Goldsmith Motors Corp.

National Labor Relations Board - Board Decisions

May 7, 1993

310 N.L.R.B. 1279 (N.L.R.B. 1993)

1279
310 NLRB No. 219
GOLDSMITH MOTORS CORP.
1 The judge inadvertently erred as to the following dates. The com-
plaint issued on August 23, 1990, rather than on August 23, 1992,
and the decertification petition was filed November 21, 1989, rather
than on November 21, 1990. The judge also erred in finding that on
January 29, 1990, the Respondent proposed that employees pay half
the cost of the medical benefit plan. The record shows that the Re-
spondent sought the elimination of the medical benefit plan on Janu-
ary 29, 1990. According to the testimony of the Respondent’s nego-
tiator, Perry Heidecker, the Respondent’s proposal that employees
pay half the cost of medical plan premiums was a modification, an-
nounced on February 9, 1990, of its initial proposal.
The judge found that on February 10, 1990, the Respondent sent
a mailgram to the Union stating that the Respondent was willing to
bargain. The record contains a confirmation copy sent by Western
Union to the Respondent on February 12, 1990, stating that the
mailgram sent to the Union was not delivered because no one was
present for delivery and there was no response to the notice of deliv-
ery.
The General Counsel contends that the judge erroneously failed to
draw an adverse inference against the Respondent for failing to
produce former co-owner Ann Louison as a witness. As the judge
found, however, at the time of the hearing Louison was no longer
associated with the Respondent because Louison and co-owner Gold-
smith terminated their business relationship in 1990. In these cir-
cumstances, the General Counsel has not demonstrated that Louison
may reasonably be assumed to be favorably disposed toward the Re-
spondent so as to trigger an adverse inference. Property Resources
Corp., 285 NLRB 1105 fn. 2 (1987), enfd. 863 F.2d 964 (D.C. Cir.
1988).
2 The General Counsel contends that After-Sales Vehicle Coordi-
nator Lucille Winters is a statutory supervisor and that in November
1989, outside the 10(b) period and prior to the start of contract nego-
tiations, Winters originated the filing of a decertification petition.
The General Counsel contends that Winters’ alleged role in the peti-
tion evinces the Respondent’s intention to avoid reaching agreement
with the Union. As the General Counsel concedes, however, Winters
was not involved in the negotiation process. Further, there is no evi-
dence that those involved in the negotiation process had any role in
the petition. Accordingly, there is no meaningful correlation between
Winter’s alleged activities and the Respondent’s bargaining posture
and activities. In any event, we agree with the judge’s conclusion
that Winters was not a statutory supervisor when the decertification
petition was filed. The record shows that Winters was an employee
with many years of service with the Respondent who, in this capac-
ity, occasionally assisted other employees in resolving disputes and
on routine work duties, and assisted them in handling customer mat-
ters. After the lockout, Winters assisted the sales manager in screen-
ing and interviewing job applicants, but the sales manager made the
decision whether to hire the applicant.
3 For the reasons set forth by the judge, we find that the reason
for the breakdown in negotiations on February 9, 1990, was the
Union’s insistence that the previous bargaining agreement had auto-
matically renewed. We agree with the judge that the Respondent did
not bargain in bad faith and did not violate the Act when it locked
out unit employees and hired temporary replacements.
4 We are not concerned here with terms and conditions that an em-
ployer proposes as permanent changes that, even in the absence of
impasse, would apply also to the striking or locked out employees
once they returned to work following the termination of the strike
or lockout. Cf. Schmidt-Tiago Construction Co., 286 NLRB 342, 343
(1987).
5 See Harter Equipment, 293 NLRB 647 (1989) (replacements for
locked-out employees are not in the bargaining unit).
Goldsmith Motors Corp. and Local Union No. 868,
an affiliate of the International Brotherhood of
Teamsters. Case 29–CA–14934
May 7, 1993
DECISION AND ORDER
CHAIRMAN STEPHENS AND MEMBERS OVIATT
AND RAUDABAUGH
On June 22, 1992, Administrative Law Judge Ray-
mond P. Green issued the attached decision. The Gen-
eral Counsel and the Charging Party filed exceptions
and supporting briefs, and the Respondent filed an an-
swering brief.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the decision and the
record in light of the exceptions and briefs and has de-
cided to affirm the judge’s rulings, findings,1 and con-
clusions2 and to adopt the recommended Order.
On February 9, 1990, the Respondent locked out its
employees and, thereafter, unilaterally implemented
terms and conditions of employment for its lawfully
hired temporary replacements at variance with the
former employment terms of its locked-out employees.
