Hershey Chocolate Corp.

National Labor Relations Board - Board Decisions

Sep 18, 1958

121 N.L.R.B. 901 (N.L.R.B. 1958)

HERSHEY CHOCOLATE CORPORATION 901
the date of the discrimination against them, to the date of the offer of reinstatement,
less net earnings, shall be computed on a quarterly basis in the manner established by
the Board in F W Woolworth Company, 90 NLRB 289, N L R B v Seven-Up
Bottling Company of Miami, Inc, 344 U S 344
Although the Respondent's unlawful conduct tends to thwart the fulfillment by
employees of their basic rights guaranteed by the Act to form labor organizations
and to engage in protected concerted activity, I am convinced that the Respondent's
conduct was spontaneous and unpremeditated and was not the result of hostility to-
wards the general purposes of the Act, particularly as the record is barren of evidence
of union animus or any conduct violative of the Act prior to the events in question
I do not anticipate, because of the unlawful conduct committed herein, a danger that
the Respondent will in the future commit other similar acts or other conduct
proscribed by the Act I shall, therefore, recommend the issuance only of a narrow
order limited to curing the effects of the conduct found unlawful herein
Upon the basis of the foregoing findings of fact and upon the entire record in the
case, I make the following
CONCLUSIONS OF LAW
1 By discriminating with respect to the hire and tenure of employment of Hector
Figueroa, Adrian Gomez, Ramiro Gomez, Francisco Rivera, Ana Lydia Gomez,
Celestmo Olmeda, Francisco Garcia, Praxedes C Gonzalez, Ana Noboa, Gilberto
Torres, and Herman Gomez, thereby discouraging membership in a labor organiza-
tion of its employees, Respondent has engaged in and is engaging in unfair labor
practices within the meaning of Section 8 (a) (3) of the Act
2 By interfering with, restraining, and coercing its employees in the, exercise of
the rights guaranteed by Section 7 of the Act, Respondent has engaged in and is
engaging in unfair labor practices within the meaning of Section 8 (a) (1) of the Act
3 The aforesaid unfair labor practices are unfair labor practices affecting com-
merce within the meaning of Section 2 (6) and (7) of the Act
[Recommendations omitted from publication
Hershey Chocolate Corporation, Petitioner and Local 464,
American Bakery and Confectionery Workers International
Union, AFL-CIO' and Bakery and Confectionery Workers
International Union of America.2 Case No 4- RM-265 Sep-
tember 18, 1958
DECISION AND DIRECTION OF ELECTION
Upon a petition duly filed under Section 9 (c) of the National Labor
Relations Act, a hearing was held before Bernard Samoff, hearing
officer The hearing officer's rulings made at the hearing are free
from prejudicial error and are hereby affirmed
Following the close of the hearing the Board, on March 28, 1958,
issued a notice and invitation to submit briefs or comment, advising
the parties hereto and all other interested organizations and persons
that it was considering possible revisions in certain of its contract bar
policies and inviting briefs or comment with respect to certain enumer-
ated policy considerations bearing on or related to the contract bar
issues in the instant case 3 Responses to the notice and invitation have
1 Herein called respectively ABC Local 464, and ABC,
Herein called BOW
At the same time, similar notices were issued In several other cases inviting briefs
and comment with respect to enumerated policy considerations bearing on or related to
the contract bar issues in such cases
121 NLRB No 124
902 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
been received from ABC Local 464, ABC, and BCW, and, as amicus
curiae, from American Bakers Association, American Federation of
Labor and Congress of Industrial Organizations, Automobile Trans-
porters Labor Division (Employers Division) and Eastern Confer-
ence Transporters Joint Committee (Employers Division), Chamber
of Commerce of the United States, International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and Helpers of America, Inter-'
national Union of United Brewery, Flour, Cereal, Soft Drink & Dis-
tillery Workers of America, AFL-CIO, and United Electrical, Radio
& Machine Workers of America (UE). Thereafter, on June 16, 1958,
the Board 4 heard oral argument at Washington, D. C., at which the
Employer-Petitioner, ABC Local 464, ABC, BCW, American Federa-
tion of Labor and Congress of Industrial Organizations, Automobile
Transporters Labor Division (Employers Division) and Eastern Con-
ference Transporters Joint Committee (Employers Division), Inter-
national Brotherhood of Teamsters, Chauffeurs, Warehousemen and
Helpers of America, International Union of United Brewery, Flour,
Cereal, Soft Drink & Distillery Workers of America, AFL-CIO, and
United Electrical, Radio & Machine Workers of America (UE), ap-
peared and participated.
