Goodman Holding Co., Inc.

National Labor Relations Board - Board Decisions

Sep 30, 1985

276 N.L.R.B. 935 (N.L.R.B. 1985)

GOODMAN HOLDING CO
Goodman Holding Company, Inc., and its wholly-
owned subsidiaries , Goodman Manufacturing
Corp ., Goodman Products Co., Inc . and Good-
man Distributing Co.,' Inc . and Sheet Metal
Workers International Association , Local Union
No. 54 , AFL-CIO. Cases 23-CA-9467, 23-
CA-9563, and 23-RC-5173
30 September 1985
DECISION, ORDER, AND DIRECTION
OF SECOND ELECTION
BY CHAIRMAN DOTSON AND MEMBERS
DENNIS AND JOHANSEN
On 19 June 1984 Administrative Law Judge
Richard J. Linton issued the attached decision. The
Respondent filed exceptions and a supporting brief,
and the General Counsel filed an answering brief.
The National Labor Relations Board has delegat-
ed 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
decided to'affirm the judge's rulings, findings, i and
conclusions only to the extent consistent with this
Decision, Order, and Direction of Second Election,
and to adopt the recommended Order as modified.
We agree with the judge that the Respondent
violated Section 8(a)(1) by coercively interrogating
its employees,- and that the election in Case 23-
RC-5173 should be set aside and a new election di-
rected. - -
Contrary to the judge, however, we find that the
Respondent did not violate Section 8(a)(1) of the
Act when Harold Goodman, the Respondent's
president, told the Respondent's employees that a
proposed individual employee incentive pay plan
would be subject to negotiation if the Union was
certified as the bargaining 'representative after the
forthcoming election. ,
As discussed in greater detail in the attached de-
cision, the Respondent- desired to institute an indi-
vidual employee incentive pay plan for the employ-
ees of Goodman Manufacturing Company, includ-
ing the 233 employees eligible to vote. Prior to the
advent of any union activity, the Respondent hired
"time study" engineers and 'a consulting firm at 'a
significant cost to prepare the incentive pay plan.
During the Union's organizational campaign, the
Respondent informed its employees of the decision
' The Respondent has excepted to some of the judge's credibility find-
ings The Board's established policy is not to overrule an administrative
law judge's credibility resolutions unless the clear preponderance of all
the relevant evidence convinces us that they are incorrect Standard Dry
Wall Products, 91 NLRB 544 (1950), enfd 188 F 2d 362 (3d Cir 1951)
We have carefully examined the record and find no basis for reversing
the find'ngs
935
to implement the plan as soon as the consultants
were finished. However, the Respondent made no
commitment regarding the actual wages, hours, or
other terms and conditions of emloyment that
would be covered under the new pay plan. At the
time of the election, no employee was receiving
any, benefit from the new pay plan.
The judge found that, during a question-and-
answer session concerning the incentive pay plan
prior to the election, the. employees asked whether
they would get the ' incentive plan if the Union
won. He found that -Goodinan's response to this
question was "that he did not know, that it would
be a matter subject to negotiation with the Union,
that he had no idea what position Local 54 would
take on the subject, and that he could not unilater-
ally decide." The judge found the pay plan was in
the implementation stage at that time and not at the
planning stage, and thus Goodman "was not at lib-
erty to say that a union victory would mean that
the program (i.e., the desire or decision to imple-
ment such a program) would have to be negotiated
with the 'Union." The judge therefore concluded
that the Respondent had phrased remarks to " em-
ployees calculated to - convince them that they
would incur an economic penalty if they voted for
the Union, and that this was in violation of Section
8(a)(1).
Contrary to the judge, we conclude that the
above response by Goodman is not a violation of
the Act. Rather, it accurately reflects the Respond-
ent's duty to bargain in good faith with a successful
union about the incentive pay plan. Normally, no
violations of the Act can result where an employer
in good faith consults the bargaining representative
before taking action, Liberty Telephone, 204 NLRB
317 (1973), and there is no evidence that Goodman
conditioned the pay plan upon defeat of the- Union.
He simply informed the employees that he did not
know what the Union's position on the pay plan
would be.
Even where an employer has had a history of
annual wage increases to employees, the existence
of a certified bargaining representative of those em-
ployees compels the employer thereafter to bargain
over all terms and . conditions of employment.
Where the amount of the increase is discretionary
it would be a violation for the employer to increase
wages without bargaining with the certified repre-
sentative. See Anaconda Ericcson Inc., 261 NLRB
831 (1982); -Allis-Chalmers Corp., 234 NLRB 350
(1978), enfd. in relevant part 601 F.2d 870 (5th Cir.
1979); Mosher Steel Co., 220 NLRB 336 (1975).
Alpha Cellulose Corp., 265 NLRB 177, 178
(1982), cited by the judge, is - inapposite to `the
present case. In'Alpha Cellulose, the employer sent
276 NLRB No. 98
936 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
a letter informing employees that negotiations "can
take many months, and in the meantime all wages
and benefits are frozen. There can be no wage in-
crease or any beneits improved by the Company
during this period of negotiation." Here, the judge
found that Goodman informed the employees he
would be a tough and disagreeable negotiator, and
that the negotiations could tie up the incentive plan
for years. However, he made clear his intention to
institute the plan, and his remarks were made in the
context of the same response that he did not know
what the Union's position on the incentive plan
would have been. At no time did-Goodman threat-
en to freeze all wages during negotiations. We find
that his statements do not violate the Act.