We agree with the judge that, even assuming the ab-
sence of a bargaining impasse, the Respondent’s con-
duct did not violate the Act.3
It is now well settled that an employer permissibly
may pay lesser benefits during a strike to lawfully
hired strike replacements after the termination of a
contract, even in the absence of a bargaining impasse.
Capitol-Husting Co., 252 NLRB 43, 45 (1980), enfd.
671 F.2d 237 (7th Cir. 1982); GHR Energy Corp., 294
NLRB 1011, 1012 (1989). As the Board found in Cap-
itol-Husting, supra, this is so for two reasons. First, as
a practical matter, a union is not expected simulta-
neously to represent the interests of the replacements
as it would the interests of the strikers. Second, the
ability to set employment terms for replacements is a
necessary incident of the right to hire them in the first
instance.4
We discern no meaningful reason why a union’s re-
lationship to newly hired temporary replacements in a
lockout situation, as here, should be considered strong-
er than a union’s relationship to newly hired replace-
ments in a strike situation. In either instance, the
union’s representational role during the job action is
directed toward the interests of the displaced employ-
ees, not toward their replacements. As a result, an em-
ployer’s unilateral implementation of employment con-
ditions for such replacements does not truly undermine
a union’s representational interests or authority.5
Further, as noted, the unilateral implementation of
employment terms for replacements is a necessary in-
cident of an employer’s right to hire temporary re-
placements during a lawful lockout. If the lockout it-
self is lawful and the hiring of temporary replacements
1280 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 Sec. 8(d) provides in pertinent part:
Provided, That where there is in effect a collective-bargaining
contract covering employees in an industry affecting commerce,
the duty to bargain collectively shall also mean that no party to
such contract shall terminate or modify such contract, unless the
party desiring such termination or modification—
(1) serves a written notice upon the other party to the contract
of the proposed termination or modification sixty days prior to
the expiration date thereof, or in the event such contract contains
no expiration date, sixty days prior to the time it is proposed
to make such termination or modification;
. . . .
(3) notifies the Federal Mediation and Conciliation Service
within thirty days after such notice of the existence of a dispute,
and simultaneously therewith notifies any State or Territorial
agency established to mediate and conciliate disputes within the
State of Territory where the dispute occurred, provided no
agreement has been reached by that time; and
(4) continues in full force and effect, without resorting to
strike or lockout, all the terms and conditions of the existing
contract for a period of sixty days after such notice is given or
until the expiration date of such contract, whichever occurs later:
2 At that time Winters’ main function was in after sales. This
means that after an automobile sale was consummated, the customer
would be brought over to her office where she would then attempt
to sell them, such items as burglar alarms, sunroofs, etc. As she
worked on commissions only, her sales obviously depended on the
activity of the salesmen in the showroom.
After the lockout, on February 9, 1990, Winters took on extra du-
ties and among them was the initial interviewing and screening of
job applicants.
is lawful, there is no logical or practical reason to re-
quire that a bargaining impasse must exist before the
employer may implement terms that are incidental to
these more critical underlying, and lawful, acts. Ac-
cordingly, we shall dismiss the complaint.
ORDER
The recommended Order of the administrative law
judge is adopted and the complaint is dismissed.
Rhonda Schectman, Esq., for the General Counsel.
Perry Heidecker Esq. (Marshall Miller Associates), for the
Respondent.
Irving T. Bush, Esq., for the Union.
DECISION
STATEMENT OF THE CASE
RAYMOND P. GREEN Administrative Law Judge. This case
was tried in Brooklyn, New York, on various dates in Janu-
ary, February, and March 1992. The charge was filed on
June 18, 1990, and the complaint was issued on August 23,
1992. The complaint as amended at hearing alleged that the
Employer engaged in surface bargaining with the Union, that
it unlawfully locked out its employees on February 9, 1990,
and that it unilaterally changed terms and conditions of em-
ployment vis-a-vis employees it hired as replacements.
On the entire record, including my observation of the de-
meanor of the witnesses, and after considering the briefs
filed, I make the following
FINDINGS OF FACT
I. JURISDICTION
The Respondent admits and I find that it is an employer
engaged in commerce within the meaning of Section 2(2),
(6), and (7) of the Act and that the Union is a labor organi-
zation within the meaning of Section 2(5) of the Act.
II. ALLEGED UNFAIR LABOR PRACTICES
A. Background
The Company and the Union have had a collective-bar-
gaining relationship for many years wherein the Union has
represented the salesmen. The most recent contract was one
of 3 years’ duration having an expiration date of January 31,
1990. That contract had a clause providing for an automatic
renewal of the contract unless either party gave written no-
tice, 60 days prior to the expiration date, that it wished to
terminate the agreement.
