Hollywood Ceramics Co., Inc.

National Labor Relations Board - Board Decisions

Dec 20, 1962

140 N.L.R.B. 221 (N.L.R.B. 1962)

HOLLYWOOD CERAMICS COMPANY, INC . 221
The Board has considered the Regional Director's report and the
exceptions thereto, and upon the entire record in this case makes the
following findings :
The Petitioner objected to the election upon the ground, inter alia,
that various forms of propaganda distributed to employees during
the critical period were similar in content and effect to "election propa-
ganda" proscribed by the Board in its decision setting aside the first
election referred to above.
The Regional Director's investigation showed that immediately
prior to the second election employees received copies of "Militant
Truth," dated May 1962, which contained four pages of appeals and
arguments against unionization based, in part, upon racial considera-
tions. In addition, the employees received copies of local newspapers
containing editorials and a letter from the Employer which stressed
similar appeals and arguments against unionization. The Regional
Director found that such propaganda did not impair the employees'
freedom of choice in the election and recommended that objections
based thereon be overruled. For the reasons stated below, we do not
agree.
In our opinion, the propaganda complained of is essentially the same
type of appeal and argument upon which the Board set aside the first
election. We find that the documents in question were intended to and
did inflame the racial feelings and other prejudices of the voters on
matters unrelated to election issues. As we noted in our prior De-
cision setting aside the first election, such propaganda has no place in
Board election campaigns since it creates an atmosphere which is not
conducive to a sober and informed exercise of the franchise. Accord-
ingly, we find that the conditions under which the election was held
impeded a reasoned choice as to a bargaining representative and nulli-
fied the election. We shall, therefore, set aside the election and direct
that a third election be held.
[The Board set aside the election held on August 24,1962.]
[Text of Direction of Third Election omitted from publication.]
Hollywood Ceramics Company, Inc. and United Brick and Clay
Workers of America, AFL-CIO, Petitioner . Case No. 21-RC-
7362. December 20, 1962
DECISION AND DIRECTION OF SECOND ELECTION
Pursuant to a stipulation for certification upon consent election an
election by secret ballot was conducted by the Regional Director for the
140 NLRB No. 36.
222 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Twenty-first Region on September 15, 1961, among the employees in
the unit described below. After the election the parties were furnished
a tally of ballots which showed that of approximately 49 eligible
voters, 48 votes were cast, of which 30 were for, and 16 were against,
the Petitioner, and 2 ballots were challenged. The Employer filed
timely objections to conduct affecting the results of the election.
In accordance with the Board's Rules and Regulations, the Regional
Director conducted an investigation and, on October 31, 1961, issued
and duly served upon the parties his report on objections, in which he
recommended that the objections be overruled, and that the Board is-
sue a certification of representatives. The Employer filed timely ex-
ceptions to the Regional Director's report and recommendations.
Upon the entire record in this case, the Board finds :
1. The Employer is engaged in commerce within the meaning of
the Act.
2. The Petitioner is a labor organization claiming to represent cer-
tain employees of the Employer.
3. A question affecting commerce exists concerning the representa-
tion of employees of the Employer within the meaning of Sections
9(c) (1) and 2(6) and (7) of the Act.
4. The parties stipulated, and we find, that the following employees
of the Employer constitute a unit appropriate for the purposes of col-
lectiv-e bargaining within the meaning of Section 9(b) of the Act:
All production and maintenance employees employed at the Em-
ployer's Los Angeles, California, plant, but excluding all office clerical
employees, watchmen, guards, technical and professional employees,
and supervisors as defined in the Act.
5. In its objections the Employer contends that the circular dis-
tributed by the Petitioner to eligibles on the day before the election
interfered with the freedom of choice of the employees. The Regional
Director's investigation revealed that on the afternoon before the elec-
tion the Petitioner distributed a handbill to eligibles printed in Eng-
lish and Spanish containing, inter alia, a table which purported to
compare wage rates of various job classifications at the above plant
with "OTHER UNION CERAMIC PLANTS." This handbill was
the last of a series of bulletins and letters issued by the parties, al-
though a letter mailed by the Employer to the homes of its employees
on September 13 presumably was not seen by most of the employees
until September 14, the evening before the election. In the above hand-
bill the described hourly rates for Employer's plants did not take into
account an existing incentive payment plan, while the specified hourly
rates at the "OTHER UNION CERAMIC PLANTS" did include at
least a 30-percent incentive payment. The only mention of incentive
payments was a sentence in English, at the end of the wage table, which
read : "These rates are on Incentive System with an average employee
HOLLYWOOD CERAMICS COMPANY, INC. 223
making 20 percent or more wages." The investigation further showed
that the plants which were intended to be used as a basis for compari-
son, but which were undisclosed in the handbill, were in the same
general industry as the Employer but were not truly comparable as to
the type of operations and degree of skill required for the jobs in-
volved.' The above handbill also contained information as to fringe
benefits at other plants, union dues, strike authorization, and an an-
nouncement of a meeting to be held that evening. The Regional Di-
rector found that the handbill in question could be recognized and
evaluated by the employees as propaganda, and recommended that the
objections be overruled. In its exceptions the Employer argues that
the publication of false wage data immediately before the election
should lead the Board to set aside the election under the Gummed
Products rule z
The rule of that case is not a fixed one; it is merely one test used
by the Board in determining whether the integrity of an election has
been so impaired that it must be set aside. The basic policy underlying
this rule, as well as the other rules in this election field, is to assure the
employees full and complete freedom of choice in selecting a bargain-
ing representative.' The Board seeks to maintain, as closely as possi-
ble, laboratory conditions for the exercise of this basic right of the em-
ployees 4 One of the factors which may so disturb these conditions as to
interfere with the expression of this free choice is gross misrepresenta-
tion about some material issue in the election. It is obvious that where
employees cast their ballots upon the basis of a material misrepresenta-
tion, such vote cannot reflect their uninhibited desires, and they have
not exercised the kind of choice envisaged by the Act. For this reason
the Board has refused to certify election results where a party has
misrepresented some material fact, within its special knowledge, so
shortly before the election that the other party or parties do not have
time to correct it, and the employees are not in a position to know the
truth of the fact asserted.