ORDER
The National Labor Relations Board adopts the
recommended Order of the administrative law
judge as modified below and orders that the Re-
spondent, Goodman Holding Company, Inc., and
its wholly-owned subsidiaries, Goodman Manufac-
turing Corp., Goodman Products Co., Inc. and
Goodman Distributing Co., Inc., Houston, Texas,
its officers, agents, successors, and assigns, shall
take the action set forth in the Order as modified.
1. Delete paragraph 1(b) and reletter paragraph
1(c) as 1(b).
2.-Substitute the attached notice for that of the
administrative law judge.
[Direction of Second Election omitted from pub-
lication.]
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR -RELATIONS BOARD
An Agency of the United States Government
The • National Labor Relations Board has found
that we, violated the National Labor Relations Act
and has orderedus to post and abide by this notice.
Section 7 of .the Act gives employees, these rights.
To organize
To form, join, or assist any union
To bargain collectively through representa-
tives of their own choice
To act together for other mutual aid or pro-
tection - -
To choose not to engage in any of these
protected= concerted activities.
WE WILL,NOT coercively interrogate you as to
your union sympathies and desires or as to how
you will .vote in a Board-conducted election:
WE WILL NOT in any like or related manner
interfere' with , restrain;- or coerce you .in the exer-
cise of the rights guaranteed you by Section 7 of
the Act. -
GOODMAN HOLDING COMPANY,. INC.,
AND ITS WHOLLY-OWNED SUBSIDIAR-
IES, GOODMAN MANUFACTURING
CORP., GOODMAN PRODUCTS Co.,
INC. AND GOODMAN DISTRIBUTING
Co., INC.
John A. Ferguson, Jr., Esq., of Houston, Texas, for the
General Counsel.
L. G. Clinton, Jr., Esq., and T J. Wray, Esq., of Houston,
Texas, for the Respondent.
Patrick M. Flynn, Esq., of Houston, Texas, for the Charg-
ing Party Petitioner.
DECISION
STATEMENT OF THE CASE
RICHARD J. LINTON, Administrative Law Judge. I
heard these cases in' Houston, Texas, on March 22-23,
1984, pursuant to the February 3, 1984 amended consoli-
dated complaint issued by the General Counsel of the "
National Labor Relations Board through the Regional
Director for Region 23 of the Board, and the February
6, 1984 Order of the Regional Director directing a hear-
ing in Case 23-RC-5173 and consolidating it with Cases
23-CA-9467 and 23-CA-9563. The complaint is based
on charges filed September 26, 1983, in Case" 23-CA-
9467, and December 14, 1983, in Case 23-CA-9563, by
Sheet Metal Workers International Association, Local
No. 54, AFL-CIO (the Union or Local 54), against
Goodman Holding Company, Inc., and its wholly-owned
subsidiaries , Goodman Manufacturing Corp., Goodman
Products,` Inc. and Goodman Distributing Co., Inc. (Re-
spondent'or the Company).i -
In the complaint the General Counsel alleges that Re-.
-spondent violated Section 8(a)(1) of the Act by conduct
constituting unlawful surveillance, interrogation, and
statements between September 17 and "about November
1983."
By its answer Respondent admits certain factual mat-.
ters but denies violating the Act.
The 'petition in Case 23-RC-5173 was filed September
29, 1983. That date opens the preelection "critical"
period whether the election, as-here, was conducted pur-
suant to a stipulation for certification on consent elec-
tion2 or a Decision and Direction of Election.3 Never-
theless, prepetition conduct may be considered insofar as
it lends meaning and dimension to related postpetition "
conduct or assists in evaluating it.4
i All dates are for.1983 unless otherwise indicated References to-
Goodman are to Harold' V Goodman, Respondent 's president . Citations
to the transcnpt of testimony are by volume and page
2 Goodyear Tire & Rubber Ca,'138 NLRB 453 (1962)
The Ideal Electric & Mfg Co., 134 NLRB 1275 (1961)
Shamrock Coal Co; 267 NLRB 625 (1983), and cases cited there at,,
fn. 3
GOODMAN HOLDING CO
Pursuant - to the stipulation for election certification
mentioned above, approved by the Regional Director on
October 26,. an election by secret ballot was conducted
under the Board's Rules on December 2 among Re-
spondent's employees in the following stipulated unit:
All 'production and maintenance employees, includ-
Ing shipping, receiving, and lead persons, excluding
all other employees, office clerical employees, engi-
neering employees, guards and supervisors as de-
fined in the Act.
The tally of ballots reflected that of approximately 233
eligible voters, 224 employees cast ballots. Of the 224
valid'ballots counted, 84 votes were for the Union, 128
were against it, and 12 ballots were challenged. Chal-
lenges were not sufficient in number to affect the elec-
tion's results.
On December 9 Local 54 filed timely objections. The
'Regional Director subsequently approved the Union's re-
quest to withdraw certain objections. This left Objec-
tions 4 and 6 to be resolved, and the Regional Director
directed a hearing as to these two. -Objections 4 and 6
are coextensive with certain allegations of the complaint.