There was a prior case involving a situation back in 1989
and which is reported at 299 NLRB 867. In that case the
company had acquired another facility, the union obtained
authorization cards from a majority of the salesmen and had
demanded recognition. The company’s refusal to recognize
and bargain with the union was found to be a violation of
Section 8(a)(5) based on the theory that because of an ‘‘after
acquired’’ clause in the collective-bargaining agreement, the
employer had waived its right to have an election. The
Board’s decision issued on August 22, 1990, and on Feb-
ruary 12, 1991, a memorandum of agreement was signed be-
tween the union and Anne S. Louison Cadillac Corp. (The
two companies having split in the interim period.)
B. The Operative Facts
On November 1, 1989 (60 days prior to the contract’s ex-
piration date), the Union, in accordance with standard proce-
dures, sent the Employer a notice that it desired to terminate
the contract and negotiate for a new agreement. Copies of
this notice were sent to the New York State Mediation Board
and to the Federal Mediation and Conciliation Service as re-
quired by Section 8(d) of the Act.1 The notice to the Em-
ployer, although having the correct name and address, had
the wrong zip code.
It is conceded by the Union that the automobile industry
was in serious decline from 1989 to 1991 and that this reduc-
tion in sales hit particularly hard at Cadillac dealers. (The
Respondent, at that time dealt exclusively in Cadillacs.)
In November 1989 a couple of the salesmen, Jorge Perez
and Ronald Daniels, talked with Lucille Winters about get-
ting rid of the Union. Although there is some dispute as to
whether the idea of filing a decertification petition originated
with Winters or with the two salesmen, the evidence shows
that at the time of this transaction, Winters was a longtime
employee of the Company and not a supervisor within the
meaning of the Act.2 In any event, Perez and Daniels signed
a petition dated November 20, 1989, which stated:
The following employees are salesmen employed by
Goldsmith Motors Corp., . . . and are interested in hav-
ing the N.L.R.B. conduct an election for the purpose of
decertifying Local 868 IBT as the collective bargaining
representative.
1281GOLDSMITH MOTORS CORP.
3 The incidents involving the decertification petition occurred more
than 6 months before the unfair labor practice charge was filed.
They therefore cannot be alleged as unlawful because of the statute
of limitations in Sec. 10(b) of the Act.
4 It is true that Haddad was discharged by the Company while he
was in the hospital with an illness. It is also true that such a cir-
cumstance might anger any reasonable man. However, I was im-
pressed with the forthrightness of his testimony and I do not think
that Haddad was influenced to give false testimony against the com-
pany because of any ill fillings he might have had.
5 Louison was the company officer designated to handle the nego-
tiations in 1990. She no longer is associated with the Respondent
after it split in two and she was not called to testify in this pro-
ceeding. Joel Goldsmith testified that it was decided that he would
not participate or play a role in the negotiations because this func-
tion had been taken by Louison in the past and because he did not
have the temperament for collective bargaining. In an affidavit sub-
mitted during the investigation, Heidecker stated that he met with
both Louison and Goldsmith to formulate the Company’s bargaining
position.
This was followed by a decertification petition that was
filed on November 21, 1990, by Daniels. Subsequently, the
petition was withdrawn on January 17, 1990.3
Mitch Haddad became the sales manager of the instant fa-
cility after he was transferred in early January from the
Hempstead location. He testified on behalf of the General
Counsel that in late January 1990, about 10 days after he
began to work at Jamaica, he complained to Joel Goldsmith
that the salesmen at the facility were not being cooperative
with him in relation to a private sale. He testified that Gold-
smith said, ‘‘Don’t worry about it, I’m going to get rid of
the Union.’’ (In my opinion, Haddad, who has no interest in
the outcome of this case, was a credible witness.)4
On January 18, 1990, the Union’s representative, Harold
Wolchok, sent the Company a list of the Union’s demands
calling for modest improvements in wages and conditions.
On January 22, the Company’s attorney, Perry Heidecker,
wrote to Wolchok asking for a meeting date.
January 29, 1990, was the first bargaining session. At this
meeting the Company tendered its demands which included
the following items:
1. Deletion of the after acquired clause.
2. Effective deletion of the union security clause by
eliminating the company’s requirement to discharge
anyone who failed to pay dues and initiation fees.
3. Deletion of dues checkoff.
4. A provision allowing the company to discharge
salesmen for lack of productivity, the determination of
which would be solely in the discretion of management.
(In other respects, discharge for other reasons would
still be subject to a just cause standard).