Upon the entire record in this case, including the briefs of the par-
ties, the responses to the notice of March 28, 1958, and the oral argu-
ment, the Board finds :
1. The Employer is engaged in commerce within the meaning of
the Act.
2. The labor organizations involved claim to represent certain em-
ployees of the Employer.
3. The question concerning representation :
Bakery and Confectionery Workers International Union of Amer-
ica, Local No. 464,5 initially as an affiliate of the American Federation
of Labor, and subsequently as an affiliate of the American Federation
of Labor and Congress of Industrial Organizations,° has been the cer-
tified and contractual bargaining representative of the Employer's
production and maintenance employees since 1939. The most recent
contract was executed on March 26, 1957, for the period from April
15 1957, through December 31,1958. This contract and apparently all
prior contracts, were negotiated and executed on behalf of the Union
by local officers only. Apparently only local officials have participated
in the administration of this and prior contracts.
Beginning in March 1957, a split developed in BCW, sparked by
charges of corruption against International President Cross and cer-
* Chairman Leedom, who was not present during the oral argument with respect to this
case, and Member Bean, who was present during only part of such argument , have read
the complete transcript of the oral argument herein.
Herein called BCW Local 464.
Herein called AFL-CIO.
HERSHEY CHOCOLATE CORPORATION 903
tain other BCW officers, and resulting in the formation of a so-called
Integrity Committee which had as its purpose the replacement of the
allegedly corrupt officers. During the spring and summer of 1957,
hearings before the Select Committee on Improper Activities in the
Labor or Management Field of the United States Senate, and an
investigation and report by the AFL-CIO Ethical Practices Com-
mittee, dealt with the substance of the charges? On th'e basis of the
report of the Ethical Practices Committee and the failure of the
officers of BCW to comply with its recommendations, BCW was sus-
pended from the AFL-CIO pending action by the forthcoming
AFL-CIO convention.
Following the suspension of BCW from the AFL-CIO, BCW
Local 464, at executive board and membership meetings held, respec-
tively, on November 26 and December 5, 1957, which meetings were
addressed by representatives of both the BCW officers and the In-
tegrity Committee, adopted a resolution condemning the actions of
the BCW officers which resulted in the suspension, calling upon the
International to comply with the AFL-CIO recommendations, and
authorizing any action necessary to continue affiliation with the
AFL-CIO ; these meetings also voted to send delegates to the AFL-
CIO convention site to participate in any action necessary to imple-
ment the resolution. The vote at the executive board meeting was
42 to 1 in favor of the resolution; at the membership meeting the reso-
lution was adopted by the approximately 250 members present by a
voice vote, with only scattered dissent.
On December 9, 1957, the AFL-CIO convention determined that
"the Bakery, and Confectionery Workers International Union is
dominated or substantially influenced by corrupt influences" and voted
to expel it unless it in good faith took immediate steps to eliminate
the corrupt influences, to correct abuses found to exist, and to bar
from office those responsible for the abuses. The expulsion was made
effective within a day or two thereafter and, on December 12, ABC
was chartered as an AFL-CIO affiliate with substantially the same
jurisdiction as BCW, the nucleus of ABC being substantially the
same individuals who had constituted the BCW Integrity Committee.
On December 17, 1957, the BCW Local 464 executive board voted,
with one dissent, to call a special membership meeting to consider
and adopt a resolution to disaffiliate from BCW and affiliate with
ABC. On December 18, a notice was mailed to the members of BCW
Local 464 announcing a special meeting to be held on December 28 to
consider questions of disaffiliation, reaffiliation, disposition of assets,
7 Based on factual matters adduced at such hearings and contained in such report,
ABC Local 464 has moved that BCW be denied the benefits of the Act and the processes
of the Board. As BCW is concededly a labor organization within the meaning of the
Act, we find no merit in the motion and it is accordingly denied . Cf. Precision Soientifo
-Company, 117 NLRB 476, 478.
904 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
and the status of collective-bargaining agreements. On December 20,
BCW advised the Employer that it was obligated to recognize only a
local of BCW and to continue to check off dues in favor of that
organization.
