letter here under consideration speaks in
a context of higher costs to Gaedke , which were predicta-
ble in the event of the unionization of its plant . Also like
the employer's remarks in Swift which posed the foreseea-
ble event of higher wages impairing its competitive posi-
tion, thus causing the mill to close, the letter here refers to
the equally foreseeable effect of higher costs destroying
"the market for [Gaedke 's] product-and as a result no
jobs for anyone ." These , it seems to me, were the "prob-
lems" spoken of in the letter's last sentence.
Accordingly, as was the Board 's view in Swift, it is my
view here that the statements in the letter dealing with
higher costs resulting in the loss of jobs "were susceptible
of recognition by the employees as economic arguments
rather than threats [of job loss] in reprisal for the employ-
ees' union activities." Consequently , I find that the letter
was privileged by Section 8(c) of the Act.
I conclude, therefore, that Gaedke did not violate Sec-
tion 8(a)(1) of the Act by writing, and distributing to em-
ployees, the letter here under consideration.
B. Facts Concerning Gaedke's Alleged Violations of Section
8(a)(3) of the Act
Before the explosion 17 employees, including those
named in paragraph 6(a) of the complaint (herein the
Twelve), worked in Gaedke's finishing department and 11
in its casting department . In view of Sandra Ackerson's
testimony at the hearing on the Union's petition for certifi-
cation , Gaedke was aware that all supported the Union.
Immediately following the explosion, Gaedke suspended
all manufacturing operations and placed all its employees
on layoff status . Anticipating that Rada would soon be in a
position to begin finishing knives at Waverly, Gaedke, on
December 12, 1974, recalled all casting department em-
ployees. Work there resumed on December 16. Before
Rada started to finish knives, exactly how many produc-
tion employees would be needed there was not known.
This was due , in part, to representations made by the man-
ufacturer of the Clair machines that they could be operated
by fewer employees than were required to operate the auto-
matics.16
i6 As it developed, these representations were exaggerated . The fact is,
however, that as of February 11, 1975, by which time Rada had been finish-
ing knives for about a month , it employed only II production workers,
whereas Gaedke needed 17 employees to do the same work before the ex-
plosion.
847
Accordingly, on December 20 Gaedke sent letters to
each of the Twelve, who had been the most junior employ-
ees in Gaedke's finishing department, informing them
"that instead of being on layoff status . . . you should con-
sider that your employment with Gaedke has been perma-
nently terminated." 1 The letter also invited its recipients
to apply for work at Rada.
The employment of the five senior Gaedke finishing de-
partment employees was not terminated. They were re-
tained on layoff status.
Two of those who received the foregoing letter, Masumi
Huberg and Mariann Nelson, applied for work at Rada
and were hired. Sheryl Powell, one of the senior employees
in Gaedke's finishing department who had been retained
on layoff status, also applied for work at Rada and she,
too, was hired.
Huberg, Nelson, and Powell were referred to Rada by
Walter Rada, the president of Gaedke and Rada. Re-
specting Huberg and Powell, they were told by Walter
Rada, Powell testified, that "he didn't want any of the
troubles from Waterloo taken up [to Waverly]." 1
Huberg's version of Walter Rada's statement differs
somewhat from Powell's. She testified that Walter Rada
said that "he doesn't want any problem brought up from
Waterloo." Huberg further testified that Walter Rada did
not "tell [her] what kind of problems he was talking
about."
Upon being queried about the foregoing testimony of
Huberg and Powell, Walter Rada stated that when he men-
tioned not taking Gaedke's problems to Waverly he was
"referring to ... litigation, insurance, production and pri-
marily safety problems that [he would] go to great lengths
[to] make sure [would] never reoccur." 1
In order to assess the General Counsel's contention that
the discharge of the Twelve was violative of Section 8(a)(3)
of the Act, findings are necessary concerning the subse-
quent employment with either Gaedke or Rada of the
Twelve and those retained on layoff status when the
Twelve were discharged. Starting with the five most senior
employees, who were retained on layoff status, I have al-
17 G.C. Exh. 12.
18 Powell also testified that during this conversation Walter Rada also
said that when he purchased Gaedke from its former owner he "knew that
Waterloo was more or less a unionized city and that he had to take that into
consideration when he bought it." Whether Walter Rada actually said this is
problematical . He denied doing so. In connection with his denial, Walter
Rada testified that he would not have made such a statement "because [he]
had been counseled by [Gaedke's lawyer] and [he] had also counseled Mrs.