5. Elimination of superseniority for the shop steward.
6. A provision that employees laid off for more than
3 months would not entitled to recall.
7. Elimination of the provision limiting the number
of salesman the employer can assign to the floor.
8. An increase in hours.
9. A provision allowing management to make sales.
10. Vacations to be paid on the basis of the min-
imum wage and not the average yearly earning.
11. A provision limiting access to salesmen by union
representatives by requiring 24 hour notice to manage-
ment before a visit.
12. Deletion of the Pension Plan.
13. A Requirement that employees pay half the cost
of the medical benefit plan.
14. Reduction in commissions.
15. A 2 year agreement.
A second meeting was held on February 2, 1990, at which
Wolchok suggested that the prior contract be extended for 3
years without change or modification. Wolchok also sug-
gested the use of a mediator. On both counts the Company
said no.
A third meeting was held on February 5, but not much
progress seems to have been made in the negotiations. How-
ever, Heidecker states that at this meeting, Wolchok said that
he thought that the Union had not sent the 60-day notice to
the Company and that the contract might have automatically
renewed itself.
Heidecker testified that on February 6, he called the Fed-
eral and state mediation services and was told that the Union
had sent copies of the 60-day notices to them. The Federal
service faxed their copy to Heidecker and he in turn faxed
it to the Company. According to Heidecker, on receipt, Anne
Louison5 said that she had located the letter and that she was
in possession of the original. Heidecker states that he then
called Wolchok, told him that the Company had copies of
the notice, and that Wolchok should quit fooling around.
On Friday, February 9, 1990, there was some initial give
and take between the parties. Among other things, the Union
offered a two-tier pay system with new hires receiving less
pay than the existing work force. Heidecker asserts, but the
Union’s witnesses deny that he offered to remove its demand
to eliminate the pension fund and made some concessions on
its vacation proposal. The Union showed a number of help
wanted ads that had been in local newspapers and after in-
quiry, the Company asserted that these ads were a mistake;
that the Company was not interviewing or hiring anyone.
The Union asserted that the Company was behind the decer-
tification petition and also accused it of interfering with cer-
tain car deliveries. These accusations were denied by the
Company.
At about 4 p.m., Heidecker suggested a break in the nego-
tiations so that he could pick up his daughter. Wolchok then
stated that he had to leave by 6 p.m. and that as far as the
Union was concerned there was no need for further negotia-
tions as the contract had renewed itself pursuant to the auto-
matic renewal clause because the Company had not received
the 60-day notice. (It should be noted that Wolchok was well
aware that the Union had, in fact, mailed the 60-day notice
to the Company.) At that point, the Company demanded that
the employees turn in the keys to their demonstrator cars and
the salesmen were locked out.
On February 10, 1990, Heidecker sent a mailgram to the
Union stating that the Company was willing to bargain. And
on February 12, the Company filed a charge with the NLRB
alleging that the Union was refusing to bargain with it. (That
charge was subsequently dismissed.)
For about 10 days after February 9, the Company did not
hire any replacements and attempted to cover the sales floor
with the managers and with Winters.
Beginning around February 21, 1990, the Company began
hiring replacements who were interviewed by Winters and
1282 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
the Sales Manager Mitch Haddad. (Winters and Haddad testi-
fied that she was used to screen out unsuitable applicants and
that the decision to hire or not hire was made by Haddad.)
In this respect, there is some confusion as to whether new
employees were told that they were temporary or permanent
hires. For example, Felix Durousseau testified that he was
told by Winters, at his interview, that the job was permanent.
Mario Dimisa testified that it was his impression that he was
offered a permanent job because he was told that he could
make $50,000 in the first year and more thereafter. He states
that nothing was said about a labor dispute and he also states
that neither the words permanent or temporary were used in
connection with the job offer. On the other hand, Mitch
Haddad, who was called as a witness by the General Counsel
and who impressed me as an honest witness, testified that he
followed explicit instructions to tell all job applicants that
there was a labor dispute and that the positions were tem-
porary.
I suspect that what really happened here was that most job
applicants were told about the labor dispute and that the po-
sitions were temporary whereas in other cases, these quali-
fications were inadvertently forgotten. In any case, as the
labor dispute and the lockout had not ended as of the dates
of this hearing, there has been no test as to whether the re-
placements were permanent or temporary as no locked-out
employee has ever been told that he would not be rehired if
and when the contract dispute is resolved.
Sometime between February 10 and 20 the Union de-
manded arbitration regarding the lockout and the Company
refused. On February 20 the Union filed a suit in Federal
court requesting an order compelling arbitration of the al-
leged discharge of the employees. As a predicate for its con-
tention that the matter was arbitral, in light of the contract’s
expiration, the Union asserted that the contract had automati-
cally renewed itself.