At the meeting on December 28, a vice president of ABC, formerly
a member of the BCW Integrity Committee, reviewed the events
leading up to the expulsion of BCW and the chartering of ABC,
including the evidence of corruption and the failure of the BCW
officers to accept the AFL-CIO directives, and urged the membership
to vote for affiliation with ABC. After a discussion period, the mem-
bership, by a vote of 829 to 1, adopted a resolution to disaffiliate from
BCW, to affiliate with ABC, to transfer all property and contract
rights from BCW Local 464 to ABC Local 464, to continue all pres-
ent officers as officers of ABC Local 464, and otherwise to continue to
function as before with only such changes as were necessitated by the
change in affiliation. As stated in the resolution, the reasons for such
action were the expulsion of BCW from the AFL-CIO and "the no-
toriety and stigmas of dishonesty and unethical dealings which have
attached to certain officials of the present International and to the
International itself, as an organization." On December 30, the Local
was advised that its request for a charter from ABC had been
granted, and on the same day it advised the Employer of the change
in affiliation, that it intended to maintain the preexisting contractual
relationship, and that it expected the Employer to do the same.
At the time of the disaffiliation action, there were about 2,800 em-
ployees in the unit, of whom about 2,000 were members of BCW
Local 464; of these 2,000, about 1,700 had executed checkoff authoriza-
tions. The Local officialdom consisted of 12 officers, about 50 execu-
tive board members, and about 92 departmental representatives. Fol-
lowing the disaffiliation action, all the officials except 1 officer and 2
or 3 departmental representatives continued in office as officials of ABC
Local 464, and about 1,350 employees executed new checkoff author-
izations in favor of ABC Local 464. ABC Local 464 has assumed
administration of the contract and, except with respect to checked-
off dues, which are involved in State court litigation and are being
held in escrow by the Employer, the change in affiliation has appar-
ently produced no change in the bargaining relationship with the
Employer.
In the meantime, on December 30, BCW appointed a trustee to
administer the affairs of BCW Local 464. On January 24,1958, after
the petition had been filed herein on January 9, the trustee advised
the Employer that he was ready and willing to administer the con-
tract and requested a meeting; there is no evidence of any reply to
this communication. On January 26, BCW Local 464 held a meeting
which was attended by about 35 employees in the unit. There appear
HERSHEY CHOCOLATE CORPORATION 905
to be about 50 employees in the unit who have expressed continued
allegiance to BCW Local 464,
The Employer has filed the instant petition seeking a Board deter-
mination as to which of the two claiming labor organizations it is
obligated to recognize, contending in substance that a schism exists
warranting an election; the Employer further asserts that the union
winning such an election should be required to assume the administra-
tion of the existing contract for the balance of its term. Both Unions,
however, assert that the existing contract, which does not expire until
December 31, 1958, is a bar and have moved to dismiss the petition.
For the reasons set forth hereinafter, these motions are denied. In
support of its motion, ABC Local 464 contends in substance that it
is the same organization as the former BCW Local 464, the only
change being one of affiliation; that it therefore continues to be the
contractual representative and is recognized as such by the Employer;
and that accordingly no question concerning representation exists.
It further asserts that BCW Local 464 is defunct. On the other hand
BCW, in support of its motion, contends that if the contractual repre-
sentative is not defunct, the Board has no authority under the Act
to direct an election on the basis of an alleged schism; and that in any
event an election should not be directed in this case because of cer-
tain alleged irregularities in the disaffiliation action. BCW denies
that BCW Local 464 is defunct and further denies that there is any
continuing identity between BCW Local 464 and ABC Local 464.
As indicated hereinabove, the Board has, in connection with this
case, considered possible revisions in certain of its contract bar policies
bearing on or related to the issues of schism and defunctness raised
herein, including such matters as the factors necessary to warrant a
finding that a schism exists; the type of election to be conducted when
such a finding is made, and the effect of conducting such an election on
the existing contract; the consequences of the assignment of a contract
from one union to another in a schismatic situation; and the factors
bearing on the issue of defunctness. Our conclusions with respect to
these matters are set forth hereinafter. We have also considered the
contention of BCW and certain of the participants amicus, that the
Board has no statutory authority to conduct an election on the basis of
a schism when the contractual representative is not defunct, and hold
in accord with established Board and court precedent' that the
Board's contract bar policies are compelled neither by the Act nor by
judicial decision, but are rather discretionary rules which may be
applied or waived as the facts in a given case may require in the inter-
ests of effectuating the policies of the Act. We therefore conclude
that the Board has authority to direct an election on the basis of a
8 E. g., Ford Motor Company, 95 NLRB 932 , 934; N., L. R. B. v. Libby-Owens-Ford
Glass Company, 241 F. 2d 831 (C. A. 4).