McMullin [then Gaedke's bookkeeper] and everybody else . . . on the man-
agement end of [Gaedke] about such things and [he was] sure that [he] did
not make that statement." Beverly McMullin, now Rada's office manager,
who was present during Walter Rada's entire conversation with Powell cor-
roborated Walter Rada's denial . She testified that she did not remember
either Walter Rada or Powell mentioning a union or union cities. McMullin
further testified that she would have remembered those subjects, if they
were discussed , because she had been warned not to talk about unions to
anyone. In view of Walter Rada's denial and its corroboration by Mc-
Mullin , I am extremely reluctant to credit Powell concerning her testimony
here under discussion.
i9 The General Counsel would have me infer that when Walter Rada
mentioned "troubles" and "problems" to Huberg and Powell he was talking
about union "troubles" and "problems." However, there does not appear to
be any cogent reason for me to accept Walter Rada's testimony at less than
face value.
848 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ready found that one of these , Powell, was hired by Rada.
The remaining four were given jobs in the casting depart-
ment at Gaedke.
Concerning the Twelve, two of their number, Huberg
and Nelson, as set forth above, were hired by Rada and
have been working there since January 8 and 15, 1975,
respectively. Seven 20 never sought employment at Gaedke
or Rada after receiving notice of their discharge.
Of the remaining three, one, Mary Frost, who lives in
Gilbertville, Iowa, about 30 miles from Waverly, asked to
be reemployed at Gaedke. Walter Rada, who had earlier
instructed Herb Jones, Rada's production manager, to give
preference in hiring to all former Gaedke employees, sug-
gested that she apply for a job at Rada. Frost replied, as
she testified, "Waverly . . . was a long way to drive."
On or about February 15, 1975, Frost again applied for a
job at Gaedke. Lou Rausch, Gaedke's production manag-
er, to whom she spoke on this occasion, told her there were
no openings there. Their discussion then turned to Rada.
As she had previously said to Walter Rada, Frost told
Rausch, as she further testified, "Waverly is quite a way for
me to drive."
Like Frost, in about mid-January 1975, Marlene Halli-
gan, the second of the remaining three, also applied for a
job at Gaedke. She stated at the time that she preferred
working in Waterloo to working in Waverly. Halligan did
not seek a position with Rada until a few days before the
hearing in this proceeding. Walter Rada stated, concerning
this, that she would be considered for employment there
"at the first opening."
After being advised of her discharge, Connie Miles, the
last of the remaining three, informed Walter Rada that she
was interested in working at Rada. Walter Rada told her,
as he testified, that "we would be glad to take [her] on."
Several days later, Miles called Walter Rada and told him,
as he further testified, that "she had changed her mind
[and because] she did not have a driver's license she would
not be interested in working at Waverly."
On January 8, 1975, Miles filed a written application for
a job at Rada. In response, Rada sent Miles a letter, dated
January 15, 1975,21 informing her that she would "be called
for work as soon as [there was] an opening, which should
be in the not too distant future." Upon receiving this letter,
Miles told Walter Rada, as she testified, that she "would
prefer to work . . . in Waterloo since [she] didn't drive."
C. Contentions and Concluding Finding Concerning
Gaedke 's Alleged Violations of Section 8(a)(3) of the Act
Although guiding principles are not in doubt, "Section
8(aX3) cases are difficult cases," 22 and the instant one is
no exception to this rule. Almost always present in such
cases, and present here also, are vexatious questions of mo-
tive.
2e These are Sandra Ackerson , Minnie Ayers , Vickie Crew, Susan Chris-
tensen , Jacquelyn Eastman , Mary Sandoval , and Delphma Van Kamen.
Shortly after the explosion , Van Kamen and Sandoval told Walter Rada
that they would never again work for Gaedke or any company like it.
21 G.C. Exh. 5.
22 N L.R.B. v Atlanta Coca-Cola Bottling Company, Inc, 293 F 2d 300,
308 (C.A 5, 1961).
If the discharge of the Twelve was motivated by their
support of the Union, as Gaedke was well aware, obviously
the termination of their employment was violative of Sec-
tion 8(a)(3) of the Act. But the facts seem to indicate that
this is not the case,
After Gaedke learned that it would be impossible to re-
sume finishing knives in Waterloo and after it had, for this
reason , decided to have that work done in Waverly
through the medium of Rada, discharge notices were sent
to the Twelve. In the expectation that the finishing opera-
tion in Waverly could be carried on with fewer employees
than the number who had done that work in Waterloo, five
senior finishing department employees, who were as
staunch supporters of the Union as were the Twelve, were
not discharged, but retained on layoff status, probably for
the purpose of employing them at Waverly. In fact, one
was so employed and the other four were given jobs in
Gaedke's casting department after its reopening on De-
cember 16.