On March 19, 1990, the judge dismissed the case because
he perceived that the parties had settled the matter. However,
as it became apparent that this was not the case, the Union’s
attorney requested that the original case be put back on the
calender and each side pressed their respective points until
sometime in April 1990 when a stipulation was entered. Pur-
suant to that stipulation, the parties agreed to arbitrate the
question of whether the employees had been discharged on
February 9 but also agreed not to arbitrate the issue as to
whether the contract had automatically renewed itself.
On May 24, 1990, the parties met before an arbitrator but
a dispute arose concerning the scope of arbitration.
Heidecker proposed that the arbitrator should decide not only
whether the locked-out employees constituted a discharge
without just cause pursuant to contract law, but also that any
decision by the arbitrator should be final and should con-
stitute a waiver by the Union of any rights to file charges
or other legal proceedings if they lost. In this respect,
Heidecker stated that the Company was willing to have the
arbitrator decide whether the lockout violated the National
Labor Relations Act. The Union refused to agree to this and
the meeting ended.
On May 25, 1990, Wolchok wrote to the Company and as-
serted, inter alia, that the lockout was illegal, that no legal
impasse existed and that the Company had not bargained in
good faith. The letter stated that the Union was prepared to
continue negotiations if the Company was prepared to make
changes in its offer of February 9, 1990. It also states:
Months ago the Union abandoned its position that the
collective bargaining agreement renewed itself when the
Company furnished the Union with a copy of a letter
dated November 1, 1989 it had received terminating the
agreement and requesting bargaining.
On May 29, 1990, Heidecker responded by stating:
During an arbitration hearing held before the Hon. Je-
rome Katz on May 24, 1990 the union, by . . . its at-
torney . . . made a formal request to resume negotia-
tions. Please be advised that Goldsmith Motors is will-
ing to meet . . . at reasonable times and places upon
the request of the union.
The Union’s attorney, Irving T. Bush, testified that in June
1990 he spoke to Heidecker and suggested that the parties
get together so that the employees could return to work. He
states that Heidecker responded that the ‘‘real problem here
is Hempstead.’’ According to Bush, he told Heidecker, that
if Heidecker thought that the Union was going to pull out
of Hempstead, he could forget it because the Union was not
going to do so. Heidecker denied this stating that he is not
so stupid as to jeopardize his client’s position with such a
statement.
Following an exchange of letters by each side sent for the
purpose of setting up a meeting (and each containing self
serving statements to buttress their respective legal posi-
tions), a meeting was finally arranged for July 20, 1991. At
this meeting, Bush asked if the Company was going to make
any changes in its proposals and asked for the Company’s
position on each of its proposals. Heidecker suggested medi-
ation, but Bush stated that mediation was not necessary for
noneconomic items; that they might use mediation once they
got to economic items. During the meeting, Bush asked if the
Company would put the locked out employees back to work
while negotiations were being conducted and the Company
said no. With respect to specific items, the Company modi-
fied and in some cases dropped certain of the proposals that
it had made as of the February 9 meeting. Thus although
continuing to be regressive, the Company’s position as of
July 20 was less so. Further, there is no indication that the
Company’s position was final.
Another meeting was scheduled to take place on August
15, 1990, but this was canceled due to Bush’s illness. There-
after, no further meetings were sought by the Union.
The General Counsel also contends that the Company vio-
lated the Act by unilaterally changing terms and conditions
of employment insofar as the replacement. In this respect, the
General Counsel asserts that the changes, which only af-
fected the replacement employees, were as follows:
1. Replacements received a minimum salary of $135 per
week as opposed to the locked-out employees who had re-
ceived a salary of $75 per week. (In both cases, salesmen’s
earnings were, for the most part, based on commissions.)
2. Replacements were paid lower commissions than the
locked-out employees had been paid.
3. Pension contributions were not made on behalf of the
replacements whereas the locked-out employees, pursuant to
1283GOLDSMITH MOTORS CORP.
6 See also I. Bahcall Industries, 287 NLRB 1257, 1261 (1988).
the old contract, had been covered by a pension plan to
which the Employer made contributions.
4. Most of the replacements were not given demonstrator
cars (although they could rent a car for $75 per week),
whereas the locked out employees had been allowed to use
company cars for their own use.
5. Replacement employees were required to pay half of the
premium for health and life insurance, whereas under the ex-
pired contract, the locked out employees did not.
6. Replacements were required to work longer hours than
the locked out employees.