The Board has limited its intervention to cases of this type because
an election by secret ballot, conducted under Government auspices,
should not be lightly set aside, and because we realize that additional
elections upset the plant routine and prevent stable labor-management
relations. We are also aware that absolute precision of statement and
complete honesty are not always attainable in an election campaign,
nor are they expected by the employees.' Election campaigns are often
i The Regional Director found, and no exception was taken thereto, that the other com-
pany's "operations , equipment and organization so differ from Employer 's that any com-
parisons could be only rough approximations."
2 Gummed Products Company, 112 NLRB 1092.
3 This is contemplated by Section 1 of the Act . See also Peerless Plywood Company,
107 NLRB 427.
• See General Shoe Corporation, 77 NLRB 124.
5 Celanese Corporation of America , 121 NLRB 303, 306.
224 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
hotly contested and feelings frequently run high. At such times a,
party may, in its zeal, overstate its own virtues and the vices of the
other without essentially impairing "laboratory conditions."" Ac-
cordingly, in reaching its decision in cases where objections to elections
have been filed alleging that one party misrepresented certain facts,
the Board must balance the right of the employees to an untrammeled
choice, and the right of the parties to wage a free and vigorous cam-
paign with all the normal legitimate tools of electioneering.
The formula used in striking this balance has been variously
phrased.' Accordingly, we deem it appropriate to restate the rule
for guidance of the parties.
We believe that an election should be set aside only where there has
been a misrepresentation or other similar campaign trickery, which
involves a substantial departure from the truth, at a time which pre-
vents the other party or parties from making an effective reply, so that
the misrepresentation, whether deliberate or not," may reasonably be
expected to have a significant impact on the election. However, the
mere fact that a message is inartistically or vaguely worded and sub-
ject to different interpretations will not suffice to establish such mis-
representation as would lead us to set the election aside.' Such am-
biguities, like extravagant promises, derogatory statements about the
other party, and minor distortions of some facts, frequently occur in
communication between persons. But even where a misrepresentation
is shown to have been substantial, the Board may still refuse to set
aside, the election if it finds upon consideration of all the circumstances
that the statement would not be likely to have had a real impact on
the election. For example, the misrepresentation might have occurred
in connection with an unimportant matter so that it could only have
had a de mimiinis effect. Or, it could have been so extreme as to put
the employees on notice of its lack of truth under the particular cir-
cumstances so that they could not reasonably have relied on the asser-
tion. Or, the Board may find that the employees possessed independ-
ent knowledge with which to evaluate the statements.to
a Recognizing this, we have stated that exaggeration , inaccuracies , half-truths, and
name calling, though not condoned , will not be grounds for setting aside elections.
7 See, for example , Gummed Products Company , supra ; Dartmouth Finishing Company,
120 NLRB 262, 266; and Celanese Corporation of America , supra , at 307.
8 To the extent that they are inconsistent with this decision, we hereby overrule those
cases which suggest that the misrepresentation must have been deliberate.
9 We are not , of course , considering in this context statements which may be reason-
ably construed to contain a threat of reprisal or force or promise of benefit . If the Board
concludes that a statement carries such a threat or promise, it is not a defense that the
message was equivocally phrased, and the election will be set aside See Dal -Tex Optical
Company, Inc ., 137 NLRB 1782
10 See , for example , Allis -Chalmers Manufacturing Company , 117 NLRB 744, 7418; Hook
Drugs, Inc., 119 NLRB 1502 , 1505 In evaluating the probable impact of a party 's state-
ment on the election , one factor which the Board will consider is whether the party
making the statement possesses intimate knowledge of the subject matter so that the
employees sought to be persuaded may be expected to attach added significance to its
assertion.