906 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
schism, whether or not the contracting representative is defunct, and
accordingly turn to the policy considerations bearing on or related
to the issues of schism and defunctness.
a. The elements of a schism
The initial consideration is a determination of the factors necessary
to a finding that a schism exists warranting an election. Relevant to
that determination is the fact that the schism issue arises in the con-
text of an existing contract which would otherwise achieve the statu-
tory objective of promoting industrial stability and therefore under
normal Board practice would remain a bar for the balance of its rea-
sonable term. The direction of an election on the basis of a schism
therefore constitutes an exception to the general principle that in the
interest of promoting industrial stability, the existence of a contract
meeting the required standards warrants postponement of the em-
ployees' statutory right freely to select their representative. Accord-
ingly, before directing an election on the basis of an alleged schism,
the Board must be satisfied that the existing contract can no longer
serve to promote industrial stability, and that the direction of an elec-
tion would be in the interests of achieving industrial stability as well
as in the interests of the employees' rights in the selection of their
representative.
There have been numerous types of situations in which the Board
has been called upon to determine whether the alleged schism has so
disrupted the existing bargaining relationship that an election is war-
ranted to resolve the resulting confusion and reestablish bargaining
stability. These have included cases in which a local union, or a
group within a local union, has sought to change its affiliation in the
context of a basic intraunion conflict over fundamental policy con-
siderations, involving an entire international union or a federation of
unions; they have also included cases in which such a change in af-
filiation is sought in the absence of any basic intraunion conflict. In
the cases arising out of a basic intraunion conflict, that conflict has
usually resulted in the disaffiliation or expulsion of a union from the
federation with which it had been affiliated and the creation of a new
rival union within the federation, or the transfer of affiliation of a
part of the official hierarchy of one union to an existing rival union,
and in consequence in the creation of a new union rivalry or the ag-
gravation of an existing rivalry based on the policy conflict. Such a
conflict and realignment has in turn been followed by intensive cam-
paigning to secure the allegiance of the local union members on the
basis of the policy differences which were initially responsible for the
basic conflict.
In considering the cases in which these varying situations have
been presented, the Board has generally found a schism to exist, war-
HERSHEY CHOCOLATE CORPORATION 907
ranting an election, when the disaffiliation action at the local level
has occurred in the context of a basic intraunion conflict' It has,
however, also on occasion found a schism to exist on the basis of local
action unrelated to a basic intraunion conflict.10 Although there are
obvious superficial similarities between these two types of cases with
respect to the situation at the local level, we nevertheless believe that
an election is warranted only when the local action occurs in the con-
text of 'a basic intraunion conflict, and not otherwise.
We reach this conclusion because we are convinced that the funda-
mental differences in causation between local action related to a basic
intraunion conflict and one not so related necessarily have different
effects on the stability of the bargaining relationship at the local
level. For, as the Board has pointed out," when "the split in the
organization was created by a basic intraunion conflict . . . no salu-
tary stabilizing purpose could have been served by applying the con-
tract bar rule . . . [and] an immediate direction of election was the
only means by which the Board could hope to assist the employer, the
employees, and a bargaining representative to continue to live to-
gether with some semblance of stability." On the other hand, if the
schism doctrine could be invoked in the absence of a basic intraunion
conflict, it could be utilized to facilitate a raid or to permit a dissident
group to repudiate'the bargain made by the existing representative,
thus providing a means for circumventing the normal contract bar
rules when-stability could be maintained on the basis of the contract
without an election.