III. ANALYSIS
While I have found above, that Goldsmith told Haddad
that he desired to get rid of the Union, that statement al-
though relevant, does not prove, of itself, that the Company
at the negotiations actually bargained in bad faith and with-
out any intention of reaching an agreement. Also, while rel-
evant, the fact that the Company demanded substantial con-
tractual give backs is not by itself inconsistent with a finding
that the Company manifested by its objective conduct, its in-
tention to reach a contract, albeit one on its own terms.
The duty to bargain in good faith is defined in Section
8(d) of the Act which does not compel either party in a col-
lective-bargaining relationship to agree to a proposal or to
make a concession. Insofar as mandatory subjects of bar-
gaining (relating to wages, hours, and other terms and condi-
tions of employment), the National Labor Relations Act does
not require either party to yield or compromise its position.
As stated by the Supreme Court in NLRB v. American Na-
tional Insurance Co., 343 U.S. 395, 404 (1952):
[T]he Board may not either directly or indirectly, com-
pel concessions or otherwise sit in judgement upon the
substantive terms of collective bargaining agreements.
The Court further stated in H. K. Porter v. NLRB, 397
U.S. 99, 107–108 (1970):
It is implicit in the entire structure of the Act that the
Board acts to oversee and referee the process of collec-
tive bargaining, leaving the results of the contents to
the bargaining strengths of the parties. . . . While the
parties’ freedom of contract is not absolute under the
Act, allowing the Board to compel agreement when the
parties themselves are unable to agree would violate the
fundamental premises on which the Act is based—pri-
vate bargaining under governmental supervision of the
procedure alone, without any official compulsion over
the actual terms of the contract.
In NLRB v. Insurance Agents, 361 U.S. 477, 489 (1960),
the Court stated:
The presence of economic weapons in reserve, and their
actual exercise on occasion by the parties, is part and
parcel of the system that the Wagner and Taft-Hartley
Acts have recognized . . . [T]he truth of the matter is
that at the present statutory stage of national labor rela-
tions policy, the two factors—necessity for good-faith
bargaining between parties, and the availability of eco-
nomic pressure devices to each to make the party in-
cline to agree on one’s terms—exist side by side.
As I stated previously in Peele Co., 289 NLRB 113, 120
(1988);
It therefore is not necessarily unlawful for the stronger
side to make demands or take positions consistent with
its strength. Quite obviously, the respective strength of
a union versus a company in bargaining is largely de-
pendent on the support of the employees it represents,
their willingness to strike, and the vulnerability of the
company to a strike. . . . Furthermore, collective bar-
gaining is basically a two-way street. Thus although a
union may lawfully make demands designed to improve
existing employee wages and benefits, there is nothing
the the Act that denies an employer the right, . . . to
demand give-backs.6
Although a company may use its relative strength to press
for favorable contract terms, it may not engage in futile or
sham negotiations with the intention of never reaching an
agreement. NLRB v. Herman Sausage Co., 275 F.2d 229,
232 (5th Cir. 1960). In Abingdon Nursing Center, 197 NLRB
781, 787 (1972), the Board stated:
Good faith, or want of it, is concerned essentially with
a state of mind. . . . That determination must be based
upon reasonable inference drawn from the totality of
conduct evidencing the state of mind with which the
employer entered into and participated in the bargaining
process. . . . All aspects of the Respondent’s bargain-
ing and related conduct must be considered in unity,
not as separate fragments each to assessed in isolation.
Moreover, it must be kept in mind that at the beginning
of negotiations, it is not unusual for both sides to make ex-
treme contract demands from which they will then com-
promise. Such demands often are nothing more than bar-
gaining tactics designed to give space for concessions to be
made later during the negotiations. The crucial question in
these kinds of cases is not what position a party opens with,
but how it conducts negotiations thereafter and throughout
the entire bargaining process. Peele Co., supra at 120.
Although the Board may look at specific contract pro-
posals made by a side charged with bad faith bargaining, it
will generally refrain from deciding that particular proposals
(if involving mandatory subjects of bargaining), are either
‘‘acceptable’’ or ‘‘unacceptable’’ and will strive to avoid
making purely subjective judgments concerning the substance
of proposals. Reichold Chemicals 288 NLRB 69 (1988). On
the other hand, where a company’s proposals called for a
union to waive its right to strike and to negotiate grievances,
while coupled with an almost unlimited management-rights
clause, the Board concluded that the company essentially was
offering a contract which would be illusory because unen-
forceable. Prentice-Hall, Inc., 290 NLRB 646 (1988).
The General Counsel makes the following propositions.