On' the entire record, including my observation of the
demeanor of the witnesses, and after due consideration of
the briefs filed by the General Counsel, the Union, and
Respondent, I make the following
FINDINGS OF FACT
1. JURISDICTION
The four entities of Respondent are Texas corporations
with an office and place of business in Houston, Texas,
where they manufacture, air-conditioning units. During
the past 12 months Respondent purchased and received
at its Houston, Texas facility products, goods, and mate-
rials valued in excess of $50,000 directly from points lo-
cated outside Texas. Respondent admits, and I find, that
it is an employer within the meaning of Section 2(2), (6),
and (7) of the Act.
II. LABOR ORGANIZATION INVOLVED
Respondent admits, and I find, that Local 54 is a labor
organization within the meaning of Section 2(5) of the
Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES •
A. Background
1. Nature of Respondent's operation
As 'explained by President Goodman, Goodman Hold-
ing Company (GHC) is a holdmg company which has'no
employees involved in this proceeding (Tr. 2:199). Nor
does Goodman Distributing Co., Inc. (Tr. 2:234). Good-
man Manufacturing Corp. (GMC) and Goodman Prod-
uct Co., Inc. (GPC) are the, subsidiaries involved in the
action here.
GMC makes air-conditioning units. The process 'in-
cludes manufacturing the coils, tubing, and sheet metal
components. The units contain hundreds of parts (Tr.
937
2.199, 240). Some 40,employees work in GPC, leaving
the balance of the approximately 233 eligible voters as
employees of GMC (Tr. 2:229). The manufacturing proc-
ess at GMC involves some 4000 job operations (Tr
2.217, 240).
GPC is a simple two-step operation where about 10
employees are machine operators who-make air -condi-
tioning cores , with the remaining 30 or so employees
being insulators who produce flexible ducts, insulate the
cores, and box them (Tr. 2:199, 228, 240).
2. The individual incentive plan for GMC
Based on his previous experience with other firms he
has owned, President Goodman has observed that incen-
tive pay plans are "very effective" (Tr. 2:230).5 In this
connection. Goodman has found individual incentive
plans to be far more effective than group incentive plans
(Tr 2:222).
In '1977 Respondent installed an individual incentive
plan at GPC when production began at that subsidiary
(Tr.•2:200, 219). Production at GMC began in September
1982 (Tr. 2:220). In March 1983 GMC' installed a group
incentive plan as a "stop gap". measure until an individ-
ual plan could be worked out for the intricate operation
at GMC (Tr 2:201, 220, 222). From the very beginning
Goodman intended to install an individual incentive pro-
gram at GMC (Tr. 2:230) The group plan was merely
the first step toward that goal. • -
The second step Goodman took to implement his deci-
sion to install an individual incentive program occurred
on April 23 when GMC placed a newspaper advertise-
ment for an "experienced methods and process engineer"
familiar with "time study" and "incentives," among
other requirements (R. Exh. 9; Tr. 2:203). Gary Hamil-
ton was hired for this purpose and began work May 23
(R. Exh. 10; Tr. 2:204). ..
At some point in the summer of 1983, Goodman took
his next step in implementing his decision to install an in-
dividual incentive plan. It was an expensive step, for
GMC hired an independent consulting firm, International
Consulting, to assist Hamilton in studying the 4000 job
operations, before the:new incentive system could be set
in motion. The consulting firm's fee was $50,000 (Tr.
2:215, 225, 226, 231). •
By September 23 the consulting firm had several rep-
resentatives on the plant floor and, because of that fact,
Goodman decided to address the employees about the in-
dividual incentive plan and how it would work (Tr.
2:207-208, 222, 224). That was his first occasion to tell
the employees about it personally (Tr. 2.223). Different
witnesses testified-that they previously had heard about
the individual incentive program from foremen (Tr.
2:277, Michael Schuller; Tr., 2:317, 'Mackenzie Evans) or
other employees (Tr. 2:295, Rhonda Wimberly).
As we shall see later, Paul Pivarik, a representative of
the consulting firm, apparently gave a detailed descrip-
tion of the individual incentive plan to employees on No-
5 Goodman 's'incomplete expression obviously means that he considers
the plans very effective in motivating employees to work diligently in
manufacturing the items his firms produce . Thus, both worker and the
Company earn more
938 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
vember 30 when Goodman made a speech to groups of
employees . Goodman 's remarks are discussed below in
relation to complaint paragraph 10.
It, is undisputed that the individual incentive plan was
set in motion sometime in January 1984. Goodman credi-
bly.testified that it could not have been done sooner be-
cause of the complications inherent with the 4000 job op-
erations and in shifting from a group plan to an individ-
ual incentive program (Tr. 2:217-218, 222).
B. Surveillance by Don Ross and Pete Alexander
1. Introduction
Apparently about early September Respondent's em-
ployees became interested in a union. The admitted
pleadings, as shown below, establish that Respondent
surveilled certain of its employees when they attended a
meeting at the union hall on September 17. Although
that conduct is well within the limitation period of Sec-
tion 10(b), it falls outside the preelection "critical" period
which opened with the filing of the petition on Septem-
ber 29, 1983, in Case 23-RC-5173.