In concluding as we have that a basic intraunion conflict is a neces-
sary prerequisite to a finding that a schism exists warranting an elec-
tion, we deem a basic intraunion conflict to be any conflict over policy
at the highest level of an international union, whether or not it is
affiliated with a federation, or within a federation, which results in a
disruption of existing intraunion relationships. As illustrated by the
cases cited in footnote 9, this would include the disaffiliation or
expulsion of an international union from the federation with which
it was affiliated, combined with the creation by the federation of a
new organization with similar jurisdiction or the assignment of such
jurisdiction to an existing organization; it would also include a split
within an international union in which some of its officials transferred
their affiliation to an existing rival union or established a new organi-
zation claiming similar jurisdiction. However, the citation of the
foregoing as illustrations does not mean that a finding as to the ex-
OR g., Brewster Aeronautical Corporation, 14 NLRB 1024; Harbison-Walker Re-
fraotorses Company, 44 NLRB 816; Boston Machine Works Company, 89 NLRB 59;
Wade Manufacturing Corporation , 100 NLRB 1135; A. C. Lawrence Leather Company,
108 NLRB 546; The Great Atlantic and Pacific Tea Company, 120 NLRB 656.
w E. g., Brightwater Paper Company , 54 NLRB 1102; Sun Shipbuilding and Dry Dock
Company, 86 NLRB 20; New York Shipbuilding Corporation , 89 NLRB 915.
u See Saginaw Furniture Shops, Inc., 97 NLRB 1488, 1491-1492.
908 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
istence of a basic intraunion conflict necessarily depends on its taking
the same form as the illustrative cases; rather, it may include any
realignment affecting an international union or federation of unions,
resulting from a policy conflict, which has substantially the same
effect on the stability of bargaining relationships as the above
illustrations.
As indicated above, the existence of a schism warranting an election
depends not only on the existence of a basic intraunion conflict, but
also upon action by the employees in the unit arising out of the basic
conflict and creating such confusion in the bargaining relationship
that stability can be restored only by an election. In determining
whether the action taken by the employees has been sufficient to war-
rant a schism finding, the Board has at times adverted to the observ-
ance or nonobservance of certain formalities,12 and also to the question
of whether or not the existing representative was defunct. 13 In our
opinion, the consideration of defunctness is largely irrelevant to the
basic principles underlying the schism doctrine. While a schism may
result in defunctness, its absence does not eliminate the confusion in
the bargaining relationship in situations of this type; on the contrary,
in a context of basic intraunion conflict and the creation of a "new'
local, the continued existence of the "old" local may tend to heighten
rather than lessen the confusion. As to the requirement of formalized
action by the bargaining representative, we believe that in some situa-
tions where a schism finding has not been made because of the failure
to observe certain formalities, form has been permitted to override
substance. However, before concluding, even in the presence of a basic
intraunion conflict, that a sufficient state of confusion exists in the
bargaining relationship to warrant an election in the face of an out-
standing contract, we must be convinced that the employees involved
have had an opportunity to exercise their judgment on the merits of
the conflict. We believe that this condition can best be satisfied at an
open meeting called, without regard to any constitutional restrictions
but with due notice to the members in the unit,.for the purpose of
taking disaffiliation action for reasons relating to the basic intraunion
conflict.
As it is the effect on the bargaining relationship which is the pri-
mary consideration, we conclude that, in the context of a basic intra-
union conflict, a finding that a schism exists warranting an election
may appropriately be made on the basis of requisite action taken by
employees in the unit seeking to change their representative for rea-
sons related to the basic intraunion conflict, only if that action is
taken within a reasonable period of time after the occurrence of the
za E g, Standard Conveyor Company, 114 NLRB 1447.
13 E. g., Muskin Manufacturing Co., Inc ., 114 NLRB 1307.
HERSHEY CHOCOLATE CORPORATION 909
conflict 14 and results in confusion unstabilizing the bargaining re-
lationship. Although we cannot attempt to anticipate all the factual
situations in which such unstabilizing confusion may or may not exist,
we find that it clearly exists where the disaffiliation action is coexten-
sive with the existing unit and results in the employer being con-
fronted with two organizations each claiming with some show of right
to be the organization previously chosen by the employees as their
representative. On the other hand, it does not exist if the employees
take no disaffiliation action or, if such disaffiliation action has been
taken, the employer is not confronted with conflicting claims by the
unions involved in the alleged schism.