1. The Respondent, as of February 9, 1990, was bargaining
without any intention of reaching an agreement. This is evi-
denced by;
(a) The single statement by Joel Goldsmith to his manager,
Mitch Haddad, in January 1990, that he was going to get rid
of the Union.
1284 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
7 Cf. American Thread Co., 274 NLRB 1112 (1985), overruling
Markle Mfg. Co. of San Antonio, 239 NLRB 1353 (1979).
8 This case is distinguishable from cases such as D.C. Liquor
Wholesalers, 292 NLRB 1234 (1989), where the company, having
been found to have bargained in bad faith, terminated negotiations
in the absence of a lawful impasse, locked out its employees, hired
replacements, and unilaterally implemented its last offer.
(b) The fact that the Company’s contract proposals called
for substantial give backs.
(c) The fact that the Company, in its initial contract pro-
posals, sought to eliminate the union security and dues-
checkoff clauses.
(d) The fact that the Company, during the initial phase of
negotiations refused the services of a mediator.
(e) The alleged company involvement in the filing of the
decertification petition.
2. Because the Company bargained in bad faith, the lock-
out that commenced on February 9, was unlawful and vio-
lated Section 8(a)(3) of the Act.
3. Alternatively, that no impasse existed as of February 9,
and therefore the Company’s lockout was violative of the
Act because it hired permanent replacement.
4. As no impasse had yet been reached, or alternatively,
because the Company bargained in bad faith, the Company
violated Section 8(a)(5) by unilaterally changing wages and
conditions of employment vis-a-vis the replacement employ-
ees.
5. That the Company linked further bargaining on resolu-
tion of the matters previously litigated in Case 29–CA–
13885.
It is true that the Company’s initially proposed contract
offer contemplated substantial give backs from its previous
collective-bargaining agreements with the Union. Neverthe-
less, the Union concedes that conditions in the retail auto-
mobile business were extremely bad and were even worse for
those dealers that sold Cadillacs. Indeed, it seems clear to me
that the Union felt it would be lucky if it could maintain the
existing terms and conditions embodied in the expired con-
tract. Both sides to the negotiations realized that these were
hard times, and that concessions would likely have to be
made by the Union and the employees it represents.
I am not impressed by the argument that the Company’s
initial contract demands were so regressive. As noted above,
parties to collective bargaining often start out at positions
from which they intend to compromise. The fact here, is that
the initial contract demands were made by the Company on
January 29, 1989, and bargaining continued for only another
12 days (before being broken off by the Union), without in-
dication by Heidecker that the Company’s position was fixed
or unalterable.
I am not pursuaded that bad faith has been shown by the
fact that the Company’s initial proposals asked for, but did
not insist as a condition of reaching agreement, on the elimi-
nation of union security and dues-checkoff provisions.
Gaywood Mfg. Co., 299 NLRB 697 (1990).7 Nor do I think
it particularly relevant that the Company refused during the
first round of negotiations to utilize the services of a medi-
ator. (During the negotiations that were held in the summer
of 1990, the Union refused to use a mediator as requested
by the Company.)
Goldsmith’s statement to Haddad is troublesome. How-
ever, I do not think that this isolated statement offsets the
fact that the Company’s negotiators did put forth a proposed
contract and did, over the entire course of bargaining, make
concessions to the Union. Also, as the evidence shows that
the the decertification petition was filed outside the 10(b) pe-
riod and was not solicited by agents of the Company, I do
not believe that this transaction shows the Company’s bad
faith.
The facts here show that on February 9, 1990, it was the
Union that broke off negotiations contending that the expired
contract had automatically renewed itself. Moreover this con-
tention was based on the false assertion that the notice re-
quired by Section 8(d) of the Act was not sent to the Com-
pany.
Whether or not there existed an impasse, the proximate
cause of the breakdown in negotiations and the concurrent
lock-out, on February 9, 1990, was the Union’s insistence
that further bargaining was unnecessary because the old con-
tract had renewed itself. On February 10, Heidecker sent a
telegram to the Union stating that the company was willing
to bargain. Instead of responding, the Union sought to com-
pel arbitration wherein it contended, inter alia, that the con-
tract had renewed itself.
In light of the above, it is my conclusion that the Com-
pany did not bargain with no intention of reaching an agree-
ment. I further find that the lockout was an offensive lockout
in furtherance of the Company’s bargaining position. As
such, absent proof of antiunion motivation, the Respondent
did not violate the Act by using temporary replacements dur-
ing such a lockout. Harter Equipment, 280 NLRB 597
(1986). See also Boilermakers Local 88 v. NLRB, 858 F.2d
756 (D.C. Cir. 1988).8
The General Counsel contends that the replacements hired
by the Company were permanent and not temporary replace-
ments, a contention that the Company’s witnesses deny. The
evidence on this point is somewhat ambiguous.