2. Allegations admitted
Complaint paragraphs 7 and 8 allege that about Sep-
tember 17 Vice President Don Ross and Supervisor Pete
Alexander observed employees attending a meeting at
the Union's hall in Houston, and that Respondent,
through such agents, did so for the purpose of discover-
ing the Union or other concerted activities of its employ-
ees. In its answer, Respondent admits these allegations.
3. The issue presented
Respondent does not contend the admitted surveil-
lance was not unlawful . Rather , at the beginning of the
instant hearing Respondent moved • that Case -23-CA-
9467 be dismissed because of Respondent 's unsuccessful"
attempt to settle the charge before trial (Tr. 1:8). Com-
plaint paragraphs 7 and 8 are based on the September 26
charge , filed by Local 54, which specifically attacks the
September 17 surveillance.6
On February 6, Attorney Ferguson wrote Attorney
Clinton as follows regarding Case 23-CA-9467 (R. Exh.
1):''
Dear Mr. Clinton:
6 Although the. same charge alleges an interrogation of 9-12-83, no
such event was carved over to the complaint , nor was any such event
litigated Thus, the surveillance event is the only aspect of Case 23-CA-
9467 pending in this proceeding
7 The parties stipulated that Attorney Clinton wrote Ferguson offering
to settle the case before Respondent received the complaint (Tr 1 16). Of
course, that stipulation does not overcome the presumption that Fergu-
son, or some other Board agent with Region 23, in compliance with Sec
101.7 of the Board 's Statements of Procedures , earlier advised Clinton of
the Region 's decision to issue a complaint on the charges in the absence
of a settlement A 15-day period is normally provided after such a region-
al determination for the parties to effect a settlement before a complaint
issues . See Sec ' 10126.2 of the Agency's Casehandling - Manual (Part
One), March 1983 edition
Pursuant to your letter dated February 3, 1984,
enclosed is a proposed Settlement Agreement and
Notice to Employees in the above-captioned case.
If this proposal meets with your approval, please
initial the Notice to Employees, sign the Settlement
Agreement and return : both documents to me
promptly.
Very truly yours,
/s/ John A. Ferguson, Jr.
John A. Ferguson, Jr.
Counsel for the General Counsel
The informal settlement agreement forwarded by Fer-
guson includes the usual nonadmission clause plus the
following provision (R. Exh. 2):
his agreement does not settle, nor does it remedy,
the allegations in Case 23-CA-9563. The under-
signed parties to this Agreement furthermore herein
expressly stipulate that in any hearing before an Ad-
ministrative Law Judge in Case 23-CA-9563, any
party, including Counsel for the General Counsel,
may introduce evidence bearing on the issues settled
by this Agreement, which bear directly on issues in
Case 23-CA-9563 and are necessary" in -the proof
thereof.
A Board notice also was enclosed . Under the preprint-
ed heading on the notice, the following text appears (R.
Exh. 3):
WE WILL NOT engage in surveillance of our em-'
ployees.attending union meetings.
WE WILL NOT in any like or related manner.
interfere with, restrain , or coerce our employees in
the exercise of their rights guaranteed under Section
7 of the Act.
Respondent thereafter posted its , own notice which
reads (R. Exh. 4):
NOTICE To EMPLOYEES
In connection with an investigation by the Na-
tional Labor Relations Board, it has come to our at-
tention that two of our supervisors may have acted
improperly on or about September 17, 1983. We do
not approve of violations of the law, and advise you
that:
WE WILL NOT engage in surveillance of our em-
ployees attending union meetings.
WE WILL NOT in any manner interfere with, re-
strain or coerce our employees in the exercise of
their rights guaranteed under Section 7 of the Na-
tional Labor Relations Act.
GOODMAN MANUFACTURING CORP.
By /s/Harold V. Goodman Harold V. Goodman,
President
DATE: February 13, 1984
GOODMAN HOLDING CO. . 939
THIS NOTICE SHALL REMAIN POSTED 60
DAYS: AND MUST NOT BE ALTERED, OR
DEFACED BY ANYONE.
At the hearing, Attorney Clinton represented that Re-
spondent rejected the proposed settlement because of the
provision permitting any party to "introduce evidence of
the surveillance in Case 23-CA-9563 to-the extent such
evidence bears "directly" on the issues in Case 23-,CA-
9563. Counsel protests that this reservation converts evi-
dence otherwise inadmissible (because of a settlement)
into admissible evidence (Tr. 1.9). Such a precondition to
settlement; Respondent argues, frustrates the purposes of
the Act (which favor settlement), and therefore the alle-
gations based on Case 23-CA-9467 (being complaint
pars. 7 and 8) should be dismissed (Tr.--1:17; Br. at 5-6).
In its brief Respondent, citing Broyhill Co., 260 NLRB
1366 (1982), also argues that the surveillance allegations
be dismissed because Respondent; by posting the notice
quoted above, effectively disavowed and' fully remedied
the surveillance conduct'of its agents.
At trial I denied Respondent's motion to dismiss (Tr.
1:17). It is' clear that the' surveillance event sheds light on
the later 'systematic interrogation by Supervisor David
Orange. In considering a remedy for the alleged interro-
gation by Supervisor Orange, it is. relevant to note that
barely 2 months earlier a vice president of Respondent
was involved in unlawful surveillance of employees'
union activities.