With respect to the instant case, the facts set forth above show a
policy conflict within. the AFL-CIO resulting in the expulsion of
BCW on grounds of alleged corruption and the chartering of ABC
with substantially the same jurisdiction; these facts establish the
existence of a basic intraunion conflict. The facts set forth above also
show that at an open meeting called for the purpose and with due
notice to the members in the unit, the employees in the unit sought to
change their representative for reasons related to the basic intraunion
conflict; 11 that such action was taken within a month after the expul-
sion of BCW from the AFL-CIO and the chartering of ABC; that
the action was coextensive in scope with the existing unit; and that in
consequence the Employer has been confronted with conflicting claims
from ABC and BCW, each claiming to be the representative pre-
viously chosen by the employees. We find, accordingly, that a schism
exists warranting an election, notwithstanding the existence of a
contract.16
b. The nature of the election; the effect on the contract
In considering cases in which it has been alleged that a schism
exists, and in directing elections on the basis of schism finding, it has
been the practice of the Board to make no distinction as to the type
of petition which it will entertain; to permit unlimited intervention;
to permit a severance election in a segment of the contract unit, wheiil
otherwise appropriate; and to give the employees an opportunity
to choose not to be represented. It has also been the practice of the
Board not to consider in a representation proceeding the effect on the
14 What is a reasonable period of time will depend on the circumstances of each in-
dividual basic intraunion conflict. However, we shall no longer follow A C. Lawrence
Leather Company, 108 NLRB 546, and cases relying thereon, to the extent that such
cases imply that the time element is to be ignored in determining the schism issue.
15 As set forth hereinabove, alleged irregularities in connection with this action are
immaterial to the issues of this case.
16 The contention of ABC Local 464, that no election is warranted because it was and
continues to be the contractual representative is rejected for the reasons discussed
hereinafter.
910 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
existing contract of the certification of a new bargaining representa-
tive. In connection with this case, we have considered whether these
practices should be continued or modified, and particularly whether
an election directed on the basis of a schism should be held for the
limited purpose of determining which of the organizations directly
involved in the schismatic situation should be entitled to administer
the existing contract. Upon full consideration of these issues, we have
concluded that no change is warranted in existing practice.17
As has been pointed out above, an election is directed in a schismatic
situation because the contract, which would -normally be a bar, is no
longer a stabilizing force and there is therefore no warrant for deny-
ing to the employees the immediate exercise of their right to select
their representative, and because it is only through the medium of an
election that stability can be restored to the disrupted relationship.
In these circumstances, no salutary purpose would be served by lim-
iting the employees' freedom of choice. Instead, granting to the
employees full freedom of choice would further serve the statutory
objective of promoting stability in bargaining relationships by defini-
tively resolving all proper questions of representation affecting the
employees involved.18 In view of this conclusion that the employees
ought not be limited in their choice in the election and in accord with
established practice, we also believe that, in a representation proceed-
ing, it would be inappropriate to require the winning union, if any, to
assume the existing contract. The Employer's contention that as-
sumption of contract should be required is therefore rejected 1s
c. Transfer of affiliation and assignment of contract
As set forth hereinabove, at the meeting of Local 464, held on
December 28, the employees voted inter alia to transfer all contract
rights from BCW Local 464 to ABC Local 464. On the basis of a
bargaining history reflecting participation in negotiations primarily
by local officials, and of the actions taken at that meeting, including
the purported "assignment of contract rights, ABC Local 464 contends
that it was and continues to be the contractual representative recog-
nized by the Employer, the only change being-one of designation and
affiliation, and that the contract therefore remains a bar. We find
no merit to this contention.
The Board has long held 20 that the mere change in designation or
affiliation of the contractual representative does not of itself warrant
17 For the reasons set forth in his separate opinion, Member Jenkins does not agree
with this conclusion
1s See, e. g., Pratt t Letchworth Co , Inc, 89 NLRB 124, 128-129
I9 This does not of course bar a voluntary assumption of the contract.
21 The Louisville Railway Company , 90 NLRB 678 ; Chesapeake cE Potomac Telephone
Company of Baltimore, 89 NLRB 231 ; Michigan Bell Telephone Company, 85 NLRB 303;
cf. Harris -Woodson Co ., Inc., 85 NLRB 1215, enfd . 179 F. 2d 720 (C. A. 4).