The Company did not hire any replacements immediately
after February 9, 1990, and attempted to get by with Winters
and its managerial staff. This became impossible to maintain
and commencing around February 21, 1990, the Company
began interviewing and hiring replacement salesmen. Al-
though, the General Counsel asserts that replacements were
told that they were being hired on a permanent basis, she
produced only one, Felix Durousseau, who unequivocally
testified that he was told by Winters that his job was perma-
nent. The other two General Counsel witnesses who testified
on this subject were Haddad, who in response to my ques-
tions, stated that he told all employees hired after February
9 that there was a labor dispute and that they were hired on
a temporary basis. Mario Demisa’s testimony on this subject
was that he got the impression that he was being offered a
permanent job, although he was not told at the time of his
hire of the labor dispute and he was not told that the job was
either temporary or permanent in nature.
As stated above, it seems probable, in accordance with the
credited testimony of Haddad, that most replacements were
told about the labor dispute and informed that their jobs were
temporary. It also seems possible that in a few cases, the
Employer neglected to say anything about the labor dispute
and thereby gave the impression that the job was permanent.
On balance, however, I do not think that the General Counsel
1285GOLDSMITH MOTORS CORP.
9 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and rec-
ommended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed
waived for all purposes.
has proved with sufficient clarity that the respondent hired
permanent rather than temporary replacements.
I also conclude that the Respondent did not violate the Act
by giving to the replacement employees different wages and
conditions than those enjoyed by the locked out employees
under the expired contract.
The general rule is that a company may implement some
or all of its contract proposals but only after the parties have
reached an impasse in their negotiations, Colorado-Ute Elec-
tric Assn., 295 NLRB 607 (1989); Sacramento Union., 291
NLRB 552 (1988). However, that rule is not applied to strike
replacements whose wages and terms of employment may be
unilaterally established by the employer. Thus, in Marbro
Co., 284 NLRB 1303 (1987), the Board stated:
The Judge found that the Respondent violated Section
8(a)(5) by unilaterally discontinuing contributions to the
fringe-benefit trust funds after the parties’ collective-
bargaining agreement expired . . . and the employees
went on strike. . . . We agree with the Judge’s finding,
but only to the extent that the Respondent discontinued
the contributions on behalf of those of its employees
who were returning strikers. In this regard it is well set-
tled that even in the absence of impasse, an employer
may lawfully change the terms and conditions of em-
ployment for strike replacements after a collective-bar-
gaining agreement terminates. . . . Accordingly, we
shall modify the Judge’s recommended remedy for the
unlawful unilateral changes by requiring the Respond-
ent to make the requisite contributions solely on behalf
of those of its employees who were members of the
bargaining unit at the commencement of the strike and
who thereafter worked for the Respondent as returning
strikers. We shall further modify the Judge’s rec-
ommended remedy to conform it to the violation found
by requiring the Respondent to make whole its employ-
ees who were returning strikers for any losses suffered
as a result of the unlawful unilateral changes. (Case ci-
tations omitted.)
In my opinion, there is no functional difference between
an economic strike and an offensive lockout. In a strike, the
purpose is to put pressure on the employer to agree to the
union’s demands. In a lockout, the purpose is to put pressure
on the union to accept the company’s bargaining position. As
such, it seems to me that temporary replacements in a lock-
out situation stand in much the same relationship as perma-
nent replacements would be in the context of an economic
strike. And this position is consistent with the position taken
by the General Counsel in an advice memorandum reported
at 125 LRRM 1374 (1987), in Lincoln, a Subsidiary of
Pentair, Case 14–CA–18744.
The Union’s attorney testified that in June 1990, while
speaking with Heidecker about setting up a bargaining ses-
sion, Heidecker said that the ‘‘real problem here is Hemp-
stead.’’ Apparently Bush interpreted this one line response as
meaning that the Company would not bargain in the present
context, unless the Union withdrew from its right to bargain
at the other location that was the subject of the previous un-
fair labor practice case. Whatever Bush’s interpretation, the
fact is that according to his own testimony, Heidecker did
not insist that the Union waive any rights it had at Hemp-
stead nor did he condition bargaining in Jamaica on any ac-
tion at Hempstead. (In fact, at a later date, a contract was
executed for the Hempstead location.) I therefore see nothing
in this testimony that would constitute a violation of the Act.
CONCLUSION OF LAW
The Respondent has not violated the Act in any manner
encompassed by the complaint.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended9
ORDER
The complaint is dismissed.