4. Conclusion
It appears that Respondent's posting falls within the
ambit of Broyhill. I therefore shall dismiss complaint
paragraphs 7 and 8 on the basis that Respondent fully ,
remedied the surveillance violation.8 On the other.hand,
I find that the General Counsel acted within his author-
ity by declining to settle Case 23-CA-9467 without the
reserved right to offer evidence of the surveillance in the
proceeding concerning Case 23-CA-9563. Thus, the
pleadings in answer to complaint paragraphs 7 and 8 are
properly before me-for background purposes.
C. Interrogation by David Orange
1. The allegations
Complaint paragraph 9 alleges that about mid-October,
and again about November 29, Supervisor David.Orange
"interrogated an employee as to the employee' s union
sympathies and desires."-
Objection 6 filed by Local 54 asserts that about No-
vember 29 "the Employer's supervisors and agents inter-
rogated employees as to their union sympathies and de-
sires."
2. The facts
Former 'sheet metal-employee Andreas Hernandez tes-
tified that in November Supervisor David Orange called
him into ' a production office for a brief interview.
Orange was seated at a desk and had before him a paper
8 In its brief Respondent represents that the notice remained posted for
a full 60 days (Br. at 5)
concerning strikes and days lost in strikes. On a second
paper Orange had. a list with the names of certain em- .
ployees. The list included the name of, Hernandez.
Orange asked Hernandez what he thought about the
Union, and whether he was going to vote for the Com-
pany or the Union (Tr. 1:36-38). Hernandez replied that
he was going to vote for the.Company. Orange wrote
"no" beside the name of Hernandez (Tr. 1:38).
Supervisor Orange admitted that he talked ,with Her-'
nandez on one occasion about November 17 or 18. He
interviewed the employees in his department in a pro-
duction office separate from the supervisor's office. Ac-
cording to Orange, he called in two at a time, although
he could not recall who was with Hernandez.9 He ad-
mittedly interviewed them for, the purpose of ascertain-
ing how they were going to vote (Tr. 2:183, 190-191).
However, Orange testified, he did not -ask Hernandez
how he was going to vote or otherwise interrogate him,-
or any employee (Tr. 2:185). Orange formed his judg-
ment on how the employees were going to vote from
their responses. to his admitted question of what they
thought the Union could -do for,them (Tr. 2.183, 189).
According to Orange, he wrote beside Hernandez' name
that he did not want to pay dues and "no" (Tr. 2:191).
Orange further testified, that at the end of his brief
interviews he suggested to the employees that they go to
the union hall to ask the Union what it could ' do for
them, and to get such statements in writing. He also told
them that he wanted' them to vote, that their ballots
were secret, that they had the 'right 'to make their own '
decision on a yes or no' vote, but, that he preferred a' no
vote (Tr. 2:184). i o ' '
3. Conclusions
Orange confirmed most of the. testimony given by
Hernandez, including the part of a question concerning
what he thought of the Union. i i On the disputed point'
of whether Orange asked how Hernandez was going to`
vote, I credit Hernandez' who testified with a sincere de-
meanor. Although Hernandez speaks English only to' a
limited extent, he 'expressed himself. --clearly enough on
this.and the few other points of his testimony.12-I do not
credit Orange in his denials. He-did -not impress me on
this score, whereas Hernandez did.
In light of the foregoing, I• find that about November
18, 1983, Respondent violated Section 8(a)(1) of the Act
when Supervisor. Orange asked employee Andreas Her-
nandez what he thought about the Union, and whether
Hernandez was going to vote for Respondent or the
Union. -These questions, asked of an employee with a
very limited command of English, invade the most basic
Orange testified that at the time he supervised 12 employees (Tr
2 187) '
10 Maricela Ledesma, the General Counsel's initial witness, gave testi-
mony which corroborates Orange in this respect (Tr 1 27-28)
11 The wording offered by Orange, of what Hernandez 'thought the
Union could do for him,, is a difference with no legal distinction
12 He was unable to repoi't his answer to the first question of what he
thought of the Union because of the language problem (Tr 1 137) As the
questioning at trial did not explore this, it is unclear whether he gave
Orange an answer Orange testified that Hernandez spoke a combination,
of English and Spanish (Tr. 2 189). The point is immaterial
940 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
and confidential right of 'every employee-to hold a pri-
vate opinion about his or her thoughts on a union and
how he or she will vote in a Board-conducted election.
D. Statements by Harold V. Goodman in Group
Meetings
1. The allegations
Complaint paragraph 10 alleges that at a series of
group meetings of employees in October-November,
President Harold V. Goodman stated that if the Union
won the election the employees "would not receive any
additional compensation under Respondent's incentive
plan," whereas if the Union lost, the employees would
receive raises and incentives.
Local" 54's Objection 4 asserts that on various dates in
November Respondent "promised wage increases to em- '
ployees if the Union was defeated in the December' 2,'
1983, election."
2. The facts
Goodman testified that he spoke to groups of employ-
ees on two occasions regarding the individual incentive
plan (Tr. 2:209). The first date was September 23 (Tr.
2:207, 222-223), and the second was November 30 (Tr.
2.209, 224). At the September 23 series of group meet-
ings, Goodman addressed the individual incentive plan
exclusively, or nearly so,'. whereas on November 30
Goodman's prepared address 'contained only a couple of
references to the incentive plan. The prepared address
was a 6-page speech Goodman read without deviating
from the double-spaced text (R. Exh. 13; Tr. 2:210-211).