HERSHEY CHOCOLATE CORPORATION 911
a finding that an otherwise valid preexisting contract is no longer a
bar; this is true whether or not there is a specific assignment of the
contract. None of the cases establishing or applying this principle,
however, involved a true schismatic situation as defined above and
present in this case. They involved, rather, an agreement with
respect. to the transfer among all the interested unions or, at most,
a disaffiliation based on a disagreement between an international and
an individual local which did not result in the confusion and insta-
bility inherent in a true schismatic situation 21 These cases are there-
fore not precedent for the result urged by ABC Local 464. Moreover,
application of this principle to a true schism would tend to place
resolution of the representation issue in the hands of the local officers
who may or may not reflect the employees' wishes. We conclude,
accordingly, that the assignment of a contract does not preserve it as
a bar when the elements of schism are present.
d. Defwnetness
The Board has consistently held, and no reason appears to reach a
different conclusion now, that a representative is defunct, and its con-
tract is not a bar, if it is unable or unwilling to represent the em-
ployees. However, mere temporary inability to function does not
constitute defunctness; nor is the loss of all members in the unit the
equivalent of defunctness if the representative otherwise continues in
existence and is willing and able to represent the employees.
In considering whether the representative continues in existence, a
question often arises, particularly in a pseudo-schismatic situation or,
as here, in the context of a schism, as to the effect on the resolution of
the defunctness issue of efforts by an international union or some in-
termediate body to assume the representative functions of a local
which, because of loss of membership, is no longer capable of per-
forming such functions. When as, here, the elements of schism are
present, we believe it is unnecessary to reach the issue of defunctness,
as resolution of that issue would add nothing to the ultimate conclu-
sion that an election should be directed. Accordingly, we do not de-
cide whether or not BCW Local 464 is defunct. When, however, it
is necessary to reach the issue of defunctness because the elements of
schism are not present, we believe that consideration should be given
only to the actions of the entity or entities which are parties signatory
to the contract and are consequently in a position to secure enforce-
ment of its terms. Accordingly, actions by an international union or
intermediate body evidencing its willingness and ability to assume the
representative functions of a local which is no longer capable of per-
forming such functions will be deemed relevant to the issue of defunct-
21 E g, The Prudential Insurance Company of America, 100 NLRB 237.
912 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ness only if such international union or intermediate body is a party
signatory to the contract.
e. Conclusions
As we have found that the current contract with the-Employer is
not a bar because of a schism, we find that a question affecting com-
merce exists concerning the representation of employees of the Em-
ployer within the meaning of Section 9 (c) (1) and Section 2 (6) and
(7) of the Act, and we shall therefore direct an immediate election.22
4. The parties agree that the existing unit as described in the con-
tract is appropriate. Accordingly, we find that all production and
maintenance employees and teamsters at the Employer's Hershey,
Pennsylvania, plant, the Lebanon Creamery, and branch milk-receiv-
ing stations, excluding office employees, executives, attorneys, travel-
ing and outside salesmen, engineers, professional employees, watch-
men, guards, superintendents, supervisors, foremen, assistant fore-
men, all other supervisors as defined in the Act, or any persons ex-
cluded by law, constitute a unit appropriate for the purposes of col-
lective bargaining within the meaning of Section 9 (b) of the Act.
[Text of Direction of Election omitted from publication.]
MEMBER JENB:INS, dissenting in part :
Since I believe the only issue raised in a "schism" conflict to be that
of the identity of the true bargaining agent I would limit the choice
on the ballot to the two contending factions. I would not confuse
this issue by permitting the intervention of third parties or rejection
of the bargaining agent.
za As there is no evidence that any of the assets of BCW Local 464 have been disbursed
to the advantage of ABC Local 464, we find no merit in the contention of BCW that no
election should be held until pending litigation involving such assets has been concluded.
The Great Atlantic and Pacific Tea Company, 120 NLRB 656 , footnote 10.
American-Marietta Company 1 and United Steelworkers of
America, AFL-CIO, Petitioner 2
American -Marietta Company, Petitioner and United Mine Work-
ers of America , District 50, Region 16 and United Steelworkers
of America, AFL-CIO. Cases Nos. 6-RC-21421 and 6-RM-157.
September 18, 1958
DECISION AND DIRECTION OF ELECTION
Upon separate petitions duly filed under Section 9 (c) of the Na-
tional Labor Relations Act, a consolidated hearing was held before
' The name of the Employer appears as amended at the hearing.
2 Herein called the • Steelworkers
'United Mine Workers of America, District 50, Region 16, herein called the Mine
workers, intervened in Case No . 6-RC-2142 on the basis of a showing of interest.
121 NLRB No. 120.