Two of the Twelve, who, like the remainder, were also
union adherents, were hired at Rada upon their applying
for work there. One did not desire to work at Rada because
it was too far from her home. Another refused an offer of
employment at Rada for a somewhat similar reason.
Still another applied for work at Gaedke at a time when
there were no vacancies and stated that she preferred to
work in Waterloo rather than in Waverly. Some 2 months
later this employee sought a position at Rada and was in-
formed, only a few days before the hearing, that she would
be hired there "at the first opening."
The remaining seven did not, following their discharge,
seek employment at Gaedke or Rada. Had they done the
latter at a time when jobs were available, it is likely, as was
the case respecting Huberg, Nelson, and Powell, that they
would have been successful in view of the instruction given
by Walter Rada, the president of Gaedke and Rada, to
Herb Jones, Rada's production manager, to give prefer-
ence in employment to former Gaedke employees.
It thus appears that those of the Twelve who applied for
work at Rada and who indicated a desire to accept em-
ployment there were hired or offered a job. It further ap-
pears that five employees in the Gaedke's finishing depart-
ment who, as in the case of the Twelve, also favored the
Union were not discharged at all.
Such a course of conduct by Gaedke does not, in my
opinion, bespeak an employer bent on destroying its em-
ployees' interest in a union by discharging its supporters. It
seems to me that if this had been Gaedke's object it would
have discharged not only the Twelve but also the five se-
nior employees who were retained on layoff status. Nor
would Rada's production manager have been instructed to
give rreference in employment to former Gaedke employ-
ees?
Notwithstanding the foregoing, I am disturbed by the
fact that the discharges occurred some 2 weeks before the
election. This is a suspicious circumstance. However, as
has been said many times, "suspicion is not a substitute for
proof." Rafael Igartua, Proprietor of Aguadilla Children's
23 It will be remembered in this regard that I have found Gaedke and
Rada to be a single employer for the purposes of the Act
GAEDKE CUTLERY MFG. CO.
Wear Plant, 174 NLRB 615, 619 (1969).
Furthermore , "an unlawful purpose is not lightly to be
inferred . In the choice between lawful and unlawful mo-
tives, the record taken as a whole must present a substan-
tial basis of believable evidence pointing toward the unlaw-
ful one." 24 Upon careful consideration of the record, I do
not find such a "substantial basis" to be present here.
Accordingly, I am constrained to conclude, upon consid-
eration of the entire record, that the General Counsel has
not proven by a preponderance of the evidence that Gaed-
ke violated Section 8(a)(3) of the Act by discharging the
Twelve on December 20, 1974.
VI. THE CHALLENGES
The six employees whose ballots were challenged at the
election held on January 3, 1975, were , as I have found,
lawfully discharged before that date . They were , there-
fore, ineligible to vote . Jefferson Mills, Division of Kahn and
Feldman, Inc., 120 NLRB 385, 388 ( 1958).
Having found that Gaedke did not engage in any of the
unfair labor practices alleged in the complaint and that the
persons whose ballots were challenged by Gaedke were in-
eligible to vote , my recommended Order will provide that
the complaint be dismissed and that the challenges to the
ballots be sustained.
Upon the basis of the foregoing findings of fact, and
u N.L.R.B. v. T.A. McGahey, Sr., et al., d/b/a Columbus Marble Works,
233 F.2d 406, 413 (C.A. 5, 1956).
849
upon the entire record in this case, I make the following:
CONCLUSIONS OF LAW
1. Gaedke and Rada constitute a single employer for the
purposes of the Act.
2. The Union is a labor organization within the meaning
of the Act.
3. Gaedke has not engaged in unfair labor practices
within the meaning of Section 8(a)(1) or (3) of the Act.
Upon the foregoing findings of fact, conclusions of law,
and the entire record in this case, I hereby issue the follow-
ing recommended:
ORDER 25
It is ordered that the complaint in Case 18-CA-4429 be,
and the same hereby is, dismissed.
IT IS FURTHER ORDERED that the challenges to the ballots
cast at the election in Case 18-RC-10268 by Mariann Nel-
son, Connie Miles, Marlene Halligan, Mary L. Frost, Vick-
ie Crew, and Sandra Ackerson be, and the same hereby
are, sustained.
25 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 Order herein shall, as provided in Sec. 102.48 of the Rules
and Regulations , be adopted by the Board and become its findings , conclu-
sions, and Order, and all objections thereto shall be deemed waived for all
purposes.