Following his reading of the November 30 "speech,
Goodman entertained questions•from the employees.
There is a significant amount of both dispute and con-
fusion among the various witnesses concerning the.
number of occasions that Goodman spoke, the dat-, and
what he said. This is understandable-in view of the pas-
sage of time and the frailty of human memory. Compli-
cating the- recollection process is the fact that at least.
whatever meetings were held in October-November;
Personnel 'Manager Joe- Pinkos was present and made .
certain remarks, with some of his comments bearing on
the incentive plan. -
Also present on November 30 was Paul Pivarik, one
of the consultants hired to assist Gary Hamilton install
the individual incentive, program (Tr. 2:215, 236). The
text of Goodman's speech indicates, at page 5, that on
November 30 Pivarik described the incentive plan for
employees before Goodman spoke. Strictly speaking, the
text is in evidence only to show the speech that Good-
man gave. Although the text is hearsay, therefore, so far
as showing that Pivarik made such a presentation, I note
that under Federal law, hearsay is not incompetent per
se, particularly in nonjury proceedings. As the circum-
stances here point to the reliability of finding that- Pi-
varik made such a presentation, I find that he did so.'
Some of the General Counsel's witnesses testified that
Goodman, at some meeting, stated that'if the Union won
the election the individual incentive program would be
dropped,14 and that if the Union lost the election Re-
spondent would proceed to implement the plan.
Based on my observation of the demeanor of the wit-
nesses, as well as on my study of the record, I credit
Goodman's testimony concerning the dates he spoke and
what he said. Goodman testified in a sincere manner, and
his version was given with substantially more clarity and
consistency than that of contrary testimony.
As earlier noted; Goodman's speech contains two ref-
erences to the incentive plan. The first, at page 4 of the
typewritten text, reads:
We also decided before the union came on the
scene to expand our piecework incentive program,
as paul described.
And at page 5:
The Union won't tell you that a union contract may
not allow for the incentive plan paul just described
After reading the speech, Goodman entertained cjues-
tions. He testified that each group of employees general-
ly asked the same two or three questions. First, they
wanted to know how much money they would make
when the individual incentive plan was installed. Good-
man "replied that by law he could not discuss that or
make any promises (Tr. 2:214). Second, to the question
of whether they would- get the incentive plan if the
Union lost the election, Goodman answered yes, they
would, because the Company had every intention to
have the incentive program. -
The third question employees asked was whether they
would get the incentive plan if the Union won. To this
question Goodman responded that he did not know, that .
it would be a matter subject to negotiation with the
Union, that he had no idea what position Local 54 would
take on the subject, and that he could not unilaterally
decide (Tr. 2:214).
3. Union requests findings on speech
The General Counsel does not argue that Goodman's
November 30 speech violates Section 8(a)(1). The Gener-
al Counsel's case rests on evidence concerning statements
Goodman supposedly made outside the text of the
speech. However, Local 54 contends in its brief that the
text of the speech contains unlawful and objectionable.
remarks and the Union requests that I so find. By impli-
cation, Local 54 appears to argue that the lawfulness of
the speech was fully litigated to the extent it goes
beyond complaint, paragraph 10. I do not agree with that
implied contention. The reason I disagree is that the text
of the speech was offered as bearing on complaint para-
graph 10. The language of paragraph 10, summarized
above,, relates to the remarks Goodman made, or sup-
posedly made, after the prepared speech. The written
text of the speech expresses Respondent's antiunion posi-
tion and mainly deals with strikes. There is no doubt that
the text is tough. But at no point did the General Coun-
' S Goodman testified he did not "think" he mentioned the Union at the
9-23-83 meetings (Tr 2 208) 14 Several 'employee witnesses called by Respondent denied this
GOODMAN HOLDING CO.
sel seek to amend the complaint. Nor did the Union raise
the issue until its brief. I decline to make findings regard-
ing the lawfulness of statements in the • text regarding
strikes, permanent replacements, and possible loss of
jobs. However, to the extent the text lends meaning and
context to Goodman's other remarks, or otherwise
comes within either complaint paragraph 10 or Objection
4, a summary of the text is relevant.
The text begins with Goodman, after thanking Pinkos
for his opening remarks (Tr. 2:210), informing employees
that he wanted to talk with them about a matter of
"deep" concern. Goodman then went-on to. describe the
election of Friday, December 2, as Decision Day. He in-
formed employees that the Company was "absolutely 'op-
posed to this Union or to any union that tries to interfere
with our relationship." In his opinion, Goodman said, a
union would work to "your serious harm." "Unioniza-
tion," Goodman stated, "is frequently followed by
strikes, unrest, violence, and even loss of jobs." If the
Union causes an economic strike, you place your job on
the line. You can be permanently replaced. You can lose
your job." On contract negotiations, Goodman advised
the employees that the Union would find him "the most
disagreeable person" it ever had to negotiate with, that
the Company was not obligated to agree to any proposal
made by the Union, although the Company would agree
to negotiate and was required to negotiate in good faith.
These negotiations, Goodman 'warned, could last "for
years." During such negotiations, the Company could
not "by itself' put in effect any improvements in wages
or benefits. Goodman further warned that unions fre-
quently trade benefits in order to get items, such as
checkoff of union dues, the unions want. Goodman also
told the employees that the Union was not going to run
the Company and "is not going to tell us how to oper-
ate." Among his other comments, Goodman referred to
the incentive program, as quoted earlier.