HOLLYWOOD CERAMICS COMPANY, INC . 225
We are satisfied that the Petitioner violated the standards we have
set forth. The handbill in question concerned wage rates, a matter of
utmost concern to the employees, and the timing of its distribution
was such as to prevent any reply to the handbill. Therefore, any sub-
stantial misrepresentation could well have significantly affected the
election results. We conclude further the leaflet did convey a sub-
stantially erroneous picture of the comparative wage situation.
As a result of the Union's failure to include any incentive increment
in the Employer's described rates, while including an arbitrary addi-
tional amount 11 in quoting the purported hourly base rates for
"OTHER UNION CERAMIC PLANTS," the Employer's rates
were grossly understated and those for the compared plant were very
much exaggerated. The omission of any identification of the plant
being compared with the Employer's operation could only serve to
induce the employees to lend credence to the Union's assertions. Had
the name of the plant and the type of work performed been disclosed,
the employees might have had some basis for evaluating the informa-
tion. For, they then might have learned of the actual dissimilarity
of the work and skills at the two plants compared.
Our finding of misrepresentation is further supported by the Un-
ion's statement, immediately following the table of compared rates,
that "These rates are on Incentive System with an average employee
making 20°Jo or more wages." This sentence is, at best, ambiguous,
and lends itself to three possible interpretations, all of which are mis-
leading. Thus, the statement could mean that : (1) both of the listed
rates are base rates and at least 20 percent should be added to each to
ascertain gross wages, but this would be misleading because the
amounts set forth for the compared employer were not base rates and,
in fact, contained an incentive increment; (2) both sets of figures are
gross rates, including the incentive factor, but this would be untrue
because the Employer's rates were not so augmented; and (3) the
words "these rates" apply only to those listed for "OTHER UNION
CERAMIC PLANTS" and they had been increased 12 by at least 20
percent, but this was false because the Petitioner acknowledged that
it added 30 percent to the base rates for the compared plant, thus
exaggerating the base rate by at least 10 percent. Thus, each of the
possible constructions is equally objectionable because each is a sub-
stantial departure from the truth.
Furthermore, in our view, if the sentence discussed above was found
to be properly explanatory and not itself misleading, the Petitioner's
11 Although as indicated above , the additional amount was said to be 30 percent , exami-
nation of the base rates as set forth by the Regional Director reveals that in most in-
stances the amount added exceeded 30 percent
12 Additionally, the words " these rates" may also be read as applying only to other
plants and as meaning that the amounts set forth are base rates to which 20 percent is
to he added This interpretation is essentially the same as alternative (1).
226 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
failure to duplicate it in Spanish was likely to have increased the
possible impact of the misrepresentation. For, it was by virtue of
this explanation that the apparent great difference between the rates
might be evaluated. But it appears that approximately one-third of
the employees were fluent in or could understand only Spanish. These
employees received no explanation, because no translation was made
of the explanatory sentence. Hence, these employees were very likely
to have been confused and misled.
Under all these circumstances, we find that the Petitioner exceeded
the bounds of fair lawful electioneering and interfered with the free
choice of the employees. Accordingly, we hereby overrule the deci-
sion of the Regional Director and set aside the election, and we shall
direct that a second election be conducted.
[Text of Direction of Second Election omitted from publication.]
MEMBERS RODGERS and LEEDOM, concurring :
We concur in the result.
Commerce Company d/b/a Lamar Hotel and Hotel & Restau-
rant Employees & Bartenders International Union , AFL-CIO.
Case No. 23-CA-1463. December 21, 1962
DECISION AND ORDER
On October 30, 1962, Trial Examiner Reeves R. Hilton issued his
Intermediate Report in the above-entitled proceeding, finding that the
Respondent had engaged in and was engaging in certain unfair labor
practices and recommending that it cease and desist therefrom and
take certain affirmative action, as set forth in the attached Intermedi-
ate Report.' Thereafter, the Respondent filed exceptions to the In-
termediate Report 2 and the General Counsel filed limited exceptions.'
Pursuant to the provisions of Section 3 (b) of the Act, the Board
has delegated its powers in connection with this case to a three-member
panel [Chairman McCulloch and Members Leedom and Brown].
'We hereby correct the following inadvertent errors in the Intermediate Report: In
the section entitled " C. The refusal to bargain," the date of the first letter to the Re-
spondent should be July 14, 1962, instead of July 12, and the date of the third letter
should be July 24 instead of July 20.
2 As the record , including the exceptions , adequately presents the issues and the posi-
tions of the parties , the Respondent 's request for oral argument is hereby denied.
3 The General Counsel excepted to the apparently inadvertent omission from the Find-
ings of Fact in the Intermediate Report of the following jurisdictional fact: "During
this same period less than 75 % of its guests remained for a month or longer." Inasmuch
as this was alleged in the complaint and admitted by the Respondent in its answer, the
Intermediate Report is amended accordingly.
140 NLRB No. 32.