The' foregoing description covers many of the points
Goodman made. He mentioned others, and repeated or
emphasized one or more of the above, such as loss of
jobs in strikes.15 Toward the end of his -speech Good-
man also spoke of certain production and attendance
goals the employees had achieved.
As previously discussed, Goodman's speech was fol-
lowed by a question and answer session . His responses to
the three questions asked at each group session are de-
scribed earlier.
4. Conclusions
Local 54, citing Alpha Cellulose Corp., 265 NLRB 177
(1982), argues that Respondent violated the Act by lead-
ing employees to believe that a penalty was attached to
the exercise of their rights in choosing a bargaining rep-
resentative. That is, the employees were told that a re-
jection of the Union would mean installation of the in-
centive plan, whereas a union victory would tie up the
incentive plan in negotiations which could take "years"
with a very "disagreeable" Goodman.
i5 The initial reference was to "economic" strikes, but other references
were not qualified
941
That argument presumes, to some extent, that the em-
ployees-viewed the new incentive plan as a favorable de-
velopment. Tubing department employee Rhonda Wim-
berly testified that the employees generally wanted the
new incentive program (Tr. 2.304). This apparently is so.
Thus, as die setter Donald Longoria' testified, there was
talk among employees-that the individual incentive plan
would allow employees to earn up to $2 an hour more
(Tr 2:257). That potentially would account for both the
view that the plan would be a benefit, and also explain,
because of its grapevine nature, why the employees
asked Goodman about'it on November 30.
I have found that the individual incentive plan was in
the implementation stage, and not at some planning step.
Moreover, Goodman told the employees as much on
September 23.'
It is true that Goodman had not previously announced
when the program would be set in motion, nor is there
any evidence that Goodman knew, even as late as No-
vember 30, that it would be January 1984. I find that Re-
spondent intended to implement the program as soon as
Gary Hamilton and the, consultants informed Goodman
that their work was complete and the system could be
initiated. Although Goodman never expressly so testified,
I find that such was the fact based on his testimony that
he intended from the beginning to implement the individ-
ual incentive program, and based on the additional facts
that he hired an industrial engineer and paid a consulting
firm $50,000 to enable GMC to install the program.
Thus, on November 30, Respondent was in the posi-
tion of already being committed to set the individual in-
centive program in motion (i.e., by paying the employees
based on that system) as soon as the engineers gave the
green light. Respondent also, on September 23, had ex-
plained to the employees that the consulting engineers
were on the plant floor making the studies needed to im-
plement the new system, and in that series of meetings
Goodman described for the employees how the new pro-
gram would work.
In view of-the committed position Respondent was in
as of November 30, Goodman was free, even required,
to say that if the Union lost the election the new incen-
tive program would be installed when the engineers
completed their studies and gave the signal to start.
The flip side is that Goodman was not at liberty to say
that a union victory would mean that the program (i.e.,
the desire or decision to implement such a program)
would have to be negotiated with the Union. Respond-
ent's only duty would have been to notify and consult
with Local 54 over the timing and impact of setting the
program in motion. 16 But that temporary delay is sub-
stantially. less than a delay for bargaining over the sub-
ject as a contract item. The limited duty is a far cry from
the "years". that Goodman suggested bargaining for a
,contract might take.
16 Indeed , it appears that Respondent would be legally required to
fully implement the program when ready , after consulting with Local 54
on the timing and impact Thereafter , the installed program would be
subject, as all other existing benefits, to the collective -bargaining process
Pending that bargaining process, however, the employees would enjoy
the fruits of the new individual incentive pay program
942 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
As Respondent observes, brief at 40, Goodman was
free to tell employees that existing benefits could be
traded away in the collective-bargaining process. Stumpf
Motor Co., 208 NLRB 431-432 (1974). But that would
apply only after Goodman told employees that Respond-
ent was obligated to set the .program in - motion when
ready after consulting with the -Union over the impact.
Only then would the new incentive program, as a then
existing: benefit, be subject to the general collective-bar-
gaining process.
It is clear that Goodman misled the employees on No-
vember 30 by stating;- in effect, that a union victory
would require Respondent to include the new incentive
program in the -general contract negotiations with Local
54. As we have seen , there was no such requirement in
the law. The law required no more than that Respondent
consult with the Union over the impact of setting the
plan in motion. Goodman, therefore, misrepresented Re-
spondent's legal -obligation in a manner ' calculated to
cause the employees to view a yes vote as a vote to self-
impose the penalty of a possible "years" of delay in re-
ceiving, if ever, the individual incentive program. The
natural tendency of this option, would be an interference
with- the Section 7 rights of employees by causing them
to view an affirmative' vote for the Union as tantamount
to imposing an economic penalty on themselves. By this
misstatement of its legal duty, Respondent unlawfully
threatened employees with an extended delay, and possi-
ble loss, of acommitted economic benefit.
As the penalty- message conveyed by Goodman on
November 30 falls within the coverage of complaint
paragraph 10, I find that Respondent thereby violated
Section 8(a)(1) of the Act.
IV. THE UNION'S OBJECTIONS
A. Objection 4
The Union's Objection 4 is quoted in conjunction with
the treatment of complaint paragraph 10. As the remarks
of President Goodman on November 30 violated Section
8(a)(1) of the Act, they necessarily were objectionable
conduct for which- the election shall be-set aside and a
new election ordered.
I deny Local 54's request that I find certain statements
about strikes, permanent replacements, and loss of jobs in
Goodman's November 30 speech constitute independent
grounds of objectionable conduct. Neither the complaint
nor the objections attack the text of the speech, and Re-
spondent was never put on notice that the text of the
speech was to be litigated.
B. Objection 6
Local 54's Objection 6 appears above in the discussion
of complaint paragraph 9 concerning the' interrogation
by Supervisor David Orange. The conduct of Orange
serves as an additional ground for setting 'aside the elec-
tion and directing that a second election be conducted.
Because Objection 6 is broader than complaint para-
graph 9 in that it attacks interrogations of employees
rather than being confined to the singular, I find that Or-
ange's admitted conduct of systematically interrogating
employees concerning what they thought Local 54 could
do for them constitutes an additional basis for setting
aside the election of. December 2.
The evidence is insufficient to establish-that Respond-
ent generally, as distinguished from the actions of Super-
visor Orange, conducted an objectionable program of
systematically questioning employees for the purpose of
ascertaining how they would vote in a Board-conducted
election. •
C. Recommendation
Based on the foregoing, I recommend that the election
of December 2, 1983, be set aside, and that Case 23-RC-
5173 be remanded to the Regional Director of Region 23
to conduct a second election at such time as the Region-
al Director deems appropriate.
CONCLUSIONS OF LAW
1. Respondent is an employer engaged in commerce
within the -meaning . of Section 2(2), (6), and (7) of the
Act.
2. Local 54 is a labor organization within the meaning
of Section'2(5) of the Act.
3. By coercively interrogating its employees on what
they thought about Local 54 and on whether they were
going to vote for the Company or for Local 54, and by
phrasing remarks to employees. calculated to convince
them that they would incur an economic penalty if they
voted for Local 54 in a Board-conducted election, Re-
spondent violated Section 8(a)(1) of the Act
4. The General Counsel acted within his discretion in
attaching as a precondition for settlement of the surveil-
lance allegations , Case 23-CA-9467, that evidence of
such event bearing on Case 23-CA-9563 could be intro-
duced in the instant proceeding.
5. Respondent's unlawful conduct affects commerce
within, the meaning of Section 2(6) and (7) of the Act.
6. By engaging in the objectionable conduct described
in part IV of this decision, Respondent has interfered
with its employees'. freedom of choice in the election
conducted December 2, 1983.
THE REMEDY
Having found that Respondent has engaged in certain
unfair labor practices , I shall recommend' that it cease
and desist and take certain affirmative action designed to
effectuate the policies of the Act. As Respondent already-
has set the new incentive plan in motion , there is no
need for an affirmative requirement that Respondent do
so. -
On these findings of fact and conclusions of law and
on the entire record , I issue the following recommend-
edt7
17 If no exceptions are- filed as provided by Sec 102 46 of the Board's
Rules and Regulations , the findings , conclusions, and recommended
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 pur-
poses.
GOODMAN HOLDING CO. 943
ORDER
The Respondent, Goodman Holding Company, Inc.,
and its wholly-owned subsidiaries, Goodman Manufac-
turing Corp., Goodman Products Co., Inc., and Good-
man Distributing Co., Inc., of Houston, Texas, its offi-
cers, agents, successors , and assigns, shall
1. Cease and desist from
(a) Coercively interrogating its employees as to their
union sympathies and desires or as to how they intend to
vote in a Board-conducted election.
(b) Phrasing statements to its employees in a fashion
calculated to persuade them that they will incur an eco-
nomic penalty by voting for a labor organization in a
Board-conducted election, such as by telling them that a
benefit, already prearranged, will be granted if they vote
against the labor organization, but that if they elect the
labor organization as their bargaining representative, the
predetermined benefit will be subject to contract negotia-
tions which might take years to complete.
(c) In any like or related manner interfering with, re-
straining, or coercing employees in the exercise of the
rights guaranteed them by Section 7 of the Act.
2. Take the following affirmative action designed to ef-
fectuate the policies of the Act.
(a) Post at its place of business in Houston, Texas,
copies of the attached notice marked "Appendix."18
Copies of the notice, on forms provided by the Regional
Director for Region 23, after being signed by the Re-
spondent's authorized representative, shall be posted by
the Respondent immediately upon receipt and maintained
for 60 consecutive days in conspicuous places including
all places where notices to employees are customarily
posted. Reasonable steps shall be taken by the Respond-
ent to ensure that the notices are not altered, defaced, or
covered by any other material.
(b) Notify the Regional Director for Region 23 in
writing within 20 days of this Order what steps Re-
spondent has taken to comply.
IT IS FURTHER RECOMMENDED that complaint para-
graph 11 is dismissed to the extent it alleges that the sur-
veillance conduct described in paragraphs 7 and 8 consti-
tutes a violation of Section 8(a)(1) of the Act.
18 If 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 Na-
tional Labor Relations Board" shall read "Posted Pursuant to a Judgment
of the United States Court of Appeals Enforcing an Order of the Nation-
al Labor Relations Board."